Sustainability Report 2013
Here I create my history
This is the eighth Sustainability Report published by AMAGGI as a form of communicating with its stakeholders and account for activities developed, goals, and future objectives. This publication follows the guidelines of the Global Reporting Initiative – GRI, an international organization that established the sustainability report standard most widely adopted by companies in different sectors worldwide. The theme of this report is “HERE I CREATE MY HISTORY.” We present testimonials of those who are building the company’s successful history. In order to value our most precious asset –people – AMAGGI invited its employees to tell stories of their personal and professional lives related to the company.
Sustainability Report 2013
www.amaggi.com.br/relatorio2013
In this print version, you will find 10 stories of people that are building the company’s future. These and other testimonials can be seen at http://www.AMAGGI.com.br/relatorio2013. Approximately 50 employees have participated in these stories, some of whom have been with the company for over 30 years, others less than 1, working in the fields, factories, warehouses, hydroelectric plants, and ports. They are the stories of those who, together, are writing the future of AMAGGI.
2013 Highlights
Creation of the Department of Corporate Affairs to streamline operations across the sustainability, communications, procurement, internal controls, and engineering areas.
In another year of record production of grain in Brazil, AMAGGI successfully carried out its actions planned for the four business areas with engagement and synergy.
Credits
Governance and management
Creation of the Sustainability Department incorporates this topic into decisionmaking processes New People Committee strengthens the personnel development strategy The Stakeholder Engagement Plan structures the relationship with strategic stakeholders Advances in the Aroeira Project, with the training of 203 leaders including directors, managers, and supervisors Excellence project promotes review of management, logistics, and procurement processes Development of the strategic planning for the André and Lúcia Maggi Foundation
US$ 5 billion in revenue
9
2.8
million tons of grain transported via the Madeira River
João Zamboni
million tons of grain sold
2
new SHEPs
100%
acquisition of DENOFA
Investments in new offices, warehouses, farms, and factories in Brazil and abroad, as well as a new river corridor to channel production through the Tapajós River and the entry into operation of two new small hydroelectric plants (SHEPs), led the company to overcome the logistical problems faced by Brazil in 2013, yielding results that exceed the goals planned for the period.
Revenue of US$ 5 billion in Brazil and abroad. 9 million tons of grain sold in Brazil and abroad 2.8 million tons of grain transported through the Madeira River corridor Acquisition of 100% interest in the Norwegian crusher DENOFA (a reference company in the processing of non-GMO soybeans in Europe) Advances in the Tapajós–Amazonas export corridor and in the construction project for the Maranhão Bulk Grain Terminal (TEGRAM), which will start in 2014. Start of construction work at the Porto Velho (RO) Port Beginning of operations of two new SHEPs: Ilha Comprida and Segredo, in the state of Mato Grosso
See below: - AMAGGI’s major highlights in 2013.
Beginning of operations of the sales office in Switzerland Beginning of construction of four new warehouses in the state of Mato Grosso Purchase of a farm and leasing of another, both located in São Félix do Araguaia, in Mato Grosso
MATERIALITY, GRI CONSULTING, PUBLISHING COORDINATION, AND DESIGN Report Sustentabilidade
GENERAL COORDINATION Juliana de Lavor Lopes Diretoria de Sustentabilidade
TEAM: Luana Bessa (project management and relationship),
EXECUTIVE COORDINATION
Michel Steinecke, Ana Fisch e Érica Liberato (GRI consulting), Gustavo Magaldi (editing), Adriana Camargo Pereira (copy), Report Sustentabilidade (print design) and Paula Mosti (layout).
Edson Cintra Corporate Communications
Revisão Assertiva Produções Editoriais
MATERIALITY AND GRI INDICATORS
The only Brazilian company to participate in the development of the UN’s Sustainable Agriculture Principles
Business
DEPARTMENT OF CORPORATE AFFAIRS
Social and Environmental R$12.5 million in investments and expenses in environmental protection Investment of R$2.6 million in projects in communities, with direct and indirect benefits to 162,300 people through the André and Lúcia Maggi Foundation
Cristiane Borges Social Responsibility
ENGLISH VERSION
PUBLISHING COORDINATION
PICTURES
Franchesca Bogo Daniel Escobar Corporate Communications
Felipe Barros and the communication department archives
Gotcha Idiomas!
PRINTING AND FINISHING Printing Company: Midiograf Print run: 250 copies
FONT TYPE Verdana, Matthew Carter para a Microsoft Corporation, 1996. Sansation, Bernd Montag, 2009.
54 farmers certified according to the Round Table on Responsible Soy (RTRS) guidelines More than 76,000 m3 of water saved with initiatives such as water recycling or reuse 5,600 GJ of energy saved through energy efficiency initiatives
fsc
Sustainability Report 2013
1
Summary
2
Foreword
4
Message from the CEO
6
Profile
42
66
Management and Results 70
74
Ibase Social Audit
Environmental Performance
88
50
Supply Chain Management
Scenario and Strategies
118
About the Report
Social Performance
60
Vision of the Future
Economic and Financial Performance
Corporate Governance Dialogue and Engagement
116
98 106 Awards and Recognition
110
AndrĂŠ and LĂşcia Maggi Foundation
122
124
GRI Table of Contents
2
AMAGGI
Foreword
Comments and suggestions are always welcome and will be received through e-mail sustentabilidade@amaggi.com.br and comunicacao@amaggi.com.br
G4-31
The website < www.amaggi.com.br/relatorio2013 > includes a survey with the entire content of the report. The results of this survey have been considered in the adoption of initiatives that aim for the continuous improvement of the publication.
Sustainability Report 2013
Dear Reader, The 2013 Sustainability Report presents AMAGGI’s economic, environmental, and social performance and describes the evolution of its business strategy, which generates and distributes value across the company’s relationship chain and contributes to sustainable development. In addition to the year’s results, the report provides an outlook for 2014 and for the coming fiscal years. With the theme “HERE I CREATE MY HISTORY,” the motto of the campaign developed in 2013 by AMAGGI, this edition features the testimonials of those who are building the company’s successful history. Published annually, the report is prepared based on the guidelines of the Global Reporting Initiative (GRI), an international organization that established the sustainability report standard most widely adopted by companies in different sectors worldwide. As with its most recent edition, adherence to the principles of this methodology and accuracy of the information presented were submitted for assurance by GRI. Based on G4, the version recently launched by GRI, the content of the report was developed based on discussions with the various stakeholders in our value chain, which resulted in the choice of nine material topics – considered a priority in sustainability-focused management – and in a structured engagement plan that identified AMAGGI’s main relationship stakeholders in 2013 (read more in Dialogue and Engagement). The indicators reported here are those that address essential issues for the strategic stakeholders and for AMAGGI’s Senior Executives. The answers may be found in the GRI Table of Contents on page 124. In addition, they are identified in the texts in which they are found, preceded by “G4.” The report is a means of providing accountability and improving communication with the main stakeholders identified. The publication, in addition to the print and online versions in English and Portuguese, includes an abridged version with the main highlights of the year. Enjoy your reading!
3
4
AMAGGI
Message from the CEO The year 2013 was filled with challenges and accomplishments for AMAGGI. We overcame the critical logistical problems faced by Brazil, which had significant impacts on agribusiness. Thanks to integrated and synergic planning, we managed to exceed the expected results and end the year successfully.
G4-1
We closed 2013 with revenue of US$5 billion in Brazil and abroad. We originated and sold approximately 9 million tons of grain, achieved good results in the sales offices in Argentina and Europe, successfully started our operations in Switzerland, and are preparing our operation in Paraguay. We acquired 100% interest in DENOFA, a Norwegian crusher recognized as a reference in the processing of non-GMO soybeans throughout Europe, and we finished the construction of two SHEPs – small hydroelectric power plants – in Mato Grosso. We adopted innovation 16 years ago with the Madeira corridor, our very own alternative route for the outflow of grain from a large production area – Parecis, in Mato Grosso – as a solution that provided gains in the social, environmental, efficiency, and cost areas. In 2012, the company planned a new waterway corridor, the Tapajós-Amazonas, and in 2013 we invested in assets to start operating through a joint venture in 2014. Also, in partnership with another company, we invested in the Maranhão Bulk Grain Terminal (TEGRAM) with operations expected to start in 2014 for receiving grain from Maranhão, Tocantins, Piauí, and Bahia, states that form the region known as Matopiba. These logistical alternatives and the investments in infrastructure allow us to more confidently plan the company’s evolution for the coming years. We kicked off our growth strategy for 2020, a bold project that plans investments to double the size of AMAGGI. In order to grow without losing sight of our institutional values and our vision – to be a reference in sustainable development – we make significant investments in people and sustainability. We changed the governance structure and added two new departments – Corporate Affairs and Sustainability – formed by internal employees, a strategy that marks the consolidation of placing career executives as new company managers. The new Department of Corporate Affairs will streamline and provide integration for the sustainability, communications, procurement, internal controls, and engineering areas. As for the Sustainability Department, headed for the first time by a woman, the idea is to incorporate sustainability criteria and values into the company’s growth strategies, since it influences the management of risks and opportunities, not only in the economic area, but also in the social and environmental aspects. In 2013, with the support of the consulting company Delloite, we identified and prioritized our business risks and developed operating models and monitoring actions. In line with this work, we also strengthened the Excellence Project with the implementation of two projects: the Matrix Management of Expenses (GMD -Gestão Matricial de Despesas) and the Organizational and Process Restructuring (ROP - Reestruturação Organizacional e de Processos). Both allow for the identification of gaps and opportunities for improvement in our processes. In this context, the Board of Directors and the Executive Board took part in a workshop with Fundação Dom Cabral in which they discussed and defined topics that are
Sustainability Report 2013
5
relevant for the company’s growth and continuity. We also consolidated the Aroeira Project, further investing in personnel development and the training of leaders, and advanced in the areas of Occupational Health and Safety, implementing a behavioral program on three farms. We advanced in the sustainable agriculture path through several partnerships. As signatories to the Global Compact, we represent Brazil in a partnership with the UN for the development of the Business Principles for Sustainable Agriculture, which started in the Rio +20 discussions and is expected to be launched in the second half of 2014. I participated in the United Nations’ 2013 Global Compact Leaders Summit in New York and felt very proud to see that we are on the right path and to be able to speak with business leaders about the creation of a more sustainable agribusiness model in their countries. We support and believe in the Global Compact’s purpose and work, as well as in this initiative. I hope these principles are embraced by governments and other institutions interested in producing food for the world. For more than 12 years we have been including these topics in our supply chain, in close partnership with rural producers. In 2013, we certified 54 farmers according to the criteria of the Round Table on Responsible Soy (RTRS) and other projects. By adhering to the GRI’s G4 version, we also advanced in the relationship with the value chain, structuring an engagement plan with strategic stakeholders. We collaborate with the development of the communities where we operate. To this end, we also reevaluated our private social investments with the development of a new strategic plan for the André and Lúcia Maggi Foundation. We remain optimistic about 2014. Our investments in infrastructure, people, and sustainability give us the confidence to achievement the various goals planned for 2014. We still have many challenges ahead of us, but the path we chose will be strengthened in the coming years so that we continue to be part of agribusiness history as a company committed to the country’s sustainable growth, to the world’s food safety, and to best practices in agriculture as a way to contribute to the sustainability of the planet.
Waldemir Ival Loto CEO of AMAGGI
6
Profile In this section ABOUT AMAGGI GROWING WITH BRAZIL INTERNAL AUDIENCE SUPPLY CHAIN BUSINESS AREAS CERTIFICATIONS
AMAGGI
Sustainability Report 2013
7
AMAGGI operates with integration and synergy in all phases of the agribusiness production chain.
Goals
INCREASE OF MORE THAN 20% IN VOLUME OF GRAIN ORIGINATED IN BRAZIL IN 2014.
People
AMAGGI HAD 3,949 DIRECT EMPLOYEES AT THE END OF 2013.
Growth
ACQUIRED 100% INTEREST OF THE NORWEGIAN CRUSHER DENOFA.
8
AMAGGI
AMAGGI in Numbers
AMAGGI G4-3, G4-4, G4-5, G4-6, G4-8, G4-9, G4-10, G4-11, G4-12 and G4-13
4
3
33
3
business areas
silos and warehouses
5
Small Hydroelectric Plants (SHEPs)
5
countries with AMAGGI offices
3,600
suppliers of soybeans and corn, approximately
plants
ports
12
farms
3,949 direct employees
2,500
large, medium, and small enterprises in the transport of grain
AMAGGI is present in every Brazilian region and is headquartered in Cuiabá, capital of the state of Mato Grosso. The company works in all phases of the agribusiness chain with integration and synergy, from the production of soybeans, corn, cotton, and soy seeds to river transport, and also in soybean origination and processing, the trading of grain, commodities, electric power, and port operations. The company also has sales offices in the Netherlands and Argentina and has started its activities in Switzerland. In 2013, the company acquired 100% interest in the Norwegian crusher DENOFA, a reference company in the processing of non-GMO soybeans with a presence throughout Europe, in which AMAGGI has had 51% interest since 2009. For 2014, the company plans the operations of two new offices, one in the state of Goiás and one in Paraguay. In the beginning of 2014, the André Maggi Group changed its name to AMAGGI for strategic reasons. The name of its business areas also changed: the AMAGGI Division became AMAGGI Commodities, the Agro Division became AMAGGI Agro, the Navigation Division became AMAGGI Navigation, and the Energy Division became AMAGGI Energy. The new names have been used in this report.
See the online version to learn more about: - AMAGGI’s operations in eight sectors.
Sustainability Report 2013
Growing with Brazil
From a small company headquartered in Paranรก to a large corporation with activities throughout Brazil and abroad, AMAGGI evolved along with the country, spreading the seed of sustainable development.
9
10
AMAGGI
Map of Operations Worldwide
Brazil
Argentina
Norway
The Netherlands
Switzerland
Activities and Business Areas
AMAGGI ENERGY
ENERGY
AMAGGI AGRO
Agricultural production
Seed production
Agricultural inputs
AMAGGI NAVIGATION
Grain origination and logistics
Soy processing
AMAGGI COMMODITIES
Port operations
River transport
Trading
Sustainability Report 2013
11
Map of Operations in Brazil
BELÉM Barcarena
MANAUS Itacoatiar Itaituba
PA
AM
MA
Balsas
PI Guaraí Bom Jesus
PORTO VELHO
TO
São Félix do Araguaia
RO Sinop
Luis Eduardo Magalhães
Vilhena Cerejeiras
Sapezal
Lucas do Rio Verde
Querência
Correntina
MT GO
CUIABÁ Rondonópolis
Itiquira Rio Verde
Farm SP
Warehouse Maringá
Guarujá
Office
PR Paranaguá
Port
São Francisco do Sul
SC
Plant Passo Fundo
SHEP
RS RS
Joint Venture Headquarters
BA
12
AMAGGI
AMAGGI’s Timeline
1997 > 1979 >
cquired first A farm (Fazenda Sm1) in Itiquira, Mato Grosso.
1977 >
Started operations in São Miguel do Iguaçu (PR) with the company Sementes Maggi (Maggi Seeds), currently named AMAGGI Commodities.
pened the Northwest O Export Corridor and started operations of AMAGGI Navigation in Porto Velho (RO) and Itacoatiara (Am). Created the André Maggi Foundation, currently the André and Lúcia Maggi Foundation.
1992 >
Founded AMAGGI Energy and built the first small hydroelectric plant (SHEP), Santa Lúcia I, the transmission lines, and the power distribution system in Sapezal (MT).
2002 >
I nauguration of the Itacoatiara (AM) Plant.
2001 >
eginning of the B soybean crushing process in Cuiabá (MT). Death of founder André Antonio Maggi.
2003 >
Started commercial production at the Santa Lúcia II SHEP in Sapezal (MT).
Sustainability Report 2013
13
2011 >
2007 >
Finished construction of the new headquarters and transfer from Rondonópolis to Cuiabá.
roTerra and ISO 14001 P certifications achieved. AMAGGI Commodities started operations in the Guarujá Bulk Terminal (TGG).
2009 >
The company increased its presence in Europe with the acquisition of 51% interest in the Norwegian crusher DENOFA.
Sales reached 1 billion dollars.
Unprecedented achievement of the Round Table on Responsible Soy (RTRS) certification. Started operations of the Divisa SHEP.
2013 >
Acquired 100% interest in the Norwegian crusher DENOFA.
Acquired Santa Lúcia Farm in São Félix do Araguaia (MT). Started commercial operations of the Ilha Comprida and Segredo SHEPs in Sapezal (MT). Beginning of AMAGGI operations in Switzerland.
2006 >
Adherence to the Soybean Moratorium Sector Pact.
2008 >
ew AMAGGI plant in N Lucas do Rio Verde (MT) received first shipment of soybeans. Beginning of operations in Rotterdam in the Netherlands. Global Reporting Initiative (GRI) guidelines adopted in the sustainability report.
2010 >
pening of corporate O office in Cuiabá. Inauguration of an origination office in Argentina.
2012 >
AMAGGI became the first Brazilian company to achieve the International Sustainability & Carbon Certification (ISCC).
Group is acknowledged as a reference in environmental management in agribusiness by the Forest Footprint Disclosure (FFD) Annual Report, 2011 edition, distributed in 2012.
14
AMAGGI
G4-10
INTERNAL AUDIENCE
internal audiences
AMAGGI ended 2013 with 3,949 direct employees, a number that remained stable in comparison with the previous year. Most contractors are in construction work. The number of contractors dropped in the period mainly due to the completion of the work on the Ilha Comprida and Segredo SHEPs. There is a large concentration of employees in the Midwest, the region with the largest company operations. Given the characteristics of the work in the fields, ports, plants, and warehouses, most employees are men. However, the number of women in our workforce has been increasing year on year. In 2013, the highlight in gender diversity was the appointment of the first woman for an executive management position (learn more on page 47).
See the online version to learn more about: - profile of employees who create the company’s successful history - profile of professionals who work in AMAGGI’s governance
Supply Chain
G4-12
AMAGGI’s suppliers are in the areas of origination, procurement and logistics.
Origination – rural producers rural producers
Origination includes relationships with rural producers, which are essential in the company’s value chain. We have approximately 3,600 suppliers of soybeans and corn, some of which are also buyers of commodities, broken down by region: Parecis (MT), BR 163 or mid-North (MT and RO), and South (South of MT, PR, and RS). Relationships with large groups are managed through a specific department at the headquarters. As for small and medium rural producers, the relationship is managed by the origination manager of each unit, based on the guidelines of regional managers at the headquarters. Since AMAGGI’s founders began their activities and had their entire history associated with agricultural production, rural producers are always very close to the company’s daily operations. Given their priority, we frequently map and develop new engagement actions to further improve this relationship (learn more on page 101).
Sustainability Report 2013
>>>>>>>> Rural producers have always been a priority for AMAGGI. The company is constantly investing in the relationship with this audience, improving the physical service structure and hiring qualified professionals to serve them. .
15
16
With a detailed engagement plan, AMAGGI seeks to create two-way communication opportunities.
AMAGGI
Subgroups Large groups (over 50,000 ha): approximately 15 large groups in Mato Grosso supply nearly 30% of the volume originated by the company. Large- and mid-sized producers, certified by the Round Table on Responsible Soy (RTRS): 54 producers from the Middle North and Parecis regions in Mato Grosso. Small- and mid-sized partner producers: from all regional units, supply nearly 20% of the volume originated by AMAGGI. Small- and mid-sized producers: from all regional units.
HERE I CREATE MY HISTORY â&#x20AC;&#x153;In 2004, a young woman, recently graduated and eager for a job opportunity, arrived in Sapezal (MT). It was not easy for a 22-year-old to go live on a farm, traveling over unpaved roads with no cell phone, no Internet access, and no knowledge of agriculture. But AMAGGI offered me a challenge and I accepted it. Today I only see the good in the path I chose, with the seeds I planted. I met people, made friends, saw good examples and qualified professionals, raised my family, and challenged other people who are now part of my team, each in their profession, their area, with their values and principles... It is like this at AMAGGI AGRO and in all business areas. I love my profession... let the next challenges come!
GISELE OLIVEIRA HAS BEEN A DIETITIAN AT THE Ă GUA QUENTE FARM IN SAPEZAL (MT) FOR NINE YEARS
Sustainability Report 2013
17
Suppliers Suppliers can be divided by product category and location (local, regional, national, and international levels).
Subgroups by product category Environmentally critical: suppliers of biomass, fuels, lubricants, chemicals, and minerals.
suppliers
Construction Companies: companies hired for the construction of warehouses and SHEPs, among others. Equipment Suppliers: includes companies that supply warehouse dryers, furnaces, silos, parts for vessels (rudders, beds, kitchens, engines), and material for SHEPs such as turbines. Most products in this category are imported. Other: includes suppliers of everyday consumables such as stationery, cleaning products, and coffee. They are generally local suppliers. The company prioritized suppliers of biomass and gravel among the environmentally critical suppliers to be included in engagement actions (learn more on page 104).
Logistics – transport suppliers There are nearly 2,500 contracts with large, medium, and small enterprises, which transport corn and soy to AMAGGI Commodities. The largest companies relate directly with the transport area at the headquarters, whereas the smaller companies are retained in centers in the transport offices of Rondonópolis, Lucas do Rio Verde and Cuiabá (MT), Vilhena (RO), and Paranaguá (PR). The largest transport flows run from Mato Grosso to Porto Velho (Itacoatiara/ RO mode) and from Rondonópolis and Alto Araguaia, in Mato Grosso, to the Port of Santos (Guarujá Bulk Terminal /TGG mode). AMAGGI develops awareness campaigns for truckers and infrastructure improvement actions to serve these professionals.
transport suppliers
18
AMAGGI
PROFILE
AMAGGI Commodities
AMAGGI Commodities operates in the origination of grain, manufacturing, logistics, port operations, importing, and trading of inputs. In 2013, the greatest challenge was to overcome the logistical problem faced by Brazil. Despite the necessary adjustments, AMAGGI Commodities not only achieved the goals planned for the year, but exceeded these goals, reaching 9 million tons of grain traded. Additionally, in 2013 the company advanced in the ranking of the largest Brazilian exporters, going from the 21st to the 18th position, according to the ranking of the Ministry of Development, Industry and Foreign Trade.
Sustainability Report 2013
19
PERCENTAGE OF GRAIN TRADED BY REGION
15.2%
72.1%
4.7% 5.5% 1.4% 1.1%
AMAGGI AMAGGI AMAGGI AMAGGI DENOFA AMAGGI
BRAZIL ARGENTINA & LDCommodities EUROPE SWITZERLAND
20
The combined operations of AMAGGI Commodities abroad have already totaled 4.7 million tons of grain, with 50% of this volume originating within AMAGGI.
AMAGGI
For AMAGGI Commodities, 2013 began with major challenges, mainly in terms of logistical issues related to the increase in road freight costs and payment of demurrage, which had a negative impact on the AMAGGI Commodities operating income. Nevertheless, those effects were offset throughout the year with the results obtained from origination and trading of corn. Abroad, AMAGGI Commodities reached record results in the Argentina, Netherlands, and Norway operations (with the acquisition of 100% interest in DENOFA), and the beginning of operations in Switzerland, also with positive results. It is important to note that the AMAGGI Commodities combined operations abroad have already totaled 4.7 million tons of grain, with 50% of this volume originating within AMAGGI. In order to improve production outflow from the North of Mato Grosso, the company started the construction of the Porto Velho Terminal. Additionally, the company invested in the new Tapajós River transport corridor and in a new terminal in Maranhão called TEGRAM, with operations planned to start in 2014. The company also began the construction of four warehouses in Matupá, Santa Rita do Trivelato, Diamantino, and Tapurah, municipalities located in the state of Mato Grosso. The operations were discontinued in the Cuiabá plant and in seven warehouses, which were leased. The company is considering the expansion of the Lucas do Rio Verde plant in the future.
ORIGINATION OF GRAIN BY AMAGGI IN BRAZIL– VOLUMES (THOUSAND TONS)
3,948
3,704
3,616 1,787
1,501
452 4,156
5,177 2011
5,735
2012 SOYBEAN
2013 CORN
total
Sustainability Report 2013
21
“We are very careful about social and environmental issues, and we conduct thorough analyses of our suppliers. We work in partnership with rural producers, and we greatly encourage best practices in the field. Producers already perceive the benefits. There will always be room for those who have a differentiated product.” Judiney Carvalho, AMAGGI Commodities Director
VALUES SHARED WITH RURAL PRODUCERS In order to achieve the expansion goals pursuant to corporate values, AMAGGI sees rural producers as essential partners. The company believes that growth should be shared and responsible in order to be continuous. Therefore, the company participates in studies and discussions, establishes commitments such as the Brazilian Pact for the Eradication of Bonded Labor, and disseminates these values in its supply chain. Through a partnership with Aliança da Terra (Earth Alliance), the company certified 54 rural producers from Mato Grosso according to the principles of the Round Table on Responsible Soy (RTRS), which represents a total of 372,900 tons of soybeans produced and originated by AMAGGI (learn more on page 40).
10% growth in the volume of grain originated in Brazil
Goals for 2013
Construction of new warehouses to support the Tapajós (PA) and Itaqui (TEGRAM) export corridors – (construction to be completed in the beginning of 2014) AMAGGI Switzerland operation kickoff
More than 20% growth in the volume of grain originated in Brazil
Goals for 2014
Improvement of the engagement project with farmers Advances in the construction of the new Porto Velho (RO) port Construction of new warehouses Beginning of AMAGGI’s operation in Paraguay
22
AMAGGI
PROFILE
AMAGGI Agro
AMAGGI Agro manages 223,400 hectares of soybean, corn, and cotton crops, in addition to its soybean seed production. Agro invested more than R$300,000 in software development and the acquisition of 150 tablets equipped with GPS in order to promote automated management, which facilitates decision-making in the field. Technology generated productivity and social and environmental gains. Initiatives like this led AMAGGI Agro to a 25% increase in revenue in 2013 and to becoming a highlight in the Agricultural and Livestock Production sector in the Agribusiness Annual Report published by Globo Rural Magazine.
Sustainability Report 2013
Investments in technology and the quality of life of employees resulted in higher productivity and social and environmental gains.
23
24
165,000
TONS OF SOYBEANS HAVE ALREADY BEEN CERTIFIED BY THE ROUND TABLE ON RESPONSIBLE SOY (RTRS), AND 284,000 TONS OF SOYBEANS HAVE BEEN CERTIFIED BY THE INTERNATIONAL SUSTAINABILITY & CARBON (ISCC), BOTH IN 2013.
AMAGGI
In the 2012/2013 harvest, climate factors affected soybean production. We expected 56 sacks per hectare and achieved 53 sacks per hectare, with a total production of 410,000 tons, a little below the goal. The corn harvest was the highlight: the goal was 400,000 tons and it exceeded 474,000 tons. Seed production also stood out, going from 156,000 sacks in 2011 to 560,000 in 2013. On the other hand, the cotton planted area decreased, since the product has low attractiveness in the market compared with soybeans and corn.
Productivity Indicators 2010-2013 2010-2011 Harvest
2011-2012 Harvest
2012-2013 Harvest
127,788
131,259
139,087
Corn
47,059
52,105
73,958
Cotton
32,647
35,336
10,415
2010-2011 Harvest
2011-2012 Harvest
2012-2013 Harvest
Soybean
417,550
441,545
410,160
Corn
194,274
332,910
474,601
113,563
127,494
43,548
2010-2011 Harvest
2011-2012 Harvest
2012-2013 Harvest
PLANTED AREA (in hectares)
Corn
THE HARVEST WAS A HIGHLIGHT, EXCEEDING THE GOAL OF 400,000 TONS AND REACHING A TOTAL OF 474,000 TONS.
Soybean
AGRICULTURAL PRODUCTION (in tons)
Cotton
AVERAGE PRODUCTIVITY (sacks) Soybean
54.5*
56.1*
52,98
Corn
68.8*
106.5*
106,95
Cotton
231.9**
240.5**
278,75
*Sack per hectare **Arroba per hectare (one arroba equals approximately 33 pounds)
Sustainability Report 2013
>>>>>>>> AMAGGI invested more than 300,000 in software development and the acquisition of 150 tablets equipped with GPS to promote automated management, which facilitates decision-making in the field.
25
26
“We do not want to be the largest. We want to be sustainable, to have organized growth, a solid base, competent people, and quality of life for our employees. In order to grow within these principles, our main strategy is to maximize access to the information available and to the use of this information. With consistent and clear indicators, we can make better decisions.” Pedro Valente, Director of AMAGGI Agro
AMAGGI
Investments result in higher productivity and social and environmental gains Based on the use of improved seeds, increasingly efficient soil management, and the mechanization of the field, production rates increased much more than the size of the planted area in the country’s agricultural production. Indicators show that AMAGGI Agro stood out in the sector with higher productivity rates in the three crops – soybean, corn, and cotton – compared with the averages in the state of Mato Grosso, according to the Mato Grosso Institute of Agricultural Economics (IMEA - Instituto Mato-grossense de Economia Agropecuária). With the investments in technology, the Geo Agricultural system, with the use of tablets, allows employees in the satellite-monitored farms to record crop conditions in real time and register the critical points. They can also access documents such as farm maps; health, safety, and environmental manuals; and procedures. In turn, managers receive the operational indicators and analyze all the information registered. In addition to gains in productivity, the process allows for a reduction in machine operation and fuel use and prevents the consumption of 50,000 sheets of paper per harvest. It is also important to note the professional development of field workers, who went through more than 100 hours of training to qualify for the innovation. AMAGGI Agro also maintained investments in the improvement of crop management and the use of agricultural inputs, allowing for the rational use of minerals, fertilizers, and agrochemicals. Agricultural practices in productivity and social and environmental gains led to the achievement of several certifications. Since 2007, the Tucunaré and Tanguro farms have been certified by ISO 14001. In 2013, a total of 165,000 tons of soybeans were certified by the Round Table on Responsible Soy (RTRS) and 284,000 tons were certified by the International Sustainability & Carbon (learn more on page 40).
Sustainability Report 2013
27
QUALITY OF LIFE FOR EMPLOYEES Pursuant to its human resources policies, AMAGGI Agro, along with 45% of the company’s employees, invests in their quality of life. In occupational health and safety, accident rates are being reduced year on year after the creation of the Occupational Health and Safety Department in 2012, thanks to the dedication of all employees to accident prevention processes. During that period, the company invested in new work methodologies and increased hours of training and the incorporation of this topic into leadership training. In 2013, the company launched the Behavioral Safety Program in three AMAGGI Agro Farms: Água Quente, Itamarati, and Tucunaré. In each pilot unit, committees for behavioral observation will be created to help create proactive indicators that anticipate the occurrence of accidents. The use of technology also provided higher qualification and quality of life to the field. With the elimination of work on Sundays and the increase in harvesting time, there was also a significant decrease in turnover rate (learn more in the Social Performance section).
To produce 440,000 tons of soybeans
Goals for 2013
To produce 395,000 tons of corn and 15,000 tons of cotton lint reach the planned planted area: 129,000 ha of soybeans, 73,000 ha To of corn, and 10,000 ha of cotton
Corn, soybean, and cotton production goals: 54 sacks per hectare of soybeans, 75 sacks per hectare of corn, and 257 arrobas per hectare of cotton
Goals for 2014
Goals for the production area: 139,000 hectares of soybeans, 60,000 hectares of corn, and 30,000 hectares of cotton The development of new production areas acquired in 2013 and the implementation of the Environmental Management System (SGA) in these areas.
28
PROFILE
AMAGGI Navigation
AMAGGI
Sustainability Report 2013
Fifteen years ago, the company saw new logistical possibilities for the outflow of the grain production from the North and the Midwest and launched the MadeiraAmazonas Corridor. Investments in modernization, the acquisition of new barges, and the record harvest of grain made it possible to exceed the goals for this area in 2013. AMAGGI Navigation also invested in a shipyard for the maintenance of vessels in Itacoatiara (AM) and in a new corridor: the Tapaj贸s-Amazonas.
29
2.8 million TONS OF GRAIN TRANSPORTED THROUGH THE MADEIRA RIVER.
30
AMAGGI
VOLUME TRANSPORTED BY AMAGGI NAVIGATION* (IN MILLION TONS)
2.5
The company has one of the largest river fleets in Latin America, with 115 vessels. Soybean and corn production is transported by truck to Porto Velho, where the company has a transshipment port terminal. Shipments then follow in convoys of barges through the Madeira River to the bulk handling port of Itacoatiara (AM), located in the margins of the Amazon River. From there, the soybeans, oil, and soymeal are exported in Panamax-class ships to Europe and Asia. River navigation depends on four factors: product, river navigation conditions, vessel efficiency, and good ship logistics. These factors consistently occurred in 2013, helping to achieve a record transported volume of 2.8 million tons of grain, which exceeded the company’s expectations.
2011
2.6
For 2014, the acquisition of new barges and pushers is planned. This investment, as well as the ongoing construction work, should increase the volume of transported grain to five million tons.
2012
2.8 2013 *On the route between Porto Velho and Itacoatiara.
New port will provide more efficiency and reduce impacts Aimed at improving the efficiency in transport logistics in the MadeiraAmazonas corridor and minimizing the impact of activities in the city of Porto Velho, the company started the construction of a new port, located farther away from the city center, which should be operating in 2015. The facilities of the city’s public port are currently being used. The company also acquired a new floating terminal in Itacoatiara. AMAGGI Navigation planned to resume transport of fertilizers in 2013; however, the plan was postponed to the beginning of 2014. The waterway mode is an environmentally responsible alternative that allows for the production of municipal, state, and federal revenues and boosts job and income generation in the cities along the way. The company has the ISO 140001 certification, which ensures compliance with environmental standards, invests in crew training, and develops projects in partnership with the Navy aimed at mitigating eventual impacts on riverfront communities.
Sustainability Report 2013
31
“The Navigation strategy has always been based on sustainability, since it offers a cleaner mode, with up to 10 times less emissions than the road transport mode.” Jorge Zanatta, Director of AMAGGI Navigation
NEW EXPORT ROUTE THROUGH THE TAPAJÓS RIVER In a joint venture with another company working in the grain sector, AMAGGI invests in the Tapajós corridor, a more efficient alternative for the outflow of grain production from the middle and northern regions of Mato Grosso. The plan proved feasible with the advance of paving in the BR163 highway, which runs across the region. The new route is expected to transport up to 6 million tons of grain each year. The project opens a new perspective on the export of soy and corn harvested in the middlenorthern region of Mato Grosso. Nowadays, almost the entire crop is transported through the South ports, located more than 2,000 kilometers away. With the new corridor, production follows by truck to Mirituba (PA), and from there it is transported in barges through the Tapajós river to the Port of Barcarena (PA) on the Amazon River, where it is shipped to Europe and Asia in large draught ships.
To start construction of the new Porto Velho (RO) Port
Goals for 2013
To acquire a second floating terminal in Itacoatiara (AM) To resume transport of fertilizers (operation to start in 2014)
To begin operations of the Tapajós - Amazonas corridor To resume transport of fertilizers
Goals for 2014
To complete construction of new shipyard in Itacoatiara (AM) To expand the fleet in the Madeira-Amazonas corridor
32
PROFILE
AMAGGI Energy
AMAGGI
Sustainability Report 2013
AMAGGI Energy manages five small hydroelectric plants (SHEPs) in the state of Mato Grosso. Four of them are located in the Juruena River in Sapezal, and one of them is in the Formiga River in the municipality of Campos de Júlio. The SHEPs are connected with the National Interconnected System that distributes electricity in Brazil. The Segredo and Ilha Comprida SHEPs, both in the Juruena River, started operations in 2013, raising the company’s installed capacity from 23 MW to approximately 70 MW. Together, the new plants have an installed capacity of 46.2 MW, which accounts for a 200% increase in relation to the company’s three other power plants. Investments totaled more than R$300 million.
33
5
SMALL HYDROELECTRIC PLANTS (SHEPs) ARE OPERATED BY AMAGGI.
34
AMAGGI
“These two projects are milestones in AMAGGI’s history, since the company now operates with 70 MW of installed capacity, which is sufficient to supply a city with a population of 200,000.”
In the execution of projects, the company is in strict compliance with environmental legislation and adopts the Basic Environmental Program (PBA - Programa Básico Ambiental), which aims to ensure the fulfillment of the most stringent environmental protection principles. The company also adopts preventive preservation measures to mitigate eventual environmental impacts on the various phases of construction and operation of the SHEPs.
INSTALLED CAPACITY PER SHEP IN MATO GROSSO Santa Lúcia I
Roberto Rubert, Director of AMAGGI Energy, in a statement about the Segredo and Ilha Comprida SHEPs
Santa Lúcia II
MW 5 7.6
Divisa
10.8
Ilha Comprida
20.1
Segredo
26.1
Note: The Jesuíta SHEP project in Mato Grosso, mentioned in the 2012 Sustainability Report, is still under analysis.
Goals
To complete the construction work and begin commercial operations of the Segredo and Ilha Comprida SHEPs
for 2013
Goals for 2014
To begin studies for the implementation of two plants to explore hydroelectric potential (AHE), in partnership with another player in the market
Sustainability Report 2013
THE SEGREDO AND ILHA COMPRIDA SHEPS, BOTH LOCATED IN THE JURUENA RIVER, WERE INAUGURATED IN 2013, RAISING THE COMPANY’S INSTALLED CAPACITY FROM 23 MW TO APPROXIMATELY 70 MW.
35
36
AMAGGI
PROFILE
Certifications
AMAGGI, aware of the market demands and demonstrating a vision for the future, has a strategy in place to remain up to date in terms of quality requirements and the new social and environmental concepts, which can be substantiated not only through the certification of the company’s agriculture, but also of its warehouses, ports, and crushers. In this sense, it became the first company in Brazil to certify a soybean farm – Tucunaré Farm in Sapezal (MT) – in the ISO 14001 standard. It was also the first, at the international level, to obtain the Round Table on Responsible Soy (RTRS) certificate and the first company in the country to achieve the International Sustainability & Carbon Certification (ISCC). In 2012 and 2013, the company had further advances in this area, training and certifying some of its suppliers in the RTRS.
Sustainability Report 2013
First company in Brazil to certify a soybean farm – Tucunaré Farm in Sapezal (MT) – in the ISO 14001 standard. It was also the first, at the international level, to obtain the Round Table on Responsible Soy (RTRS) certificate and the first company in the country to achieve the International Sustainability & Carbon Certification (ISCC).
37
38
AMAGGI
ISO 14001 In 2013, the company audited 22 units to renew certification, which is valid for the next three years with annual maintenance audits. The environmental management system and the work of the employees involved were, once again, very well assessed by ABS Quality Evaluations, the company that audits the system. This international standard establishes requirements for planning, implementation, and operation of an Environmental Management System (SGA - Sistema de Gestão Ambiental) already in place in all of the company’s operating units. The SGA allows units to have efficient management of their significant environmental aspects by adopting environmental controls, as well as in the qualification of the grain supply chain through a registration program and social and environmental guidance to rural producers.
See the online version to learn more about: -AMAGGI units with ISO 140001 certification.
HERE I CREATE MY HISTORY “I had been living abroad for three years, and Europe was in the middle of a major economic downturn. Also, there was an outbreak of H1N1 – known as the swine flu – and my wife was close to giving birth to our first daughter. It was in this scenario that the opportunity to join AMAGGI came. I had my first interview by phone when I was still in Lisbon (Portugal), then we returned to Brazil where I went through the entire selection process. I was approved for the position and my daughter, Sofia, was born in the same month I started working in the company. Today when I look back, I see how important AMAGGI’s support and confidence in my ability was at that hectic time of my family’s life. Looking ahead, I see new opportunities and challenges because the company is growing and I am evolving as an individual and a professional.
DANIEL ESCOBAR HAS WORKED AT AMAGGI FOR FOUR YEARS AS A COMMUNICATION ADVISOR IN THE COMPANY’S HEADQUARTERS IN CUIABÁ (MT)
Sustainability Report 2013
39
ProTerra Standard AMAGGI once again obtained the ProTerra Standard certification and, in 2013, traded 1 million tons of soybeans certified with the ProTerra seal. The standard establishes social and environmental responsibility criteria for the responsible production of non-genetically modified soybeans in order to meet the specific demands of the commodities market. ProTerra verifies if raw material suppliers have sustainable production. To this end, the company evaluates compliance with legal, environmental, ethical, social, and non-GMO (non-genetically modified) product requirements in the entire production chain, from farm (production and origination) to port. In this process, the soy meal, oil, and grain exported through the Itacoatiara (AM) port are evaluated. The standard is aligned with the Basel Criteria, the SA 8000 standard (workplace environment), the Universal Declaration of Human Rights, the Child Rights Convention, the International Labor Organization (ILO) conventions and recommendations, and the United Nations (UN) standards for human rights and the Global GAP Standards (accounting).
40
Round Table on Responsible Soy In 2013, the company advanced in its partnership with the Round Table on Responsible Soy. In addition to certifying 165,000 tons of soybean produced by AMAGGI Agro, it certified 373,000 tons from 54 suppliers. In 2011, AMAGGI was the first agribusiness company in the world to receive certification for producing soy according to the RTRS principles and criteria. In 2012, the company expanded the certification to its supply chain by certifying 40 producers. In 2013, in addition to maintaining 39 partners, it certified another 15 producers. Certification is preceded by an audit that evaluates 98 indicators within the five principles established by RTST: legal compliance and best practices; fair and responsible work conditions; a responsible relationship with the community; environmental responsibility; and best agricultural practices. The agreement to validate the certification is considered historic, since six years of negotiations with NGOs, companies, and producers from several countries were necessary to reach a consensus on the certification criteria for responsible soy. These certifications are currently seen as important credibility statements, ensuring that clients are receiving a responsible product that is increasingly better from an agricultural, environmental, and social standpoint.
International Sustainability & Carbon Certification (ISCC) The certificate documents the route followed by bioenergy by accounting for biomass based on the entire value added chain â&#x20AC;&#x201C; from the field to delivery to end users. In order to meet the strategic objectives associated with the sustainable use of the land, protection of the natural environment, and reduction of greenhouse gas (GHG) emissions and to supply EUâ&#x20AC;&#x2122;s biofuel market, the company certified 284,500 tons of soy and corn in 2013. The ISCC certification system was developed to meet the demands of the European Union (EU), according to the Renewable Energy Guideline (EU-RL 2009/28/ EC). This certificate safely comprises all phases of the production process, taking into account the legal requirements for the production of energy and fuel from biomass. To obtain certification, it is necessary to prove that the biofuel produced from soy or corn is at least 35% less pollutant than fossil fuel. In 2017, this percentage will be increased to 50%.
AMAGGI
Sustainability Report 2013
41
Brazilian Responsible Cotton In 2013, AMAGGI Agro was again granted the Brazilian Responsible Cotton seal from the Social Cotton Institute (IAS - Instituto Algodão Social) for the cultivation of cotton on the Tucunaré, Itamarati, and Água Quente farms, located in Mato Grosso. The Brazilian Responsible Cotton seal attests to compliance with Brazilian labor legislation and with work safety and environmental protection guidelines, including the encouragement of social action in the field to the benefit of employees, their families, and the social communities surrounding the properties. The seal, which until last year was called Algodão Social (Social Cotton) and comprised only the state of Mato Grosso, now has nationwide coverage.
Quality Certifications G4-PR1 In the entire development, production, and trading chain, AMAGGI uses systems to ensure the safety and quality of its products. Through these procedures, it is possible to verify compliance of the product with applicable legal requirements, especially those related to suitability and quality of all intermediate and final items. Since 2001, the company has had the Quality Program, which was developed based on the Best Manufacturing Practices (BPF - Boas Práticas de Fabricação) and the principles of Analysis of Hazards and Critical Control Points (APPCC Análise de Perigos e Pontos Críticos de Controle), which allow for the analysis of the risks involved in each phase in the production of the products traded and the evaluation of the effectiveness of the control measures currently adopted. The process ensured the company’s plants and ports the GMP+B2 certification, expanded in 2012 to GMP+FSA, similar to GMP+B3 certification which applies to the areas of ports, origination, trade, execution, and logistics certified by the GMP+ International, a Dutch agency that regulates companies operating in the animal feed industry and is renowned for its high standards. Furthermore, AMAGGI has some warehouses and all plants certified by the Ministry of Agriculture, Livestock and Food Supply. Each of our plants undergoes an average of four inspections annually. They were successfully approved in all nonconformity checks carried out in the period covered by this report. For soybean (grain), meal, and oil, there are also the HARD IP (Preserved Identity) and the Non-GMO (non-genetically modified) certifications, issued by Cert ID.
See the online version to learn more about: - Quality Certifications
With the implementation of the program for monitoring equipment and environments to detect outbreaks of possible poisoning by Salmonella spp, the main points were identified and routine cleaning and disinfection were implemented in those areas. These actions led us to a clearer understanding of the contamination mechanisms triggered by these microorganisms, and we managed to reduce the contamination identified by the program. Continuous monitoring is carried out through microbiological swab analysis (qualitative quick set - path check hygiene pathogen system), to check the effectiveness of our control measures.
42
Corporate governance In this section GOVERNANCE STRUCTURE PRINCIPLES AROEIRA PROJECT RISK MANAGEMENT
AMAGGI
Sustainability Report 2013
43
Our main challenge is to prepare people who support the company’s growth strategy and who are guided by our corporate values.
People
AND SUSTAINABILITY ARE THE STRATEGIC PILLARS OF GROWTH.
NEW DEPARTMENTS REINFORCE THE STRATEGY.
THE BOARD OF DIRECTORS AND THE EXECUTIVE BOARD PRIORITIZE RISKS AND DISCUSS TOPICS THAT ARE RELEVANT FOR THE BUSINESS.
44
“We initiated our business succession process, and that is not simply a father-to-son issue. Succession is much more complex and involves the company’s daily activities and its perpetuity. It is strategic to those who are part of the agribusiness chain and want to firmly proceed in the market in a sustainable way.” Blairo Maggi, Shareholder and one of AMAGGI’s founders
AMAGGI
Corporate Governance G4-34, G4-35, G4-36, G4-37, G4-38, G4-39, G4-40, G4-45, G4-47
The corporate governance guidelines incorporated into the company’s Management Policies seek to develop professional management that promotes sustainable economic growth and continuous improvement based on the equal treatment given to shareholders, transparency in management, full accountability by managers, and corporate responsibility while seeking the best results for AMAGGI and caring for its longevity. Our main challenge is to prepare people who support the company’s growth strategy and who are guided by our corporate values. In 2013, major advances in leadership training were achieved in the Aroeira Project. Sustainability, and in turn, the Sustainability Area, gained importance as it gained the status of a Department. People and sustainability are the basis of the company’s growth strategy until 2020.
GOVERNANCE STRUCTURE AMAGGI’s senior management is comprised of the Board of Directors and the Executive Board, each with formally different roles and responsibilities. Both rely on support committees. In line with best practices in corporate governance, the Chairman of the Board does not hold a position on the Executive Board. The Board of Directors, which is the highest governance body, is formed by seven members, one of whom is an independent member (in line with the Code of Best Corporate Governance Practices of the Brazilian Institute of Corporate Governance – IBCG). Members are elected for a three-year term and are eligible for reelection. Board members meet regularly to discuss strategic guidelines for economic, environmental, and social issues. Management of topics is structured and hierarchical; the competency, authority, and autonomy of the CEO and Directors are established for these purposes. The Board convenes monthly to discuss results of the business areas, as well as their challenges, goals, and opportunities regarding those three topics. An evaluation is also carried out to check if the goals planned by the Board of Directors for the current year are being met.
Sustainability Report 2013
45
AMAGGI
Chairman of the Board of Directors
CEO AMAGGI
Risk Management
Human Resources Management
Corporate Affairs Managemen
Financial Adm. Managemen
Sustainability Managemen
Comptrollership
Legal Department
AMAGGI Agro
AMAGGI Commodities
Origination Managemen
AMAGGI Navigation
Sales Managemen
AMAGGI Energy
46
AMAGGI
MISSION To contribute to the development of agribusiness by adding value, respecting the environment, and improving life in the communities.
VISION To be a reference in sustainable development.
VALUES Integrity To be ethical, fair, and consistent with our thoughts, words, and actions.
Respect for the Environment To be a reference in social and environmental management.
Simplicity Focus on the essential, encouraging agility and less bureaucracy.
G4-43, G4-51, G4-56
In 2013, AMAGGI planned its growth strategy until 2020, based on the preservation of its beliefs and values and the development of leaders. In 2013, there were changes in the governance structure with the creation of two new departments – Corporate Affairs and Sustainability – and the new People Committee. The organizational structure marks the consolidation of career executives in the role of new company managers. To better evaluate the business from a sustainability standpoint, the administrative and executive boards attended a workshop conducted by Dom Cabral Foundation, discussing topics defined in the 2012 Materiality and incorporating other topics of interest.
Humility To show respect for all, following common sense in professional and personal relations.
Participatory Management To encourage participation by promoting recognition and professional growth, involving people in key company processes.
Commitment “Fly the company flag.” Work with passion and pride and strive for the company’s success.
Variable remuneration of directors and managers already includes the performance of sustainability indicators – a measure that should apply to all employees in the future. Performance goals are established for bonus payments shared by employees in two hierarchical levels immediately below management. And the goals defined for the CEO, for example, are in line with those applied to the executive management and managers. The stakeholder engagement plan, structured in 2013 by the Sustainability Department, foresees the determination of impacts, challenges, and opportunities that provide support for assessments and definitions of the strategies for the Board of Directors and the Executive Board.
Principles AMAGGI’s growth is grounded in a culture that values integrity, respect for the environment, partnership, and people development.
Innovation and Entrepreneurship Retain creative, participative, bold, talented, and enthusiastic people who can make a difference in the competitive market.
Respect for our partners Foster good business relations, remaining faithful to the commitment of being a company admired and respected by all.
The principles that define the relationship for AMAGGI in the value chain through partnerships are responsible for structuring governance. Internally, we foster our Mission, Vision, and Values through policies, communication, and training. Externally, we reaffirm our principles through national and international pacts established with governmental agencies and society and participate in discussion groups and agribusiness associations.
Sustainability Report 2013
47
“We need to be very mindful, looking ahead and slowly preparing for future demands. At RTRS, for example, we managed to be the first because we started talking to them from the beginning and modifying our processes right away. When the moment came, we were ready and had no significant impact on cost. The challenge for the new Board is to operate proactively.” Juliana de Lavor Lopes, Sustainability Director
NEW SUSTAINABILITY DEPARTMENT The first woman to become a Director at AMAGGI, Juliana de Lavor Lopes will head the new Sustainability Department, created in 2013. The area was previously at the management level and worked mainly in management processes. Although the topic is already present across the company, it was necessary to work proactively, being attentive to the markets in which the company operates and identifying challenges and opportunities. Also in 2013, a workshop was conducted with the Executive Board to discuss relevant topics for the company. It was the first step in the design of the Global Sustainability Plan to be launched in 2014, partially based on the Business Principles for Sustainable Agriculture and the Global Compact of the United Nations (UN). Our idea is to incorporate sustainability criteria and values into the company’s growth strategies. To this end, the Executive Board is also developing the 2020 Vision with annual steps to support the strategy of each business area.
AROEIRA PROJECT The Aroeira project is aimed at preparing leaders, identifying talents to execute our growth strategy, ensure business continuity and the company’s values, and also develop and conduct a succession plan. The project started in 2011 at the Board level. Then it was extended to managers, and in 2013 it included supervisors, who took part in assessments and workshops in the School for Leaders (learn more in the Social Performance section). Having already planned the continuous phases, the project will slowly include AMAGGI’s nearly 4,000 employees. The Aroeira Project links the people management work to the analysis of individual results and to the business matrix, and aligns it to medium- and long-term business plans of all company areas. It does all this without losing sight of the essence of success the company was founded with in the 1970s and the intention to continue in the essence of a family company. Another objective of the Aroeira project is to encourage the necessary leadership attitudes to ensure the company’s continuity. The Aroeira (Brazilian Pepper Tree) was one of the favorite trees of our founder, André Maggi, who insisted on planting one on each of his properties. The tree is found throughout the country and is a symbol of tenacity, continuity, and future.
48
Committees identify and measure the main financial, environmental, and social risks to which the company is exposed, establishing preventive or mitigation measures and procedures. Learn more about the committees in the online version of the report.
AMAGGI
RISK MANAGEMENT AMAGGI applies preventive management through the work of committees based on an appropriate information system. Committees identify and regularly measure the main financial, environmental, and social risks to which the company is exposed, establishing preventive or mitigation measures and procedures. To improve this work, in 2012 the company started a project, supported by the consulting company Delloite, aimed at implementing, in a more integral way, the risk management process in all its activities. In 2013, the group identified, documented, and prioritized the strategic, financial, operational, and regulatory risks of its companies, created action templates for risk management and monitoring of actions that embody the response strategy to the risks prioritized, and also defined the most appropriate actions to manage the risks. Risks were prioritized according to their complexity, volume, and degree of risk related to the process, according to the figure below. To ensure best practices in governance and maintain transparent management conduct, AMAGGI relied on the work of six corporate committees in 2013: Sustainability and Occupational Health and Safety; Ethics and Conduct; Financial Risks; Tax and Fiscal; Internal Audit; and the new People Committee.
See the online version to learn more about:
G4-2, G4-14, G4-41, G4-44, G4-46, G4-49, G4-50, G4-53, G4-57, G4-58, G4-SO3
-Sustainability and Occupational Health and Safety Committee -Ethics and Conduct Committee -Financial Risks Committee -Tax and Fiscal Committee -Internal Audit Committee -People Committee
HERE I CREATE MY HISTORY “I only joined AMAGGI in 2001, but I had already learned about the founder when I was still working for a major competitor. Having been hired by that company as a trainee in the 1970s, during the onboarding process I had the opportunity to visit all its units in the state of Paraná. Upon arrival, I noticed that local managers of that company talked about Mr. André Maggi as a reference in the region (farms, seeds, trade, politics, etc.), and their challenge was to bring that visionary entrepreneur to their client’s portfolio. It was a goal that was accomplished only 10 years later, in the 1980s, when I met Mr. André Maggi in Itiquira (MT) and we started doing business. AMAGGI’s reputation and the way its founder would relate and lead were already acknowledged as differentials by major corporations, so much so that in the 1990s, high ranking leaders of the American headquarters of the company I worked for came to Brazil. They visited AMAGGI’s properties and were welcomed by the Maggis themselves. Unfortunately, when I joined the company in 2001, Mr. André Maggi had passed away, but I can say that during my professional life, AMAGGI and its founder were always present in some way.”
JOÃO ZAMBONI HAS BEEN ON THE TEAM FOR 13 YEARS AND IS CURRENTLY DIRECTOR OF CORPORATE AFFAIRS
Sustainability Report 2013
49
IMPACT
6
5 3
high
2
10
1
7
4
8
RISKS
9
1 Succession
medium
low
2
Adherence to Policies
3
Investments and Projects
4
Logistics (outflow)
5
Market and Competition
6
Cash Flow
7
Commodities (exhibition)
8
Integrity of Information
9
Attraction / Retention of Talents
10 Tax / Fiscal low
medium
high
VULNERABILITY
50
Dialogue and engagement In this section SHARED VALUE IN THE VALUE CHAIN ENGAGEMENT AND MATERIALITY COMMITMENTS AND INSTITUTIONAL PARTNERSHIPS
AMAGGI
Sustainability Report 2013
51
AMAGGI believes that generation of value in the long term depends on the engagement of its main relationship stakeholders and on participation in agreements and sector studies.
9 MATERIAL TOPICS ARE DEFINED BY THE LEADERSHIP.
6 GROUPS ARE PRIORITIZED IN A STRUCTURED ENGAGEMENT PLAN.
AMAGGIâ&#x20AC;&#x2122;s CEO TALKS ABOUT SUSTAINABLE AGRICULTURE AT THE UN.
52
AMAGGI
Shared value in the value chain In addition to market-related factors, AMAGGI believes that long-term generation of value is essentially based on the engagement of its main stakeholders and their participation in agreements and sector studies. Thus, the company will be able to identify the main positive and negative impacts of its activities on society and manage them adequately. Based on this vision, in recent years the company has intensified initiatives to map and consult stakeholders, in addition to taking a pioneering stance in national and international commitments on sustainability. This work has helped the companyâ&#x20AC;&#x2122;s senior management consider social and environmental risks and opportunities in their strategic and operational decisions. Next, we describe the main outcomes of the consultation process and AMAGGIâ&#x20AC;&#x2122;s commitments and studies.
Engagement and Materiality
In 2011, AMAGGI carried out the first structured mapping of its stakeholders, an effort that involved many areas of the company. In the following year, we chose a group of stakeholders and asked for their opinions about the main impacts (positive and negative) on the business. Based on this consultation, the company chose the nine most relevant topics to be managed more strictly (for more details on the consultation see the About the Report section). The nine material topics are presented in the Materiality Matrix (see chart on the opposite page). In 2013, these material topics were discussed by the Board of Directors and by senior management in a workshop conducted in partnership with the Dom Cabral Foundation. The leaders carried out a review for a new materiality process to be carried out in 2014. Last year, the company also invested in a structured plan for stakeholder engagement with the support of an external consulting company. This project will structure the materiality review process.
Dialogues help senior executive management consider the social and environmental risks and opportunities in their strategic and operational decisions.
G4-18, G4-25
Sustainability Report 2013
53
analysis of six internal documents
“It is important for us to share information and encourage integration between institutions. Sharing can inspire new actions.”
survey of communication channels and tools
Participante do II DialogAção
We adopted the engagement concept from ISO 26000: to create two-way dialogue opportunities in order to build a consistent basis for decision-making in the organization. The plan was developed based on inputs raised in the following processes:
interviews with six key area leaders (sustainability, environment, communications, procurement, transport logistics, and origination) evaluation of results of the Dialogue with Social Organization Panel development of the Fofa matrix (strengths, opportunities, weaknesses, and threats)
G4-19
MATERIALITY MATRIX
3.0
Transparency and accountability to society Commitment to sustainability and the pursuit of consistency in the company’s daily actions
INTERNAL AXIS
Cooperation and partnerships (adherence to voluntary initiatives, associations, round tables, agreements, etc. – e.g., Soy Moratorium) Training and skill building (professional qualification, courses, etc.)
1.5
Compliance with legislation (labor, environmental, land, etc.) Environmental Preservation (e.g., respect for permanent preservation areas and legal reserves, protection of riparian forests and springs, etc.) Monitoring of risks (environmental, social, human rights, etc.)
0.0
Development of local communities (creation of jobs and income, tax payments, boost in local economy, etc.)
0.0
1.5 EXTERNAL AXIS
3.0
Market presence (relevance of the company in the market, operation strategy by geography, etc.)
54
AMAGGI
Based on the inputs collected, we developed AMAGGI’s map of stakeholders, shown on the opposite page. The criteria for prioritizing the stakeholders included in the action plan were: audiences considered critical for the achievement of AMAGGI’s strategic and sustainability objectives
G4-26
audiences that can indicate risks and/or opportunities based on the impacts of the business on local communities and/or propose solutions for mitigation of these risks audiences that are part of AMAGGI’s supply chain and whose product and/or service could present a high social and/or environmental risk with potential to affect the company’s reputation and/or cause major damage to the environment and to society (learn more on page 104) audiences whose cooperation may bring opportunities for the company and create a competitive advantage and differentiation in the current scenario.
Audiences
internal audiences
local communities
rural producers
institutional partners
suppliers
transport suppliers
Based on these criteria, the priority stakeholders are: internal audiences (senior management, key area managers, managers of the Mato Grosso units, and employees that deal with truckers) rural producers (large, medium, and small) environmentally critical suppliers (biomass and gravel) local communities (municipalities in Mato Grosso) institutional partners (local, national, and international) truckers (contractors) G4-24
An action plan for the short and medium term was developed for each priority group with the assumption to maximize the existing communication channels and tools and propose replicable and low-cost actions with potential large-scale impact. A cultural change necessarily includes cognitive, attitude, and behavioral changes. These phases (changes) were applied to the plan’s actions in order to promote a cultural change toward valuing dialogue and engagement. G4-37
Sustainability Report 2013
55
Map of stakeholders
ENERGY STAKEHOLDERS AGRICULTURAL INPUTS
government, local community, internal audiences, contractors, competitors, client (ANEEL), suppliers, players of the energy sector
AMAGGI ENERGY
AGRICULTURAL PRODUCTION STAKEHOLDERS PRODUCTION OF SEEDS
AMAGGI AGRO
government, local community, internal audiences, contractors, AMAGGI Commodities and AMAGGI Navigation, competitors, clients, suppliers, players in the Agribusiness sector.
AMAGGI COMMODITIES
government, local community, internal audiences of the national and international business units, contractors, rural producers, truckers, clients, AMAGGI Navigation and AMAGGI Agro, competitors, suppliers, players in the domestic and foreign trade and transport sectors
GRAIN ORIGINATION AND LOGISTICS
SOYBEAN PROCESSING
STAKEHOLDERS
PORT ADMINISTRATION STAKEHOLDERS RIVER TRANSPORT
AMAGGI NAVIGATION
government, local community, internal audiences, contractors, competitors, clients, suppliers, players in the logistics sector
TRADING
STAKEHOLDERS AMAGGI
government, internal audiences, family members of internal audiences, institutional partners, suppliers, agencies and trade associations, media/press, financial institutions, shareholders, players in the agribusiness sector, society
56
AMAGGI
Commitments and institutional partnerships G4-15
AMAGGI has institutional commitments that, along with its mission, vision, and values, express the company’s position on topics of relevance for society and for the business. Current commitments include: the United Nations Global Compact, the National Pact for the Eradication of Bonded Labor, the Business Pact for Integrity and Against Corruption, the Programa Empresa Amiga da Criança (ChildFriendly Company Program), the Millennium Development Goals and the Natural Capital for Leadership Compact. Before making a new commitment, we evaluate whether the initiative is aligned with the company’s values and if the company meets at least 70% of the commitments and goals. In 2013, AMAGGI participated in the process to restructure the National Pact for the Eradication of Bonded Labor, along with the Instituto Ethos de Empresas e Responsabilidade Social, the Instituto Observatório Social, the NGO Repórter Brasil, the International Labor Organization (ILO), and other companies. The work resulted in the launch of InPacto, a non-profit organization whose objective is to provide better governance structure and financial sustainability for activities already being developed and for activities that need to be developed to turn the eradication of bonded labor into a reality in Brazil. In association with the United Nations Global Compact, the company works to create the Business Principles for Sustainable Agriculture. For two years, the proposals will undergo global consultation with the pact’s signatory companies, NGOs, and signatory academic experts in the areas of agriculture and food. The goal is to launch the development agenda in 2014.
HERE I CREATE MY HISTORY “As an AMAGGI employee, this is the fifth city I’ve lived in, having participated in the construction of six new units. Everything started when my daughter was less than one year old and I joined the company at Tanguro Farm in Querência (MT). Soon after that, I was transferred to the headquarters when it was still in Rondonópolis (MT). Six months later, the headquarters changed to the state capital and I moved with it. The good work that I developed in the procurement area opened doors, and I was promoted to the administrative supervision of two new SHEPs that were to be built by AMAGGI Energy: Segredo and Ilha Comprida. For that reason, I moved to Sapezal (MT) and reached one of my greatest personal achievements: I bought a house. Two years later, when the construction work ended, the opportunity came to participate in the construction of the Portochuelo Shipping Terminal, and I moved to Porto Velho (RO) with my family where I found out that my wife, who was always by my side and supported me, was pregnant with our second child. There were many happy moments, and for all that, I can say that I am part of AMAGGI’s history and the company is part of mine.
SILVIOMAR MARCHESINI HAS WORKED AT AMAGGI FOR SIX YEARS AND IS CURRENTLY AN ADMINISTRATIVE SUPERVISOR IN PORTO VELHO (RO)
Sustainability Report 2013
57
II DIALOGAÇÃO – ROUND TABLE WITH SOCIAL ORGANIZATIONS The sustainability area, in partnership with the André and Lúcia Maggi Foundation, carried out a conversation panel in the headquarters, in Cuiabá, with representatives of social, governmental, and nongovernmental organizations from many municipalities of Mato Grosso where the company operates and that received or used to receive financial support from the foundation. Some activities were conducted in order to elicit the opinion of participants about the most relevant topics for the relationship, to improve management and communication processes, and to report on the survey of topics carried out in 2012 and its outcomes. The panel also provided material to support the Engagement Plan. In 2014, we intend to map representatives of the communities where the company operates in order to expand the diversity of opinions and perspectives and create other forums to listen to the communities, which will increase our understanding about the impacts of the business and aid in the decisionmaking process.
AMAGGI’s CEO TALKS ABOUT SUSTAINABLE AGRICULTURE AT THE UN AMAGGI’s CEO, Waldemir Loto, invited some of the most important business leaders in the world to think about a more sustainable model of agriculture in their countries in a lecture at the United Nations Global Compact Leaders Summit 2013. The Leaders Summit 2013, whose theme was “Architects of a Better World,” brought together more than 2,000 participants including executives and business leaders, representatives of civil society, governments, and the United Nations in New York (USA). The executive spoke about the discussions on the Business Principles for Sustainable Agriculture, with a focus on corporate responsibility to ensure world food safety. Waldemir was one of the three Brazilians to speak during the summit, along with the Minister of Environment, Izabella Teixeira, and Jorge Abrahão, President of the Instituto Ethos de Responsabilidade Ambiental.
58
AMAGGI
AMAGGI participated in all phases of the project, which included 20 other private organizations, and it was the only Brazilian company invited. In the beginning of the year, AMAGGI will be the host in the regional consultation to be held in Brazil. The work that is already finished will serve as a base for the company’s Global Sustainability Policy.
Global Compact An initiative led by the United Nations (UN) to mobilize the international business community to adopt, in their business practices, fundamental and internationally accepted values – expressed in 10 principles – in the areas of human rights, labor relations, and environment, as well as in the fight against corruption. AMAGGI joined the Global Compact on April 22, 2009. Learn more about the principles at www.unglobalcompact.org.
National Pact for the Eradication of Bonded Labor AMAGGI joined the pact on November 16, 2005 and committed to defend human rights and ban any type of bonded or slave labor in its production chain. <www.pactonacional.com.br>
Business Pact for Integrity Against Corruption The pact aims to promote the engagement of companies against all forms of corruption and establish guidelines that regulate the relationship between organizations and the government. AMAGGI joined the pact on April 22, 2009. <http://www.empresalimpa.org.br>
Programa Empresa Amiga da Criança (Child-Friendly Company Program) The program, created by the Abrinq Foundation in 1995, is aimed at mobilizing companies into social actions that benefit children and adolescents in Brazil. AMAGGI was awarded the Child-Friendly Company seal on April 24, 2009. Since then, we have published an annual performance report to communicate our main actions on the topic. <www.fundabrinq.org.br>
Millennium Development Goals A set of eight macro-goals that must be achieved by signatory countries by 2015 through tangible actions developed by the government and society. AMAGGI supports the Millennium Goals and disseminates them to its employees. Furthermore, these guidelines have become one of the criteria for the Seleção Pública de Projetos (Public Selection of Projects), a program created by the André and Lúcia Maggi Foundation. Learn more about this initiative at <www.amaggi.com.br/spp>. <www.objetivosdomilenio.org.br>
Sustainability Report 2013
Natural Capital Leadership Compact In 2012, the company became a signatory to the Natural Capital Leadership Compact, created by the Cambridge University Sustainability Leadership Programme. Launched during the UN Conference Rio +20, the pact had the adherence of 16 signatories. AMAGGI and Natura are the only Brazilian business organizations included in it. The pact aims to achieve the mutual agreement of business leaders to value and maintain natural resources, while prompting governments to align economic development with the responsible and sustainable use of nature. In 2013, the company joined a study group that intends to create the methodology to map externalities. <www.cpsl.cam.ac.uk>
Initiatives, partnerships, and studies AMAGGI participates in discussion groups and initiatives with national and international organizations and associations involved in agribusiness and sustainable development. The company is also part of several institutions and representatives of various sectors that tackle issues that affect all companies in the sector, such as the Brazilian Association of Vegetable Oil Industries (ABIOVE - Associação Brasileira das Indústrias de Óleos Vegetais), Association of Soy and Corn Producers of the State of Mato Grosso (APROSOJA - Associação dos Produtores de Soja e Milho do Estado de Mato Grosso), and the Association of Cotton Producers of Mato Grosso (AMPA - Associação Mato-grossense dos Produtores de Algodão). See the online version to learn more about: - Business Services for Ecosystemic Services - Trends in Ecosystemic Services - Major Projects and Local Development - FGV - Abrange - Greener Soybean Project - Soy Moratorium
HERE I CREATE MY HISTORY “The greatest adventure of my life was to come alone on a motorcycle from Rio Grande do Sul to Mato Grosso, following my parents’ path: they went to work in Sapezal (MT). I started to work there for a competitor, but I was curious about the reason why AMAGGI’s employees were different from workers of other companies and why the company was so admired by the population. In the following years, I got married and moved to Sinop where I finally started working at AMAGGI. Today I can say that the outside view I had about the company’s differential and its employees was not only true, but it is even better. I am very happy and pleased with the path AMAGGI has planned for itself, and consequently, for me.”
RICARDO HUFFEL HAS WORKED AS A BUYER AT THE SINOP (MT) WAREHOUSE FOR TWO YEARS
59
“I invite you, business leaders, to contribute to the creation of a more sustainable agribusiness model in your countries. And I hope these principles [of sustainable agriculture] are welcomed by governments and by other agencies interested in the production of food for the world.” Waldemir Loto, CEO of AMAGGI, in a passage from his speech at the Leaders Summit 2013
G4-16
60
Scenario and strategies In this section GROWTH WITH SUSTAINABILITY ADDRESSING MARKET DEMAND
AMAGGI
Sustainability Report 2013
61
In this positive scenario for Brazilian agribusiness, AMAGGI proceeded with its growth strategy.
STUDIES CONDUCTED BY OECD AND FAO INDICATE AN INCREASE OF UP TO 40% IN THE GLOBAL DEMAND FOR FOOD BETWEEN 2007 AND 2019.
AMAGGI REACHED THE GOAL OF A 10% INCREASE IN THE VOLUME OF GRAIN ORIGINATED IN BRAZIL.
AMAGGI COMMODITIES RANKS 18th AMONG THE LARGEST BRAZILIAN EXPORT COMPANIES ACCORDING TO THE RANKING FROM THE MINISTRY OF DEVELOPMENT, INDUSTRY, AND FOREIGN TRADE.
62
AMAGGI
Growth with sustainability Studies conducted by the Organisation for Economic Co-operation and Development (OECD) and the United Nations Food and Agriculture Organization (FAO) indicate an increase of up to 40% in the global demand for several types of food between 2007 and 2019. Most of this demand will come from developing countries. The studies also appoint Brazil as one of the main countries to expand its production and exports in order to supply a large part of this increased demand. These perspectives represent both an opportunity and a challenge to Brazilian agribusiness. In order to expand agribusiness production and exports and consolidate the country’s leadership in the international agricultural market, it is necessary to intensify joint efforts of farmers and the government, whose public policies should ensure adequate levels of support and contribute to the improvement of logistics and infrastructure conditions. Based on the commitments reaffirmed in the Corporate Sustainability Forum at Rio+20, aligned with the Zero Hunger initiative and the Nutrição em Escala (Nutrition in Scale) movement, the Global Compact is promoting the voluntary development of Business Principles for Sustainable Agriculture (PEAS - Princípios Empresariais para uma Agricultura Sustentável) so that companies work more efficiently with the United Nations and reach the goals listed in The Future We Want document produced at Rio+20. The PEAS are meant to be guiding principles for sustainable agriculture, consolidating and referencing the significant advances achieved in politics, technology, knowledge, and innovation that have defined the food and agriculture sector in recent years – especially those achieved by the private sector.
HERE I CREATE MY HISTORY “When I started working at AMAGGI, I had no idea how big the company would become. I learned the history of the Maggi family and would have really liked to have met Mr. André Maggi because everyone said good things about him being an ethical and fair person. I have a lot to thank the company and God for because I grew both personally and professionally. The company helped me finish my college education and supported me with its benefits in difficult times. In all this time I’ve met a lot of people, exchanged experiences, and cultivated good friendships that remain even today, just like I want to remain at AMAGGI, contributing to the company’s growth and thus growing as a person.”
REGIANE SILVA HAS BEEN PART OF THE TEAM FOR 13 YEARS AND IS CURRENTLY AN ADMINISTRATIVE SUPERVISOR AT THE CAMPO NOVO DO PARECIS (MT) WAREHOUSE.
Sustainability Report 2013
The companyâ&#x20AC;&#x2122;s strategy to expand trading, based on its principles of sustainability and focused on origination, is consolidated by a strong partnership with rural producers.
63
Growing to meet the demand Despite the adverse climate conditions that affected important production regions in Brazil in 2013, production of grain hit a new record of 188.2 million tons, 16.2% over the 2012 harvest. This performance, based on gains in productivity and also on the expansion of the planted area, reaffirms the importance of Brazilian agriculture and the entrepreneurship of rural producers. The sector ensures supply for the domestic market and contributes to the trade balance surplus, not to mention employment and income generation. Brazil increasingly stands out in the international agricultural market as one of the largest global producers and exporters, showing that the sector is mindful of opportunities arising from a growing demand for food, driven mainly by the increased income in emerging and developing countries. Agribusiness exports totaled US$99.97 billion in 2013, an increase of 4.3% compared with 2012, according to data from the Department of International Relations of the Ministry of Agriculture, Livestock, and Food Supply (SRI/MAPA). Imports increased by 4% and reached US$17.06 billion. The agribusiness foreign trade balance was positive by US$82.91 billion. The main exporting sector was the soybean complex (US$30.96 billion), responsible for 31% of sales abroad. Soybean grain exports hit the record amount of US$22.81 billion, increasing US$5.36 when compared with 2012. The amount exported went from 32.9 million tons to 42.8 million tons, which represented 52.3% of the Brazilian soybean harvest in 2012/2013. Another record-breaking result was reached with sales of corn abroad, which totaled US$6.25 billion, an increase of 18.2% when compared with the previous year. On the wave of increased soybean exports, China, the largest global importer of the grain, exceeded the EU as the main buyer of Brazilian agribusiness products for the first time, purchasing US$22.88 billion, US$4.91 billion more than in 2012. In this positive scenario for Brazilian agribusiness, AMAGGI proceeded with its growth strategy.
64
AMAGGI
In grain exports, the company achieved its goal of a 10% growth in volume of grain originated in Brazil. AMAGGI’s strategy was influenced by the serious logistical problems faced by the country in 2013. In order to reach the volumes planned, our trading origination focus was adjusted: of the total volume planned for soybeans, we replaced 450,000 tons with corn. With the climate-related problems faced by soybean crops, the record corn harvest, and the increase of transportation costs, the corn margins proved to be better and ensured the company’s planned result. Trading ranks 18th among the largest Brazilian export companies, according to the ranking from the Ministry of Development, Industry, and Foreign Trade, advancing from the 21st position held the previous year. Our growth strategy, based on the company’s sustainability principles and focused on origination, is consolidated by a strong partnership with rural producers.
25%
increase in Agro’s revenue. The navigation strategy was consolidated through investments in the Madeira Corridor
AMAGGI Energy increases its installed capacity from 23 to 70 MW
In agricultural production, soybean crops suffered from the severe drought in the grain filling period and from rains during the harvest, which caused results a little below expectations. The forecast of 56 sacks per hectare was reduced to 53 sacks, totaling 405,000 tons, which was below the expected 440,000 tons. As for corn production, the goal of 400,000 tons was surpassed, with production exceeding 450,000 tons. Seed production also stood out, going from 156,000 sacks in 2011 to 560,000 in 2013. The cotton planted area decreased due to attractive soybean and corn prices. In all, AMAGGI Agro achieved a 25% increase in revenue. The productivity growth strategy was consolidated through investments in technology, better agricultural practices, and quality-of-life projects for the employees in the fields. In spite of climate adversities, the company ended the year with higher productivity than the average achieved in the state of Mato Grosso, the country’s largest producer of grain. For soybeans, the state average was 50 sacks per hectare, while AMAGGI Agro produced 53 sacks per hectare. Corn productivity was 106 sacks, while the state’s rate was 101 sacks per hectare. As for cotton, productivity was 4,180 kg per hectare, whereas the state average was 3,890 kg. AMAGGI Navigation, in view of the record grain harvest and the logistical difficulties in the country’s South and Southeast ports, invested in the improvement of its infrastructure, which enabled the company to exceed the volumes planned for 2013. The company transported 2.8 million tons of grain through the Madeira corridor, an increase of 9.7% when compared with the 2.6 million tons transported in the previous year. The company planned to resume the transport of fertilizers in 2013, but the activity will be resumed in 2014. The unforeseen increase in transported volumes had no impact on final results. Our Navigation strategy was consolidated through investments in the Madeira Corridor, such as a new port in Porto Velho, with larger capacity and less impact on the local community. In addition, the company started construction of the
Sustainability Report 2013
Tapajós corridor, which opens a new option for the outflow of Mato Grosso’s production. The new corridor will have an outflow capacity of up to 20 million tons of grain and will supply the European market and the Asian market, which is currently the largest importer of grain in the world. AMAGGI energy finished the construction of two new small hydroelectric plants, already in operation. With five operational plants, the company has consolidated its strategy and started to fully generate cash flow, increasing its installed capacity from 23MW to 70 MW.
>>>>>>>> The agribusiness sector is mindful of opportunities arising from the growing demand for food.
65
66
Management and results In this section ECONOMIC AND FINANCIAL PERFORMANCE ENVIRONMENTAL PERFORMANCE SOCIAL PERFORMANCE SUPPLY CHAIN MANAGEMENT AWARDS AND RECOGNITION
AMAGGI
Sustainability Report 2013
67
To consolidate its position as one of the world’s largest players in agribusiness, AMAGGI monitors indicators and annually reviews its management processes for continuous improvement.
US$5 BILLION IN REVENUE.
R$12.5 MILLION IN INVESTMENTS AND EXPENSES FOR ENVIRONMENTAL PROTECTION.
INVESTMENT IN PEOPLE AND THE SUPPLY CHAIN TO ENSURE THE COMPANY’S CONTINUITY.
68
To enable its growth strategy with sustainability and according to institutional values, in addition to a strong and responsible governance structure, it is necessary to rely on efficient management and a system that ensures the protection and integrity of information.
AMAGGI
Management and results
AMAGGI closed 2013 with positive results; with revenue of US$5 billion, the company proceeded with its growth strategy. The commodities market requires cost-efficient management, since margins in this sector are small and tend to decrease. For this reason, in 2013 the company launched the Excellence Project, which combines internal initiatives in cost management and gains in efficiency for logistics and procurement processes. Another aspect deemed important by the company is financial management. To enable its growth plan, the company needs to invest in fixed assets (port terminals, barges, pushers, warehouses) with appropriate credit lines. It is also necessary to have working capital for the origination of grain, considering that the medium-term goal is to double the volume originated. New financial partners are essential in this context, partners who feel comfortable with the way the company conducts its economic, social, and environmental management. To enable its growth strategy with sustainability and according to institutional values, in addition to a strong and responsible governance structure, it is necessary to rely on efficient management and a system that ensures the protection and integrity of information. To consolidate its position as one of the worldâ&#x20AC;&#x2122;s largest players in agribusiness, AMAGGI monitors indicators and annually reviews its management processes for continuous improvement.
Investments in Information Technology
To keep up with the growing demand for quality, agility, and security, AMAGGI invests in people, equipment, and systems to support its activities. The Information Technology Department has nearly 50 professionals who work in the infrastructure, support, and development of software and systems. In 2013, the area was deeply involved in the implementation of new units and the maintenance of existing ones, as well as the creation and management of tools for improvement and standardization of processes, both in Brazil and abroad. In 2014, we expect an even bigger investment to support the companyâ&#x20AC;&#x2122;s sustainable expansion actions.
Sustainability Report 2013
69
EXCELLENCE PROJECT Since 2012, AMAGGI has been analyzing internal processes for the management of costs and for the logistics and supply chain. In order to implement its business and sustainability strategies in 2013, the company, with the support of an external consulting company, implemented two projects: the Matrix Management of Expenses (GMD in the Brazilian acronym) and the Organizational and Process Restructuring (ROP in the Brazilian acronym). Through the GMD, the company grouped accounts and created package managers. After a threemonth training, managers identified opportunities for improvement and established indicators and goals for each group of accounts. The 2014 budget had the help of these managers, based on the opportunities identified in the previous year. The establishment of goals to use and manage energy, water, paper, and solid waste is in line with the companyâ&#x20AC;&#x2122;s Environmental Policy. They are the result of the continuous monitoring of the use of natural resources in line with the opportunities for improvement identified by the Excellence Project, with reduction goals for the headquarters in 2014 and, later, for the branches. For the ROP, supply and logistics chains were defined as a priority. Based on the analysis of AMAGGIâ&#x20AC;&#x2122;s strategy for the coming years and the gaps identified in the processes, a new design was conceived. To this end, we created an action plan to be implemented in the first half of 2014. The goal of the project is to gain efficiency and align processes with the companyâ&#x20AC;&#x2122;s sustainability principles.
70
AMAGGI
MANAGEMENT AND RESULTS
Economic and financial performance AMAGGIâ&#x20AC;&#x2122;s executive board annually defines budgets and performance goals and reviews them monthly in specific meetings for the purpose. The areas of accounting, tax planning, and risk control prepare financial statement tables, develop and monitor budgets, and track exposure to market variables. There are goals related to those assignments in the variable remuneration plan of these areas. The CEO is globally responsible for the determination and supervision of the companyâ&#x20AC;&#x2122;s results and for the risk management structure. The company maintains a risk management department, which reports regularly and directly to the CEO.
Sustainability Report 2013
The policies that define limits of exposure to the risk of commodity prices and exchange rates are continuously monitored by AMAGGIâ&#x20AC;&#x2122;s risk department. These values are reviewed by the CEO in order to reflect eventual changes in market conditions and in the operations developed by the company.
71
72
AMAGGI
Results
Throughout 2013, AMAGGI reached the goal established to increase sales volumes in all its business areas. In this period, AMAGGI Commodities shipped 9 million tons of grain, between corn and soybeans, while AMAGGI Agro closed the year with production volumes close to one million tons. Also in 2013, AMAGGI Navigation transported 2.8 million tons and AMAGGI Energy began operating with installed capacity of 70 MW.
“Our flagship is still soy, but in 2013 corn had an important contribution to the results, which was unprecedented in the company’s history.” Dante Pozzi, AdministrativeFinance Director
For AMAGGI Commodities, 2013 came with great challenges, especially in terms of logistical issues associated with the increase of inland freight costs and the payment of demurrage, which had a negative impact on the operating income for AMAGGI Commodities. Nevertheless, these effects were offset throughout the year with the results obtained in corn origination and trading. Abroad, AMAGGI Commodities reached record results in its operations in Argentina, the Netherlands, and Norway (with the acquisition of 100% interest in DENOFA), in addition to the beginning of operations in Switzerland, also with positive results. It is important to note that the combined operations of AMAGGI Commodities abroad already amount to 4.7 million tons of grain, with 50% of these volumes originating within AMAGGI. AMAGGI Agro achieved its production goals, especially due to a larger corn harvest in 2013. The decreased result when compared with the previous year is mainly a reflection of the reduction in soybean prices when compared with 2012. AMAGGI Navigation reached new records in transported volume in 2013 as a result of improvements in the logistics for the receiving of products at the Porto Velho (RO) Port, of the river barge fleet, and of the ships in Itacoatiara (AM). Finally, AMAGGI Energy, now with five plants in operation, will start operating with a total installed capacity of approximately 70MW in 2014. The 2013 results for the area partly reflect this expansion with the completion of the Ilha Comprida and Segredo SHEPs in the first half of the year.
See the online version to learn more about: -Breakdown of Value Added Distribution in 2012 and 2013.
G4-EC1
Sustainability Report 2013
73
to increase by 10% the volume of grain originated in Brazil
Goals for 2013
to build new warehouses to support the export corridors of the Tapajós River and Itaqui Port in Maranhão (the warehouses will be finished in 2014) to advance in the construction of the Bulk Terminal of Itaqui (MA), in a joint venture with Louis Dreyfus Commodities to begin the operation of the new Ilha Comprida and Segredo SHEPs in Sapezal (MT) to begin investments in navigation in the Tapajós (PA) corridor to begin AMAGGI operations in Switzerland to develop internal projects for cost management and gains in efficiency in the logistics and procurement processes
Growth above 20% in the volume of grain originated in Brazil
Goals for 2014
Advances in the construction of the new Porto Velho (RO) Port Increase in the fleet in the MadeiraAmazonas corridor To begin navigation in the Tapajós-Amazonas corridor (PA) To build new warehouses to support the export corridors of the Tapajós River and Itaqui Port in Maranhão To begin AMAGGI operations in Paraguay
74
MANAGEMENT AND RESULTS
Environmental performance
AMAGGI
Sustainability Report 2013
In 2013, the environmental area restructured its processes, which enabled the improvement of collection and the analysis of indicators. In partnership with the agricultural GHG Protocol, the area took part in studies and conducted an analysis of its emission inventory to launch a Carbon Management Plan in 2014. The company advanced in the evaluation of ecosystemic services in partnership with the PESE Platform from Fundação Getúlio Vargas and Cambridge University Natural Capital Leadership. The area also advanced in the work with the production chain, certifying 54 rural producers pursuant to the criteria of the Round Table on Responsible Soy (RTRS).
75
90,000 + HECTARES OF PRESERVED AREA
76
Basic guidelines
> To meet applicable legal
requirements and other requirements subscribed to by the organization in terms of its environmental aspects
> To improve processes, seeking
to prevent pollution, manage greenhouse gas emissions, and continuously improve environmental performance
> To apply best techniques and
procedures for the effective mitigation of environmental accidents
> To provide training to all
employees who work on behalf of AMAGGI
> To encourage and guide our
commercial partners in the improvement of their social and environmental performance
AMAGGI
Environmental policy and management AMAGGI’s Environmental Policy is defined by the CEO and by the Executive Board, based on the company’s mission and values and its business strategy. In order to remain up-to-date with these principles and with variations in the market, the policy is reviewed annually. In 2013, management of greenhouse gas emissions was included in the basic guidelines, given the fact that this has proven to be a relevant topic for the business, for the renewal of certifications, for meeting the demands of the foreign market, and for the benefit of society at large. The policy reaffirms AMAGGI’s commitment to preserving the environment, promoting solid waste management and the continuous monitoring of environmental performance, and established environmental objectives and goals. To this end, the company grounds its operations in the prevention of environmental damages and seeks continuous improvement of its processes. Environmental management is based on the Environmental Policy. The Environmental Management System, certified since 2007, was developed based on ISO 140001 and applies to all business areas. In addition to the management of legal issues, the system enables the management of units, better use of natural resources, and better performance, not only from an environmental standpoint but also from an economic and social standpoint. The environmental area, under coordination of the Sustainability Department, was restructured in 2013. The units’ environmental analysts, who were allocated to the units and who previously reported to the corporate area, now report to the manager of each unit under the supervision of the corporate environmental team, providing greater autonomy to tackle peculiarities. At the headquarters, specialists divided by themes (licenses, management system, external partnerships, and corporate affairs) monitor and guide the units. These changes enabled improvements of processes and in the analysis of indicators.
Sustainability Report 2013
Compliance and investments
77
R$ 12.5
MILLION IN ENVIRONMENTAL INVESTMENTS
G4-EN29, EN31, G4-EN31 and EN33
One of the processes of the Environmental Management System (SGA in the Brazilian acronym) which are conducted annually is the Legal Compliance Evaluation, which evaluates the compliance of each environmental aspect of the activities developed by the company. Likewise, when a new activity is implemented, the environmental aspects and the associated impacts are identified, along with the applicable environmental legislation. When inconsistencies are identified, a nonconformity is registered internally to be duly addressed, and the actions necessary for its correction are defined. In addition to internal processes, the social and environmental compliance of environmentally critical suppliers is evaluated by checking applicable licenses, the existence or non-existence of embargoes at IBAMA (Brazilian Institute for the Environment and Natural Resources), and the presence or lack thereof of the company in the Ministry of Labor and Employmentâ&#x20AC;&#x2122;s black list for bonded labor. The evaluation results in a report containing the information collected in the consultations, including risk analysis, when applicable. If some of the items evaluated prove to be nonconforming, the contract is not executed until the irregularity is solved. The company was not assessed significant fines or non-monetary sanctions in 2013. Also, there were no lawsuits by arbitration mechanisms against the company. We continued with the actions to comply with the Termo de Ajustamento de Conduta - TAC (an agreement between a private company and the Public Attorneyâ&#x20AC;&#x2122;s Office to committing to act pursuant to the law) that aim to recover degraded Permanent Protected Areas, in compliance with one of the phases of the MT Legal Program, to which AMAGGI voluntarily adhered. Every year the company makes environmentally-related investments to maintain a continuous improvement structure of its processes and mitigate impacts. Investments are focused on the maintenance of the Environmental Management System, on improvements in our operating units, and on research and development. In 2013, these investments totaled R$12,472,667.52.
Legal Compliance STRICT EVALUATION THROUGH the Environmental Management System
78
AMAGGI
In the operating units, there were many improvements last year that were in line with the guidelines established in the Environmental Policy, both in operating units and in new projects, such as the structure to build deposits for waste and the purchase of equipment for wastewater treatment. Another highlight in 2013 was the increased investment in research and development through partnerships with the UN (Global Compact and Sustainable Agriculture Principles), The Nature Conservancy (TNC), Aliança da Terra (social and environmental actions in the soybean supply chain), Cambridge University, and GVces (ecosystemic services and environmental valuation).
See the online version to learn more about: -details on investments and expenditures in environmental protection, by type. -extension of the mitigation of environmental impacts of products and services.
HERE I CREATE MY HISTORY “To become an AMAGGI employee was undoubtedly a great achievement because the company has a considerable differential when it comes to respecting the environment and valuing its employees, as well as commitment and seriousness. Before joining the team, I considered myself a citizen with “sustainable” attitudes, but when I learned more about the company’s dynamic and projects, I realized my contribution to the environment was next to none. AMAGGI greatly influenced my habits, especially in terms of concern about sorting different types of waste, among other attitudes. I take these new habits to my home, my friends, and everywhere I see the need. Great results are a consequence of great efforts, and they must come from everyone.”
CAMILA ROCHA HAS WORKED AS AN ADMINISTRATIVE ASSISTANT IN THE HEADQUARTERS IN CUIABÁ (MT) FOR SIX MONTHS
Sustainability Report 2013
79
INVESTMENTS IN SEARCH OF SELF-SUFFICIENCY IN BIOMASS Aimed at achieving self-sufficiency in the biomass used for grain drying (warehouses) and steam production (crushers) processes, AMAGGI invests in reforestation with exotic species on its own properties. Today the company has farms with eucalyptus in different phases of development. In 2012, for example, the company acquired Santo André Farm, with 3,200 hectares in Sorriso (MT), as part of a plan to achieve self-sufficiency for the Lucas do Rio Verde plant. In Itacoatiara, there is an ongoing experiment called “Evaluation of phosphate fertilization and spacing on experimental planting of two forest species (Eucalyptus urograndis and Sclerolobium paniculatum) for the production of energy in Central Amazon,” which has been ongoing for five and a half years and is currently in the data collection phase. In 2014, we expect the first results about the two species evaluated, considering variables such as the equation for volume, the equation for biomass, the density, and the evaluation of phosphate fertilization and spacing. The experiment is being conducted by AMAGGI and will be evaluated by Embrapa Amazônia Ocidental.
80
AMAGGI
AMAGGI has over Biodiversity 90,000 hectares of G4-EN13 area preserved as legal order to contribute to the conservation of biodiversity, we developed programs reserves and permanent In to monitor wildlife and flora in the areas surrounding the companyâ&#x20AC;&#x2122;s large projpreservation areas. ects, both those under implementation and operational. Of this total, 19,000 ha are located within state parks and 71,000 are preserved in the companyâ&#x20AC;&#x2122;s farms.
AMAGGI also has 90,357.40 ha of area preserved as legal reserves and permanent preservation areas. Of this total, 18,980.59 ha are located within state parks (intended for compensation or exemption of legal reserve), and 71,376.81 ha are preserved in the companyâ&#x20AC;&#x2122;s farms. The percentage of legal reserve calculated to comply with the legislation may vary between 20% and 35% when the area is located in the cerrado region, and between 50% and 80% when it is located in forests. This variation may occur according to the year and the size of the area of the property that is cleared. When two types of areas are found within a single property, calculations are made individually. Results of the recovery measures are evaluated by internal experts and checked in inspections and surveys from environmental licensing agencies. In areas where plant cover is non-compliant with the parameters required by legislation, Recovery Plans Degraded Areas (PRAD in the Brazilian acronym) are implemented. The company purchased nearly 14,400 seedlings of native species to recover these areas and produced more than 47,000 kg of seeds in its own nurseries. AMAGGI also invests in its own eucalyptus and acacia reforestation areas to supply its biomass demand to discourage the clearing of new areas. When acquiring biomass, the company prefers, whenever possible, to use firewood from the reforestation of exotic species, such as eucalyptus, to avoid a greater impact on biodiversity. In factories we use sawmill waste from wood processing, thus promoting the sustainable destination of waste and avoiding the exploration of new areas.
Sustainability Report 2013
>>>>>>>> AMAGGI invests in its own eucalyptus and acacia reforestation areas to supply for its biomass demand to discourage the clearing of new areas.
81
82
AMAGGI
SIGNIFICANT IMPACTS ON BIODIVERSITY G4-EN12
The construction of AMAGGI’s small hydroelectric plants started in 2008 with the opening of access roads and the consequent degradation of areas, as planned in the licensed project. In 2013, AMAGGI Energy carried out several recovery activities for degraded areas in approximately 58 hectares of construction sites, access ways, and deposits of gravel and clay, in addition to monitoring wildlife in the Ilha Comprida and Segredo SHEPs. In the areas of SHEPs, some endangered species were detected in our wildlife monitoring.
More than 76,000 m3 of water saved through water recycling or reuse initiatives. 5,600 GJ of energy saved through energy efficiency initiatives.
The impacts identified are reversible, comprising the area surrounding our projects and their corresponding reservoirs. Reconfiguration of these areas, the object of the PRAD, will fully reestablish the area to the conditions prior to the impacts. In 2013, AMAGGI Commodities acquired four plots of land of approximately 10 hectares each for the implementation of storage units. The areas had already been cleared, causing no impact on local biodiversity. In turn, when we built AMAGGI’s Private Port Terminal in Porto Velho, Rondônia, we had to suppress 27.80 ha of vegetation. In order to obtain authorization for this suppression, the company prepared a forest inventory in partnership with a specialized consulting company. The inventory considered impacts that were irreversible and had possible compensation, a process previously carried out in the project’s licensing process. A dam, located in the same area, was drained and had its ichthyofauna recovered to prevent environmental accidents involving fish. Seven species of fish were collected: cará (Aequidens tetramerus), lambari (Acinocheirodon melanogramma), joaninha (Crenicichla spp), peixe cobra/muçum (Synbranchus marmoratus), traíra (Hoplias brasiliensis), curimba (Prochilodus lineatus), and tambaqui (Colossoma macropomum). AMAGGI Agro acquired new properties in 2013, totaling 81,5039 ha of Degraded Permanent Preservation Areas (APPD in the Brazilian acronym), which are not the object of recent deforestation. In 2014, we are going to start the Recovery Plan for Degraded Areas in order to recover the environmental liability and restore local biodiversity. Impacts related to APPDs involve depletion of the soil due to removal of the local plant cover and possible silting of waterways. The local impacts described are reversible after the recovery of these areas with the use of native species. The projects are devised in compliance with the guidelines established by competent environmental agencies. See the online version to learn more about: -location and area of AMAGGI’s properties -endangered species identified -wastewater and waste management
G4-EN11, G4-EN23
Sustainability Report 2013
83
WATER AND ENERGY At AMAGGI’s plant operations, water is used in the production process for the generation of steam to extract degummed oil. As for other units, water use is restricted to cleaning activities and human consumption. Considering that industries account for 72% of the total water used, we consider the monitoring of these operating units a priority. In terms of energy, AMAGGI develops its own generation projects and invests in energy efficiency in order to identify both new opportunities to save that resource and to reduce carbon emissions. In the materiality process carried out in 2013, water and energy resources were not identified as material. Thus, the indicators referring to their use are presented only in the GRI Table of Contents on page 124.
ENVIRONMENTAL RESEARCH WITH IPAM AMAGGI maintains a partnership with the Environmental Research Institute of the Amazon (IPAM - Instituto de Pesquisa Ambiental da Amazônia) at the Tanguro Farm, one of its main production units, in Querência (MT). Researchers are monitoring water quality in local streams and collecting information about animals in order to gather knowledge to guide governmental agencies in the definition of public policies that preserve the forest and its biodiversity. Research also aims to generate information for rural producers and help guide forest recovery actions. In 2013, we continued the execution of the Savanização Project, which evaluates the vulnerability of tropical forests to climate change and modification in the use of land. That same year, IPAM requested authorization to slash and burn the Legal Reserve Area in order to conduct a study in the area. Results are still under analysis. Experimental slash and burn was carried out with the purpose of quantifying the relationships between microclimate, amount of combustible material (leaves and branches), and fire behavior. Preliminary results show that low-intensity fire has an immediate effect on the plant cover, with a 20% reduction in the leaf area index. Web link <www.ipam.org.br>.
84
AMAGGI
CLIMATE CHANGE G4-EC2
Climate change is an increasingly relevant topic at AMAGGI, considering the impact on its operations. According to EMBRAPA’s evaluation, “Agriculture is highly dependent on climate factors, such as temperature, rainfall, soil humidity, and solar radiation. Climate change may affect agricultural production in many ways: through the change in climate factors, including frequency and severity of extreme events, the increase in production due to the fertilizing effect through greater concentration of CO2 in the atmosphere, changes in harvest intensity due to changes in the number of degrees-day for growth, or by modifying the occurrence and severity of pests and disease, among other effects.” In agricultural production of soybeans, corn, and cotton, the acknowledgement of risks resulting from climate change leads the company to increasingly invest more in knowledge (research, information systems) and adaptation of production (seeds and pest control, among others) to tackle challenges and turn them into opportunities. This preparation reduces losses and ensures better productivity. Reduction of productivity has a direct impact on the sales volume planned by the company, causing impacts on economic results. Since the company operates with commodities, the result of other countries’ crops may also represent a risk or an opportunity. When another country has a record harvest, product supply increases and the price for the product may be smaller than expected, reducing gains planned by the company. Similarly, a bad harvest in another country can represent an opportunity for the product to reach higher prices or enter new markets, such as the case in 2002 with the corn harvest in the U.S., which caused the country, traditionally the largest corn producer in the world, to import it from Brazil. Changes in the rainfall regime also have a major impact on river operations and the generation of energy, considering the impact on river volumes, essential for the small hydroelectric plants (SHEPs) and for river transportation. An extended drought requires more convoy voyages, since it is not possible to load the barges to full capacity, and it also requires more attention to river drought. In turn, with floods and excessive increases of river levels, there is a risk of falling tree trunks, which are dragged to the river bottom and may cause damage to vessels. As for the storage of grain, when room temperature increases, it is necessary to turn on warehouse fans to keep the crushed soybeans from “burning,” which increases spending for electricity.
AMAGGI participates in the development of the GHG Agriculture Protocol to expand its current tool, considering the most significant emissions associated with the agribusiness.
Sustainability Report 2013
>>>>>>>> Risk management becomes a competitive advantage when the company operates efficiently, even in face of climate adversities.
85
86
AMAGGI
AMAGGI’s operations in terms of climate conditions can be observed in the management of natural resources in production processes and the evaluation of atmospheric emissions. In industrial plants, periods of intense rainfall increase consumption of biomass (firewood and wood chips) and electricity. In times of drought, we have the risk of hot spots and outbreaks of fire in the biomass. The greatest risks are associated with our core activity. Therefore, the company invests in new technologies and knowledge about the topic in order to mitigate impacts. Risk management becomes a competitive advantage when the company operates efficiently, even in face of climate adversities. In regulatory terms, AMAGGI identified opportunities, such as the case with the European Union Renewable Energy Directive, which determines the maximum level of greenhouse gas emissions from the field to end users. Since the company has been adopting best agricultural practices in its farms and supply chain for more than 10 years, it quickly obtained the ISCC certification, which meets the European directive and, consequently, the European market demand. AMAGGI was one of the first Brazilian companies to obtain this certification. It is not possible to measure the amount invested in mitigation of climate impacts, considering that the topic is associated with the company’s activities in a process of continuous improvement.
AMAGGI’s operations in terms of climate conditions can be observed in the management of natural resources in production processes and the evaluation of atmospheric emissions.
See the online version to learn more about: The company’s emissions in the online report
HERE I CREATE MY HISTORY “When I was called for the job interview, I couldn’t sleep waiting for the day to come. I was very anxious because I was unemployed and had been left with three children to take care of by myself. I needed the job, and God gave me a little hand. Once employed, I worked with love and dedication until destiny played a trick on me: I underwent surgery to remove my saphenous vein and was no longer able to perform my kitchen and cleaning activities. I was on leave for a long time. I wasn’t fully rehabilitated until 2012, when AMAGGI not only took me back but also promoted me to the administrative area. What can I say about this company? It is true to its mission, vision, and values... it offers many opportunities to employees who fly the company’s flag and are committed to their work. I am proud to be part of this team; it is an honor for me to be able to share my story. Quoting one of the founders, Lúcia Borges Maggi: “From here, I only move forward. Never backward!”
RAQUEL SILVA HAS BEEN WORKING AT AMAGGI FOR 10 YEARS AS AN ADMINISTRATIVE ASSISTANT IN ITACOATIARA (AM)
Sustainability Report 2013
Green House Gas (GHG) emissions AMAGGI participates in discussion forums about green house gas emissions, identified by scientists as the main cause of climate change. Among the forums, the Agriculture GHG Protocol initiative stands out, in partnership with the World Resources Institute (WRI) and the GetĂşlio Vargas Foundation Center for Sustainability Studies (GVCes in the Brazilian acronym). The purpose is to expand the current GHG Protocol tool, taking into consideration the most significant emissions associated with agribusiness. The idea is to launch a new tool by February 2014 to allow companies in the agribusiness sector to enter their data on emissions, which in the past was impossible given the lack of methodology to convert emission factors. The company also obtained two certifications that deal with the inventory of emissions: the Round Table on Responsible Soy Association (RTRS REDD) and the International Sustainability Carbon Certification (ISCC). RTRS promotes discussions among parties about the development of production, processing, and marketing of more sustainable soy. The ISCC certification is more focused on GHG emissions of the product chain of custody, aligned with international directives that set goals or boundaries for emissions of GHG (learn more in the Certifications section). In 2013, AMAGGI prepared its third inventory of green house gases (GHG) in order to identify sources of emissions arising from its activities. This is an essential procedure to establish a baseline for the development of the Strategic Carbon Management Program, planned for 2014. In order to prepare a new inventory, we commissioned a specialized consulting company, Pangea Capital, which analyzed the results of the previous year and proposed improvements in the management of emissions to increase transparency and credibility of the results disclosed. The new inventory incorporated modifications in the scope and methodology to calculate GHG emissions, including emission factors that are more appropriate for the local reality. Furthermore, new sources of emissions associated with agricultural activities were included.
See the online version to learn more about: - AMAGGIâ&#x20AC;&#x2122;s direct and indirect emissions
87
G4-EN15, G4-EN16, G4-EN17, G4-EN18, G4-EN21
88
AMAGGI
MANAGEMENT AND RESULTS
Social performance
People management is one of AMAGGIâ&#x20AC;&#x2122;s main focuses. With a successful history, the small family company, which became an internationally recognized company with operations abroad, foresees a significant expansion of future business and invests in people to ensure its continuity.
Sustainability Report 2013
Our People Management Policy is based on respect for human beings and diversity, transparency of its actions, and personal and professional development of its employees.
89
90
AMAGGI
“Our challenge is no longer to be in compliance with the country’s complex legislation, because that is strictly what we do. Looking ahead, I see that our main challenge is to attract, develop, and retain qualified people who cultivate our values, essence, and culture. These people will implement the strategic business planning to ensure the company’s growth in an increasingly competitive scenario.”
DEVELOPMENT AND EDUCATION The growth strategy based on people development is materialized through the Aroeira Project. The initiative consists of, among many actions, preparing leadership and identifying potential talents to execute the growth strategy, seeking to ensure the continuity of the business and organizational values. The Personnel Department manages actions and impacts of training and education, based on the Human Resources Policy and through human and organizational development programs. Each area defines its action plan based on its own organizational strategy and business plan, as well as on the employees’ developmental needs, which are identified through competencies. The action plan, defined until 2020 to attract, develop, and retain employees, is called Strategy Decoding. The People Committee regularly assesses the work in a continuous improvement process. In 2014, the challenge is to apply a new survey on engagement, culture, and values. In 2013, the following development and education programs stood out.
Nereu Bavaresco, Human Resources Director
AMAGGI Corporate Education FORMAL EDUCATION Education allowance
PROFESSIONAL ADM/ TECH/OPERATIONAL Improvement trails
SCHOOL OF LEADERS PDD – Executive Board
GENERATION OF HUMAN CAPITAL
Young Talent
PDG – Manager Language courses
Internships PDS – Supervisor
External courses
PDC – Coordinator
Apprentices
Sustainability Report 2013
91
Education Allowance Program The purpose is to invest in academic training for employees. In 2013, a total of 192 people benefitted from the program, which finances up to 50% of the expenses for enrollment and tuition in technical and professional training courses, as well as graduate and post-graduate degrees. The investment totaled R$264,000 that year. Between 2012 and 2013, eighty percent of employees who participated in the program received recognition through promotion or merit. In 2014, the organization will focus on language courses, given the company’s internationalization.
The Education Allowance Program helped 192 people in 2013. Investments totaled R$264,700.
Professional Qualification – Improvement Trails Project designed according to the mapping of careers and needs identified in the medium- and long-term strategy. It includes technical and behavioral qualifications customized for each business area, aimed at the improvement of administrative, technical, and operational performance of employees. In 2013, the positions included in the program were mainly: buyers, field coordinators, sales representatives of chemical products, and unit supervisors.
School of Leaders – Management & Action In order to prepare leaders, one of the main objectives of the Aroeira Project, we created a School of Leaders in 2013, with competency development projects for supervisors, coordinators, managers, and directors. Since 2011, the entire Executive Board (12 directors) have been undergoing assessment and coaching processes, in addition to courses. In 2013, a total of 75 managers completed the third module and 116 supervisors completed the first module. All 203 leaders are in the process of the individual development plan.
AVERAGE NUMBER OF TRAINING HOURS PER YEAR
Employee Category / gender
G4-LA9
Organizational Competencies
OHS
Environment
2011
2012
2013
2011
2012
2013
2011
2012
2013
Managers
7.93
19.94
15.04
15.65
14.49
12.47
1.56
3.01
4.54
Administration
5.21
7.88
7.22
15.65
4.97
6.89
1.56
3.55
6.98
Technical
4.67
7.93
4.44
15.65
11.46
27.89
1.98
8.50
4.87
-
-
31.49
-
-
6.26
-
-
5.68
Operational
4.49
4.23
4.11
15.65
18.27
23.81
1.53
2.61
3.69
Contractors*
0.00
0.00
0.63
3.46
6.01
2.19
1.56
1.11
0.40
TOTAL
4.96
6.75
3.25
7.80
11.93
10.35
1.56
3.00
2.39
Young Talents
Note: It was not possible to generate the number of employees trained by gender, since the records were prepared based on Version 3 of the GRI guidelines. Adjustments will be carried out for 2014.
92
AMAGGI
Young Talent Program The program’s objective is to identify and develop young people to assume management positions or specific technical positions. It is a two-year program and includes development actions in knowledge areas aligned with the participants’ field of work, with AMAGGI’s business needs, and future challenges. In 2013, the company had 28 youths in the program, one who was hired, and 13 who are expected to be hired in 2014.
Young Apprentice Program AMAGGI supports the entry of young people into the labor market through partnerships with schools and companies as a way to encourage the development of creativity, commitment, and teamwork. In 2013, the company had 59 young apprentices in the program and 16 were hired.
Internship Program Enables employer and students to exchange knowledge, which allows for the sharing of technological, scientific, and cultural advances between educational institutions and the company. In 2013, a total of 10 interns who started work last year were hired and 5 new interns entered the program. G4-LA10
Career Transition Planning Aims to prepare the employee in the last two years before retirement, both in psychological terms and in the creation of business plans to continue with other activities.
Outplacement Applied at the executive level, it is also available according to business requests and needs. The company helps the terminated employees, through a specialized consulting company, in their reentry into the labor market.
AVERAGE NUMBER OF TRAINING HOURS IN 2013 – ORGANIZATIONAL COMPETENCIES, OHS, AND ENVIRONMENT
Employees
Hours
Hours per Employee
411
13,172.6
32.05
833
17,566.6
21.08
Technical
119
44,26.7
37.19
Young Talents
22
955.6
43.43
Operational
2,564
81,033.2
31.60
Contractors*
4,227
13,592.2
3.21
TOTAL
8,176
130,746.9
16.0
Employee Category Managers Administration
Sustainability Report 2013
PERFORMANCE ASSESSMENT PROGRAM AMAGGI’s current Goals Program was defined in 2011, including all leadership and specific job positions, seeking to evaluate competencies, work methodology, and the results obtained in terms of our corporate values. Strategic objectives were turned into goals for the various management levels in practical and operational terms so they could become a collective task and allow for the company’s performance evaluation. Of the total number of AMAGGI’s employees, 487 employees (of which 439 are men and 48 are women) are involved in the performance assessment (learn more in the GRI indicators on page 124).
DIVERSITY In governance structure and in relationships with employees and other strategic stakeholders, the promotion of diversity is based on the Diversity Valuation Guideline, an integral part of the People Management Policy and formalized in the Code of Ethics and Conduct. In terms of physically challenged people, the company invests in campaigns to attract professionals and employee awareness campaigns. In 2013, to attract more professionals in all business areas, the company launched an advertising campaign on radio stations, television, websites, and in newspapers in the states of Mato Grosso, Rondônia, and Amazonas. AMAGGI simultaneously developed an internal campaign with managers, who received a primer to guide the process of PCDs. Employees also took part in a discussion conducted by the Social Responsibility Center based on informational material distributed to raise awareness and encourage employees to respect differences and keep the work environment free of prejudice and discrimination. The campaign is part of the project Eu cidadão: refletindo sobre os direitos e deveres da gente (I am a citizen: reflecting on people’s rights and duties). “Recognizing and valuing talents makes us stronger. However, to find those talents, we need to look beyond appearances and understand that physically challenged people may have some limitations, but here they have the same responsibilities and abilities of any other professional.” (Statement of AMAGGI’s CEO, Waldemir Ival Loto, in a message to managers).
See the online version to learn more about: -ratio of remuneration between men and women in the company
93
94
AMAGGI
Well-being and citizenship To support and contribute to the well-being of its employees and their families, AMAGGI develops activities focused on the six health areas recommended by the World Health Organization (WHO) – physical, social, emotional, professional, intellectual, and spiritual – in order to achieve a better balance between personal life and work. The program was launched in 2008 and comprises seven projects: Better Life for Couples (59 employees and 23 family members in 2013), Better Life for Children (109 children in 2013), Better Life for Women (pilot project with 22 employees’ wives in 2013), Open Doors (23 families in 2013), and Financial Balance (821 employees in 2013). Projects are carried out through lectures and workshops for employees, spouses, and their children. Since 2008, we have held the Environment Week, an annual event that includes discussions and lectures on the topic. AMAGGI expanded the scope of the event with the Weekly Sustainability Talks, using the company’s internal channels to publish weekly messages on social and environmental topics. The Annual Conference on Sustainability was held in 95% of the company’s units and involved 73% of the company’s employees. Topics like ethics and corruption are also addressed in the project I Am a Citizen: reflecting on people’s rights and duties. In 2013, campaigns on diversity and integrity were conducted in all company units.
See the online version to learn more about: -Work benefits offered to employees.
G4-SO4, G4-HR2
The Well-being and Citizenship Project benefits employees and addresses topics such as ethics, corruption, diversity, and integrity.
>>>>>>>>
Sustainability Report 2013
95
HEALTH AND SAFETY AT THE WORKPLACE AMAGGI consistently invests in OHS management in order to ensure health and physical integrity for its employees, contractors, and suppliers. In recent years, the company has improved its Management System to ensure compliance with the Occupational Health and Safety Policy. In 2011, the company carried out the first internal audit and developed the Safe Practices Guide, and in 2012, we distributed it to employees and contractors to inform them about occupational hazards and control measures to eliminate or minimize them. Also in 2012, the company presented, in partnership with a renowned company, a sample diagnosis on culture in the Health and Safety Management System. The survey was conducted with over 1,000 people through online questionnaires and visits to farms, plants, warehouses, and other company units. Results showed the main points for improvement in structural processes and OHS leaderships. In 2013, the print version of the Safe Practices Guide was turned into a video presented in all units. Since then, the material has been shown to every hire. Also in 2013, the company started the Behavioral Safety Program in three AMAGGI Agro farms: Água Quente, Itamarati, and Tucunaré. The purpose is to further reduce the number of accidents at work through nearly 80 actions conducted in 2013 and 2014.
Rates of injury, occupational diseases, lost days, absenteeism, and number of work-related fatalities G4-LA6 2011
2012
2013
Health and Safety Indicators
Employees
Contractors
Employees
Contractors
Employees
Contractors
Number of accidents**
234
32
196
37
160
14
24.58
-
15.93
-
13.19
0
-
0
-
0
Total number of lost days*
1,193
-
2,571
-
8,207
Total absenteeism
0.11%
-
0.20%
-
0,16%
2
0
0
1
2
Injury severity rate Rate of occupational diseases
Total number of fatalities in the period
*Lost days: this rate considers calendar days away from work, except the day of the accident and the return day. The system of norms applied to the recording and reporting accident statistics is the NBR 14280 – Registry of Accidents in the Workplace. ** In addition to typical accidents at work, the number includes accidents while commuting.
96
AMAGGI
Also in 2014, we intend to extend the program to the other farms and later expand activities to all AMAGGI units. The reduction of injury severity rates is mainly due to significant work to raise awareness among leaders and the adoption of the new tools provided by the OHS Management System. Since 2012, unlike previous years, in addition to lost days, the transported and debited days are included in the calculation, which explains the increase in the number of lost days. The increase in the total number of lost days in 2013 results from the fatality that occurred at AMAGGI Navigation in Porto Velho. In 2013, the 15% goal for the injury severity rate was exceeded. The goal remains the same for 2014.
See the online version to learn more about:
G4-LA1
-the guidelines of the Occupational Health and Safety Policy -risk prevention and control actions
HERE I CREATE MY HISTORY I was married for 15 years to the father of my three daughters and when we broke up, I had to look for my first job at the age of 35. Since I was studying for a degree in Environmental Management Technology, I managed to enter AMAGGI’s internship program after hounding everyone I knew who worked there. Today, I have finished my degree, and I’m beginning a second college degree helped by the company’s education allowance, and one of my daughters is in the Young Apprentice Program, also offered by the company. Thank you very much, AMAGGI!”
CLAUDEJANE BRAGADO WORKS AS A LAB TECHNICIAN IN SEED PRODUCTION IN SAPEZAL (MT); SHE HAS BEEN AT AMAGGI FOR TWO YEARS
Sustainability Report 2013
97
Representation in OHS committees AMAGGI has 100% of its employees represented in formal committees (CIPA, CIPATR, and CPATP). We also have an Occupational Health and Safety Committee formed by members of the Executive Board, responsible for making decisions on topics related to this area. We currently have 160 representatives in the formal committees (CIPA, CIPATR, and CPATP), and 593 employees to act in situations of environmental or occupational health and safety emergency (Emergency Brigade). In 2011, the OHS Committee joined AMAGGIâ&#x20AC;&#x2122;s Sustainability Committee to form the Sustainability and OHS Committee composed of the CEO and members of the Executive Board. There are also local OHS committees in each operating unit, totaling 211 members, appointed by local managers who help implement and maintain the OHS Management System, among other competencies. Occupational Health and Safety is a regular topic in the dialogue between AMAGGI and its employees, including in collective bargaining agreements. The company adopts the practice of including more items and information than required by law in agreements with trade unions.
See the online version to learn more about: -employee turnover indicators - return rates after maternity / paternity leaves
G4-LA5
98
AMAGGI
MANAGEMENT AND RESULTS
Supply chain management G4-EN32, G4-EN33, G4-HR10, G4-HR11, G4-LA14, G4-LA15, G4-SO9 and G4-SO10
The company’s Procurement area follows rules and procedures approved by the Executive Board. The purchasing policy prioritizes local and regional suppliers to contribute to the development of the regions where AMAGGI operates. In 2013, a total of 2,060 new suppliers were hired. All of them were assessed based on environmental criteria, human rights, labor practices, and impacts on communities. In terms of current suppliers, only one– a supplier of mineral products – among the 1,177 that already had commercial relationships with the company was not qualified, and improvement measures were established.
Sustainability Report 2013
All contracts prepared by AMAGGI contain specific human rights clauses in order to prevent exploitation of child labor, degrading or bonded labor in its production chain, and benefits from or support for such practices. Furthermore, suppliers are required to preserve the environment, pursue sustainable development, and minimize adverse environmental effects that might result from their activities. Contracts also include clauses regarding labor and social security obligations, as well as employee safety and health assurance with the use of individual and collective protective equipment, employee training, and awareness on these topics.
99
G4-HR5, G4-HR6
100
AMAGGI
AMAGGI has a system to block all suppliers that are on the blacklist of bonded labor, thus avoiding any type of business relations with such suppliers and ensuring compliance with the institutional commitment of the Pact for the Eradication of Bonded Labor, which the company embraces. All contracts presenting environmental, property or personal, financial, or labor damages risks follow specific procedures to minimize those risks. In these cases, legal and environmental documents are required and records of pertinent regulatory agencies are consulted. These topics are set forth in the contracts and, in cases of noncompliance, adjustments are required to formalize supply. If irregularities are identified during the term of the agreement, it may be terminated.
G4-EC9
RATIO OF EXPENSES FOR LOCAL SUPPLIERS IN IMPORTANT OPERATING UNITS
96% 2011
87%
Purchasing practices are constantly reviewed by the corporate team and, if necessary, measures are taken to improve processes. In 2013, Procurement started reviewing and restructuring its processes with the help of a consulting company, within the Excellence Project - ROP, in addition to other improvements that were identified by the area and have been implemented since 2010 (learn more on page 102). For the company, work with the supply chain is strategic. As a result, in the mapping of audiences for the Engagement Plan developed in 2013, three among the five priority groups were part of the supply chain: rural producers, environmentally critical suppliers, and truckers. The company already develops projects with these audiences and the two-way communication will be enhanced with the action plan created for the coming years aiming to provide AMAGGI with a responsible supply chain that shares the companyâ&#x20AC;&#x2122;s principles and values.
LOCAL PURCHASES 2012
85.37% 2013 Note: The company considers local purchases those occurring within the state where the company branches are located, and all units are considered in the calculation. The percentages above include, in addition to local purchases of materials and supplies, the contributions for strengthening local agriculture.
The company prefers to procure supplies in the region where its units are located. When local suppliers cannot meet the demand or do not comply with the requirements established by AMAGGI, other suppliers are sought. The result of this guided process can be seen, for example, in the purchase of grain from third parties, who in 2013 accounted for 30% of the amounts paid in the state of Mato Grosso alone, and 14% in the other regions where the company operates. The chart on the left shows how this policy has been carried out in recent years.
Sustainability Report 2013
Rural producers, strategic partners. AMAGGI works with approximately 3,600 rural producers who supply grain for sale, and many of them receive support from the company in the form of inputs and credit. These are strategic players and are essential to the growth of the business; therefore, it is critical for them to be in line with our corporate values and commitments. Our challenge is to mobilize and engage all agents in the supply chain. Soybean supply AMAGGIâ&#x20AC;&#x2122;s supply chain qualification program promotes responsible agricultural production by encouraging producers to apply best agricultural and sustainability practices to crop management. Our strategic goal is to interact with rural producers, whose production is sold by the company, and stimulate gradual improvement in legal compliance and in social and environmental performance standards. Strategic guidelines Prohibition of degrading work Prohibition of child labor Commitment not to interfere with Indigenous areas Commitment not to interfere with preservation areas Commitment not to produce in areas under embargo (IBAMA) Commitment not to produce in areas cleared after July 2006 in the Amazon biome (Soy Moratorium)
101
Rural producers are strategic players and are essential to the growth of the business; therefore, it is critical for them to be in line with our corporate values and commitments.
102
In 2013, a total of 831 properties were assessed based on social and environmental aspects, including records kept in registration forms, visit forms, and suggestions for improvement.
AMAGGI
Social and Environmental Registry The company carries out the social and environmental registration of producers in the category of Future Purchase, which foresees detailed monitoring of the social and environmental conditions of the farms, including aspects such as water and soil conservation, social management and work safety, conditions of operational and maintenance areas, environmental protection areas, handling of agrochemicals, waste destination, legal compliance, and management and continuous improvement. In 2013, the environmental department updated the registry, including new indicators to improve analyses. Altogether, 831 properties were monitored throughout the year, including registration forms, visit forms, and suggestions for improvement based on the aspects listed. The social and environmental visit is an in loco survey to check the conditions of rural properties and the social and environmental practices, including occupational health and safety aspects. The Sustainability team participates in the credit approval strategy and has power to veto deals. Their decisions are based on the registration and visit information, as well as on the analysis of reports and property documents. In order to facilitate monitoring of the areas, a collection of up-to-date satellite images of over 320 municipalities covering soy-producing regions or regions in agricultural expansion is available. To ensure that no trading occurs with areas under embargo, the public list issued by IBAMA is entered in AMAGGIâ&#x20AC;&#x2122;s control system, which automatically blocks these areas. The system also blocks areas listed in the Soy Moratorium and the bonded labor blacklist, thus avoiding any type of business with these areas. AMAGGI also carries out, with certain producers, a social and environmental diagnosis based on data gathered in the annual assessments, allowing for the evaluation of this aspect in the supply chain through the monitoring of a series of environmental indicators.
Sustainability Report 2013
103
>>>>>>>> Our challenge is to mobilize and engage all agents in the supply chain.
AMAGGI CERTIFIES 54 RURAL PRODUCERS THROUGH THE RTRS. In 2012, a partnership was established between the André and Lúcia Maggi Foundation and the NGOs Aliança da Terra and Solidaridad to conduct the social and environmental registration and certification through the Round Table on Responsible Soy (RTRS) of 40 properties located in the Mid-north and Parecis regions in Mato Grosso. In 2013, a total of 54 rural producers were certified, totaling 373,000 tons of soy. The first steps were visits to the farms and a social and environmental survey of each property, followed by audits, which certified all farms involved with the project. For 2014, the Engagement Plan prepares actions to further improve the relationship with these rural producers, allowing all of them to share the benefits and also to plan the future of the partnership together.
104
AMAGGI
CRITICAL SUPPLIERS G4-LA14, G4-LA15 e G4-HR1
In recent years, the company has intensified the evaluation of biomass suppliers, of which the inspection process is required by internal procedures.
AMAGGI established guidelines to select and evaluate the profile of all suppliers, including criteria on compliance with labor, social security, and fiscal and environmental legislation. In terms of environmentally critical business partners (among which are suppliers of biomass, sand, gravel, and fuel), the Procurement area requests legal and environmental analyses prior to entering into an agreement based on the risk assessment involved in supplying. Since 2010, the hiring of all suppliers has been evaluated by the Sustainability Department, which is responsible for issuing an environmental report. When necessary, inspections are carried out to determine work conditions (physical structure, personal protective equipment, and meal and lodging structures offered to employees), as well as environmental compliance in its activities. For three years, the company has used a system that undergoes continuous improvement to control environmental evaluation requests of environmentally critical suppliers and, as a result of the SGA and of the audit and legal compliance of processes, the company defined this category of suppliers more specifically in its internal procedures. In recent years, the company has intensified the evaluation of biomass suppliers (native firewood or eucalyptus), which require, pursuant to our internal procedures, a mandatory inspection process. The purpose is to verify environmental lawfulness, including the analysis of the production capacity of the supplier in terms of maintenance of environmental balance and compliance with applicable legislation in the use and processing of wood. The information collected is registered in a standard report, which includes a checklist. If during the term of the agreement, any adjustable irregularity is found, the supplier is notified and activities are blocked until the problem is duly solved. If the problem persists, the agreement is terminated and the supplierâ&#x20AC;&#x2122;s name is removed from the companyâ&#x20AC;&#x2122;s supplier list. In the event of a shortage of suppliers to serve a region where AMAGGI operates, work to promote and provide technical support is conducted, when applicable, to help regularize potential suppliers.
Sustainability Report 2013
105
Responsible Truckers IN 2013, AMAGGI proceeded with the campaign with approximately 2,500 truckers (contractors) of partner carriers using the Responsible Trucker Guide, a guide for the activityâ&#x20AC;&#x2122;s best practices inside and outside of the company. Starting with the prioritization of this group of suppliers in its Engagement Plan, activities became part of an action plan. In 2013, a field study was conducted at some of AMAGGIâ&#x20AC;&#x2122;s units involving interviews with truckers and company employees, seeking to identify management and communication improvement opportunities, including in loco visits to truck driver hiring locations. Improvements in the logistic processes under development in the Excellence Plan (learn more on page 69) will also have a positive impact on this group, since one of the objectives is to decrease trucker waiting time in warehouses and plants.
See the online version to learn more about: -private security management
G4-HR7
A campaign with approximately 2,500 truckers is part of the engagement plan for this audience, which is considered a priority.
>>>>>>>>
106
MANAGEMENT AND RESULTS
Awards and recognition
AMAGGI
Sustainability Report 2013
For the first time, AMAGGI has been included in Exame Magazine Sustainability Guide as one of the most sustainable companies in Brazil. The company also showed a significant improvement in rankings by important publications such as Valor Grandes Grupos, Valor 1000 Yearbook, and Maiores e Melhores by Exame Magazine.
107
108
AMAGGI
Exame Sustainability Guide The 14th edition of the Exame Magazine Sustainability Guide lists AMAGGI as one of the 61 most sustainable companies in Brazil among 20 industry segments and as one of the 4 best companies in agribusiness.
Valor Grandes Grupos AMAGGI was highlighted in the ranking of the Valor Grandes Grupos Yearbook by Valor Econômico. The publication ranks the 200 largest business groups in Brazil by revenue. In 2013, AMAGGI advance 10 positions in the ranking (to 86th position), further strengthening its place among the country’s 100 largest companies. The company also ranks 13th among the 20 largest in the trade sector.
Valor 1000 Yearbook AMAGGI advanced in the ranking and is now among the 70 largest companies in Brazil. Compared with the previous edition, the company advanced 15 positions, going from 84th to 69th. In the ranking by region, the company also advanced one position and today ranks 4th among the largest companies in the North and Midwest. It is the first company in Mato Grosso in this ranking, and it stands out as having one of the best performances in the region.
AMAGGI stands out in people development at HR Management. The Tanguro Farm receives the Produzindo Certo (Producing Right) award from the NGO Aliança da Terra.
Agro was highlighted in the Globo Rural Agribusiness Yearbook.
>>>>>>>>
Sustainability Report 2013
Maiores e Melhores by Exame Magazine In the 2013 edition, AMAGGI Commodities advanced 27 positions in the national ranking when compared with 2011, going from 103rd to 76th, holding its place among the country’s 100 largest companies. AMAGGI Agro, one of the 1,000 largest, advanced 65 positions, going from 670th to 605th.
Latin America’s 500 (AméricaEconomia) The magazine includes 13 countries in the ranking: Argentina, Bolivia, Brazil, Chile, Colombia, Costa Rica, Ecuador, Mexico, Panama, Paraguay, Peru, Uruguay, and Venezuela. Net revenue in dollars is the criteria used to rank companies. AMAGGI ranked 203rd. In the evaluation of the 100 largest exporters in Latin America, the company ranked 40th.
Agribusiness Yearbook by Globo Rural Magazine AMAGGI Agro was the most outstanding company in the Agriculture and Livestock Production of the 2013 edition of the Agribusiness Yearbook published by Globo Rural Magazine, in addition to advancing several positions in the Yearbook’s 500 Largest ranking, going from 154th to 120th. AMAGGI advanced 10 positions in the ranking to achieve 15th place among the 500 largest companies by net revenue.
Gestão RH Publishing Company AMAGGI was the only company in Mato Grosso to receive, in 2013, the Highlight in the Personnel Development Dimension, after competing with 10 other institutions – all of which are located in the Rio-São Paulo region.
Produzindo Certo – Aliança da Terra The Tanguro Farm, located in Querência (MT), was one of the winners in the fourth edition of the Produzindo Certo (Producing Right) award, granted by the NGO Aliança da Terra. Our unit was awarded in the Environmental Highlight category, which acknowledges the sustainability practices developed by the branch.
109
110
André and Lúcia Maggi Foundation In this section THE ANDRÉ AND LÚCIA MAGGI FOUNDATION EVALUATION OF IMPACT, DEVELOPMENT, AND ENGAGEMENT PROJECTS IN COMMUNITIES
AMAGGI
Sustainability Report 2013
111
New direction points to projects and programs that are not focused exclusively on philanthropy or exclusively on the business.
2.6 MILLION IN PRIVATE SOCIAL INVESTMENT.
162,300 DIRECT AND INDIRECT BENEFICIARIES.
A WOMAN’S NAME AND NEW STRATEGIC POSITIONING.
112
AMAGGI
TOTAL ANNUAL INVESTMENT (R$ MILLION)
1.17
André and Lúcia Maggi Foundation
Created in 1997, the Foundation closed 2013 with nearly 1 million people assisted and new challenges on the way. Its former name, André Maggi (the founder of the company) was changed to the André and Lúcia Maggi Foundation to include the name of the matriarch, who greatly influenced AMAGGI’s history and had her name included to acknowledge her importance. Also last year, the company revised its Social Investment Policy with the redevelopment of its strategic planning.
2011
2.29 2012
2.62 2013
NUMBER OF BENEFICIARIES
247,560
232,605
The Foundation carried out an assessment to define strategic guidelines for its social investments, with the help of a consulting company. The new direction indicates projects and programs that are not focused exclusively on philanthropy or exclusively on the business. Strategies were divided into four dimensions: human resources, internal projects, stakeholders, and added value. The company also revised and consolidated its project portfolio in an action plan for 20142018. The Foundation receives annual resources from AMAGGI companies, which gives it financial sustainability. In 2013, the total amount invested was R$2.6 million and the number of direct and indirect beneficiaries exceeded 162,300. The annual budget for the activities is approved in a General Shareholders Meeting, which ensures the maintenance, improvement, and expansion of projects and programs. Annually, the Foundation publishes an account of its resources and activities in the National Registry of Public Interest Entities (CNEs - Cadastro Nacional de Entidades de Utilidade Pública Federal) on the Ministry of Justice website. In 2013, the Foundation operated on three fronts: partnership with social institutions and some specific financial aid; its own projects and actions; and local development.
162,360
2011 2012 2013
20+219
Sustainability Report 2013
113
Map of operations
Mato Grosso Boa Esperança, Brasnorte, Campo Novo do Parecis, Campo Verde, Campos de Júlio, Cuiabá, Deciolândia, Diamantino, Ipiranga do Norte, Itiquira, Lucas do Rio Verde, Nova Mutum, Nova Ubiratã, Primavera do Leste, Querência, Rondonópolis, Santa Rita do Trivelato, Sapezal, Sinop, Sorriso, Tangará da Serra, Tapurah and Vera Amazonas Itacoatiara and Manaus Pará Barcarena and Belém Rondônia Porto Velho, Vilhena and Cerejeiras Paraná Maringá, Paranaguá e São Miguel do Iguaçu Rio Grande do Sul Passo Fundo Santa Catarina São Francisco do Sul
HERE I CREATE MY HISTORY “I was hired by AMAGGI to work in replanting tree seedlings in Itacoatiara (AM), and in these 10 years with the company I have worked for AMAGGI Energy and currently for AMAGGI Navigation. I hope I can tell my great-grandchildren about the opportunity that this company gave to a brave woman who came from the countryside, with no formal education but who was very eager to work and support her children. Today, I just retired due to my age, even though I am still active in the company where I am very proud to work.”
ARLETE NASCIMENTO HAS BEEN A KITCHEN ASSISTANT IN ITACOATIARA (AM) FOR 10 YEARS
114
AMAGGI
Evaluation of impact, development, and engagement G4-SO1, G4-SO2 and G4-EC8
The André and Lúcia Maggi Foundation promotes the Management Pact project in Itacoatiara (AM). With the participation of public managers, it supports public project planning and assessment of public initiatives as a way to strengthen the work of local leaders. The purpose of the pilot project implemented in 2011, in partnership with the Center for Studies and Research in Education, Culture, and Community Action (CENPEC - Centro de Estudos e Pesquisas em Educação, Cultura e Ação Comunitária), is to promote discussions between public managers and civil society about the problems of municipal education. In 2013, the Management Pact held monthly meetings for discussions and training with the main center and extended discussion forums with the participation of communities. The main topics discussed were the work of the municipality’s rights council and participation in social control. Also in 2013, the Foundation incorporated the methodology implemented by CENPEC’s technical coordination in order to improve actions and replicate them in other municipalities. To identify the significant impacts of its operations, the Foundation also has the DialogAção Project, conducted annually since 2012 with social and environmental partner organizations. The aim is to involve the community and their interests in the decision-making processes at the Foundation and at AMAGGI. In 2013, a total of 12 organizations from Mato Grosso took part (learn more on page 57). In 2014, the Foundation intends to expand the panel to three cities in Mato Grosso, increasing community representation by involving not only partner organizations, but also community leaders, experts, and local suppliers, among others. Objectives include better identification of the significant impacts of AMAGGI’s operations, definition of mitigation actions, and promotion of social control in the municipalities where the company operates.
Sustainability Report 2013
115
Projects in communities G4-EC7
In 2013, a total of R$487,200 was invested in social and environmental projects with communities. In 2014, the Foundation plans to conduct a participatory diagnosis assessment to identify community demands and needs. Among the projects are the support for initiatives aligned with the UN Millennium Development Goals, donations to social entities, cultural activities, and dietary supplementation.
See the online version to learn more about: - the projects developed by the Foundation in 2013
The Foundation invested a total of R$2.6 million in 2013, and the number of direct and indirect beneficiaries exceeded 162,300.
>>>>>>>>
116
AMAGGI
Vision of the future AMAGGI is preparing for a significant increase, by 2020, in the volume of grain originated and marketed. To this end, the company invests in logistics and warehousing infrastructure, people training, and the incorporation of sustainability as a value of its corporate culture. G4-28
The Brazilian agribusiness scenario is promising for this decade. According to projections by the Ministry of Agriculture, Livestock, and Food Supply (MAPA), the growth of the agriculture, livestock, and forestry sectors in 2012/13-2022/23 will allow the country to supply a total of 200 million Brazilians annually, in addition to generating a surplus that can be exported to over 200 countries, resulting in a strong internal agriculture and livestock market and a trade balance surplus of more than R$100 billion per year. Production of grain should exceed 222 million tons in the 2022/2023 harvest, which represents an increase of at least 34 million tons to the current production in Brazil. However, to reach these results, Brazil must invest in infrastructure and research and improve financing conditions. The growth of agriculture production should be based on greater productivity, especially with the dissemination of the use of technology in the field. According to analyses of the Ministry of Development and Foreign Trade, the forecast for the coming years is for Brazil to have a significant increase in exports, but the domestic market will continue to be an important growth factor. MAPA’s forecast shows that by 2022/23, 51% of soybean production and 67% of corn will be destined for the domestic market. Thus, there will be extra pressure upon domestic production given the expansion of the internal market and the country’s exports. Currently, 52% of soybeans produced is geared to the domestic market, as well as 66.7% of the corn. In this scenario, AMAGGI is preparing for a significant increase, by 2020, in the volume of grain originated and sold. To this end, the company is investing in logistics and warehousing infrastructure, people training, and the incorporation of sustainability as a value of its corporate culture in order to generate continuous value for society as a whole. The company’s main strategy is to increase the volume of grain originated, especially in Mato Grosso, relying on the improvement of production outflow conditions through the North. In 2014, the company will start operating in the TapajósAmazonas corridor and foresees a volume of 2 million tons, with the potential to reach 4 million tons in the next five years.
Sustainability Report 2013
117
The company also invests in infrastructure that allows for an increase in the volume of grain originated. In 2014, it invested in four new warehouses in Mato Grosso, and by 2015/16, it plans to build five additional units. With the new production outflow possibilities through the Northeast, we are also building a terminal at Itaqui Port in the state of Maranhão. Based on projections of production growth in the region known as Matopiba (Maranhão, Tocantins, Piauí, and Bahia), the goal is to originate approximately 1.2 million tons of grain in the next three years in order to utilize the terminal, whose operation starts in 2014. Despite forecasts for a reduction in the margins of grain sales, the company counts on offsetting this reduction with the increase in volume originated. As for agricultural production, the focus is to increase productivity in two ways: better use of the current area and an increase in planted area. In recent years, 30% of the area was used for more than one harvest; today, it is 50% of the area and we plan to increase this to 70% of the production area. As for the international market, the company operates in Argentina, The Netherlands, Switzerland, Norway, and recently started operations in Paraguay with origination offices. The acquisition of 100% interest of DENOFA, a Norwegian crusher that supplies the European non-GMO market, reaffirms the company’s strategy to expand its market share. For the coming years, AMAGGI also plans a more structured presence in Asia. In summary, the company’s future growth is based on sustainability through productivity gains, with preservation of the environment and use of technologies and practices that reduce costs and bring more income to producers.
For the coming years, AMAGGI also plans a more structured presence in Asia.
>>>>>>>>
118
AMAGGI
About the report
Nine material topics, validated by senior management, are the basis of the Sustainability Report. G4-17, G4-28, G4-33
This sustainability report presents a balance of AMAGGI’s main activities developed in the company units in Brazil from January 1 to December 31, 2013. The annual review, along with a set of future goals and objectives, allows for the definition of a scenario for advancement of the company in its sustainability practices associated with the business and its responsibility in the agribusiness chain. The publication reports on the operations of the units in the Brazilian territory that are fully controlled by AMAGGI, including leased properties. It does not report on quantitative data for companies that are not fully controlled by AMAGGI, thereby excluding joint ventures and operations in other countries. The eighth annual report, and the sixth developed according to the guidelines of the Global Reporting Initiative (GRI), one of the world’s references in corporate reports already in its G4 version and launched in 2013, consolidates information related to 67 performance indicators, divided into three sustainability dimensions: economic, social, and environmental. The application level adopted was the Essential level, since at least one indicator associated with the aspects defined as material is presented. There is also a set of data reported based on Ibase’s Social Audit. The economic and financial indicators were determined according to the criteria established by the Brazilian accounting rules and are subsequently analyzed and validated by an external independent audit. The social and environmental data, which cover both the administrative activities at company headquarters in Cuiabá (MT) and the activities developed by the various units and business areas, were consolidated without analysis and validation by external auditors. This measure, which was planned for 2013, is under study for implementation in the next cycle, since the adoption GRI’s G4 version required adjustments in the collection of indicators to be implemented in 2014.
Sustainability Report 2013
In the development the report, inputs from those audiences identified as strategic were considered, based on the materiality process conducted in 2012. The consultations were the following: Comparative study of four companies operating in the sectors of agribusiness, logistics and food Online consultation with 12 stakeholders – institutional partners (four suppliers, two government representatives, three members of organized civil society, one client, and one representative of a financial institution) A dialogue panel with the participation of 22 social institutions that received financial support from the André and Lúcia Maggi Foundation between 2008 and 2012 Analysis of six sector studies of topics that are relevant for AMAGGI’s operating areas, three of which are national and three international Interviews with four experts about topics that are relevant to the agribusiness and logistics sectors Dialogue panels with 81 employees. Meetings were held in seven locations: Cuiabá, Rondonópolis, Sapezal, Lucas do Rio Verde, Itacoatiara, Belém, and Porto Velho Personal interviews with members of senior management, conducted with six directors and the CEO, about the most relevant topics for the company in terms of the social, economic, and environmental impacts of its activities and business strategies Analysis of six internal documents: Code of Ethics and Conduct; environmental evaluation of rural producers; environmental evaluation of suppliers; strategic planning guidelines; Environment Policy; and People Management Policy.
119
G4-18
120
AMAGGI
Based on the topics considered a priority by internal and external audiences, nine topics were validated by AMAGGI’s Executive Board (according to the materiality matrix on page 53 and the table below). G4-19, G4-20, G4-21 and G4-27
Material topic
GRI – G4 Aspect
Correlation Topic/Audience
Risk monitoring
Economic performance Environmental evaluation of suppliers Mechanisms for grievances and complaints associated with environmental impacts Occupational health and safety Evaluation of suppliers on labor practices Mechanisms for grievances and complaints associated with labor practices Investment practices and procurement processes Freedom of association Child labor Bonded labor Safety practices Evaluation Evaluation of suppliers on Human Rights Mechanisms for grievances and complaints associated with Human Rights Corruption Evaluation of suppliers on impacts on society Mechanisms for grievances and complaints associated with impacts on society
Internal audience – senior management
Development of local communities
Market presence Indirect economic impacts Employment Relationship between employees and governance Local communities
Suppliers Clients Government Institutional partners Partner NGOs of the André and Lúcia Maggi Foundation Agribusiness experts
Market presence
Economic Performance Procurement practices
Internal audience – employees
Environmental preservation
Biodiversity Emissions Effluents and Waste Transportation
Suppliers Clients Government Institutional partners Partner NGOs of the André and Lúcia Maggi Foundation Agribusiness experts Internal audience – employees Internal audience – senior management
Compliance with legislation
Conformity Occupational Health and Safety Anti-competitor behavior Compliance Client health and safety Labeling of products and services Communication and marketing Client privacy
Suppliers Clients Government Institutional partners Agribusiness experts Internal audience – senior management
Training and development of capabilities
Training and education Corruption
Internal audience – senior management
Transparency and accountability to society
There is no relation to GRI Aspects
Partner NGOs of the André and Lúcia Maggi Foundation Internal audience – senior management
Commitment to sustainability and search for coherence in the company’s daily actions
There is no relation to GRI Aspects
Partner NGOs of the André and Lúcia Maggi Foundation Agribusiness experts Internal audience – senior management
Cooperation and partnerships
There is no relation to GRI Aspects
Suppliers Clients Government Institutional Partners Agribusiness experts Internal audience – employees
Sustainability Report 2013
In 2013, in order to improve the identification of relevant topics for the business and society and to improve the quality of our relationship with strategic stakeholders, AMAGGI advanced on many fronts. The company promoted a workshop with the Board of Directors and the Executive Board to debate and validate strategic topics for the business and structured an engagement plan geared toward the following audiences: rural producers, suppliers, carriers, (supply chain), internal audiences, local community, and institutional partners (learn more on page 47). These actions will provide support for a new materiality process, to be carried out in 2014. Comparability with the content of the previous report (2012) is ensured, since changes and eventual corrections are duly highlighted, when necessary, in different passages throughout the text or in explanatory notes. Nevertheless, it is important to mention that there are no significant changes compared with previous editions in terms of scope, boundary, or even measurement methods used in this report. Two important institutional commitments with which AMAGGI engaged in 2009 (Global Compact and Millennium Development Goals) continue to stand out throughout the report, with the respective correlation of topics covered by the two global initiatives, which is presented in the beginning of each section. The same procedure is adopted with GRIâ&#x20AC;&#x2122;s performance items and indicators for their easy identification and to facilitate reading. The report has two versions: a relatively abridged print version and a more detailed online version. In addition, for the second year we have produced a short edition for employees as a response to one of the suggestions made by stakeholders.
121
To improve the process of identifying relevant topics for the business and society, AMAGGI discussed and validated strategic topics and structured an engagement plan for priority stakeholders.
G4-22
122
AMAGGI
Annual Social Audit / 2013 Company: 1 – Calculation Basis
2013 (thousands)
2012 (thousands)
8,589,766
5,982,711
Operating Income (OI)
737,892
662,194
Gross Payroll (GP)
176,781
Net Income (NI)
2 – Internal Social Indicators
169,439
Value (thousand)
% on GP
% on NI
Value (thousand)
% on GP
% on NI
Food
18,577
10.51%
0.22%
16,691
9.85%
0.28%
Mandatory social contribution
35,423
20.04%
0.41%
36,651
21.63%
0.61%
642
0.36%
0.01%
915
0.54%
0.02%
Health
9,015
5.10%
0.10%
8,453
4.99%
0.14%
Occupational health and safety
3,462
1.96%
0.04%
2,914
1.72%
0.05%
379
0.21%
0.00%
484
0.29%
0.01%
0
0.00%
0.00%
0
0.00%
0.00%
Private pension
Education Culture Training and professional development Daycare or daycare assistance Profit sharing Other Total – Internal Social Indicators 3 – External Social Indicators
1,600
0.91%
0.02%
861
0.51%
0.01%
29
0.02%
0.00%
33
0.02%
0.00%
20,760
11.74%
0.24%
16,021
9.46%
0.27%
2,242
1.27%
0.03%
4,527
2.67%
0.08%
92,129
52.11%
1.07%
87,550
51.67%
1.46%
Value (thousand)
% on GP
% on NI
Value (thousand)
% on GP
% on NI 0.02%
Education
1,210
0.16%
0.01%
1,001
0.15%
Culture
1,295
0.18%
0.02%
691
0.10%
0.01%
232
0.03%
0.00%
95
0.01%
0.00%
Sports
121
0.02%
0.00%
73
0.01%
0.00%
Hunger prevention and food safety
763
0.10%
0.01%
707
0.11%
0.01%
4,557
0.62%
0.05%
245
0.04%
0.00% 0.05%
Health and sanitation
Other Total social contribution
8,178
1.11%
0.10%
2,812
0.42%
Taxes (less social contribution)
483,468
65.52%
5.63%
236,578
35.73%
3.95%
Total – Internal Social Indicators
491,646
66.63%
5.72%
239,390
36.15%
4.00%
Value (thousand)
% on GP
% on NI
Value (thousand)
% on GP
% on NI
11,584
1.57%
0.13%
32,807
4.95%
0.55%
888
0.12%
0.01%
1,011
0.15%
0.02%
1.69%
0.15%
33,818
5.11%
0.57%
4 – Environmental Indicators Investments related to production/operation Investments in programs and/or external projects Total investments in the environment Regarding “annual goals” to minimize waste, general consumption for production/operation, and increased efficiency in the use of natural resources, the company:
12,472 ( ) has no goals ( ) meets 0 to 50%
( ) meets 51 to 75% (x) meets 76 to 100%
( ) has no goals ( ) meets 0 to 50%
( ) meets 51 to 75% (x) meets 76 to 100%
5 – Workforce Indicators
2013
2012
Number of employees at the end of the period
3,965
4,108
Number of hires in the period
2,346
2,436
821
1,072
Number of contractors Number of interns Number of employees over 45 years of age
5
9
561
553
Number of women working in the company
670
659
% of management positions held by women
8.49%
10.17%
Number of Black employees in the company % of management positions held by Black employees Number of people with disabilities or special needs
3,166
3,201
66.30%
53.80%
91
83
Sustainability Report 2013
123
6 – Relevant information on corporate citizenship
2013
Goals 2014
Ratio between highest and lowest salary
66.3
66.3
Total number of work-related accidents
160
The social and environmental projects developed by the company were defined by:
( ) Board
( )B oard and managers
The standards for occupational health and safety were set by:
( )B oard and managers
( )a ll employees
Concerning freedom of association, the right to collective bargaining and internal employee representation, the company:
( ) is not involved
(x) f ollows ILO standards
Private pension plans include:
( ) Board
Profit sharing includes:
( ) Board
In selecting suppliers, the same ethical and social responsibility standards adopted by the company:
( )a re not considered
( )B oard and managers ( )B oard and managers
0 (x) a ll employees
( ) Board
( )B oard and managers
(x) all employees + CIPA ( )e ncourages and follows ILO standards
( )B oard and managers
( )a ll employees
( ) is not involved
( ) f ollows ILO standards
(x) a ll employees
( ) Board
( )B oard and managers ( )B oard and managers
(x) t all employees (x) all employees + CIPA (x) w ill encourage and follow ILO standards ( x) all employees
(x) all employees
( ) Board
(x) are suggested
( ) are required
( )a re not considered
(x) w ill be suggested
(x ) all employees ( ) will be required
( ) is not involved
(x) will support
()w ill organize and encourage
Regarding employee participation in volunteer programs, the company:
( ) is not involved
(x) supports
( )o rganizes and encourages
Total consumer claims and criticisms:
In company: 6
At Procon: 0
In court: 0
In company: 5
At Procon: 0
In court: 0
Total consumer claims and criticisms resolved:
In company: 100 %
At Procon: 0%
In court: 0%
In company: 100%
At Procon: 0%
In court: 0%
Total value added for distribution (in thousand R$) Distribution of Added Value (DVA)
In 2013: 1,779,223 28.82% government 2.48% shareholders
16.67% employees 38.19 % third parties
In 2012: 1,325,051 13.83% withheld
17.85% government 3.58% shareholders
20.08% employees 47.50 % third parties
10.99% withheld
7 – Other Information
G4-17 The companies that comprise AMAGGI are: André Maggi Participações S/A (legal nature: closed capital corporation/CNPJ: 04.786.144/0001-76), AMAGGI Exportação e Importação Ltda (legal nature: limited liability company / CNPJ: 77.294.254/0001-94), AMAGGI International Ltda, Agropecuária Maggi Ltda (legal nature: limited liability company / CNPJ: 00.315.457/0001-95), AMAGGI Argentina S.A., Hermasa Navegação da Amazônia S/A (legal nature: closed capital corporation / CNPJ: 84.590.892/0001-18), Maggi Energia S/A (legal nature: closed capital corporation / CNPJ: 03.908.754/0001-32), Agro Sam Agricultura e Pecuária Ltda (legal nature: limited liability company / CNPJ: 92.644.715/0001-03), Divisa Energia S/A (legal nature: closed capital corporation / CNPJ: 10.431.501/0001-86), Ilha Comprida Energia S/A (legal nature: closed capital corporation / CNPJ: 08.936.794/0001-01), Jesuíta Energia S/A (legal nature: closed capital corporation / CNPJ: 08.918.031/0001-38), Segredo Energia S/A (legal nature: closed capital corporation / CNPJ: 08.936.816/0001-33), AMAGGI S.R.L (created in 2013, origin Paraguayan), and Fundação André Maggi (legal nature: private foundation / CNPJ: 01.832.808/0001-06). AMAGGI’s headquarters, whose industry is agribusiness, is located in Cuiabá-MT. For inquiries on the data provided, contact: Juliana de Lavor Lopes, phone: +55 (65) 3645-5000, email: juliana.lopes@AMAGGI.com.br. This company does not use child, Indigenous or bonded labor, is not involved in prostitution or sexual exploitation of children or adolescents, and is not involved in corruption. Our company values and respects diversity, both internally and externally. General information on item 1 (Calculation Basis) The Operating Income and Value Added Statement figures comply with the changes brought by Law 11.638/07 and by the Provisional Measure 449/08, later converted into law 11.941/09, which adjusted the Brazilian accounting rules and practices to international standards (IFRS – International Financial Reporting Standards). General Information on Internal Social Indicators Occupational health and safety: the difference in investment from 2012 to 2013 refers to the natural adjustment of market values and increase in work demand. Training and professional development: the difference in investment from 2012 to 2013 refers to the implementation of the School for Leaders for the Executive Board, Management and Supervisor levels, and to development Programs for critical positions and technical training in partnership with universities, technical schools, and specialized consulting companies. Participation in profits or results: amount paid in 2013, referring to profit-sharing in 2012. General Information on External Social Indicators Other: refers to local development projects, operational structuring of private social investments, project selection, and support for social institutions. Taxes: value mentioned corresponds to the taxes collected in the period. Environmental Indicators The value of investments related to production/operations includes investments that provide environmental improvements (R$7,358,720.50) and the values of expenses for the regular environmental management operations and ongoing construction work (R$3,766,288.80) and treatment and disposal of waste (R$459,471.31). In the calculation of investments in programs and/or external projects, the support for environmental projects executed in partnership is also included (R$888,186.91). The difference in investment from 2012 to 2013 is due to the acquisition of the Santo André Farm in the municipality of Lucas do Rio Verde/MT for the implementation of reforestation projects, including the acquisition of eucalyptus seedlings. General Information on Workforce: Hires in the period: this number includes all hires made by AMAGGI, including the seasonal jobs typical in agribusiness. Number of Black employees: methodology used for calculation according to Ibase’s guideline for the preparation of the Social Audit, which requires considering Black employees as the sum of individuals classified/self-declared as having black or brown skin (according to RAIS). Number of people with disabilities: according to the GRI LA13 indicator in this material. Number of contractors – fixed and in construction work / Construction of SHEPs (monthly average): 124 General information on corporate citizenship Work-related accidents: This item accounted for all accidents, including those with and without accident leave, in addition to accidents while commuting. All consumer complaints are settled within the company, and cases of complaints were not substantiated by laboratory analysis, but actions were taken in order to intensify prevention and respond to the client’s complaint. DVA: value referring to AMAGGI companies. There were reclassifications in the 2012 DVA, referring to PCLD (provision for doubtful debtors), “Costs”, and retained profits and dividends that had been classified in incorrect lines. Due to these adjustments, in 2012 the percentages distributed to stakeholders (shareholders, employees, government, retained profits, and interest and leases) had small changes when compared with the demonstration of the previous year.
124
AMAGGI
GRI Table of Contents GENERAL CONTENT Item
Description
Page /response
Omission
External Assurance
STRATEGY AND ANALYSIS G4-1
Message from the CEO
4,5
NO
G4-2
Description of key impacts, risks and opportunities
48, 49
NO
G4-3
Company name
8
NO
Organizational profile
NO
G4-4
Main brands, products, and/or services
8, 10
NO
G4-5
Location of company’s headquarters
8
NO
G4-6
Countries where the organization operates and where its main operations are located
8, 10
NO
G4-7
Type and legal nature of the property
The companies that comprise AMAGGI are: André Maggi Participações S/A (legal nature: closed capital corporation/CNPJ: 04.786.144/0001-76), AMAGGI Exportação e Importação Ltda (legal nature: limited liability company / CNPJ: 77.294.254/0001-94), AMAGGI International Ltda, Agropecuária Maggi Ltda (legal nature: limited liability company / CNPJ: 00.315.457/0001- 95), AMAGGI Argentina S.A., Hermasa Navegação da Amazônia S/A (legal nature: closed capital corporation / CNPJ: 84.590.892/0001-18), Maggi Energia S/A (legal nature: closed capital corporation / CNPJ: 03.908.754/0001-32), Agro Sam Agricultura e Pecuária Ltda (legal nature: limited liability company / CNPJ: 92.644.715/0001-03), Divisa Energia S/A (legal nature: closed capital corporation / CNPJ: 10.431.501/0001-86), Ilha Comprida Energia S/A (legal nature: closed capital corporation / CNPJ: 08.936.794/0001-01), Jesuíta Energia S/A (legal nature: closed capital corporation / CNPJ: 08.918.031/0001-38), Segredo Energia S/A (legal nature: closed capital corporation / CNPJ: 08.936.816/0001-33), and Aruanã Comercializadora de Energia Ltda, AMAGGI S.R.L (legal nature: limited liability company / CNPJ:16.587.133/0001-46). AMAGGI’s headquarters, whose industry is agribusiness, is located in Cuiabá-MT.
NO
G4-8
Markets served
8, 10, 11
NO
G4-9
Company size
8
NO
G4-10
Total workforce by employment type, employment contract, and region
14
NO
G4-11
Percentage of employees covered by collective bargaining agreements
All collective negotiations – whether in Agreements or Collective Labor Conventions – apply to all employees registered in their units.
NO
G4-12
Describe the company’s supply chain
14, 15, 16, 17
NO
G4-13
Major changes in the reporting period
8
NO
COMMITMENT TO EXTERNAL INITIATIVES G4-14
Explanation of whether and how the precautionary approach or principle is addressed by the organization
48, on-line
NO
G4-15
Externally developed charters, principles, or other initiatives
56, 57, 58, 59, on-line
NO
G4-16
Memberships in associations and/ or national/international advocacy organizations
58, 59, on-line
NO
118, 123
NO
Aspectos materiais identificados e limites G4-17
Entities reported in the consolidated financial statements and entities not covered in the report
G4-18
Process for defining report content
52, 119
NO
G4-19
List of material topics
53, 120
NO
G4-20
Materiality and boundaries of each aspect within the organization
120
NO
G4-21
Materiality and boundaries of each aspect outside the organization
120
NO
G4-22
Restatements of information provided in earlier reports
121
NO
G4-23
Significant changes in scope
There were no changes in scope and boundaries from the previous report.
NO
Sustainability Report 2013
Item
Description
125
Page /response
Omission
External Assurance
ENGAGEMENT OF STAKEHOLDERS G4-24
List of stakeholder group engaged by the organization
54
NO
G4-25
Basis for identification and selection of stakeholders with whom to engage.
52, 53, 54
NO
G4-26
Approaches to stakeholder engagement
54
NO
G4-27
Key topics and concerns that have been raised through stakeholder engagement
120
NO
118
NO
REPORT PROFILE G4-28
Reporting period for information provided
G4-29
Date of most recent previous report
The most recent previous report was published in 2013 and reported data from 2012.
NO
G4-30
Reporting cycle
Annual
NO
G4-31
Contact details for questions about the report or its contents
2
NO
G4-32
Table identifying the location of information in the report
122, 123, 124, 125, 126, 127, 128, 129, 130, 131, 132, 133, 134, 135, 136 e on-line
NO
G4-33
Policy and current practice concerning external assurance for the report
118
NO
GOVERNANCE G4-34
Governance structure of the organization, including committees under the highest governance body
44, 45, 48, on-line
NO
G4-35
Report process to delegate authority for economic, environmental, and social topics of the highest governance body for senior executives and other employees
44
NO
G4-36
Report whether the organization appointed an executive-level position or positions with responsibility over economic, environmental, and social topics and whether holder of the position reports to the highest governance body
44
NO
G4-37
Report processes of consultation of stakeholders and of the highest governance body in economic, environmental, and social topics. If consultation is delegated, describe who is responsible for it and what the feedback process is to the highest governance body
44, 54
NO
G4-38
Independent or non-executive members of the highest government body
44
NO
G4-39
Chair of the highest governance body
44
NO
G4-40
Qualifications of members of the highest governance body
44, 46
NO
G4-41
Processes to ensure that conflicts of interest are avoided
48, on-line
NO
G4-42
Report role of the highest governance body and senior executives in the development, approval, and updating of mission, vision, values, strategies, policies, and goals related to environmental, social, and economic impacts
AMAGGIâ&#x20AC;&#x2122;s governance model establishes that culture-related decisions are shared between the Board of Directors and the Executive Board.
NO
G4-43
Report measures taken to develop and improve the collective knowledge of the highest governance body in economic, social, and environmental topics
46
NO
126
AMAGGI
Conteúdo geral
Omission
External Assurance
Item
Description
Page /response
G4-44
Process for self-assessment of performance of the highest governance body
48, on-line One of the responsibilities of the People Committee is to support the Chairman of the Board and AMAGGI’s CEO in the annual evaluation process of executive directors and board members. This evaluation involves several qualitative instruments to analyze profile, 360-degree evaluation, competencies, and quantitative research associated with the business (business result). The development of the eight leadership competencies is conducted through the School of Leaders with directed programs and actions.
NO
G4-45
Responsibility for adopting economic, environmental, and social policies
44
NO
G4-46
Report role of the highest governance body in the analysis of efficacy of the company’s risk management processes for economic, environmental, and social topics
48
NO
G4-47
Report the frequency with which the highest governance body reviews economic, environmental and social impacts, risks, and opportunities
44
NO
G4-48
Highest body or position that formally analyzes and approves the company’s sustainability report and ensures that all relevant aspects are covered
The sustainability report first undergoes analysis and approval by the Sustainability Department to verify whether the material topics, identified in the materiality matrix, are duly reported. After the initial validation, the document is analyzed and validated by all Directors and the CEO in order to ensure that all information pertains to the reporting period.
NO
G4-49
Report the process to communicate critical concerns to the highest governance body.
48, on-line
NO
G4-50
Report the nature and the total number of critical issues communicated to the highest governance body and the mechanisms used to solve them
48, on-line
NO
G4-51
Relationship between remuneration and company performance (including social and environmental)
46
NO
G4-52
Report the process to determine remuneration. Report whether remuneration consultants are involved in the definition of remuneration and whether they are independent from management. Report any other relationships that remuneration consultants have with the organization
46 AMAGGI’s Career and Salary Structure follows the Hay methodology (Hay Group Consulting), which adopts a points system for each role and salary levels for each position group. The salary ranges are reviewed through studies provided by the consulting company. At the same time, AMAGGI conducts a salary survey through Taji Consultoria to evaluate the competitiveness of salaries and benefits in the market. The results will be evaluated in the first half of 2014.
NO
G4-53
Report how the opinions of stakeholders are consulted and taken into account in terms of remuneration, including the results of voting sessions on remuneration policies and proposals, if applicable
48 By means of suggestions sent to the Ethics committee, which also functions as Ombudsman.
NO
G4-54
Report the ratio of the total annual remuneration of the highest paid individual in the company (in each country with significant operations) to the total average annual remuneration of all employees (except the highest paid individual, in the same country)
Strategic information for the company.
NO
G4-55
Report the proportion of percentage increase in the total annual remuneration for the highest paid individual in the company (in each country with significant operations) to the total average annual remuneration of all employees (except the highest paid individual, in the same country)
Strategic information for the company.
NO
ETHICS AND INTEGRITY G4-56
Mission and values statements, codes of conduct, and relevant principles
46, 48, on-line
NO
Sustainability Report 2013
127
Omission
External Assurance
Item
Description
Page /response
G4-57
Report internal and external mechanisms to seek advice on ethical and legal behavior and issues related to organizational integrity, such as assistance services or advice help lines
48, on-line
NO
G4-58
Report internal and external mechanisms adopted by the Organization to communicate concerns with unethical behavior or behavior that is incompatible with the legislation, and issues related to organizational integrity, such as the escalation of concerns through hierarchical channels, mechanisms to report irregularities or channels for grievances.
48, on-line
NO
Specific Content
ECONOMIC CATEGORY Material Aspect
DMA and Indicators
Description
Omission
Assurance
Page/ response
ECONOMIC PERFORMANCE DMAEC
Management Practice
NO
70, 71, 72, 73
Market presence
G4-EC1
Direct economic value generated and distributed, including revenue, operating costs, employee compensation, donations and other community investments, retained earnings, and payments to capital providers and governments.
YES
72, on-line
Risk monitoring
G4-EC2
Financial implications and other risks and opportunities for the organization's activities due to climate change
NO
84, 86
Market presence
G4-EC4
Significant financial assistance received from government.
YES
R$ 40,501,000.00
G4-DMAEC
Management Practice
NO
70, 71, 72, 73
G4-EC5
Range of ratios of standard entry-level wage compared with local minimum wage at significant locations of operation
NO
In 2013, all AMAGGI’s employees received more than the minimum wage. The percentage ratio between the lowest salary paid by the Company at significant locations of operation and the national minimum wage is 5% on the farms; 12.5% at the Cuiabá (MT) Plant; 20.5% at the Lucas do Rio Verde (MT) plant; and 9.8% at the Itacoatiara (AM) plant. Calculation was made considering the lowest salary paid, divided by the current minimum wage (R$622.00). We consider significant locations of operation those with a significant workforce; that is, a total workforce of 2,203 employees (54% of the total). The amount of the lowest salary used in the operational units is R$ 653.00.
MARKET PRESENCE
Development of local communities
Percentage between the lowest standard entry-level wage in important operating units compared with reference minimum wage
Lowest salary paid by the company (2013)
Energy
Navigation
Commodities
Agro
AMAGGI
Minimum wage determined by law used as reference
Percentage ratio (%)
Men
826.00
735.00
763.20
800.00
735.00
R$ 678.00
8.41%
Women
857.00
700.00
750.00
800.00
700.00
R$ 678.00
3.24%
* national reference minimum wage ** definition of “important operating units”: We use the lowest salary of each Business Division.
128
AMAGGI
Specific Content
Material Aspect Development of local communities
DMA and Indicators G4-EC6
Description
Omission
Procedures for local hiring and proportion of senior management hired from the local community at significant locations of operation
Assurance
Page/ response
NO
AMAGGI does not have a formal hiring policy that prioritizes members of the local community; the company recruits at the national level where positions are advertised on regional websites. For senior management positions, the company prioritizes internal promotion, incorporating the help of the Aroeira Project, which identifies talents. Both in 2012 and 2013, all members of senior management, directors, and the CEO are from Brazil, as defined by the company as local community. Thus, when hiring members of senior management and employees in general, we prefer local workforce, whether in Brazil or in another country where the company operates, strengthening the construction of a career within the company.
INDIRECT ECONOMIC IMPACTS DMAEC
Management practice
NO
112, 114 and 115
Development of local communities
G4-EC7
Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, in-kind, or pro bono engagement.
NO
115
Development of local communities
G4-EC8
Description of significant indirect economic impacts
NO
114
PROCUREMENT PRACTICES
Market presence
DMAEC
Management practice
NO
98, 99, 100, 101
G4-EC9
Policy, practices, and proportion of spending on locally-based suppliers at significant locations of operation
NO
100
ENVIRONMENTAL CATEGORY Material Aspect
DMA and Indicators
Description
Omission
Verification
Page/ response
BIODIVERSITY DMAEN
Management Practice
NO
75, 76
Environmental Preservation
G4-EN11
Operating units owned, leased, managed in, or adjacent to protected areas and areas of high biodiversity value outside protected areas
NO
82, on-line
Environmental Preservation
G4-EN12
Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas
NO
82
Environmental Preservation
G4-EN13
Habitats protected or restored.
NO
80
EMISSIONS DMAEN
Management practice
NO
75, 76
Environmental Preservation
G4-EN15
Total direct greenhouse gas emissions (GHG) (scope 1), by weight.
NO
87, on-line
Environmental Preservation
G4-EN16
Total indirect greenhouse gas emissions (GHG) (scope 2), by weight.
NO
87, on-line
Environmental Preservation
G4-EN17
Other relevant indirect greenhouse gas emissions (GHG) (scope 3), by weight.
NO
87, on-line
Sustainability Report 2013
Material Aspect
DMA and Indicators
129
Description
Omission
Verification
Page/ response
NO
87, on-line
Environmental Preservation
G4-EN18
Intensity of greenhouse gas emissions.
Environmental Preservation
G4-EN19
Reduction of greenhouse gas emissions (GHG).
Management of greenhouse gas emissions will be implemented this year.
NO
Environmental Preservation
G4-EN20
Emissions of ozone-depleting substances by weight.
These emissions are not controlled.
NO
Environmental Preservation
G4-EN21
NOx, SOx, and other significant air emissions by type and weight.
NO
87, on-line
WASTE AND WASTEWATER DMAEN
Management practice.
NO
75, 76
Environmental Preservation
G4-EN23
Total weight of waste by type and disposal method.
NO
82, on-line
Environmental Preservation
G4-EN24
Total number and volume of significant spills.
NO
The volume and significant spills defined by AMAGGI are based on internal procedures, considering the necessary controls for assistance to emergencies. As a preventive measure, units have their Individual Emergency Plans (PEI), which list the different emergency scenarios mapped for each type of activity. Also, there are controls planned for cases of spills, which are considered significant in cases that result in environmental impacts related to damages or direct losses to society. Based on these criteria, in 2013, a spill considered significant was registered in Paraná, and required mobilization of internal and outsourced specialized assistance, given the location of the incident (mountain area and steep slope) and the type of material (degummed oil). The criticality was due to the fact that the accident happened downstream from the point where water is collected to supply the municipality of Carambeí. Actions were effective and there was no damage caused to society or the environment.
Environmental Preservation
G4-EN26
Identity, size, protection status, and biodiversity value of bodies of water and related habitats significantly affected by discharges of water and runoff.
NO
AMAGGI does not make discharges to bodies of water or habitats that are significantly affected. The only discharge in water made in the company’s activities is in Itacoatiara, whose effluent flows into the Amazon River. That river has a high purifying potential, as seen in information already reported in indicator EN 09 (reported exclusively in the online version, since it is not material).
DMAEN
Management practice
NO
75, 76, 77
G4-EN29
Monetary value of significant fines and total number of nonmonetary sanctions for non-compliance with environmental laws and regulations.
NO
77
G4-EN30
Significant environmental impacts of transporting products and members of the workforce.
DMAEN
Management practice
NO
75, 77
G4-EN31
Total investments and expenditures in environmental protection by type.
NO
78
COMPLIANCE
Conformity with legislation
TRANSPORTATION Environmental Preservation
The Greenhouse Gas Emissions Management Program will be implemented this year.
NO
GENERAL
Environmental Preservation
ENVIRONMENTAL EVALUATION OF SUPPLIERS DMAEN
Management practice
NO
98, 99, 100
Monitoring of Risks
G4-EN32
Percentage of new suppliers whose selection is based on environmental criteria.
NO
98
Monitoring of Risks
G4-EN33
Significant real and potential negative impacts in the supply chain and related measures taken.
NO
77, 98
130
AMAGGI
Specific Content
Material Aspect
DMA and Indicators
Description
Omission
Verification
Page/ response
MECHANISMS FOR GRIEVANCES AND COMPLAINTS ASSOCIATED WITH ENVIRONMENTAL IMPACTS
Monitoring of Risks
DMAEN
Management practice
NO
48, on-line
G4-EN34
Number of grievances and complaints associated with environmental impacts registered, processed, and solved through formal mechanisms for grievances and complaints.
NO
There were no grievances associated with environmental impacts in 2011, 2012, and 2013. In terms of formal communication mechanisms for existing grievances and complaints, the company responds to social and environmental issues according to internal guidelines, providing channels that can be used by internal or external audiences to register any type of communication (complaint, suggestion, compliments, and questions). The following social and environmental communication channels are available for internal or external audiences or stakeholders: - Contact Us channel available on the company’s website - Forms, available at the company units’ reception desk, indicate information fields to be completed to register the communication. The forms can also be sent by mail at no cost - operational units’ telephone - email (sustentabilidade@amaggi.com.br)
SOCIAL CATEGORY – LABOR PRACTICES AND DECENT WORK Material Aspect
DMA and Indicators
Description
DMALA G4-LA1
Omission
Verification
Page/ response
Management practice
NO
89, 90, 91
Total number and rate of new hires and employee turnover rate by age, gender, and region.
NO
97, on-line
EMPLOYMENT Development of local communities
RELATIONSHIP BETWEEN EMPLOYEES AND GOVERNANCE Development of local communities
DMALA
Management practice
NO
48, on-line
G4-LA4
Minimum notice period(s) regarding operational changes, including whether it is specified in collective agreements.
NO
All information on changes, whether of an institutional nature or concerning employee movements (internally), are available for the units through the Communication department, within time frames that precede the fact or immediately after the confirmation or modification or change occurred, whether or not is its set forth in Collective Bargaining, as negotiation between the parties in the month of the reference date is provided by law. Generally, unions send their list of claims one month prior to the employee category negotiation date, according to time frame provided by law.
HEALTH AND SAFETY AT WORK DMALA
Management practice
NO
95, 96
Respect to legislation
G4-LA5
Percentage of total workforce represented in formal health and safety committees.
NO
97
Risk monitoring
G4-LA6
Rates of injury, occupational diseases, lost days, absenteeism, and number of work-related fatalities by region.
NO
95
Risk monitoring
G4-LA7
Number of employees with high incidence/risk of serious work-related disease.
NO
There are no employees involved in activities with high incidence/risk of serious specific diseases.
Sustainability Report 2013
Material Aspect
DMA and Indicators
131
Description
Omission
Verification
Page/ response
TRAINING AND EDUCATION DMALA
Management practice
NO
90, 91, 92, 93
Training and development of skills
G4-LA9
Average hours of training per year, per employee, and per gender by employee category
NO
91
Training and development of skills
G4-LA10
Programs for the management of competencies and continuous learning that support the continued employability of employees and assist them in managing career endings.
NO
92
Training and development of skills
G4-LA11
Percentage of employees receiving regular performance and career development reviews by gender.
NO
What is the total percentage of employees who received performance assessments and career development (%)?
Total number of employees (same as G4-10)
2012 Men
Women
2013 Men
Women
4,108
3,293
656
501
439
48
% by gender
-
13%
% of the total
12%
Number of employees submitted to performance assessment and career development
7% 12%
EVALUATION OF SUPPLIERS ON LABOR PRACTICES DMALA
Management practice
NO
98, 99, 100, 101, 102, 103, 104, 105
Monitoring of risks
G4-LA14
Percentage of new suppliers selected based on labor criteria.
NO
98, 104
Monitoring of risks
G4-LA15
Significant real and potential negative impacts referring to labor practices in the supply chain and related measures taken.
NO
98, 104
MECHANISMS FOR GRIEVANCES AND COMPLAINTS ON LABOR PRACTICES Monitoring of risks
DMALA
Management practice
NO
48, on-line
G4-LA16
Number of grievances and complaints associated with labor practices registered, processed, and solved through formal mechanisms for grievances and complaints.
NO
One incident in the construction work of the Matupรก warehouse identified by the internal Occupational Health and Safety area, causing shutdown of work until security items and occupational medicine items were duly adjusted.
132
AMAGGI
Specific Content
SOCIAL CATEGORY – HUMAN RIGHTS Material Aspect
DMA and Indicators
Description
Omission
Verification
Page/ response
INVESTMENT AND PROCUREMENT PRACTICES DMAHR
Management practice
NO
98, 99, 100, 101, 102
Monitoring of risks
G4-HR1
Percentage and total number of significant investment agreements that include human rights clauses or that have undergone human rights screening.
NO
99, 104 2 Contracts for the Acquisition of Properties – investments of approximately R$145 million. 5 Contractor Agreements for the Construction of New Warehouses and Ports – investments of approximately R$110 million
Monitoring of risks
G4-HR2
Total number of hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained.
NO
94 Total of 2,230 hours of training in the project “Eu cidadão: refletindo sobre os direitos e deveres da gente”
FREEDOM OF ASSOCIATION Monitoring of risks
DMAHR
Management practice
NO
100, 101, 102
G4-HR4
Operations and significant suppliers identified in which the right to exercise freedom of association and collective bargaining may be at significant risk and actions taken to support these rights.
NO
AMAGGI only establishes partnerships with suppliers with Collective Labor Conventions. The highest risk is in the state of Mato Grosso, where most of the company’s units are located.
DMAHR
Management practice
NO
56, 98, 99
G4-HR5
Operations and significant suppliers identified as having significant risk for incidents of child labor and measures taken to contribute to the elimination of child labor .
NO
58, 99
DMAHR
Management practice
NO
56, 58, 98, 99
G4–HR6
Operations and significant suppliers identified as having significant risk for incidents of forced or compulsory labor and measures to contribute to the elimination of forced or compulsory labor.
NO
56, 58, 98, 99, 101
DMAHR
Management practice
NO
105, on-line
G4–HR7
Percentage of security personnel trained in the organization's policies or procedures concerning aspects of human rights that are relevant to operations.
NO
105, on-line
CHILD LABOR Monitoring of risks
FORCED/BONDED LABOR Monitoring of risks
SECURITY PRACTICES Monitoring of risks
Sustainability Report 2013
Material Aspect Monitoring of risks
DMA and Indicators
133
Description
Omission
Verification
Page/ response There were no cases of violation of rights of Indigenous people registered within AMAGGI’s operation areas in 2013. AMAGGI Energy coordinates the operation of Small Hydroelectric Plants (SHEPs) in the Alto Juruena Basin in Mato Grosso, with Indigenous land in its surroundings inhabited by the Enawenê_Nawê, Parecis, Nhanbikuara, Minky, and Erikbatsa nations. The properties where the Divisa, Segredo, and Ilha Comprida SHEPs are located, which belong to AMAGGI Energy, were taken into account in the environmental licensing studies in the social and environmental area of influence. In this sense, a conciliation agreement was signed with the support of Federal Justice on September 28, 2012 with the Enawene-Nawe ethnic group (the group that lives the closest to the SHEPs) to meet the permanent compensation request for ethnic-environmental damage that might have already happened or might affect the community due to the implementation of the SHEPs. The agreement establishes monthly payments (fixed amounts) of permanent compensation for each SHEP for 20 years, which is already in effect.
G4–HR8
Violation of rights of Indigenous people.
NO
DMAHR
Management practice
NO
98, 99, 100, 101
G4–HR9
Percentage and total number of operations analyzed in terms of risks related to human rights and/or their impacts.
NO
100% of the operations annually analyze risks related to human rights. The Occupational Health and Safety System and the labor audit are the tools used in all the company’s units which, in 2013, were conducted twice in each location. Throughout the years, AMAGGI has intensified efforts to ensure the safety and health of its employees. Among the most important actions are: the implementation of a specific management system, which addresses items such as people qualification and engagement; compliance with applicable legislation; analysis and planning of tasks; and correction of inappropriate conditions, among others. This year the Behavioral Security Program was implemented, a pilot initiative that was first implemented on the Água Quente, Itamarati, and Tucunaré Farms. Program actions are aimed at identifying and correcting deviations, improving employees’ perceptions of risks, encouraging the participation of leaders in issues related to OHS, and creating proactive indicators. There is a tool in the OHS Management System that comprises management of issues related to service providers. Items such as structure of lodging, food, and transportation; supply of PPEs; specific activity training; and legal programs that aim to protect the health, safety, and integrity of employees are included in the tool. As for labor and union relationships, all of the company’s employees in all units are covered by Collective Bargaining Agreements or Conventions, negotiated with entities that represent employees. To ensure compliance with the labor and social security legislation of contractors, regular inspections of documents, payment of fees, and labor practices are carried out.
EVALUATION Monitoring of risks
EVALUATION OF SUPPLIERS ON HUMAN RIGHTS DMAHR
Management practice
NO
98, 99, 100, 101
Monitoring of risks
G4–HR10
Percentage of new suppliers selected based on human rights criteria.
NO
98
Monitoring of risks
G4-HR11
Significant real and potential negative impacts referring to human rights in the supply chain and related measures taken.
NO
98, 99
MECHANISMS FOR GRIEVANCES AND COMPLAINTS ON HUMAN RIGHTS Monitoring of risks
DMAHR
Management practice
NO
48, on-line
G4-HR12
Number of grievances and complaints associated with human rights registered, processed, and solved through formal mechanisms for grievances and complaints.
NO
We had no conclusive findings related to human rights through the Ethics and Conduct Committee. AMAGGI reports on cases investigated twice a year, and we had no conclusive cases. The survey process is not disclosed before a final conclusion is not communicated.
134
AMAGGI
Specific Content
SOCIAL CATEGORY – SOCIETY Material Aspect
DMA and Indicators
Description
Omission
Verification
Page/ response
LOCAL COMMUNITIES DMASO
Management practice
NO
112, 113, 114
Development of local communities
G4-SO1
Percentage of operations with implemented local community engagement, impact assessments, and development programs.
NO
114
Development of local communities
G4–SO2
Operations with significant actual and potential negative impacts on local communities.
NO
114
CORRUPTION DMASO
Management practice
NO
48, on-line
Monitoring of risks
G4–SO3
Percentage and total number of business units analyzed for risks related to corruption.
NO
48, on-line Non-existent evaluation. In 2013, we conducted an action plan to improve our work toward our institutional commitments, which included the Pact for Integrity and Against Corruption. We identified possible improvements, which are under discussion with corporate areas for implementation.
Training and development of skills
G4–SO4
Communication and training on policies and procedures against corruption.
NO
94
Monitoring of risks
G4–SO5
Confirmed cases of corruption and measures taken.
NO
Legal department registered no incidents.
DMASO
Management practice
NO
48
G4–SO7
Unfair competition.
NO
Legal department registered no incidents.
DMASO
Management practice
NO
48
G4–SO8
Monetary value of significant fines and total number of non-monetary sanctions for noncompliance with laws and regulations.
NO
There are no significant cases in 2013, whose defenses and administrative and/or judicial appeals are final and that resulted in fines or other penalties.
Anti-competitive behavior Respect to legislation Compliance Respect to legislation
EVALUATION OF SUPPLIERS ABOUT IMPACTS ON SOCIETY DMASO
Management practice
NO
98, 99
Monitoring of risks
G4–SO9
Percentage of new suppliers screened using criteria for impacts on society.
NO
98, 100, 101
Monitoring of risks
G4–SO10
Significant actual and potential negative impacts on society in the supply chain and measures taken in that respect.
NO
98, 99
MECHANISMS FOR GRIEVANCES AND COMPLAINTS RELATED TO IMPACTS ON SOCIETY Monitoring of risks
DMASO
Management practice
NO
48, on-line
G4–SO11
Number of grievances and complaints about impacts on society filed, addressed, and resolved through formal mechanisms for grievances and complaints.
NO
There was one case in Porto Velho, conducted by the Public Prosecutor’s Office, related to the discharge of dust in the Porto Velho Port. The case was monitored by the environmental area and it was confirmed that the levels of dust were within the limits defined by law.
Sustainability Report 2013
135
SOCIAL CATEGORY – PRODUCT RESPONSIBILITY Material Aspect
DMA and Indicators
Description
Omission
Verification
Page/ response
CLIENT HEALTH AND SAFETY
Respect to legislation
DMAPR
Management practice
NO
41, 48, on-line
G4–PR1
Percentage of significant product and service categories in which health and safety impacts are evaluated to seek improvements.
NO
41 Although the indicator is not material, the company considered it should be reported.
G4–PR2
Total number of incidents of noncompliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle, by type of outcomes.
NO
Clients carry out analyses by product sampling, and at times positivity for salmonella was found. For the grievances made, the positives for salmonella were not confirmed in counter samples that were sent to the lab. AMAGGI develops a salmonella program at points considered critical among the points surveyed in the process. What is the total number of cases of non-compliance with regulations and voluntary codes related to health and safety?
Cases of noncompliance with regulations that resulted in fine or penalty
0
Cases of noncompliance with regulations that resulted in warning
0
Cases of noncompliance with voluntary codes (GRIEVANCES)
6
Total
6
LABELING OF PRODUCTS AND SERVICES DMAPR
Management practice
NO
41
Respect to legislation
G4–PR3
Type of product and service information required by procedures and percentage of significant products and services subject to such information requirements.
NO
Based on IN 42 OF 2012, the MAPA (Ministry of Agriculture, Livestock, and Food Supply) exempted the registration of ingredients in animal feed specific to soymeal, in which case a Technical Report for Registration-Exempt Product (RTPI) containing product information must be created and sent to MAPA. Any change in product formula or label must be approved by the Technician Responsible for the Unit, provided it complies with the current legislation. Classification, identity and quality standards, labeling rules (such as indication of product purpose, expiration date, product storage instructions) and other demands are met. Negotiations include discussions about quality standards of the product supplied to clients, and in the case of any requirement different from the ANEC standard (National Association of Grain Exporters), the Sales Department, aided by Quality and Sustainability, analyses if it is possible to meet the demand. For exports, sales are usually based on the quality defined in ANEC’s contracts both for degummed oil and for soymeal, soybeans, and corn. For products sold as transgenic, extra documents are not required, except for non-GMO products whose clients demand certificates and reports that ensure the authenticated identity and traceability of the product. Products derived from genetically-modified organisms are regulated by IN 01 of 2004 and by international regulations that require the inclusion of the transgenic icon for the identification of transgenic products.
Respect to legislation
G4–PR4
Total number of incidents of noncompliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcome.
NO
There were no cases of noncompliance related to labeling, since we comply with the current legislation. When clients request any extra product information before loading, the company immediately provides it.
136
AMAGGI
Specific Content
Material Aspect
DMA and Indicators
Description
Omission
Verification
Page/ response
COMMUNICATION AND MARKETING DMAPR
Management practice
NO
41
Respect to legislation
G4–PR6
Sale of banned or disputed products.
NO
We are certified by the Programs Identidade Preservada, NGMO e Rastreabilidade. The non-GMO market is very important in the company’s action strategy to supply a demanding market, whether about the type of product or assurance about the social and environmental responsibility of the product produced and sold. Our institutional stand is that we should have any type of product available to ensure the right of choice to our consumer market. As for non-GMO, we are founding members of ABRANGE (Brazilian Association of Producers of Non-Genetically Modified Grains) – whose mission is to promote the market of transgenic-free products, ensuring consumers’ right of choice and offering support to the agribusiness supply chain with technological and innovative solutions that seek transparency, quality, and safety, with economic, social, and environmental sustainability. Furthermore, the company participates regularly in conferences on the topic, and presents these differentials and the results obtained to clients and other companies in the consumer market that wish to maintain the consumption standard.
Respect to legislation
G4–PR7
Total number of incidents of noncompliance with regulations and voluntary codes concerning marketing communications, including advertising, promotion, and sponsorship by type of outcomes.
NO
Legal department registered no incidents.
Respect to legislation
G4–PR8
Breaches of customer privacy and loss of customer data.
NO
No incidents reported.
DMAPR
Management practice
NO
48
G4–PR9
Monetary value of significant fines for noncompliance with laws and regulations concerning the provision and use of products and services.
NO
There were no fines, but we were granted discounts due to product standard deviation according to the definition from ANEC and Mercado Interno. The amount was R$237,232.04.
Privacidade do cliente Respect to legislation
2013 Highlights
Creation of the Department of Corporate Affairs to streamline operations across the sustainability, communications, procurement, internal controls, and engineering areas.
In another year of record production of grain in Brazil, AMAGGI successfully carried out its actions planned for the four business areas with engagement and synergy.
Credits
Governance and management
Creation of the Sustainability Department incorporates this topic into decisionmaking processes New People Committee strengthens the personnel development strategy The Stakeholder Engagement Plan structures the relationship with strategic stakeholders Advances in the Aroeira Project, with the training of 203 leaders including directors, managers, and supervisors Excellence project promotes review of management, logistics, and procurement processes Development of the strategic planning for the André and Lúcia Maggi Foundation
US$ 5 billion in revenue
9
2.8
million tons of grain transported via the Madeira River
João Zamboni
million tons of grain sold
2
new SHEPs
100%
acquisition of DENOFA
Investments in new offices, warehouses, farms, and factories in Brazil and abroad, as well as a new river corridor to channel production through the Tapajós River and the entry into operation of two new small hydroelectric plants (SHEPs), led the company to overcome the logistical problems faced by Brazil in 2013, yielding results that exceed the goals planned for the period.
Revenue of US$ 5 billion in Brazil and abroad. 9 million tons of grain sold in Brazil and abroad 2.8 million tons of grain transported through the Madeira River corridor Acquisition of 100% interest in the Norwegian crusher DENOFA (a reference company in the processing of non-GMO soybeans in Europe) Advances in the Tapajós–Amazonas export corridor and in the construction project for the Maranhão Bulk Grain Terminal (TEGRAM), which will start in 2014. Start of construction work at the Porto Velho (RO) Port Beginning of operations of two new SHEPs: Ilha Comprida and Segredo, in the state of Mato Grosso
See below: - AMAGGI’s major highlights in 2013.
Beginning of operations of the sales office in Switzerland Beginning of construction of four new warehouses in the state of Mato Grosso Purchase of a farm and leasing of another, both located in São Félix do Araguaia, in Mato Grosso
MATERIALITY, GRI CONSULTING, PUBLISHING COORDINATION, AND DESIGN Report Sustentabilidade
GENERAL COORDINATION Juliana de Lavor Lopes Diretoria de Sustentabilidade
TEAM: Luana Bessa (project management and relationship),
EXECUTIVE COORDINATION
Michel Steinecke, Ana Fisch e Érica Liberato (GRI consulting), Gustavo Magaldi (editing), Adriana Camargo Pereira (copy), Report Sustentabilidade (print design) and Paula Mosti (layout).
Edson Cintra Corporate Communications
Revisão Assertiva Produções Editoriais
MATERIALITY AND GRI INDICATORS
The only Brazilian company to participate in the development of the UN’s Sustainable Agriculture Principles
Business
DEPARTMENT OF CORPORATE AFFAIRS
Social and Environmental R$12.5 million in investments and expenses in environmental protection Investment of R$2.6 million in projects in communities, with direct and indirect benefits to 162,300 people through the André and Lúcia Maggi Foundation
Cristiane Borges Social Responsibility
ENGLISH VERSION
PUBLISHING COORDINATION
PICTURES
Franchesca Bogo Daniel Escobar Corporate Communications
Felipe Barros and the communication department archives
Gotcha Idiomas!
PRINTING AND FINISHING Printing Company: Midiograf Print run: 250 copies
FONT TYPE Verdana, Matthew Carter para a Microsoft Corporation, 1996. Sansation, Bernd Montag, 2009.
54 farmers certified according to the Round Table on Responsible Soy (RTRS) guidelines More than 76,000 m3 of water saved with initiatives such as water recycling or reuse 5,600 GJ of energy saved through energy efficiency initiatives
fsc
Sustainability Report 2013
Here I create my history
This is the eighth Sustainability Report published by AMAGGI as a form of communicating with its stakeholders and account for activities developed, goals, and future objectives. This publication follows the guidelines of the Global Reporting Initiative – GRI, an international organization that established the sustainability report standard most widely adopted by companies in different sectors worldwide. The theme of this report is “HERE I CREATE MY HISTORY.” We present testimonials of those who are building the company’s successful history. In order to value our most precious asset –people – AMAGGI invited its employees to tell stories of their personal and professional lives related to the company.
Sustainability Report 2013
www.amaggi.com.br/relatorio2013
In this print version, you will find 10 stories of people that are building the company’s future. These and other testimonials can be seen at http://www.AMAGGI.com.br/relatorio2013. Approximately 50 employees have participated in these stories, some of whom have been with the company for over 30 years, others less than 1, working in the fields, factories, warehouses, hydroelectric plants, and ports. They are the stories of those who, together, are writing the future of AMAGGI.