Sustainability Report Multiexport Foods 2019

Page 1

S U S TA I N A B I L I T Y REPORT



This report has been prepared in accordance with the Global Reporting Initiative Standards (GRI). The information contained in this report covers Multiexport Foods S.A., and all its affiliates. C O N TA C T If you have any questions or suggestions, we invite you to be part of our continuous improvement process regarding this report by writing to the following emails: sustentabilidad@multiexportfoods.com Francisco Lobos Sustainability and Corporate Affairs Manager. flobos@multiexportfoods.com This document is presented in digital format on our website www.multiexportfoods.com ART AND DESIGN DIRECTION Cincel Design www.cinceldesign.com

S U S TA I N A B I L I T Y REPORT

2019


CONTENTS

1

2

3

4

OUR C O M PA N Y pg. 07

C O R P O R AT E GOVERNANCE pg. 23

S TA K E H O L D E R E N G A G E M E N T, M AT E R I A L I T Y A N D C O N TA C T pg. 33

PRODUCTIVE PERFORMANCE pg. 40

5

6

FINANCIAL PERFORMANCE pg. 48

E N V I R O N M E N TA L PERFORMANCE pg. 50

7 SOCIAL PERFORMANCE pg. 65

8 S O C I O - E N V I R O N M E N TA L I N I T I AT I V E S pg. 81

9 GRI CONTENT INDEX pg. 90


5

M E SSAG E F R O M T H E C E O D E A R S TA K E H O L D E R S I am very pleased to present our third Sustainability Report for 2019. This was a year in which we achieved many important goals for our strategic plan, and in which, during the last quarter, we faced a very different scenario as a result of the social unrest that broke out in Chile. In terms of sustainability, our company made significant progress, which demonstrates the importance that we have given to the issue, placing it at the heart of our business model. During the year, we finished reinforcing the structure of the Sustainability and Corporate Affairs Management, with the creation of the Community Relations Management. We also created the Corporate Reputation and Sustainability Board Committee, where strategies and action plans regarding this matter are established. We also started to provide monthly reports on the progress of our sustainability strategy to the company’s board of directors, as well as providing quarterly sustainability management reports to our investors and the Commission for the Financial Market. We have hit many important milestones this year, one of which was completing our first harvests in the Magallanes region, achieving excellent production and health performance, with 100% of the production antibiotic free. Likewise, we became the first salmon company in the world to join the Dow Jones Sustainability Index, the most respected global ESG index. We also announced that we will end our salmon farming operations in Chilean lakes by 2020, a promise that, as of the date of this report, has been fully met. We carried out the third corporate measurement of our carbon footprint, registering it in Huella Chile, and we measured our water footprint for the first time. This information helps us by encouraging us to constantly improve. We renewed our products and sustainability certifications from Best Aquaculture Practices (BAP) and the Aquaculture Stewardship Council (ASC), and it was also certified that 100% of the energy consumed by our processing plants was obtained from renewable sources. We carried out regular initiatives promoting relationships and local development with multiple neighboring organizations and

communities, from the IX to XII regions of the country, and started a powerful project to clean the beaches and the seabed in our concession areas. This report includes many interesting indicators that look at the company from a financial, productive, labor, safety, social and environmental standpoint. These indicators are related to our analysis of material aspects, and account for how we seek to minimize the impact of our activities, while reaffirming our commitment to the United Nations sustainable development goals for 2030. As an organization, we understand that today we live in a time full of challenges: the world is facing an unprecedented pandemic, with unknown epidemiological, health and economic effects; and this is added to the fact that our entire society is going through turbulent times. As far as it is in our hands, we will continue to direct a sustainable path towards caring for our people, keeping our supply chain in operation, and maximizing value for our shareholders and all our stakeholders. We know that we will be successful in these objectives, as we are supported by our solid financial position and great farming conditions, added to the commitment, experience and professionalism of our teams, all of which assures us that we will be able to continue making and implementing the right decisions to move forward. Finally, I want to thank each and every one of Multiexport’s collaborators, because all of them contribute to the sustainability of our company.

AND RÉS LYO N LAB B É CEO Multiexport Foods


OUR COMPANY

6

M U LT I E X P O R T F O O D S AT A G L A N C E 2 0 1 9

2,654 61.61% 1,635

38.39% 1,019

TOTA L CO L L A B O R ATO R S

46 FA R M S O P E R AT E D

95.5

USD 568

Thsd TON WFE

Million

H A R V E S T E D VO L U M E

96.1 Thsd TON WFE P R O C E S S E D VO L U M E

TOP 1

FIRST EXPORTER OF SMOKED PRODUCTS OF CHILE .

TO TA L S A L E S

TOP 2 USD 84 Million E B I T DA

TOP 3

S E CO N D E X P O R T E R O F AT L A N T I C S A L M O N O F CHILE .

THIRD EXPORTER OF ALL SPECIES OF CHILE .

Total in Multiexport and external plants

90.1

USD 43

Thsd TON

Million

VO L U M E S O L D

PROFIT

TOP 6

S I X T H E X P O R T E R BY P R O D U C E D VO L U M E WO R L DW I D E .


O U R C O M P A N Y

CHAPTER

OUR COMPANY

01

7


OUR COMPANY

8

S T R A T E G Y

MISSION

VISION

To feed the world with superior quality products, meeting the needs of consumers through efficient business management based on people, innovation, care for our environment and good relations with our local communities. Our products are a source of life.

Become one of the most important companies in aquaculture worldwide; be recognized for the quality of our products, our passion for innovation, the profitability of our operations and our strong sense of social responsibility.

VA L U E S

Commitment to Our People: We deeply value the personal, family and professional development of our staff, providing them with the skills, the work environment and the opportunities necessary to make them human beings who are happier, more productive and more committed to their work.

Social Role: For Multiexport Foods, the company is conceived as an extension of man and as such, it is an exceptional way to contribute to the development of society. With this conviction we carry out our work, which is founded on our great commitment to both the wellbeing of the communities where we are based and the protection of their environment.

Passion for innovation: Only innovation and continuous improvement lead to excellence. And that is always our goal.

Market Orientation: We carefully consider the needs of the market in order to offer the best value propositions. Likewise, we pay careful attention to our clients so we can provide them with optimum quality of service before and after the sale.

Ethical Conduct: We act with professionalism, moral integrity, loyalty, and deep respect for people. The principles of humanism guide everything we do. OUR COMPANY

Quality: Our processes and products are made with the highest quality and safety standards available in the market.

8


OUR COMPANY

9

I N T E G R AT E D P O L I C Y Quality, environment, health and safety, sustainability, and food safety. MULTIEXPORT FOODS S.A., through its affiliates, establishes that the production processes, processing and commercialization of salmon, as a superior product, must be carried out with sustainable and ethical behavior, closely related to the Safety, Quality and Social Responsibility of the company, which is expressed through care and preservation of the Environment, Biodiversity and Safe Labor Practices. Furthermore, we consider that we are moving towards Excellence when we exceed and increase the level of satisfaction and expectations of our Customers, when we maintain high standards of Food Safety and product technical specifications, when we improve productivity rates and pursue efficiency in the use of resources by implementing new farming and processing strategies.

We are moving towards Excellence when we become aware of and apply contamination awareness and respect for the Environment and its Biodiversity in all our processes, and when we recognize that our productive goals must be achieved with special emphasis on the Occupational Health and Safety of our workers.

Along with this, we assume the commitment to comply with the applicable Legislation in areas such as Food Safety, Quality, the Environment, Food Defense, Occupational Health and Safety, and with the following voluntary commitments: ISO 9001, BRC, IFS, ISO 14001, ISO 45001, GLOBALG.A.P., BAP-GAA, ASC Salmon Standard and Marine Stewardship Council (MSC).

This is why we assume the commitment to implement a Sustainable Process of continuous participatory and multidisciplinary improvement, in which all of the members of the organization, with a preventive attitude, serve as the main promoters of Safety, Quality, the preservation of the Environment and Occupational Health and Safety, both individually and collectively. ANDR É S LYON LABBÉ CEO Multiexport Foods


OUR COMPANY

10

S U S TA I N A B I L I T Y A N D C O R P O R AT E R E P U TAT I O N S T R AT E G Y

Sustainability is at the heart of our business model. For this reason, the new Sustainability and Corporate Affairs Management was implemented this year, and provided with the human and budgetary resources necessary to carry out an ambitious long-term plan. This corporate unit works under the guidelines of the new Committee of Directors for Sustainability and Corporate Reputation, which is composed of and managed by a founding director and two independent directors.

In 2019 we presented our Sustainability and Corporate Reputation Strategy to the organization and our stakeholders. The strategy was formed from the diagnosis of material aspects deriving from the interaction between salmon farming and society. From there, the strategy promotes improvements through long-term action plans, involving the entire organization.

ESG PILLARS*

01

C O R P O R A T E

02

B U S I N E S S

03

04

G O V E R N A N C E

P R O D U C T

C U S T O M E R S

*ESG: environmental, social and governance.

• Business Ethics • Risk Management • Corporate Strategies • Regulatory Compliance • Communication • Increasing Demand • Responsible Farming • Productivity • Attractive Investment • Supply Management • Organic Growth • Technologies • Nutritional Attributes • Traceability • Food Safety • Product Development • Marketing Strategies • Relationship Development • Satisfaction • Transparency

05

E N V I R O N M E N T

• Health Strategy • Welfare • Biodiversity • Fish Escapes • Control of Environmental Impacts • Waste Management • Climate Change Strategy

06

P E O P L E

• Code of Conduct • Health and Safety • Attractive Source of Employment • Integrity • Talent Management • Research and Innovation

C O M M U N I T I E S

• Shared Value • Presence and Dialogue • Transparency • Local Suppliers

07


OUR COMPANY

11

S U S TA I N A B I L I T Y A N D C O R P O R AT E R E P U TAT I O N S T R AT E G Y F O C U S

O N

H I G H

M U LT I E X P O R T

R E P O R T A B I L I T Y

S U S T A I N A B L E

P E R F O R M A N C E

S O C I E T Y

A N D

O P E R A T I O N S

C O R P O R A T E

C U LT U R E

S T A N D A R D S

M O D E L

0%

100%

waste to landfill • Processing 2020 • Farming 2022

participatory cultural transformation process

Traceability Pilot – Blockchain

Redefinition of value proposal, alignment and leadership

0 escape events from our facilities

100% of clean seabed of inorganic waste prior to the next use by 2020

60% antibiotic (AB) reduction by 2025

25% of production “AB Never Use” by 2021

100% of coastal areas close to our operations under a permanent cleaning program

100% of our Stakeholders identified, evaluated and with a relationship plan

Carbon Footprint Annual Assessment

-20% reduction of our carbon footprint by 2020 Carbon Neutral by 2025 Electromobility pilot in the corporate fleet of vehicles

< 0,7 FIFO < 0,7 (FISH IN FISH OUT) Ratio for the conversion of wild feed fish to farmed fish

A N D

Participation in GSI (Global Salmon Initiative) and SalmonChile Sustainability Annual Reports Multiexport Foods Annual Sustainability Report

S U R V E I L L A N C E

C O R P O R A T E

A N D

C O M M U N I C A T I O N

C E R T I F I C A T I O N

100%

Communications Policy

of our staff trained annually

Corporate Storytelling

0 infractions and fines

100% of our productive facilities operating under BAP* standard

7 ASC certified farms by 2020

*BAP: Best Aquaculture Practices.

T R A N S P A R E N C Y

Mainstream and Social Media Strategy


S U S TA I N A B I L I T Y IS THE HEART OF

OUR COMPANY

OUR COMPANY

12

OUR BUSINESS. 12


OUR COMPANY

13

S U S TA I N A B I L I T Y IS OUR BUSINESS F O U N D AT I O N S

FARMED SALMON

CHICKEN

PORK

BOVINE

OVINE

GLOBAL PRODUCTION

3 .4

114.3

120.9

6 7.4

9.8

1.2-1.5

1.7-2.0

2.7-5.0

6.0-10.0

68%

46%

52%

N O DATA

38%

23%

10%

14%

N O DATA

5%

25%

27%

16%

7%

N O DATA

3.7

7. 1

11

102

185

0.60

0.88

1.30

5.92

N O DATA

Measured in Millions of Tons. FEED CONVERSION RATIO (FCR)

Measures the productivity of different protein production methods. It demonstrates the kilograms (kg) needed to increase the animal’s bodyweight by 1kg. EDIBLE YIELD

Edible yield is calculated by dividing edible meat by total body weight.

N O DATA

ENERGY RETENTION

Describes the efficiency of a product in retaining energy from food. This is calculated as a percentage (energy in edible parts/gross energy feed).

CALORIE RETENTION

Describes the gain in edible calories as a percentage of the calorie intake from feed. It is calculated as a percentage (calories in edible portion / calories in feed).

LAND USE

Amount of land needed to produce 100g of edible protein. CARBON FOOTPRINT

Measures in grams of carbon dioxide equivalent (g CO2e) per typical serving (40g) of edible protein of the product. Data are median values.

Source: GSI Sustainability Report, https://globalsalmoninitiative.org/


OUR COMPANY

14

SALMON BUSINESS MANAGEMENT MODEL Our current management model is structured around obtaining maximum efficiency from each of the stages of the value chain, from breeding in fresh water to harvest in sea water, as well as in added value and sales, where the processing and smoked products sectors stand out. In this way, we aim for each stage to operate in an independent but coordinated manner, in order to maintain the focus of the business, facilitating management within the company. Providing support to the business units are the Administration and Finance, Sustainability and Corporate Affairs, Information Technologies, and Human Resources areas.


OUR COMPANY

15

SEA WATER GROWING

PROCESSING

VA L U E C H A I N

FRESH WATER BREEDING

Multiexport Foods is integrated vertically, from reproduction to distribution to the final customer, adding value in every stage of the business chain.

ADDED VALUE

SALES AND DISTRIBUTION

GENETICS AND REPRODUCTION

GENETICS AND

FRESH WATER BREEDING

SEA WATER GROWING

PROCESSING

ADDED VALUE

SALES AND DISTRIBUTION

REPRODUCTION

This includes the incubation, spawning and smoltification phases. We have 5 land-based hatcheries with high quality technology that allows the reutilization and recirculation of the water (70 – 97%).

The fish farming process starts with an approximate weigh of 150 grams, up to when they reach their commercial size. Our operations in this phase are developed in the X, XI and XII Regions of Chile.

We have two processing plants located in Puerto Montt, one for fresh and frozen products, and the other for smoked products. Together, they have a processing capacity of 80 thousand tons per year.

Here, innovative products are developed and commercialized, according to the needs and trends of customers and markets all over the world.

We supply over 900 thousand portions of salmon daily, to more than 30 countries around the world.

We have a program of genetic selection with breeders that are individually checked to ensure that they comply with the best conditions. Egg production mainly comes from our own breeders, which are kept in freshwater facilities inland.


OUR COMPANY

16

S A L M O N FA R M I N G C YC L E AT L A N T I C SALMON

COHO SALMON

2 months

2 months

SPAWNING

4 months

3 months

SMOLTIFICATION

7 months

4 months

14 - 18 months

9 months

Total 27 - 31 months

Total 18 months

GENETICS AND REPRODUCTION

FRESH WATER BREEDING

SEA WATER GROWING HARVEST

I N M AY 2 0 1 9 , T H E B OA R D O F D I R E C TO R S D E C I D E D TO E N D S M O LT P R O D U C T I O N I N C H I L E A N L A K E S BY 2 0 2 0. T H I S ANNOUNCEMENT IS IN LINE WITH O U R CO M PA N Y ’ S CO M M I T M E N T TO T H E E N V I R O N M E N T A N D S U S TA I N A B I L I T Y.


OUR COMPANY

17

GEOGRAPHIC L O C AT I O N

A R AU C A N Í A REGION LOS RÍOS REGION

4

RIVER

1

H ATC H E R Y

CONCESSIONS L O S L AG O S

( 1 2 H E C TA R E S )

REGION

4 23

H ATC H E R I E S SEA CONCESSIONS (2 3 8 H E C TA R E S )

AY S É N PROCESSING

REGION

76

PLANT SEA

FRESH AND

CONCESSIONS

F R OZ E N P L A N T

(6 1 2 H E C TA R E S )

AND SMOKED PLANT

WE ARE IN 25 NEIGHBORHOODS

M AG A L L A N E S REGION

OR GROUPS OF SALMONID CO N C E S S I O N S , W I T H A TOTA L O F 1 0 6 S E A WAT E R CO N C E S S I O N S . T H I S A L LOWS U S TO G UA R A N T E E A N D OPTIMIZE THE CONTINUITY AND EFFICIENCY OF OUR P R O D U C T I V E O P E R AT I O N S .

7

SEA CONCESSIONS ( 70 H E C TA R E S )


2019 SUSTAINABILTY MILESTONES The Community Relations Management is created

Salmon Chile and GSI Sustainability Reports

The Committee of Directors on Sustainability and Corporate Reputation is created

Rules for Good Practices with Communities was signed

Our carbon footprint is registered at “Huella Chile�. Multiexport Foods S.A. is recognized by being incorporated into the Dow Jones Sustainability Index (DJSI) the most prestigious ESG rating worldwide

Group BAP certification

Ganso Farm ASC certification

JANUARY

MARCH

Climate Change Strategy

APRIL

M AY

Announcement of the end of smolt production in lakes (starting in 2020)

MEF Sustainability Report

J U LY

First Atlantic Salmon harvest in the Magallanes region antibiotics and antiparasites free

Upgrade OHSAS 18001 to ISO45001

The energy used at the processing plant is certified as 100% renewable

New offices are inaugurated at Cardonal Campus, an energy efficient and highly sustainable building

AUGUST

Sustainability and Corporate Reputation Strategy

SEPTEMBER

OCTOBER

DECEMBER

Electro-mobility pilot starts

ASC Farms certification, XII Region

OUR COMPANY

OUR COMPANY

18

18


OUR COMPANY

19

SALES AND MARKETS Our main export markets are the United States, Brazil, Japan, China and Russia, where value-added products represent 43% of total sales. MIAMI COMMERCIAL OFFICE HONG KONG COMMERCIAL OFFICE METROPOLITAN REGION SANTIAGO HEADQUARTERS LOS LAGOS REGION

2019 MEF Exports (Millions USD FOB)

CAMPUS CARDONAL

19 RUSSIA

62 12

214 NORTH AMERICA

EUROPE

3

ASIA

62 JAPAN

W E A R E P R O U D TO

WESTERN ASIA

S U P P LY OV E R 9 0 0 106 LATIN AMERICA

THOUSAND PORTIONS OF S A L M O N DA I LY TO M O R E T H A N 3 0 CO U N T R I E S A R O U N D T H E WO R L D


20 OUR COMPANY

IN 2019, OUR SALES I N C R E A S E D TO U S D 568 MILLION, 6% MORE THAN 2018

Sales by Product Format (Millions USD FOB)

Sales by Specie (Thsd TON)

FROZEN

114.99 SMOKED

42.80

FRESH

2% 1.54

348.84

TROUT

92% 83.93

7% 6.52

AT L A N T I C

COHO

SALMON

SALMON


OUR COMPANY

21

BRANDS AND PRODUCTS We have 8 official brands, with a focus on the following:

S A L M O N I S T H E O N LY A N I M A L P R OT E I N W H I C H P R OV I D E S O M E G A 3

Proportion of Processed Products MEF Plants by Type

51.1%

35.95%

7.36%

3.99%

0.98%

0.62%

FILLET

WHOLE

LOINS

SLICED

PORTIONS

OTHER


OUR COMPANY

22

L AT I T U D E 4 5 ° , O U R B R A N D O F S M O K E D S A L M O N I N T H E U N I T E D S TAT E S , G R E W A N D E X PA N D E D I N 2 0 1 9 . PA R T N E R S H I P S W I T H T H E M A I N R E TA I L E R S I N T H E CO U N T RY, S U C H A S WA L M A R T, B J ’ S , S A M ’ S C LU B , W I N N D I X I E A N D M E I J E R , HAS POSITIONED THE BRAND AS THE AU T H E N T I C S A L M O N F R O M C H I L E A N PATAG O N I A , D U E TO D I G I TA L M A R K E T I N G C A M PA I G N S A N D A DV E R T I S I N G AT R E TA I L O U T L E T S , R E AC H I N G M O R E THAN 20 MILLION NORTH AMERICAN CO N S U M E R S , W I T H S A L E S S U R PA S S I N G 3 6 3 ,0 0 0 K I LO S .


C O R P O R A T E G O V E R N A N C E

CHAPTER

OUR COMPANY

02

23


CCOORRPPOORRAATTEE GGOOVVEERRNNAANNCCEE

24

OWNERSHIP AND CONTROL M U LT I E X P O R T FOODS S.A. BUSINESS NAME

Multiexport Foods S.A

TA X I D N o .

76.672.100-1

T Y P E O F C O M PA N Y

Open Stock Corporation

R E G I S T R AT I O N I N THE SECURITIES REGISTRY

Nยบ 979

ADDRESS

Av. Cardonal 2501, Puerto Montt, Region of Los Lagos

TELEPHONE

(56-65) 2 483 700

FA X

(56-65) 2 483 701

W E B PAG E

http://www.multiexportfoods.com/

EMAIL ADDRESS

inversionistas@multiexportfoods.com

MNEMONIC CODE I N T H E STO C K M A R K E T

Multifoods

E X T E R N A L AU D I TO R

PricewaterhouseCoopers

M I T- S A L M O N S PA . ( M I T S U I & C O. (USA), INC.)

76.626849% SALMONES M U LT I E X P O R T S.A.

M U LT I E X P O R T PAC I F I C FA R M S S . A . 99.99998897% 0.00001103%

23.373151%

A L I M E N TO S MUTIEXPORT S.A. 99.9975%

M U LT I E X P O R T FOODS INC. USA 100%

99.99999212%

S A L M E X 2 S PA .

0,0025%

0.00000788%

SOC. INVERSIONES I S L A V I C TO R I A LT DA . 99%

C U LT I VO S AC U ร C O L A S N AC I O N A L E S S.A. 99%

C U LT I VO S O T WAY S . A .

1%

1%

0.01%

35.27% OT H E R I N V E S TO R S

M U LT I E X P O R T PATAG O N I A S . A .

99.99%

100%

64.73% CONTROLLER GROUP


C O R P O R AT E G O V E R N A N C E

25

C O R P O R AT E GOVERNANCE COMPOSITION

José Ramón Gutiérrez Arrivillaga CHAIRMAN

In accordance with our bylaws, Multiexport Foods is led by a Board of Directors with seven members elected every 3 years at the Ordinary Shareholders’ Meeting, who remain in office for the same number of years (said period may be renewed). The members of the Board of Directors elect the Chairman for the same period, and he/she may be re-elected. At their meeting, held on April 24th, 2019, the shareholders’ assembly of Multiexport Foods S.A. elected the Board for the 2019-2022 period, with José Ramón Gutiérrez, Martín Borda, Alberto de Pedregal, Hernán Goyanes and Carlos Pucci being ratified, and two new directors joining the board: Rodrigo Pérez Mackenna and Elke Schwarz. Elke Schwarz is the first woman to join the Company’s Board of Directors. • Multiexport Foods does not request minimum attendance from its Directors. • Multiexport Foods does not restrict the number of boards that its Directors can participate in.

Note: We welcome the definition of Independent Director given by the law No. 18,046 for open stock corporations. Their main characteristic is that they have no relationship with the company, the other companies in the group it is part of, its controller company, or with the main executives of any of these. In this way, the independent directors contribute to the exercise of fair, objective, and impartial judgement on the occurrence of possible conflicts of interest between the different classes of shareholders, or between the shareholders and the administration.

Civil Industrial Engineer 7,017,364-6 Alberto del Pedregal Labbé

Martín José Borda Mingo

DIRECTOR

DIRECTOR

Business Administrator 6,604,969-8

Economist 7,010,555-1

Elke Renate Schwarz Kusch

Carlos Pucci Labatut

INDEPENDENT DIRECTOR

DIRECTOR

Civil Engineer 6,474,225-6

Journalist 8,858,781-2

Rodrigo Perez Mackenna

Hernán Salvador Goyanes García

INDEPENDENT DIRECTOR

INDEPENDENT DIRECTOR

Civil Engineer 6,525,287-2

National Public Accountant 48,082,143-2


C O R P O R AT E G O V E R N A N C E

26

BOARD DIVERSITY BY GENDER

Number of women

BOARD COMMITTEE 2018

2019

0

1

1

1

B Y N AT I O N A L I T Y

Number of foreigners B Y AG E R A N G E

< 35 years

0

0

0

0

51 - 65 years

6

7

> 65 years

1

0

35 - 50 years

This is composed by Elke Renate Schwarz Kusch, Hernán Salvador Goyanes Garcia, and Rodrigo Pérez Mackenna, who were chosen in the meeting held on April 24th, 2019. Hernán Goyanes was appointed as the Chairman of the Committee, and the attorney Rubén Bascuñán as the Secretary of the Minutes.

the external auditors and the risk rating agency, after evaluating their proposals. • Examination of operations in relation to transactions with related parties.

· The Board Committee met 12 times during the year, with an average attendance of 94.05% of the members.

• Examination of the remuneration system and compensation plans for managers and executives.

During this period, the Board Committee agreed to fulfill its duties and exercise the powers established in article 50 bis of law 18,046

Additionally, the following matters are also reviewed in the meetings of the Board Committee:

The main subjects addressed in these meetings were the following:

• Status and progress of essential risks of the company, studied using the ARCE methodology

• Quarterly financial statements presented by the administration. • Corporate standards Note: The average seniority (tenure) of Multiexport Foods’ Board is 10 years.

• Examination of the reports from external auditors, the balance sheet, financial statements and the internal control letter presented by PwC. The committee ruled on these documents prior to their submission to the board. They also proposed names for

• Internal Audit Reports • Other matters according to requirements that arise periodically.

Multiexport Foods Board Committee CHAIRMAN OF THE COMMITTEE

Hernán Salvador Goyanes García 48,082,143-2

DIRECTOR

DIRECTOR

Elke Renate Schwarz Kusch 8,858,781-2

Rodrigo Pérez Mackenna 6,525,287-2


C O R P O R AT E G O V E R N A N C E

27

S U S TA I N A B I L I T Y A N D C O R P O R AT E RESPONSIBILITY BOARD COMMITTEE In order to lead the company’s sustainability and corporate reputation strategy, in 2019, Multiexport Foods formed a board committee who will guide and advise General Management and Sustainability and Corporate Affairs Management on these matters. The committee is made up of directors José Ramón Gutiérrez, Elke Schwarz and Rodrigo Pérez Mackenna. There will also be executives taking part in these committee meetings on a permanent basis, and these are the CEO, Andrés Lyon, the Sustainability and Corporate Affairs Manager, Francisco Lobos, and the Marketing Manager, Cecilia Rojas.

The main topics addressed in these meetings were the following: • Diagnosis of material aspects in the interaction between salmon farming and society • Development of the sustainability and corporate reputation strategy • Management of and relations with the community • Corporate communications plan • Cultural transformation project • Social contingency and foundations for a new agenda with stakeholders

• The Sustainability Committee met 5 times during the year, with an average attendance of 100% of the members.

Multiexport Foods Sustainability Committee

CHAIRWOMAN OF THE COMMITTEE

Elke Renate Schwarz Kusch 8,858,781-2 Permanent member DIRECTOR

DIRECTOR

Rodrigo Pérez Mackenna 6,525,287-2 Permanent member

José Ramón Gutierrez Arrivillaga 7,017,364-6 Permanent member


C O RCPOORRPAO TR E AGT O E VGE O R VNEARNNCAEN C E

28

I N 2 0 1 9 , T H E S U S TA I N A B I L I T Y A N D CO R P O R AT E R E P U TAT I O N B OA R D CO M M I T T E E WA S C R E AT E D TO P R OV I D E G U I DA N C E A N D A DV I C E TO G E N E R A L M A N AG E M E N T A N D S U S TA I N A B I L I T Y A N D C O R P O R AT E A F FA I R S M A N AG E M E N T O N S U C H M AT T E R S .


A N D R É S LY O N

FRANCISCO LOBOS

R I C A R D O G R Ü NWA LD

GINO MANRÍQUEZ

YO I C H I R O YAG I H A S H I

MARTÍN HEPP

Corporate General Manager Civil Industrial Engineer, Pontificia Universidad Católica de Chile ID No.: 10,019,058-3

Sustainability and Corporate Affairs Manager Marine Biologist, Universidad de Concepción, Civil Industrial Engineer, Universidad San Sebastián MBA, Universidad Mayor ID No.: 13,623,808-6

Commercial Manager Civil Industrial Engineer, Pontificia Universidad Católica de Chile ID No.: 7,080,918-4

Administration and Corporate Finance Manager. Business Administrator, Pontificia Universidad Católica de Chile. MBA, Pontificia Universidad Católica de Chile ID No.: 10,626,204-7

New Business Development Asian Markets Business Administrator, Keio University, Japan ID No.: 26,842,838-0

Farming Manager Civil Industrial Engineer, Pontificia Universidad Católica de Chile ID No.: 15,782,459-7

J O H N M AT E O

MARCELO CISTERNAS

RUBÉN BASCUÑAN

RODRIGO RODRÍGUEZ

JASON PAIN E

SEBASTIÁN ORTEGA

Processing Division Manager Chemical Civil Engineer and Master’s degree in Engineering Sciences, Universidad de Santiago de Chile ID No.: 11,863,124-2

Human Resources Manager Business Administrator, Pontificia Universidad Católica de Chile ID No.: 9,832,861-0

In House Lawyer Lawyer, Pontificia Universidad Católica de Chile ID No.: 8,108,412-2

Information Technology (IT) Manager Computer Science Engineer, Pontificia Universidad Católica del Maule. Master’s degree in Computing Management, IDE Spain ID No.: 10,021,849-6

Manager of Multiexport Foods Inc. USA Aquaculture Technology

Auditor Civil Industrial Engineer, Pontificia Universidad Católica de Chile ID No.: 13,551,832-8

Graduate from the Florida Institute of Technology. MBA, University of Miami, United States.

C O R P O R AT E G O V E R N A N C E

MAIN EXECUTIVES

29


C O R P O R AT E G O V E R N A N C E

30

BOARD

O R G A N I Z AT I O N A L STRUCTURE

CEO G eneral M anagement

Auditor Marketing Management

Sustainabilit y and Corporate

Environment

Af fairs M anagement

and Concessions

Legal Counsel

Management Communit y Relations

Farming

Process

Commercial

H uman

Administration

IT

M anagement

M anagement

M anagement

Resources

and Finance

M anagement

M anagement

M anagement

Fresh Water

O perations

G eneral

H uman

Accounting

Produc tion

and Plants

Projec ts

Management

Resources

and Finance

Management

Management

Management

M ultiexpor t

Management

Management

Produc tion

Q ualit y

Foods Inc . USA

O perations

Administration

Management

A ssurance

Management

Value Added

ChiloĂŠ -

Management

Produc ts

Puyuhuapi Area

Engineering

Produc tion

Management

A sia Market

and Financial

Management

Logistic s

Management

Liabilit y

Cordillera Area

Management

L atam Market

Management

Management

Supply

Russian Market

Management

and others

Control

Management

Management

Produc tion Management M elinka Area Produc tion Management AysĂŠn Area

Management

Management

Management Per formance, Development

Logistic s Management

Produc tion Management Magallanes Area O perations and Logistic s Management H ealth Management Food and N utrition

Responsibility at the executive level for economic issues falls on the Administration and Finance Manager.

Management Per formance and Planning Management

Responsibility at the executive level for environmental and social issues falls on the Sustainability and Corporate Affairs Manager as well as the review and approval of this report.


C O R P O R AT E G O V E R N A N C E

31

R E M U N E R AT I O N BOARD The remuneration for the Board of Directors is set at each Ordinary Shareholders’ Meeting. Directors are paid for each time they attend, and there is a difference in pay for the Chairman of the Board and the Committee of Directors. At the Ordinary Shareholders’ Meeting held on April 24th, 2019, it was agreed that the position of Director would be paid an amount of $1,750,000 for attendance at each meeting, and the Chairman of the Board $3,000,000. For the Board Committee, the remuneration was set at $750,000 for attendance at each meeting, with the Chairman of the Board Committee receiving $1,750,000 for each meeting. Finally, a budget for operating expenses for the Committee and its eventual advisors was set as a maximum of $50,000,000. Directors José Ramón Gutiérrez and Carlos Pucci have voluntarily waived 100% of their remuneration for being part of Multiexport ordinaries board meetings.

EXECUTIVES The total amount of remuneration received by the company’s senior managers and executives during the year amounted to US$ 8.126M. Multiexport Foods has an incentive system consisting of an annual bonus, applicable to the main executives and other positions considered eligible at the company’s discretion. This compensation system seeks to motivate the respective executive through a formal scheme that rewards both individual performance and the creation of economic value.


C O R P O R AT E G O V E R N A N C E

32

S TA N D A R D S A N D T R A N S PA R E N C Y

I D E N T I F I C AT I O N A N D M A N AG E M E N T O F R I S KS

For Multiexport, ethical conduct is an integral part of our company values. This is why we have an Ethics Committee which is in charge of resolving any ethics issues that are identified. In addition, there is a whistle-blower system (email, traditional mail, and telephone) designed for receiving information related to ethical breaches.

In order to strengthen Multiexport’s Corporate Governance, at the beginning of 2019 we created the Comptroller’s Office, which is responsible for Risk Management and Internal Audits. In 2019, the Comptroller’s Office worked on defining its functions and organization, with the objective of separating the Risk Management and Internal Audit units, but keeping them under the same base methodology. For this purpose, a comprehensive risk management project began in the fourth quarter, with the aim of updating the process map, determining risk appetite and risk tolerance, and surveying strategic risks, emerging risks and operational risks, in order to obtain a risk map based on which both the Risk Management and Internal Audit units will carry out the activities of each function.

The mission, vision, and values of the company, as well as the Code of Ethics, were prepared in the context of the implementation of the Crime Prevention Model. These documents were carried out with the advice of external consultants and were subsequently approved by the Board. The Code of Ethics is the responsibility of the Ethics Committee, which is made up of directors and the General Manager. Annually, the Ethics Committee reviews and updates the Code of Ethics, which is delivered to all new workers in the company. In 2019, Multiexport Foods did not report any cases in which the Code of Conduct was violated or that led to fines by regulatory bodies.

POLITICAL INFLUENCE In line with its internal rules and regulations, Multiexport did not provide contributions to any political campaigns, political organizations, lobby organizations, lobbyists and/or other tax-exempt groups with political influence in 2019.


C O R P O R AT E G O V E R N A N C E

33

S T A K E H O L D E R S E N G A G E M E N T , M A T E R I A L I T Y A N D

C O N T A C T

CHAPTER 03


S TA K E H O L D E R S E N G A G E M E N T, M AT E R I A L I T Y A N D C O N TA C T

34

S U S TA I N A B L E D E V E L O P M E N T G OA L S U N I T E D N AT I O N S O R G A N I TAT I O N We assume the responsibility of achieving the Sustainability Goals of the United Nations. The operations of Multiexport Foods are in line with several of the 17 goals, but for the purpose of this report we will focus on those with the greatest impact.


S TA K E H O L D E R S E N G A G E M E N T, M AT E R I A L I T Y A N D C O N TA C T

35

M A T E R I A L I T Y A N A LY S I S In 2019, we focused on the topics that have the greatest impact on our management, in environmental, social, and economic terms. The above was based on a materiality analysis carried out in 2018, which conducted surveys of different interest groups, following the guidelines delivered by the Global Reporting Initiative (GRI). This was also supplemented by a study carried out in 2019 that aimed to define the guidelines of our Sustainability and Corporate Reputation Strategy. Based on the above, we have developed a robust sustainability strategy focused on the issues that concern our stakeholders, with particular focus on our corporate governance, business, products, customers, the environment, our staff, and our neighboring communities.


L A B O R P R AC T I C E S

M AT E R I A L I T Y M AT R I X

S TA K E H O L D E R S E N G A G E M E N T, M AT E R I A L I T Y A N D C O N TA C T

36

FISH ESCAPES L O C A L E C O N O M I C I M PAC T

CO M M U N IT Y M A N AG E M E NT

A N I M A L W E L FA R E

C O M M U N I C AT I O N C H A N N E L S

7,0

ENERGY EFFICIENCY

PROFESSIONAL DE VELOPM ENT

BUSINESS ETHICS FOOD

FOOD SAFET Y

S U S TA I N A B I L I T Y

U S E O F M E D I C AT I O N

T R A N S PA R E N C Y

6,5 PRODUCTIVE PERFORMANCE BIODIVERSITY

S T R AT E G Y EMISSIONS I M PAC T O N L A N D S C A P E S

6,0 I M P O R TA N T F O R I N T E R E S T G R O U P S

T R AC E A B I L I T Y C E R T I F I C AT I O N S

N AT U R A L

LOCAL

RISKS

DE VELOPM ENT

R E L AT I O N S H I P W I T H

FINANCIAL I N D I C AT O R S

SUPPLIERS N AT I V E P E O P L E

QUALITY OF PROCESSES

5,5

AND PRODUCTS

D O N AT I O N S AND

A N A LY S I S

DE VELOPM ENT

OF THE

OF LOCAL

CONTEXT

SUPPLIERS

COMMERCIAL MANAGEMENT

F R E E A S S O C I AT I O N

SOCIAL

CONTRIBUTIONS

E N V I R O N M E N TA L ECONOMIC

5,O 5,O

5,5

6,0

6,5

7,0

CROSSOVER ISSUE

I M P O R TA N T F O R M U LT I E X P O R T F O O D S Note: Scale from 1,0 to 7,0 for both axis.


S TA K E H O L D E R S E N G A G E M E N T, M AT E R I A L I T Y A N D C O N TA C T

37

S TA K E H O L D E R S In order to align our management with the requirements of our environment, we systematize our interactions with stakeholders; by generating dynamic, continuous dialogues with them it allows us to continue strengthening our relationship in the long term.

SHAREHOLDERS

CUSTOMERS

INVESTORS

AUTHORITIES

A P P R OAC H TOWA R DS TH E

A P P R OAC H TOWA R DS TH E

A P P R OAC H TOWA R DS TH E

A P P R OAC H TOWA R DS TH E

COM PANY

COM PANY

COM PANY

COM PANY

They are interested in production results and long-term performance, focusing on strategy, business image, and risk management.

Their main focus is on the quality, safety and sustainability of the food.

They are interested in investment returns.

Their main concerns are the stability of the sector in the long term and the social environment.

I N I T I AT I V E S F R O M T H E C O M PA N Y I N I T I AT I V E S F R O M T H E C O M PA N Y

I N I T I AT I V E S F R O M T H E C O M PA N Y

We maintain fluid relations with controlling shareholders through meetings and periodic reports. C O M M U N I C AT I O N C H A N N E L S

· Board Meetings · Annual Report and Financial Statements · Sustainability Report · Shareholders’ Meeting · Press Events

We strive to exceed customer expectations, and evaluate their satisfaction using various tools. C O M M U N I C AT I O N C H A N N E L S

· Attention from Commercial Executives · Marketing Campaigns · Certifications · Customer satisfaction surveys · Participation in Seafood Fairs · Sustainability Report

We strive to maintain a continuous and open dialogue with investors and fund administrators, through the annual report, quarterly reports, essential communications, and the direct investor service channel.

I N I T I AT I V E S F R O M T H E C O M PA N Y

We promote open and transparent dialogue with the authorities. We participate in specific sector discussions. C O M M U N I C AT I O N C H A N N E L S

C O M M U N I C AT I O N C H A N N E L S

· Quarterly Financial Reports · Direct Channel for providing Assistance to Investors · Annual Report and Financial Statements · Multiexport Foods Annual Conference · Sustainability Report · Press releases

· Meetings with Public Agencies · Public-Private Worktables · Inspections and Visits · Sustainability Report


S TA K E H O L D E R S E N G A G E M E N T, M AT E R I A L I T Y A N D C O N TA C T

38

SUPPLIERS

NGO'S, LOCAL

E M P LOY E E S

A P P R OAC H TOWA R DS TH E

COMMUNITIES, UNIONS

A P P R OAC H TOWA R DS TH E

COM PANY

AND ACADEMIA

COM PANY

They take care to meet the expectations of the company at all stages, meet objectives and achieve long-term relationships. I N I T I AT I V E S F R O M T H E C O M PA N Y

We seek to encourage total commitment from our suppliers, and we support them so that they can achieve the highest operational standards. We promote prompt payment for services and supplies, to facilitate a fair and healthy relationship. C O M M U N I C AT I O N C H A N N E L S

· Tenders · Regular Meetings · Training · Audits · Sustainability Report

A P P R OAC H TOWA R DS TH E COM PANY

These are groups focused on promoting care for ecosystems and quality of life involved in our operations, ranging from sustainable fish production to animal welfare, public health and food safety. I N I T I AT I V E S F R O M T H E C O M PA N Y

We focus our work on building relationships of trust with organizations that seek to improve and contribute to the development of the industry, by participating in dialogues around territorial planning in different sectors of local development projects. C O M M U N I C AT I O N C H A N N E L S

· Meetings and Visits · Professionals dedicated to Relations with these groups · Dialogues around Territorial Planning · Local Development Projects · Extension and Assistance Programs · Agreements with Educational Institutions · Salmon Social Initiative · Sustainability Report

Their main concerns are understanding their objectives, succeeding in productive challenges and creating a great work environment. I N I T I AT I V E S F R O M T H E C O M PA N Y

The company seeks to understand the expectations of workers and support them in their personal and professional development. There are several initiatives related to training and improvement of skills and abilities. On a regular basis, the Board analyzes the organizational culture and proposes actions to promote it. C O M M U N I C AT I O N C H A N N E L S

· Emails · Strategic Alignment · Collective Negotiation · Corporate Magazine · Open System for Suggestions and Complaints. · Internal and External Social Networks · Sustainability Report


S TA K E H O L D E R S E N G A G E M E N T, M AT E R I A L I T Y A N D C O N TA C T

39

M A T E R I A L I S S U E S A N D S T R AT E G Y

C O M M U N I C AT I O N

TR A N S PA R E N C Y

C E R T I F I C AT I O N S

CHANNELS C O R P O R AT E

R E P O R TA B I L I T Y

SURVEILLANCE

C O M M U N I C AT I O N

AND

AND

T R A N S PA R E N C Y

C E R T I F I C AT I O N

QUALIT Y OF PROCESSES AND PRODUCTS FOOD SAFETY

EMISSIONS HIGH

TR ACEABILIT Y

BUSINESS M U LT I E X P O R T SOCIETY AND

PERFORMANCE C O R P O R AT E

FOOD

S TA N D A R D S

S U S TA I N A B I L I T Y

S T R AT E G Y

C U LT U R E M O D E L

WORK PR ACTICES

ETHICS COMMERCIAL

PROFESSIONAL

MANAGEMENT

DEVELOPMENT FREE

ENERGY

A S S O C I AT I O N

EFFICIENCY

FOCUS ON S U S TA I N A B L E O P E R AT I O N S

LOCAL

PRODUCTIVE

ECONOMIC

PERFORMANCE

FISH ESCAPES

COMMUNITY MANAGEMENT

I M PAC T A N A LY S I S

USE OF

LOCAL

OF THE

M E D I C AT I O N

DEVELOPMENT

SUPPLIERS

BIODIVERSITY

SUPPLIERS

FINANCIAL

ANIMAL

N AT I V E

I N D I C AT O R S

W E LLFA R E

PEOPLE

N AT U R A L

D O N AT I O N S A N D

RISKS

CONTRIBUTIONS

ENVIRONMENT

SOCIAL E N V I R O N M E N TA L ECONOMIC C O R P O R AT E

I M PAC T O N LANDSCAPES


C O R P O R AT E G O V E R N A N C E

40

P R O D U C T I V E P E R F O R M A N C E

CHAPTER 04


2017

Wild and farmed salmon production. (Thsd TON WFE)

4,500

2018

INDUSTRY

2019 MEF

2017

2018

COHO SALMON

2 .06%

10.80%

5.50%

9.70%

6.29%

M O R TA L I T Y

8.30%

4 . 47

In 2019, the worldwide production of farmed salmon increased by 7.6% and the production of wild salmon decreased by 5.6%. The increased of the total salmon offer worldwide is consequence of better farming conditions.

4.69

Multiexport vs Chilean Industry (kg WFE/smolt)

4.59

A sustainable approach to feeding the world’s growing population is more necessary than ever. As wild fishing has reached its maximum capacity, aquaculture is necessary so future generations can continue to enjoy salmon as we do today.

4.40

AT L A N T I C S A L M O N PERFORMANCE

4.54

GLOBAL PRODUCTION

4.26

PRODUCTIVE PERFORMANCE

41

2019 AT L A N T I C S A L M O N

S M O LT S S T O C K I N G

4,000

(thousands of units)

2019: 20,928

X R E G I O N : 7, 7 6 7 XI REGION : 11,361

3,500

XII REGION : 1,800 3,000

STOCKING

2,500

2018: 22 , 320

X REGION : 5,655 XI REGION : 14,865 XII REGION :

2,000 1,500

2017: 20,110

1,800

X REGION : 5,458 XI REGION : 14,652

1,000

HARVESTS

500

2019

XII REGION : 0

52 ,167

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2 0 07 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

0

95 , 475

2018 WILD SALMON

FA R M E D S A L M O N

4 8 , 470 81,839

2017

BIOMASS EXISTENCE IN FA R M I N G AT T H E E N D O F T H E P E R I O D ( TO N W F E )

38,771 75,657

H A RV E S T ( TO N W F E )


S A N I TA R Y S T R AT E G Y

FCRb

(KG OF FEED REQUIRED TO GROW 1 KG OF WEIGHT IN SALMON LWE)

FUNCTIONAL DIETS

HIGH ENERGY DIETS

PHOTOPERIOD

VACCINES (SMOLT)

SANITARY MANAGEMENT

Pentavalent Vaccine + Live Vaccine BKD Vaccine for Fish in the Magallanes Region

Continuous health monitoring with weekly vet visits

ATLANTIC SALMON

COHO SALMON

2017

1.23

1.08

2018

1.25

1.11

2019

1.2

1.03

VA C C I N E S A N D A N T I B I O T I C S As part of the health strategy defined in 2016, we seek to continuously and sustainably reduce the use of antibiotics. In 2019, this effort was reflected in a drop of 12.9% in their use compared to 2017, a figure that maintains the trajectory we projected when the strategy was implemented.

Evolution of Antibiotic Use g AB/TON Produced (LWE)

Smolts Vaccinated with a Pentavalent Dose

900

Use of Antibiotics (g / TON Produced (LWE))

800

2017

2018

2019

100%

100%

100%

458

306

399

700 600 500 400 300

2018

2017

2016

2015

2014

399

0

2019

306

458

454

512

100

616

200

800

Our strategy is based on constant supervision by veterinarians over the state of health of our fish, allowing early clinical diagnosis. Therefore, the use of antibiotics is restricted solely and exclusively to situations where diseases occur, and always under the care of specialized professionals. To ensure the safety of the final product, we rely on a robust system of traceability and control of pharmacological residues, which allows us to ensure the quality and safety of our product.

2013

PRODUCTIVE PERFORMANCE

42

Note: This year the indicator of antibiotic use is presented considering tons equivalent to live weight, LWE.


PRODUCTIVE PERFORMANCE

43

W E H AV E R E D U C E D T H E U S E O F A N T I B I OT I C S BY A L M O S T 5 0 % CO M PA R E D TO 2 0 1 3 . T H I S I S I N L I N E WITH SALMON CHILE’S COMMITMENT W I T H M O N T E R E Y B AY AQ UA R I U M TO R E D U C E T H E U S E O F A N T I B I OT I C S BY 5 0 % BY 2 0 2 5 .

F O U R T H CO N S E C U T I V E Y E A R O F CO H O S A L M O N A N D M AG A L L A N E S R E G I O N P R O D U C T I O N A N T I B I OT I C S A N D A N T I PA R A S I T I C F R E E .


CALIGUS Graph of Total Adults (Mobile and Ovigerous Females) Atlantic Salmon

Antiparasitics in Baths g AB / TON

15

SPECIES

Atlantic Salmon Coho Salmon

2017

2018

2019

10.7

12.15

11.75

0

0

0

2017

2018

2019

0.06

0.05

0

0

0

0

10

Antiparasitics in Feed g AB / TON 5

SPECIES

Atlantic Salmon Coho Salmon SEP

OCT

N OV

DEC

SEP

OCT

N OV

DEC

2018

AU G

2017

AU G

2016

JUL

2015

JUN

MAR

2014

M AY

FEB

2013

APR

JAN

0

2019

Graph of Total Adults (Mobile and Ovigerous Females) Coho salmon 0.07 0.06 0.05 0.04 0.03 0.02 0.01

2016

2017

2018

JUL

2015

JUN

APR

2014

M AY

MAR

2013

FEB

0.00

JAN

PRODUCTIVE PERFORMANCE

44

2019


PRODUCTIVE PERFORMANCE

45

CERTIFIED PRODUCTION VO LU M E

FOOD SAFETY

We have policies and procedures to ensure the legality, quality, and safety of our products. Within this framework, the following methods are used: A Management System that is periodically submitted for certification audits under international standards such as ISO 9001, ISO 14001, ISO 45001, ASC, MSC, BRC, IFS, BAP and GLOBAL G.A.P., in addition to a product traceability system and a strong Food Defense system, as required by the most demanding markets in the world - The United States, the European Union, Brazil, Russia, Japan and China, among others.

The fish produced by Multiexport Foods, in all stages of their life cycle, are bred using traditional production methods. No genetic modification techniques are used, in accordance with the provisions of Directive 2001/18/EC, a document on the intentional release of genetically modified organisms (GMO). Similarly, we do not use hormones in any the stages of the life cycle of our fish. Multiexport Foods only uses approved substances for aquaculture fish. The company’s Health Management guarantees compliance with these provisions, supported by certifications: ISO 9001, ISO 14,001, and OHSAS 18001 and BAP, BRC, IFS and Global Gap Systems for processing plants.

HARVESTED BIOMASS (TON WFE)

2017

2018

2019

75,657

81,839

95,475

6,170

0

7,038

75,657

81,939

95,475

2017

2018

2019

ISO 9001, ISO14001, ISO 45001

66,418

71,360

77,273

GLOBAL GAP

66,418

71,360

77,273

BRC and IFS

66,418

71,360

77,273

ISO 9001, ISO14001, ISO 45001 ASC BAP

PROCESSED BIOMASS IN OUR PLANTS (TON WFE)


PRODUCTIVE PERFORMANCE

46

A N I M A L W E L FA R E MODEL

FREDOM FROM HUNGER

We provide adequate nutrition at each development stage and constant fish activity monitoring.

FREEDOM TO EXPRESS

FREEDOM FROM DISEASE AND PAIN

Our experienced team of veterinarians is constantly monitoring the health of our fish to react timely in the presence , of any pathology.

04

VISITS FROM VETS PER FA R M P E R M O N T H

15

VETS

NORMAL BEHAVIOR

We provide adequate cultivation densities, using only 1.6% of the volume of each fish cage during the harvest period.

MAKE UP THE B I O S E C U R I T Y S TA F F A T M U LT I E X P O R T FOODS

FREEDOM FROM

FREEDOM FROM THREATS

DISCOMFORT

We are continuously improving protection against predators such as birds and sealions without taking harmful actions against them.

We minimize the stress of our fish by reducing the number of managements. We are also concerned with keeping optimal physical-chemical parameters in our farms even in the face of natural irregularities., despite natural losses.

We understand the importance of good animal welfare practices, and the link between the health of our fish, their wellbeing and the quality and safety of the food we produce. For this reason, we have based our Animal Wellbeing or Welfare standards on the 5 freedoms concept, which has been adapted from the Worldwide Agriculture Welfare Council.

We have also established the following instructions for veterinary treatments to fulfill our goal of improving animal welfare: • All vaccines and injections are given with previous anesthesia prescribed by veterinarians and under their supervision. • In the event of discarding fish, they are sedated prior to any managements. • All our fish are harvested using humanitarian methods.

C A G E V O L U M E U S E AT M A X I M U M D E N S I T Y

9 8 .4 %

1.6%

WATER

FISH


PRODUCTIVE PERFORMANCE

47

FISH ESCAPES

N° Fish Escapes

2016

2017

2018

2019

0

0

0

0

Note: The number of fish escapes is shown as a net number after recapture, from January to December.

I N 2 0 1 9 W E D I D N OT H AV E I N C I D E N T S R E L AT E D TO F I S H ESCAPES.


PERFORMANCE FINANCIERO

48

F I N A N C I A L P E R F O R M A N C E

CHAPTER

05


FINANCIAL PERFORMANCE

49

I N S E P T E M B E R 2 0 1 9 , O U R C O M PA N Y B E C A M E T H E F I R S T S A L M O N C O M PA N Y I N T H E WO R L D TO B E PA R T O F T H E D OW J O N E S S U S TA I N A B I L I T Y INDEX. T H I S I N D E X I S C O M P O S E D O N LY FO R CO M PA N I E S W I T H T H E H I G H E S T S U S TA I N A B I L I T Y P E R FO R M A N C E , C O N S I D E R I N G T H E FO L LOW I N G A S P E C T S : E N V I R O N M E N TA L , S O C I A L & G OV E R N A N C E ( E S G ) . ACCO R D I N G TO I N D E P E N D E N T AU D I T S C A R R I E D O U T I N T H E F I R S T H A L F O F 2 0 1 9 , A N D V E R I F I E D BY R O B E CO S A M I N SW I T Z E R L A N D, M U LT I E X P O R T F O O D S WA S A M O N G T H E TO P 2 5 % O F CO M PA N I E S W I T H T H E B E S T S U S TA I N A B I L I T Y M A N AG E M E N T I N T H E “ F O O D P R O D U C T S ” S E C TO R WO R L DW I D E .

In 2019, the company saw a revenue from operations of USD 568.4 million, 5.8% more than 2018. This increase is explained by a higher volume sold (8.8%), partially offset by lower sales prices. Furthermore, the harvested volume in 2019 was 95,476 TON WFE, 16.7% higher than the 81,839 TON WFE harvested in 2018. The Operational EBITDA reached USD 83.6 million, while the Operational EBIT reached USD 63.8 million. These figures show a decrease compared to the 2018 financial year of 28.3% and 34.8%, respectively. The drop in the EBIT is mainly due to the lower sales prices in 2019 than in 2018, and to a slight increase in ex farm costs. Finally, the consolidated profit for the year was USD 43.4 million, decreasing by 46.6% (USD 38.0 million) compared to what was reported the previous year. This drop is explained by the factors previously indicated.

INDICATOR

MILLION USD

Revenue

568.4

EBITDA

83.6

EBIT

63.8

EBIT/kg Atlantic WFE

0.73

Profit

43.4

Net Leverage

<0.9

Liquidity

>2


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50

E N V I R O N M E N T A L P E R F O R M A N C E

CHAPTER

06


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51

E N V I R O N M E N TA L MONITORING A Q U A C U LT U R E E N V I R O N M E N T A L R E P O R T S ( I N FA S ) These are the environmental monitoring received during the period, as required by national aquaculture regulations, executed under the supervision of Sernapesca. AEROBIC FARMS

ANAEROBIC FARMS

2017

40

6

2018

31

6

2019

40

6

PHYTOPLANKTON The information from these analyses has been delivered to SalmonChile in order to share it with the community. N° PHYTOPLANKTON MONITORING

2017

3,500

2018

4,949

2019

7,357

MONITORING OF E N V I R O N M E N TA L VA R I A B L E S

100%

O F M U LT I E X P O R T ’ S FA R M S POSSESS REAL TIME TECHNOLOGY FOR THE MEASUREMENT OF

O C E A N O G R A P H I C PA R A M E T E R S


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52

FEED CONSUMED

130,805,631 kg

AV E R A G E % O F FISH MEAL IN FEED

FEED CONSUMED 2019

9.5%

9.2%

7. 1 %

0.51 kg of wild fish are needed to produce 1 kg salmon

Multiexport has determined the maximum benthic deposit in its

FM LEVEL + FO LEVEL FIFO= X FCR FM PERFORMANCE + FO PERFORMANCE

different sea water farms which range from 27 gC /m2/year, up to 5,800 gC/m2/year. Various studies indicate that in the area of influence under the cages, hypoxic or anoxic conditions

AV E R A G E % O F

and structure variation of benthic communities are produced. In farms considered as sedimentary, this involves

2019

6.6%

5 .4 %

5.5%

1.42 kg of wild fish are needed to produce 1 kg of salmon

0.60

2018

2019

2017

0.64

et.al, 2013) in farms considered as dispersive.

2018

IN FEED

6,000 gC/m2/year (Keeley et.al., 2012) or 10,000 gC/m2/year (Cromey et.al., 2002), with up to 15,000 gC/m2/year (Keeley

Goal <0.7

FISH OIL

0.60

ON SEABED

2018

The term Fish in Fish Out (FIFO) is used to describe the ratio of how much wild fish it takes to produce one ton of aquaculture fish. Controlling this indicator is important in order to continue our development regardless of the supply and production of ingredients that come from fishing. This allows us to allocate a greater proportion of these resources to direct human consumption, and reduce fishing for aquaculture production.

2017

E S T I M AT E D D E P O S I T

2017

FIFO

FM: Fishmeal FO: Fish Oil


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W AT E R FOOTPRINT To contribute to the better use and management of natural resources, in this report we present the first measurement of the water footprint for Hatcheries, Farming, Plant and Office processes for 2019. Note: The methodology applied in the analysis corresponds to the analysis of

WAT E R U S E We use surface water and groundwater for all our farming and processing processes. This resource is used in accordance with the water use rights granted by the General Water Directorate (DGA), in which coordinates, extraction points and discharge are indicated.

the processes detailed by the Water Footprint Network, according to Arjen

All emissions are monitored and comply with regulation, according to the Monitoring Resolution issued by the Superintendence of Health Services (SISS) based on the tables indicated by Supreme Decrees 90/2000 (Hatcheries) and 609/1998 (Processing Plants).

Hoekstra’s guidelines.

Along with this, the Molco, Chaparro and Puerto Fonck hatcheries have environmental monitoring programs, which were established in theirs Environmental Qualification Resolutions. It should be noted that the areas where our hatcheries and plants are located do not suffer water stress. Note: The water consumption data shows 100% of the company’s water use.

Water Footprint (WF) Components

WAT E R F O O T P R I N T O F A P R O D U C E R OR CONSUMER

INDIRECT USE

O F WAT E R

O F WAT E R

GREEN WAT E R FOOTPRINT

B L U E WAT E R FOOTPRINT

B L U E WAT E R FOOTPRINT

NONCONSUMPTIVE

O U R TOTA L WAT E R

WAT E R

GREEN WAT E R FOOTPRINT

CONSUMPTION

WAT E R W I T H D R AWA L

DIRECT USE

CO N S U M P T I O N I N 2 0 1 9 WA S 48,828 THOUSAND M3, 10% LESS THAN THE PREVIOUS YEAR AND

WAT E R U S E

1 1 % LOW E R T H A N I N 2 0 1 7. T H I S

(return flow)

VA LU E I S I N L I N E W I T H O U R

WAT E R

G R AY W A T E R FOOTPRINT

POLLUTION

G R AY W A T E R FOOTPRINT

OBJETIVE OF REDUCING OUR Blue WF: Fresh water extracted. Gray WF: Fresh water to dilute contamination. Green WF: Rainwater.

WAT E R CO N S U M P T I O N BY AT L E A S T 5 % BY 2 0 2 0 ( B A S E 2 0 1 7 )


Water Use by Operation (Million m3)

Total Consumption per Year (Millions m3) Plant Water Consumption Ratio m3/ TON WFE Processed

15.4

2018

0.01 0.42

0 0.42

53.69

5.5

5.8

6.4

49

2019

2018

2017

2019

2018

2017

0.03 0.04 0.06

48,4

71%

BLUE WF

28%

GRAY WF

1%

R E S U LT S ( m 3 ) BLUE WF

GRAY WF

INDIRECT WF

TOTAL WF

Hatcheries

2,282,828

5,657,085

9,660

7,949,573

Processing Plants

0

279,557

4,996

19,674

Sea Water

0

0

77,294

77,294

2,282,828

5,900,348

91,950

8,275,126

AREA

2019

Water Extraction by Source (Millions m3) 2019

INDIRECT WF

H AT C H E R Y

PUERTO FONCK

PLANT

PROCESSING

0.4 0.4 0.4 2018

H AT C H E R Y

MOLINO DE ORO

M O LCO

H AT C H E R Y

H AT C H E R Y

RÍO NEGRO

H AT C H E R Y

C H A PA R A N O

2017

54

55

4.7

7. 6

9.8 10.9

11.8

15.1 14.7 14.8

19.2 1 7. 4

5% Reduction Goal (base 2017)

15.1

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54

Total

BASED ON THE MEASUREMENTS M A D E F O R E AC H O F T H E A R E A S

2017

0 0.42

T H I R D PA R T Y WAT E R G R O U N D WAT E R S U R FA C E WAT E R

54.37

A N D T H E I R D I F F E R E N T WAT E R F O OT P R I N T CO M P O N E N T S , T H E TOTA L R E S U LT F O R M U LT I E X P O R T F O O D S I N 2 0 1 9 WA S 8 , 2 75 ,1 2 6 m 3 .


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55

CARBON FOOTPRINT Reducing green house gases (GHG) emissions is strategically important for the future development of our operations and the country. Multiexport Foods therefore has the opportunity to contribute to the reduction of these emissions through analysis and management of its carbon footprint. In this report we present the third measurement carried out by the company in its fresh water, sea water, processing and office-based operations.

The GHGs identified in this inventory are the following: 路 Carbon dioxide 路 Methane 路 Nitrous oxide

R E S U LT S GHG Inventory by Scope

Note: This study is carried out in accordance with the Greenhouse Gas Protocol (GHG Protocol). This tool is widely used in the estimation of carbon footprint and is supported by the World Resources Institute (WRI) and the World

GHG EMISSIONS (tCO2e)

SCOPE

ACTIVITY

Scope 1

Fuel consumption and gas refrigerants

Scope 2

Use of electricity

Scope 3

Waste, corporate flights, and water

Business Council for Sustainable Development (WBCSD).

Emission sources included in this study:

CO2

CH4

N2O

SCOPE 3

SCOPE 2

74,944 0

Total

19,938 94,882

Network consumption amounted to 15,980,944 (16 GWh) in 2019. The emissions from this consumption are zero tCO2e, since we are the first Chilean salmon farming company with a certification of Renewable Energy consumption, provided by Enel Generaci贸n through IRECs.

S CO P E 2 R E F L E C T S GHG Inventory by Consumption Area (Thsd tCO2e)

EMISSIONS FROM THE

SCOPE 1

Scope 1 (mandatory) GHG emissions from sources that are owned or controlled by the company. Scope 2 (mandatory) Consumption of electricity and/or steam generated by third parties.

PROCESSING PLANT

46

E L E C T R I C I T Y, W H I C H I N

S E A WAT E R

25

FR E S H WATER OFFICE

CO N S U M P T I O N O F

22

2

2 0 1 9 WA S Z E R O, A S T H E E N E R GY U S E D I N O U R PROCESSING PLANTS IS 1 0 0 % R E N E WA B L E

Scope 3 (optional) GHG emissions that are not owned or controlled by the company.


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56

GHG Inventory by Contributing Source and Consumption Area

Annual Comparison of GHG Emissions by Scope (tCO2e)

48%

R -2 2 / R - 4 4

O I L S E A WAT E R PLANT OFFICES

D R I N K I N G WAT E R SYSTEM H AT C H E R I E S LIQUID GAS SEA WAT E R H AT C H E R I E S OT H E R

776

25%

3% 1%

816 0

981 5 ,70 6

4,845

59,697

6 7, 0 6 2

18%

2% 0.4%

2017

1% 0.4% 0.01%

74 , 9 4 4 2018

SCOPE 1

2019

SCOPE 2

SCOPE 3

Carbon footprint of the product N AT I O N A L , I N T E R N AT I O N A L CHARTER FLIGHTS

1% 75,760 tCO2e

tCO2e = 1 .1 7

95,475 TWFE * 68% F R E S H WAT E R

S E A WAT E R

OFFICES

tEdibleMeat

PROCESSING PLANT

C O M PA R I S O N W I T H P R E V I O U S Y E A R S Unlike the measurements from previous years, in 2019 the range of emission classifications in Scope 3 was expanded by adding the consumption items associated with Water and Corporate Flights, whose contribution amounts to 19,122 tCO2e.

Intensity (tCO2e / tEdibleMeat)

67,062

74,944

Scope 2

5,706

4,845

0

Scope 3

981

776

816

Total

66,384

72,683

75,760

Production (TON wfe)

75,255

82,850

95,475

1.30

1.29

1.17

Intensity (tCO2e / t Edible Salmon)

REDUCTION IS IN LINE WITH 1 .17

59,697

2019

Scope 1

CO M PA R E D TO 2 0 1 7. T H I S

1.29

2019

2018

2018

C A R B O N F O OT P R I N T BY 1 0 %

1.30

2017

W E H AV E R E D U C E D O U R

2017

For the purposes of comparison with previous years, the 2019 emissions results are divided into all consumption items, and the quantification of emissions without the contribution of corporate flights and water consumption.

O U R G OA L TO D E C R E A S E O U R C A R B O N F O OT P R I N T BY 2 0 % BY 2 0 2 0.


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57

WA S T E M A N A G E M E N T Note: The waste generation data refers to 100% of the company.

FA R M I N G ( T O N ) LANDFILL

PROCESSING (TON) R E C YC L I N G

REUSE

LANDFILL R E C YC L I N G

2019

2,954 3,525 8,315

2018

2 , 8 74 2,460

2019

COMPOSTING R ECOV ERY (EN ERGY )

517 1, 287 14,206

55 2018

4,357

718 1,459

12,100

45 NON-HAZARDOUS 2019

HAZARDOUS

2017

1,198 318

117

NON-HAZARDOUS 2018

109

HAZARDOUS

8,581 2019 2018 2017

12,424

14,677

14 8 9

16,051 14,314 13,931


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“ Z E R O WA S T E ” P R O C E S S I N G P R O J E C T Processing Division Waste by Type (Thsd TON) For the last 4 years, Multiexport Foods has been developing a sustainability initiative called Zero Waste to Landfill in the Puerto Montt processing plants, with a focus on expanding this project to farms in its second stage.

O R G A N I C WA S T E F R O M T H E PROCESS SLU DG E

The project aims to reduce, recycle, and reuse waste, changing the paradigm of waste production, use and disposal, in line with the Responsible Consumption required by the Sustainable Development Goals established by the UN for 2030.

MISCELL ANEOUS INDUSTRIAL WA S T E PA P E R A N D C A R D B O A R D

The plan is to send zero waste to landfill from the processing plants by the end of 2020. MISCELL ANEOUS PL ASTIC S DISCARDED SUPPLIES

Evolution of Waste Sent to Landfill from Processing (TON)

SCRAP 3,048

SHARP MEDICAL INSTRUM E N T S , C H E M I C A L C O N TA I N E R S A N D OT H E R S USED OILS 1,409

0

2

4

6

8

10

12

14

1,198 718 517

2015

2016

2017

2018

R E C YC L I N G , R E U S E O R R E C O V E R Y

LANDFILL

2019

“Zero Waste” Processing Project Progress

97%

3%

3Rs

LANDFILL

W E A R E F U L LY CO M M I T T E D TO

C I R C U L A R E CO N O M Y I N O U R PROCESS.


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M AT E R I A L S U S E D I N P R O C E S S I N G Of the total materials used in our production process at the plant, 38% is renewable, consisting of cardboard. In the other hand, 22.7% of those materials are made with recycled components.

Materials Used in the Production Process (Thsd kg) C A R D B OA R D

1,667 1 ,412

P O LY S T Y R E N E S A LT

604

P O LY E T H Y L E N E

314

SMOKED

138

P R O D U C T T R AY S FILM

85

VA C U U M PA C K S

64

SUGAR

59

A N TI OXI DA N TS

17

PA C K A G I N G

10

SEALS DRESSING

1

D I S I N F E C TA N T S

1

ADDITIONAL

0.02

PA C K A G I N G

F R O M N O N - R E N E WA B L E S O U R C E S

F R O M R E N E WA B L E S O U R C E S

77,28% N O T R E C YC L E D

22,72% M A D E W I T H R E C YC L E D M AT E R I A L S


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BIODIVERSITY In accordance with the Environmental Impact Statements and the Environmental Qualification Resolutions of our facilities, no significant impacts are produced on the biodiversity surrounding our operations. We have carried out biodiversity characterization studies in some of our farms, and we have identified the species included in the national and international conservation lists that interact daily with our workers and contractors in the 3 regions where our operation is concentrated. This is all accompanied by a rigorous training program on the company’s conservation plan. Protecting the ecosystems where we operate is an integral part of our business management; we are committed to reducing negative interactions with wildlife through responsible management. However, despite our efforts, occasionally species can die as a result of interaction with our farms.

EX EXTINCT

EN

ENDANGERED

EW EXTINCT IN THE WILD

VU VULNERABLE

CR

NEAR THREATENED

LEAST CONCERN

DATA DEFICIENT

1

EN

10

7

15

22

VU

NT

LC

DD

NE

CONSERVATION CONSERVATION STATUS STATUS ACCORDING ACCORDING TO THE RED LIST, TO THE INTERNATIONAL NATIONAL UNION FOR CLASSIFICATION CONSERVATION OF NATURE (IUCN)

CR

4

0

EN

10

7

17

24

EN

VU

NT

LC

DD

NE

XI REGION

IDENTIFIED: 33

CONSERVATION STATUS ACCORDING NATIONAL CLASSIFICATION

XII REGION

IDENTIFIED: 31

NOT EVALUATED

DD

5

EN

NE

LC

CONSERVATION STATUS ACCORDING TO THE NATIONAL CLASSIFICATION

CONSERVATION STATUS ACCORDING TO THE RED LIST, INTERNATIONAL UNION FOR CONSERVATION OF NATURE (IUCN)

CR

CRITICALLY ENDANGERED

NT

X REGION

IDENTIFIED: 30

CONSERVATION STATUS ACCORDING TO THE RED LIST, INTERNATIONAL UNION FOR CONSERVATION OF NATURE (IUCN)

CR

4

0

EN

10

7

19

26

EN

VU

NT

LC

DD

NE


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61

No. of Negative Interactions with Wildlife

Chilean Protected Areas and their degree of IUCN approval

2017

2018

2019

Birds

0

0

0

Mammals

0

0

1

PROTECTED AREA / IUCN CATEGORY

la

lb

II

III

Marine Park (MP) Virgin Regions Reserve (VRR) National Park (NP) Natural Monument (NM) Nature Reserve (NR) Forest Reserve (FR) National Reserve (NR) Marine Reserve (MR) Coastal Marine Areas of Multiple Uses (CMAMU) IUCN Protected Area Management Categories

III. Natural monument

Ia. Strict Natural Reserve

IV. Habitat/species management area

Ib. Wild natural area

V. Protected land and seascape

II. National Park

VI. Managed protected area

Source: Ministry of the Environment, http://areasprotegidas.mma.gob.cl/areas-protegidas/

IV

V

VI


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62

Distance Operations - Protected Areas FARMS WITH A DISTANCE BETWEEN 0 AND 1 KM

No. of concessions Farms

Conservation Area

Region

Category

4

Pitipalena - Añihue

XI

CMAMU

58

NR Las Guaitecas

XI

NR

3

NP Isla Magdalena

XI

NP

5

NP Melimoyu

XI

NP

7

NR Kaweskar

XII

NR

7

NP Kaweskar

XII

NP

Region

Category

X REGION

XI REGION

FARMS WITH A DISTANCE BETWEEN 1 AND 4 KM

No. of concessions Farms

Conservation Area

1

NP Pumalin

X

NP

3

NP Alerce Andino

X

NP

5

NR Las Guaitecas

XI

NR

3

NP Isla Magdalena

XI

NP

1

NP Queulat

XI

NP

XII REGION

Note: A distance up to 4 km is established, since, when evaluating the area of influence of a project, the landscape component is the aspect with the greatest

territorial range (3.5 km).

Our operations are carried out close to different environmental protection sites, in accordance with the National Registry of Protected Areas of the Ministry of the Environment.

Multiple Uses. In the Region of Magallanes, our farming farms are located in the area delimited by the Kaweskar National Reserve, and close to the Kaweskar National Park area.

In the Region of Aysén, our farms operate on the coast near the Las Guaitecas National Reserve and the Melimoyu National Park, and within the territory of the Pitipalena-Añihue Coastal Marine Area of

In both cases, we take care to act in accordance with our conservation plan, based on international standards and the best practices in the industry.


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C L I M AT E C H A N G E S T R AT E G Y Climate Change is one of the greatest challenges facing humanity. Conscious of this situation, in our company we are carrying out the “Multiexport Climate Action Strategy” program, through which we aim to become carbon neutral by 2025. Below we present the most significant milestones from 2019 in terms of this strategy:

100% R E N E WA B L E E N E R G Y IN OUR PROCESSING EQUAL TO

16 GWh NET REDUCTION OF

6 .0 0 0 t CO 2 e 8 % O F O U R T O TA L GHG EMISSIONS

We became the first salmon company worldwide to receive a renewable energy certification (IRECs), delivered by Enel Generación Chile S.A. This accredited that in 2019 the company supplied its processing plants (Cardonal, located in the city of Puerto Montt) with only Non-Conventional Renewable Energy (NCRE), registering an annual energy consumption of 16 GWh from renewable sources. The reduced carbon footprint of our processing plant is equivalent to 44,117,647 km1 traveled by an average car; that is, 42,749 trips from Puerto Montt to Santiago, or 114 trips from the earth to the moon2. We registered our carbon footprint in the “Huella Chile” program of the Climate Change Office of the Ministry of the Environment. This is the first national program for quantifying and managing corporate carbon footprints, whose purpose is to support and promote the quantification and voluntary management of GHG emissions at the corporate level, in both the public and private spheres. In line with our commitment to sustainability and innovation, in 2019 we implemented our pilot electro-mobility plan by adding a 100% electric Hyundai Ioniq to our fleet of corporate vehicles, and becoming the first salmon company in the country to adopt this technology.

1 Equivalences considering CO2e emissions equal to 136g/km, a factor of emission corresponding to a medium-sized vehicle (e.g. 4-door gasoline fu-

eled Hyundai Accent, information from the Database: Vehicle Consumption

FIRST SALMON PROCESSING PLANT ZERO EMISSION

of the Ministry of Energy, available at http: // www. consumovehicular.cl/). 2 Considering a distance of 384,400 km between the earth and the moon

OUR CARBON FOOTPRINT IS REGISTERED IN THE HUELLA CHILE PROGRAM.

1

T H E F I R S T S A L M O N C O M PA N Y I N T H E COUNTRY TO IMPLEMENT ELECTROM O B I L I T Y.


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64

R E G U L AT O R Y CHANGES REGULATORY CHANGE

OF_135338 2019 FAN Monitoring

01-14-19

OF_135342 Acatenella Program

01-14-19

Exempt Resolution. No. 1005-2019 Contingency Term Format

03-15-19

Exempt Resolution. No. 1769-2019 Modifies the Calendar, Modifies Exempt Resolution No. 5958

04-30-19

Exempt Resolution. No. 544-2019 Initiation of the Preliminary Draft for the Emission of Pollutants at Farming Sites and Processing Plants for Hydro-biological Resources

06-10-19

Exempt Resolution. No. 2968-2019 Sets Minimum Contents, Replaces Exempt Resolution. No. 4424

07-04-19

Exempt Resolution. No. 3096-2019 Exempt Resolution. No. 5958 and Exempt Resolution. No. 1769

07-12-19

ORD DGA No.143125 2019 MM

08-22-19

Exempt Resolution. No. 1165-2019 Preliminary project that establishes goals for Collection and Valuation, and Obligations for Containers and Packaging

DATE

09-30-19

Exempt Resolution. No. 3264-2019 Variables to Measure

10-14-19

Exempt Resolution. No. 5158-2019 V Modifies Exempt Resolution No. 3096 that Determines the Scheduling of Contingency Plans to be Delivered

11-08-19

Exempt Resolution. No. 6004-2019

12-31-19


SOCIAL PERFORMANCE

65

S O C I A L P E R F O R M A N C E

CHAPTER

07


SOCIAL PERFORMANCE

66

C O L L A B O R AT O R S S TA F F I N G

B R E AKDOWN BY S E NIORIT Y

G E N D E R B Y J O B C AT E G O R Y

Our team is the engine that drives Multiexport Foods, and the management of their wellbeing, development, growth and health is essential to ensure the company’s results.

Under 3 years: 1,228

Senior Management

481

In 2019 we strengthened our organizational structure in different areas by incorporating the Human Resources Corporate Management, Legal Counsel Management and the Comptroller’s Office, which will allow us to continue to face the current and future challenges of our industry.

74 7

WOM EN

MEN 15%

Between 3 and 6 years: 519

4 WOM EN

187

85% 41 MEN

332

Management

B R E AKDOWN BY G E N DE R WOM EN

MEN

Between 6 and 9 years: 555 252 61.61% 1,635

303

38.39%

26%

1,019

135 WOM EN WOM EN

T O TA L : 2 , 6 5 4

74 % 387 MEN

MEN

Between 9 and 12 years: 208

Technicians

B R E A K D OW N BY AG E 76 21.89%

62.43%

581

1 ,657

416

UNDER

BETWEEN

OV ER

30

30 AND 50

50

132

15.67% WOM EN

MEN 28%

Over 12 years: 144 23

1 04 WOM EN

72% 262 MEN

121

Workers B R E A K D O W N B Y N AT I O N A L I T Y

WOM EN

MEN

96.50% S TA F F W I T H D I S A B I L I T I E S 2,561

0.30%

C O S TA R I C A N 1

0.04%

S PA N I S H 2

0.08%

45% 773 WOM EN

CHILEAN

CO LO M B I A N 8

HAITIAN 7

0. 26%

J A PA N E S E 1

0.04%

PERUVIAN 1

0.04%

VENEZUEL AN 54 2 .03% AMERICAN 19

0.72%

0.83% 22 PEOPLE

55% 945 MEN


SOCIAL PERFORMANCE

67

H U M A N C A P I TA L D E V E L O P M E N T We understand that the professional growth of our collaborators is a key tool to ensure the success of our company. In this sense, in 2019 we focused our efforts on training our collaborators in the new regulatory and technical aspects that the industry must comply with. To meet this objective, we increased investment in training and education for our team, adding a total of 61,087 hours of learning and improvement, for which we invested a total of $ 287,532,888 - 26.3% more than in 2018.

Processes Division A highlight of 2019 was the Operational Excellence Program, which was implemented for the third consecutive year and saw the participation of more than 700 collaborators who developed their knowledge with the TPM (Total Productive Maintenance) methodology, in the Fresh and Frozen processing plant. The program also included change management workshops, which sought to improve the adaptability of our collaborators to changes in their daily tasks and functions.

Farming In Farming, meanwhile, our collaborators participated in the Design and Planning of the Production Cycle course, whose objective was to reinforce the goals and objectives of the production cycle. Among the topics covered by this course were: Audits, Occupational Health and Safety, fish feeding, Nutrition, SIFA, Health and growth, Teamwork, Effective Communication, and sense of belonging. This course was held in order to align the technical knowledge of all our collaborators, and ensure an efficient and safe production process.

AV E R A G E H O U R S O F T R A I N I N G B Y G E N D E R

INVESTMENT IN TRAINING

AND POSITION:

Employee training – % of revenue Employee training (CLP) Average cost invested in training per employee (CLP) T O TA L : 2 1

T O TA L : 1 2

M A N AG EM ENT

24

6

PROFESSIONALS

20

18

21

10

E M P L OY E E T R A I N I N G - % O F R E V E N U E 30%

AND TECHNICIANS 20%

A D M I N I S T R AT I V E

Goal 2019: 16%

S TA F F A N D 10%

2019

2018

0%

2017

WORKERS

2017

2018

2019

GOAL 2019

17%

26%

18%

16%

$219,227,820

$227,612,538

$287,532,888

$263,188,688

$91,612

$93,514

$108,339

$99,167


SOCIAL PERFORMANCE

68

CAREER DEVELOPMENT Hiring

TOTAL NUMBER OF NEW HIRED EMPLOYEES

AGE BREAKDOWN:

Under 30 years Between 30 and 50 years Over 50 years

2018

2019

461

413

459

449

58

61

Staff Turnover In 2019 we managed to decrease the turnover rate of our collaborators from 3.22 (obtained in 2018) to 2.7. This decrease is the result of a decrease in resignation or dismissal of collaborators in all age and gender ranges.

BY G E N DE R

80% STAFF TURNOVER RATE AGE BREAKDOWN:

790 753

X REGION

1.21

Between 30 and 50 years

1.57

1.30

Over 50 years

0.21

0.19

2018

2019

1.18

1.06

2.04

1.64

TURNOVER AS % OF TOTAL COLLABORATORS

2018

2019

Total Turnover (voluntary, retirement, dismissals, etc.)

36.9%

24.4%

7.8%

5.3%

Men

26

2019

Internal mobility Number of positions taken by internal candidates Percentage of positions taken by internal candidates

1.44

Women

24

2018

2019

BREAKDOWN BY GENDER:

104 190

XI REGION XII REGION

2018

Under 30 years

5 9

2017

2018

2019

75

74

82

44%

34%

33%

PERFORMANCE ASSESSMENT 2019

In terms of percentages, with respect to the total number of collaborators, there was a significant decrease of 12.5% in the case of total turnover, and 2.5% in voluntary resignation, between 2018 and 2019.

In 2019 we hired a total of 923 people, all of whom come from regions in which we have some type of operation.

IX REGION

Performance Assessment % of employees who have received a periodic performance and professional development assessment.

Voluntary Resignation

76%


SOCIAL PERFORMANCE

69

TRADE UNIONS

R E M U N E R AT I O N

As a company, we respect and recognize the importance of the representation of our workers, which comes about through the creation and exercise of trade unions. For this reason, we have promoted our Free Association Policy throughout the organization, and in 2019 we reinforced our open-door policy and our continuous dialogue with these entities. We are keen to take advantage of this opportunity to establish participatory and transparent relationships, with the aim of closeness and harmony with all collaborators.

Wage Gap The wage gap indicates the difference between the salaries of women and men when holding the same position. Ratio of base salary and remuneration of women compared to men

During the year we successfully closed early negotiations with the Cordillera-Dalcahue unions, and with the IX Region union.

Percentage of employees represented by an independent union or covered by collective agreements

1.00

0.84

LEADERSHIP AND PROFESSIONAL POSITIONS

29% 2017 53% 2 01 8 58% 2 01 9

1.00

0.86

A D M I N I S T R AT I V E S TA F F

1.00

0.92 WORKERS

AS OF DECEMBER 31st 2019, WE

H AV E 9 T R A D E U N I O N S , W H I C H TO G E T H E R R E P R E S E N T 5 8 . 4 % O F O U R WO R K E R S .


SOCIAL PERFORMANCE

70

Wage Difference The wage difference, meanwhile, measures the difference between the gross wage per hour that a collaborator earns, and the country’s minimum wage. By looking at the table below, it is possible to see that our workers earn 2 times the country’s minimum wage.

POSITION

WAGE DIFFERENCE

Leadership and Professional Positions

5.7

Technical-Administrative Staff

2.8

Workers

2.0

Minimum Salary Ratio By looking at the graphic below, it is possible to see the efforts we have made to improve the salaries of our collaborators. In 2019, we increased the minimum wage for our workers by 28% in the case of men, and by 23% in the case of women.

2018

$373,010

$288,000

INITIAL

M I N I M U M WA G E

SAL ARY MEF

2019

IN 2019, WE INCREASED T H E M I N I M U M WAG E O F O U R

WO R K E R S BY 2 8 % I N T H E C A S E O F M E N , A N D BY 2 3 % I N T H E $ 475 , 52 8

$459, 256

INITIAL SAL ARY MEF

$301,000 M I N I M U M WA G E

C A S E O F WO M E N .


SOCIAL PERFORMANCE

71

H E A LT H A N D S A F E T Y The physical and psychological wellbeing of our collaborators is fundamental for Multiexport Foods, and for this reason we constantly seek to strengthen and consolidate a preventive culture throughout the company. In 2019 we started the Preventive Health Program, whose focus is to diagnose collaborators’ health conditions to ensure the best safety standards throughout our production chain. This was also supplemented with activities for the promotion and protection of health for the future. Accident Rate The Accident Rate (TA) measures the percentage of accidents that occurred in a certain period in relation to the number of workers in the company in the same period.

Accident Rate Average Days Lost due to Accidents

2016

2017

2018

2019

3.84%

4.93%

3.41%

3.81%

11.4

15.27

15.91

15.05

Absence Rate Any absence related to the personal health of a worker (Total number of days of absence/total number of workdays).

Absenteeism Rate

2016

2017

2018

2019

0.57%

0.54%

1.78%

0.24%

Fatalities Number of deaths of workers at the company’s facilities between January and December.

Fatality Rate

2016

2017

2018

2019

0

0

0

0


SOCIAL PERFORMANCE

72

ALLIANCES

Multiexport Foods, partners of SalmonChile, maintains its strong commitment to the collaborative construction of a sustainable aquaculture industry for another year; the aim is for an industry that is responsible for growing in harmony with the community and environment that surrounds us. Therefore, Multiexport Foods participated in the different joint projects carried out in 2019, taking part in the General and Technical Board, and in the different commissions (territorial and communicational), contributing their experience and good relationships to the construction of synergies for the good of society.

Along the same lines, since it has been present in Magallanes, Multiexport Foods has been part of the Asociación de Productores de Salmón y Trucha de Magallanes AG, actively participating in the meetings of the Board, and interacting with partner companies and local actors.

In the 2019 period, we actively participated in the meetings and conferences of the “Global Salmon Initiative” (GSI), an initiative that groups together 17 salmon companies across the world, exceeding 50% of the world’s production. The common goal of this group is to provide a healthy source of protein to feed a growing population, minimizing environmental impact and improving the social contributions of operations. In this context, Multiexport Foods is part of the 4 topics forming the common agenda: Bio-security, Nutrition and Food, Standards and Communications.

We are proud to be part of GSSI from 2019. It is an initiative that brings together more than ninety stakeholders in a pre-competitive effort to address the complex global sustainability challenges facing the aquaculture industry. In this space, the private sector, NGOs, Governments, and other International Organizations, including the FAO, collaborate and exchange knowledge in order to create joint solutions to these challenges.

The Corporación de Desarrollo Productivo del Litoral Aysén (CorpAysén) was created on November 29th, 2016, in order to promote and implement actions to encourage the development of communities and productive sectors connected to the coast of the Aysén Region.

The company is part of the Salmon Social Initiative, which brings together 10 producing and supplying companies in the salmon farming industry of the Los Lagos and Aysén Region. This has the aim of jointly improving the social and environmental standards of the operations of the companies, beyond current regulations. The group has been creating commitments for a responsible relationship with local communities for more than 3 years, based on respect and care for the environment, building relationships of trust, and contributing to social development through the creation of shared value.

INSTITUTION

CONTRIBUTION AMOUNT 2019 (USD)

SalmonChile

$ 305,011

Global Salmon Initiative

$ 88,456

Asociación Productores de Salmón y Trucha Magallanes

$78,522

Others

$ 18,819

Total

$ 4 9 0, 8 0 8 U S D CO N T R I B U T I O N TO A S S O C I AT I O N S A N D ALLIANCES IN 2019.

$490,808


PSEOR CF IOARLMPAENRCFEO RSMOACNI C AE L

73

W E TA K E PA R T I N A S S O C I AT I O N S B E C AU S E W E S E E K TO E N S U R E T H E S U S TA I N A B I L I T Y O F T H E I N D U S T RY A N D I T S T H R E E F O L D I M PAC T A S W E L L A S , TO TA K E A DVA N TAG E O F T H E P L AT F O R M S

FOR DISCUSSION ON TECHNICAL A S P E C T S , P R O D U C T I V E I N N OVAT I O N O R S A N I TA RY I S S U E S .


SOCIAL PERFORMANCE

74

R E G U L AT O R Y COMPLIANCE Total No. of Infractions

2019

8

2018

7

2017

8

6 6

E N V I R O N M E N TA L

SOCIO - ECONOMIC

Total Amount Paid for Infractions in USD

2019

904

2018

16,728

2017

28,788

18 ,145

E N V I R O N M E N TA L

14, 205

SOCIO - ECONOMIC


SOCIAL PERFORMANCE

75

SUPPLIERS As a company, we have a firm commitment to promoting sustainability throughout our value chain, making the management of suppliers a strategic pillar. Therefore, in line with the UN’s Sustainable Development Objective No. 12 on Responsible Production and Consumption, we promote responsible practices in acquisition and development processes with our suppliers and service providers.

national economy. For this reason, 99.6% of our total investment in suppliers is concentrated within our country, with a figure of more than USD $461M.

LOCAL ECONOMIC CHAIN

At the same time, we seek to strengthen the local economies of the regions where we have our production and processing activities. We have 26 farms in the X region, Los Lagos, and this is the region where we invested most in suppliers in 2019, reaching 71.89% of our total expenditure in Chile.

The supply chain is structured around the efficiency of each one of its stages, from fresh water breeding to harvest in sea water, as well as in value added and sales, where the smoked products and processing operations stand out. In this sense, we understand the importance of our suppliers, and we want to be a driving force in the local and

We strive to cultivate long-term relationships with our suppliers based on trust and mutual growth. We partner with our suppliers to develop innovation projects for the benefit of both us and them,

Distribution of Amount Invested in Suppliers by Region (Millions USD)

we care about the conditions of their workers, and we maintain a prompt payment practice, which contributes to our positive working relationship.

Distribution of Amounts Invested in Suppliers by Country

USD 4 6 3 ,0 8 6 , 8 4 5 TOTA L 2 0 1 9 .

0.05% 0.01%

UK

USA

USD 218,629

0.01%

JAPAN USD 403,418

0.03%

$8

$5

$14

$9

USD 23,186 DENMARK

2019

OT H E R S

REGIONS

USD 121,788 VIII REGION

$108

$91 RM

$331 X REGION

$272

USD 55,835

2018

0.09% GERMANY

0.01% BR AZIL

99.62%

USD 38,175

CHILE USD 461, 323,013

0.19% ARGENTINA USD 893,960


SOCIAL PERFORMANCE

76

72% OF OUR INVESTMENT IN SUPPLIERS IN 2 0 1 9 WA S I N LO S L AG O S R E G I O N , W H E R E 2 3 O F O U R FA R M S A R E F O U N D, A S W E L L A S 4 O F O U R H ATC H E R I E S A N D O U R 2 P R O C E S S I N G P L A N T S .


SOCIAL PERFORMANCE

77

CRITICAL SUPPLIERS We have determined as critical suppliers those whose supplies are in direct contact with our fish feed and those who could pose a risk in terms of human health and the environment.

S A L M O N CO M PA N I E S S I G N E D A N AG R E E M E N T W I T H G OV E R N M E N T

The commitment that suppliers in this category must assume involves safeguarding the integrity and safety of the products they deliver to Multiexport Foods, throughout their value chain, maintaining quality assurance procedures, certifications and/or programs for successful management. They must also safeguard the safety of their employees and the environment where they develop their services. In 2019, we had the support of a total of 1,445 suppliers, of which 74 are defined as part of the group of critical suppliers.

2019

Total No. of Suppliers Critical Suppliers % of Critical Suppliers

I N 2 0 1 9 M U LT I E X P O R T A N D OT H E R

1,445 74 5%

TO E N H A N C E T H E P R O D U C T I V E I M PAC T O N AYS É N R E G I O N .


SOCIAL PERFORMANCE

78

Selection of Suppliers

DELIVERY OF

SUPPLIER

Application request file

FILE AND

C O N TA C T

DOCUMENTS

SUPPLIER

Supplies REQUESTS FILE AND DOCUMENTS

REVISION OF DOCUMENTS

TYPE OF

VA L I D AT I O N

REGISTRY OF THE SUPPLIER

AND

I N C O R P O R AT I O N FILE

Yes A P P R O VA L

COMPLETES

IN THE VENDOR AP P ROVE D?

MASTER

P ROVI D E R ? S U P P LY

Not Incorporation File

REQUEST REJECTED Services

A P P R O VA L AND VA L I D AT I O N

SUPPLIERS CONTROL , C S R A N D H E A LT A N D SAFET Y

C O N TA C T A N D R E Q U E S T

R E V I S I O N A N D A P P R O VA L

I N C O R P O R AT I O N


SOCIAL PERFORMANCE

79

S U P P L I E R E VA L U A T I O N AND AUDIT Suppliers of Materials Suppliers of packaging materials and additives are evaluated annually. In the event that a supplier does not obtain the expected results, this must be audited in the following period. The audit process is led by an external entity and conforms to the highest international standards.

Processing Services The services that support the Processing unit are evaluated every six months.

Farming Services The services that support the Farming unit are evaluated quarterly.

Assessment Items

Assessment Items

Assessment Items

6 0 % Weighed quality risk 4 0 % Certification matrix 2 0 % Documentary/administrative

In 2019, 51 suppliers were evaluated and 21 were audited according to the results obtained in the evaluations from 2018. Two suppliers were suspended in 2019 due to the results of the process.

5 0 % Documentary/administrative 5 0 % Quality of service

In 2019, 121 suppliers were evaluated, of which 100 were approved, and 21 were approved with observations.

5 0 % Operational evaluation 2 0 % Outsourcing regime 3 0 % Health and safety

In 2019, 22 suppliers were evaluated, of which 20 were approved, and 2 obtained insufficient results.


SOCIAL PERFORMANCE

80

A Q U A C U LT U R E L I C E N S E S The company contributes directly to municipal funds through the payment of aquaculture licenses.

Total Aquaculture Licenses

LA UNIÓN $5 ,160,789

2017

2018

2019

$915,193,608

$940,280,521

$952,311,917

P U E R T O O C TAY $ 1 5 , 5 9 7, 1 2 0 PUERTO MONT T $ 8 , 4 3 9 , 6 3 1 CALB UCO $ 7 9 , 0 4 9 , 4 3 9

COCHAMÓ $ 2 6 , 8 0 5 , 2 5 7 H UA L A I H U É $ 3 7, 8 6 2 , 3 4 9

QUEMCHI $535 , 928 DA L C A H U E $ 4 9 6 , 2 3 0 C U R AC O D E V É L E Z $ 2 8 , 8 4 6 , 8 4 2 CASTRO $1 0,0 4 8 ,65 8 Q U I N C H AO $ 4 5 , 8 7 5 , 4 7 1 C I S N E S $ 4 74 , 3 8 4 , 1 4 8

P U E R T O AY S É N $ 1 4 9 , 7 8 7, 4 7 7

N ATA L E S $ 6 9 , 4 2 2 , 5 7 7

T H E CO M PA N Y C O N T R I B U T E D

C L P $ 9 5 2 , 3 1 1 , 9 1 7 TO M U N I C I PA L F U N D S T H R O U G H T H E PAY M E N T O F AQ UAC U LT U R E L I C E N S E S .


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S O C I O E N V I R O N M E N T A L I N I T I A T I V E S

CHAPTER 08


82 S O C I O - E N V I R O N M E N TA L I N I T I AT I V E S

PILLARS OF THE COMMUNIT Y RELATIONS STRATEGY

ACTIVE MANAGEMENT

SOCIAL INVESTMENT

PROMOTION AND CARE OF

OF RELATIONS

FOR DEVELOPMENT

THE ENVIRONMENT

COMMUNITY R E L AT I O N S We understand that our link with the social environment is a fundamental element in the way we run our company. We seek to establish close, long-term relationships within the framework of our value chain, in order to contribute to the development of the communities in which we are based, and improve the quality of life of the people who live in them.

Our goal is to always be of help to the 38 communities close to our operations, from AraucanĂ­a to Magallanes. We understand that each of our collaborators is an ambassador of the company in the territory; their roles and functions must promote the common good and manage interactions.

In 2019, we carried out a diagnosis of our area of influence and relevant social actors, which allowed us to design a Community Relationship strategy, based on three pillars: Active Management of Relations, Social Investment for Development, and Promotion and Care of the Environment. These pillars establish actions to be developed and the indicators associated with their fulfillment.


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AC T I V E M A N AG E M E N T O F R E L AT I O N S We establish active and continuous communication channels that create a relationship of trust with the community. These channels also serve to guide the social benefits brought by the company’s production chain, through shared values. Taking a cross-cutting approach, we have established open-doors initiatives, among which we would like to highlight the Molco Alto School and Preschool students’ visit our hatcheries and the Piedra Azul High School aquaculture students’ visit our processing plant in Puerto Montt, as well as the invitation of social leaders to our base in Puerto Cisnes, among others. These initiatives allowed us to demonstrate our processes and the standards with which we work, and establish the grounds for communication channels.

INVESTIGATION CENTRE

NEIGHBORS & CITIZENS

LOCAL MASS MEDIA

NGOs

SERVICE PROVIDERS

REGIONAL AUTHORITIES

TRADE ASSOCIATIONS

SALMON COMPANIES

NATIVE PEOPLE

COMPANIES

Another major focus has been our relationship with native people, with the aim of strengthening their culture. In this regard, in 2019 we accompanied Kawésqar communities on a trip to their ancestral territory, and we also supported, together with the Ancón Sin Salida Community, an intercultural educational visit to students from two schools in Punta Arenas. In our relationship with society in general, we contribute to improving quality of life through the promotion of art and sports, and the provision of specific support for people with disabilities, raising funds for Jornadas Solidarias de Rehabilita Aysén and Salmo Jornadas in Magallanes.

LOCAL AUTHORITIES

WORSHIP/ RELIGIOUS ASSOCIATIONS

FISHERMEN

REGULATORS

NEIGHBORS

TOURIST SERVICES

FUNCTIONAL SOCIAL ORGANIZATIONS

PUBLIC SERVICES

REGIONAL SOCIAL ORGANIZATIONS

SCHOOLS


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W E M A I N TA I N A N AC T I V E A N D P E R M A N E N T CO M M U N I C AT I O N W I T H CO M M U N I T I E S TO B U I L D T R U S T W I T H T H E M BY C R E AT I N G S H A R E D VA LU E .


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ART

SPORT

The development of culture and the arts is an area we always seek to be involved in; with this aim, we support various initiatives, such as:

We promote initiatives for healthy living, in particular those that encourage sports activities and the development of those who practice them.

• For the sixth consecutive year we supported the School Theater meeting, which brings together children and young people from the south of the country, and allows them to present their work in a comprehensive learning space. This event was held at the Diego Rivera Theater in Puerto Montt. • Within the framework of the 150th anniversary of the Instituto Alemán in Puerto Montt, our company supported the staging of the play “Macbeth” by the English theater company TNT, involving students from the Institute itself, along with those from the Inmaculada Concepción of Puerto Varas, the Liceo de Niñas, Escuela Alemania, Liceo Bosque Mar and the American School of Puerto Montt. • We also supported the production of “Shrek” the musical by Colegio Puerto Varas, which was staged at the Teatro del Lago de Frutillar, an event attended by five • Likewise, we continue to support the Bosque Nativo Cultural Extension Center in Puerto Varas, and we sponsor seasons of cinema, arts, and music, among other initiatives.

In this sense, we are proud to continue supporting, for the sixth year, the progress of athlete Rodrigo Cárdenas, from Dalcahue, who participated in the 2019 World Athletics Championships in Naples in the discus throwing event. Along with this, we supported the organization of the ‘2019 Sailing Week’ in Llanquihue, an event that combines sport and tourism, and promotes regional development. Finally, we support various amateur soccer and basketball clubs throughout the territory, providing sports equipment, and we contribute to the organization of the Chiloé Cycling Tour and the Puerto Aysén Basketball Championship, among others.


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SOCIAL INVESTMENT FOR DEVELOPMENT We contribute to the social and economic development of the communities we operate in, promoting initiatives related to strengthening education, training, and development of local suppliers, in addition to the execution of projects aimed at promoting social capital.

E D U C AT I O N In 2019, we provided strong support to the educational work of schools linked to the aquaculture sector, creating training opportunities and taking part in workshops with specialized foundations.

As part of these initiatives, we received 89 internship students at our farms, hatcheries and processing plants, where they were guided by our collaborators, who taught them all about the industry. In addition, we carried out talks at public schools in different locations, among other training activities. We also organized a joint project between the Arturo Prat Chacón High School of Puerto Cisnes, the Universidad de Concepción and COPAS Sur Austral, as part of the students’ comprehensive education.

Alliances with NGOs We continued our joint work with the NGO Canales, implementing opportunities for students to approach the world of work, promoting the development of skills that increase their employability. We also maintained our commitment to scholarships for students in melinka, who leave guaitecas seeking higher education. Through Enseña Chile, we contribute to bringing new teachers into classrooms in vulnerable areas of the country, providing new approach for students in the communities in which we work, to help them face the challenges they may encounter during their education.


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PROMOTION OF ENTREPRENEURSHIP We promote the development of local entrepreneurs, organizing training opportunities for the community, where we seek to provide tools for their social and economic development. With this aim, we implemented training programs for different social groups, in which we provided tools to promote local entrepreneurship. For example, we ran “Boat Repair” courses for 20 fishermen from the Puerto Aysén Fishermen’s Union, and two “Tanning and creation of leather craft” courses for 20 people from the district of Cochamó, in alliance with the National Women’s Service and the Municipality.

We created networks, joining a project with the Choigo Indigenous Community and the Isla Llingua Association of Women in Agriculture, where we supplemented the award of a state fund (FOSIS), which allowed them to acquire a tractor to improve the productive efficiency of horticulturists and pickers.

In parallel, we supported the inhabitants of Isla Tenglo with the installation of an open pier for the community in the area, which allowed them to improve accessibility and contributed to improving the fishing processes and tourist activities in the town, as was the case with Turismo de Mar y Tierra, who already had a boat and a tourism project managed with the State.

Alongside these initiatives, we also supported the creation and formalization of new service providers for the industry, providing them with advice from our team of professionals in the operations, supply, security and occupational health areas, with special focus on the Aysén and Magallanes regions.


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PUBLIC COMMITMENTS In terms of development alliances, this year we signed the Salmon Social Initiative, together with other companies in the industry, with the aim of improving the social and environmental operating standards of companies beyond the regulations in force, and encouraging the hiring of local services and workers. Furthermore, in AysĂŠn we signed a Productive Protocol agreed between companies in the industry and the government, in order to reinforce our commitment to the development of the region, which will strengthen the value chain and the development of aquaculture in the territory.


PROMOTION AND CARE OF THE ENVIRONMENT

CONTRIBUTIONS

We promote a culture of responsible citizenship when dealing with our environment, which manifests itself through two lines of work on this issue:

In 2019, we reinforced our direct contribution to communities within our area of direct influence, supporting those organizations and initiatives that had the greatest impact on the quality of life of families, and responding to the Community Relations model that has been established.

Projects linked to environmental awareness: in this area, we support recycling initiatives and environmental education in schools, among which we would like to highlight our work with the Environmental Committee of the Colegio Bosquemar de Puerto Montt, and visits to hatcheries from the students of the environmental brigade at the Escuela de Molco, among others.

In this period, we contributed CLP 8.000.000 in salmon products for social activities. Also, the company disbursed CLP 50.000.000 implementing social programs in local communities involving 542 volunteers’ hours of our staff.

We renewed our commitment to the Re-create Llanquihue program, with which we have been partners since its creation in 2017, and which this year continued its Environmental Education program. This program also prevented more than 200 tons of waste from reaching landfills thanks to its recycling chain

Millions of Chilean pesos

Sea and Coastal Clean ups: : we have organized operations in places such as Huyar, San Javier, Apiao, Puerto Aguirre, Puerto Cisnes, Melimoyu, Lago Rupanco and Estuario de ReloncavĂ­, where we have partnered with other companies, farmers and social organizations.

D O N AT I O N S 2018

$88

$76

$54

Along with these projects, we participated for the third consecutive year in the Environmental Table of the district of Quinchao, an initiative convened by the Municipality, in which companies present in the territory join together to contribute to various projects for the benefit of local inhabitants and the environment. $19

S O C I O - E N V I R O N M E N TA L I N I T I AT I V E S

89

SOCIAL INVESTMENT 2019


GRI CONTENT INDEX

90

G R I C O N T E N T I N D E X

CHAPTER

09


GRI CONTENT INDEX

91

GRI STANDARD

CONTENT

GRI 102

GENERAL DISCLOSURES

OMISSION

PAGE

ORGANIZATIONAL PROFILE

102-1

Name of the organization

24

102-2

Activities, brands, products, and services

21

102-3

Location of headquarters

19

102-4

Location of operations

17

102-5

Ownership and legal form

24

102-6

Markets served

19

102-7

Scale of the organization

6

102-8

Information on employees and other workers

66

102-9

Supply chain

102-10

Significant changes to the organization and its supply chain

5

102-11

Precautionary Principle or approach

32

102-12

External initiatives

102-13

Membership of associations

75 - 76 - 77 - 78 - 79

34 - 88 72 - 86 - 88

STRATEGY

102-14

Statement from senior decision-maker

102-15

Key impacts, risks, and opportunities

5 5 - 32

ETHICS AND INTEGRITY

102-16

Values, principles, standards, and norms of behavior

8

102-17

Mechanisms for advice and concerns about ethics

32

GOVERNANCE

102-18

Governance structure

102-19

Delegating authority

102-20

Executive-level responsibility for economic, environmental, and social topics

30

102-21

Consulting stakeholders on economic, environmental, and social topics

36

102-22

Composition of the highest governance body and its committees

102-23

Chair of the highest governance body

25

102-24

Nominating and selecting the highest governance body

25

102-25

Conflicts of interest

25

25 - 26 - 27 Omit

25 - 26 - 27


GRI CONTENT INDEX

92

GRI STANDARD

CONTENT

OMISSION

PAGE

102-26

Role of highest governance body in setting purpose, values, and strategy

32

102-27

Collective knowledge of highest governance body

38

102-28

Evaluating the highest governance body’s performance

102-29

Identifying and managing economic, environmental, and social impacts

102-30

Effectiveness of risk management processes

Omit

102-31

Review of economic, environmental, and social topics

Omit

102-32

Highest governance body’s role in sustainability reporting

102-33

Communicating critical concerns

Omit

102-34

Nature and total number of critical concerns

Omit

102-35

Remuneration policies

31

102-36

Process for determining remuneration

31

102-37

Stakeholders’ involvement in remuneration

31

102-38

Annual total compensation ratio

Confidential

102-39

Percentage increase in annual total compensation ratio

Confidential

Omit 32 - Financial Report

30

STAKEHOLDER ENGAGEMENT

102-40

List of stakeholder groups

102-41

Collective bargaining agreements

102-42

Identifying and selecting stakeholders

37 - 38

102-43

Approach to stakeholder engagement

35

102-44

Key topics and concerns raised

37 - 38 69

37 - 38 - 39

REPORTING PRACTICE

102-45

Entities included in the consolidated financial statements

102-46

Defining report content and topic Boundaries

102-47

List of material topics

36

102-48

Restatements of information

42

102-49

Changes in reporting

102-50

Reporting period

1

102-51

Date of most recent report

5

102-52

Reporting cycle

5

102-53

Contact point for questions regarding the report

3

3 - 49 35 - 36 - 39

Without changes


GRI CONTENT INDEX

93

GRI STANDARD

CONTENT

OMISSION

PAGE

102-54

Claims of reporting in accordance with the GRI Standards

3

102-55

GRI content index

92

102-56

External assurance

103

GRI 200

ECONOMIC STANDARDS

GRI 201

ECONOMIC PERFORMANCE

103-1

Explanation of the material topic and its Boundary

Financial Report

103-2

The management approach and its components

Financial Report

103-3

Evaluation of the management approach

Financial Report

201-1

Direct economic value generated and distributed

49

201-2

Financial implications and other risks and opportunities due to climate change

63

201-3

Defined benefit plan obligations and other retirement plans

201-4

Financial assistance received from government

GRI 202

MARKET PRESENCE

103-1

Explanation of the material topic and its Boundary

68

103-2

The management approach and its components

68

103-3

Evaluation of the management approach

68

202-1

Ratios of standard entry level wage by gender compared to local minimum wage

70

202-2

Proportion of senior management hired from the local community

68

GRI 203

INDIRECT ECONOMIC IMPACTS

103-1

Explanation of the material topic and its Boundary

86 - 87

103-2

The management approach and its components

86 - 87

103-3

Evaluation of the management approach

86 - 87

203-1

Infrastructure investments and services supported

203-2

Significant indirect economic impacts

GRI 204

PROCUREMENT PRACTICES

103-1

Explanation of the material topic and its Boundary

75

103-2

The management approach and its components

75

103-3

Evaluation of the management approach

77 - 79

204-1

Proportion of spending on local suppliers

75 - 76

GRI 205

ANTI-CORRUPTION

Omit Does not apply

89 74 - 80


GRI CONTENT INDEX

94

GRI STANDARD

CONTENT

OMISSION

PAGE

103-1

Explanation of the material topic and its Boundary

32

103-2

The management approach and its components

32

103-3

Evaluation of the management approach

Omit

205-1

Operations assessed for risks related to corruption

Omit

205-2

Communication and training about anti-corruption policies and procedures

Omit

205-3

Confirmed incidents of corruption and actions taken

GRI 206

ANTI-COMPETITIVE BEHAVIOR

103-1

Explanation of the material topic and its Boundary

Omit

103-2

The management approach and its components

Omit

103-3

Evaluation of the management approach

Omit

206-1

Legal actions for anti-competitive behavior, anti-trust, and monopoly practices

Omit

GRI 207

TAX

103-1

Explanation of the material topic and its Boundary

Financial Report

103-2

The management approach and its components

Financial Report

103-3

Evaluation of the management approach

207-1

Approach to tax

207-2

Tax governance, control, and risk management

207-3

Stakeholder engagement and management of concerns related to tax

207-4

Country-by-country reporting

GRI 300

ENVIRONMENTAL STANDARDS

GRI 301

MATERIAL

103-1

Explanation of the material topic and its Boundary

Omit

103-2

The management approach and its components

Omit

103-3

Evaluation of the management approach

Omit

301-1

Materials used by weight or volume

59

302-2

Recycled input materials used

59

303-3

Reclaimed products and their packaging materials

59

GRI 302

ENERGY

103-1

Explanation of the material topic and its Boundary

10 - 55 - 56

103-2

The management approach and its components

11 - 55 - 56

32

Omit Tax Policy 30 - 32 Omit Financial Report


GRI CONTENT INDEX

95

GRI STANDARD

CONTENT

OMISSION

PAGE

103-3

Evaluation of the management approach

302-1

Energy consumption within the organization

302-2

Energy consumption outside of the organization

Not rated

302-3

Energy intensity

Not rated

302-4

Reduction of energy consumption

55

302-5

Reductions in energy requirements of products and services

63

GRI 303

WATER AND EFFLUENTS

103-1

Explanation of the material topic and its Boundary

53 - Water Footprint

103-2

The management approach and its components

53 - Water Footprint

103-3

Evaluation of the management approach

53 - Water Footprint

303-1

Interactions with water as a shared resource

303-2

Management of water discharge-related impacts

303-3

Water discharge

303-4

Water withdrawal

54

303-5

Water consumption

54

GRI 304

BIODIVERSITY

103-1

Explanation of the material topic and its Boundary

10 - 60 - 62

103-2

The management approach and its components

11 - 60 - 62

103-3

Evaluation of the management approach

11 - 60 - 62

304-1

Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas

62

304-2

Significant impacts of activities, products, and services on biodiversity

52

304-3

Habitats protected or restored

62

304-4

IUCN Red List species and national conservation list species with habitats in areas affected by operations

60

GRI 305

EMISSIONS

103-1

Explanation of the material topic and its Boundary

10

103-2

The management approach and its components

11

103-3

Evaluation of the management approach

11

305-1

Direct (Scope 1) GHG emissions

55

305-2

Energy indirect (Scope 2) GHG emissions

55

11 - 55 - 56 55 - 56

Water Footprint Omit Water Footprint


GRI CONTENT INDEX

96

GRI STANDARD

CONTENT

OMISSION

PAGE

305-3

Other indirect (Scope 3) GHG emissions

55

305-4

GHG emissions intensity

56

305-5

Reduction of GHG emissions

56

305-6

Emissions of ozone-depleting substances (ODS)

Does not apply

305-7

Nitrogen oxides (NOX), sulfur oxides (SOX), and other significant air emissions

Does not apply

GRI 306

EFFLUENTS AND WASTE

103-1

Explanation of the material topic and its Boundary

103-2

The management approach and its components

11

103-3

Evaluation of the management approach

11

306-1

Water discharge by quality and destination

54

306-2

Waste by type and disposal method

306-3

Significant spills

306-4

Transport of hazardous waste

306-5

Water bodies affected by water discharges and/or runoff

GRI 307

ENVIRONMENTAL COMPLIANCE

103-1

Explanation of the material topic and its Boundary

10

103-2

The management approach and its components

11

103-3

Evaluation of the management approach

11

307-1

Non-compliance with environmental laws and regulations

74

GRI 308

SUPPLIER ENVIRONMENTAL ASSESSMENT

103-1

Explanation of the material topic and its Boundary

Omit

103-2

The management approach and its components

Omit

103-3

Evaluation of the management approach

Omit

308-1

New suppliers that were screened using environmental criteria

Omit

308-2

Negative environmental impacts in the supply chain and actions taken

Omit

GRI 400

SOCIAL STANDARDS

GRI 401

EMPLOYMENT

103-1

Explanation of the material topic and its Boundary

68

103-2

The management approach and its components

68

103-3

Evaluation of the management approach

68

10 - 58

57 - 58 Does not apply 57 Omit


GRI CONTENT INDEX

97

GRI STANDARD

CONTENT

OMISSION

PAGE

401-1

New employee hires and employee turnover

401-2

Benefits provided to full-time employees that are not provided to temporary or part-time employees

Omit

401-3

Parental leave

Omit

GRI 402

LABOR/MANAGEMENT RELATIONS

103-1

Explanation of the material topic and its Boundary

69

103-2

The management approach and its components

69

103-3

Evaluation of the management approach

69

402-1

Minimum notice periods regarding operational changes

GRI 403

OCCUPATIONAL HEALTH AND SAFETY

103-1

Explanation of the material topic and its Boundary

71

103-2

The management approach and its components

71

103-3

Evaluation of the management approach

71

403-1

Occupational health and safety management system

Omit

403-2

Hazard identification, risk assessment, and incident investigation

Omit

403-3

Occupational health services

Omit

403-4

Worker participation, consultation, and communication on occupational health and safety

Omit

403-5

Worker training on occupational health and safety

Omit

403-6

Promotion of worker health

Omit

403-7

Prevention and mitigation of occupational health and safety impacts directly linked by business relationships

Omit

403-8

Workers covered by an occupational health and safety management system

Omit

403-9

Work-related injuries

403-10

Work-related ill health

GRI 404

TRAINING AND EDUCATION

103-1

Explanation of the material topic and its Boundary

67

103-2

The management approach and its components

67

103-3

Evaluation of the management approach

67

404-1

Average hours of training per year per employee

67

404-2

Programs for upgrading employee skills and transition assistance programs

67

404-3

Percentage of employees receiving regular performance and career development reviews

68

404-3

Porcentaje de empleados que reciben evaluaciones periĂłdicas del desempeĂąo y desarrollo profesional

68

68

Omit

71 Omit


GRI CONTENT INDEX

98

GRI STANDARD

CONTENT

OMISSION

PAGE

GRI 405

DIVERSITY AND EQUAL OPPORTUNITY

103-1

Explanation of the material topic and its Boundary

69 - 70

103-2

The management approach and its components

69 - 70

103-3

Evaluation of the management approach

69 - 70

405-1

Diversity of governance bodies and employees

26 - 66

405-2

Ratio of basic salary and remuneration of women to men

69 - 70

GRI 406

NON-DISCRIMINATION

103-1

Explanation of the material topic and its Boundary

Omit

103-2

The management approach and its components

Omit

103-3

Evaluation of the management approach

Omit

406-1

Incidents of discrimination and corrective actions taken

GRI 407

FREEDOM OF ASSOCIATION AND COLLECTIVE BARGAINING

103-1

Explanation of the material topic and its Boundary

69 - Free Associaton Policy

103-2

The management approach and its components

69 - Free Associaton Policy

103-3

Evaluation of the management approach

69 - Free Associaton Policy

407-1

Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk

GRI 408

CHILD LABOR

103-1

Explanation of the material topic and its Boundary

Does not apply

103-2

The management approach and its components

Does not apply

103-3

Evaluation of the management approach

Does not apply

408-1

Operations and suppliers at significant risk for incidents of child labor

GRI 409

FORCED OR COMPULSORY LABOR

103-1

Explanation of the material topic and its Boundary

Does not apply

103-2

The management approach and its components

Does not apply

103-3

Evaluation of the management approach

Does not apply

409-1

Operations and suppliers at significant risk for incidents of forced or compulsory labor

GRI 410

SECURITY PRACTICES

103-1

Explanation of the material topic and its Boundary

Omit

103-2

The management approach and its components

Omit

32

Not rated

Not rated

Not rated


GRI CONTENT INDEX

99

GRI STANDARD

CONTENT

OMISSION

PAGE

103-3

Evaluation of the management approach

Omit

410-1

Security personnel trained in human rights policies or procedures

Omit

GRI 411

RIGHTS OF INDIGENOUS PEOPLES

103-1

Explanation of the material topic and its Boundary

83

103-2

The management approach and its components

83

103-3

Evaluation of the management approach

83

411-1

Incidents of violations involving rights of indigenous peoples

GRI 412

HUMAN RIGHTS ASSESSMENT

103-1

Explanation of the material topic and its Boundary

Code of Ethics

103-2

The management approach and its components

Code of Ethics

103-3

Evaluation of the management approach

Omit

412-1

Operations that have been subject to human rights reviews or impact assessments

Omit

412-2

Employee training on human rights policies or procedures

Omit

412-3

Significant investment agreements and contracts that include human rights clauses or that underwent human rights screening

Omit

GRI 413

LOCAL COMMUNITIES

103-1

Explanation of the material topic and its Boundary

10 - 83

103-2

The management approach and its components

11 - 83

103-3

Evaluation of the management approach

11 - 83

413-1

Operations with local community engagement, impact assessments, and development programs

413-2

Operations with significant actual and potential negative impacts on local communities

GRI 414

SUPPLIER SOCIAL ASSESSMENT

103-1

Explanation of the material topic and its Boundary

75

103-2

The management approach and its components

75

103-3

Evaluation of the management approach

75

414-1

New suppliers that were screened using social criteria

Not rated

414-2

Negative social impacts in the supply chain and actions taken

Not rated

GRI 415

PUBLIC POLICY

103-1

Explanation of the material topic and its Boundary

32

103-2

The management approach and its components

32

Does not apply

89 Omit


GRI CONTENT INDEX

100

GRI STANDARD

CONTENT

OMISSION

PAGE

103-3

Evaluation of the management approach

32

415-1

Political contributions

32

GRI 416

CUSTOMER HEALTH AND SAFETY

103-1

Explanation of the material topic and its Boundary

Omit

103-2

The management approach and its components

Omit

103-3

Evaluation of the management approach

Omit

416-1

Assessment of the health and safety impacts of product and service categories

Omit

416-2

Incidents of non-compliance concerning the health and safety impacts of products and services

Omit

GRI 417

MARKETING AND LABELING

103-1

Explanation of the material topic and its Boundary

103-2

The management approach and its components

103-3

Evaluation of the management approach

Omit

417-1

Requirements for product and service information and labeling

Omit

417-2

Incidents of non-compliance concerning product and service information and labeling

Omit

417-3

Incidents of non-compliance concerning marketing communications

Omit

GRI 418

CUSTOMER PRIVACY

103-1

Explanation of the material topic and its Boundary

Omit

103-2

The management approach and its components

Omit

103-3

Evaluation of the management approach

Omit

418-1

Substantiated complaints concerning breaches of customer privacy and losses of customer data

Omit

GRI 419

SOCIOECONOMIC COMPLIANCE

103-1

Explanation of the material topic and its Boundary

10

103-2

The management approach and its components

11

103-3

Evaluation of the management approach

11

419-1

Non-compliance with laws and regulations in the social and economic area

74

419-1

Incumplimiento de las leyes y normativas en los รกmbitos social y econรณmico

74

Omit 10


GRI CONTENT INDEX

101

ANNEX


SOCIAL PERFORMANCE

102


SOCIAL PERFORMANCE

103


SOCIAL PERFORMANCE

104


SOCIAL PERFORMANCE

105


S O C I O - E N V I R O N M E N TA L I N I T I AT I V E S

106


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