Annual Report Is Aimed the Materiality Matrix Was Structured Through Material Themes at Odebrecht S.A
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Annual 2018 Report 2 3 The future We, Odebrecht members, build the future based on our daily accomplishments, the challenges we face and what we have learned throughout our history. It has been like this for 74 years. We are more than 50 thousand people, of different nationalities, with is built diverse experiences and knowledge, of the most varied cultures, speaking several languages and united by the principles and concepts of Odebrecht Entrepreneurial Technology (TEO). We are responsible for combining the Odebrecht Group continuous everyday evolution to the objectives of sustainable development, which takes us to the desired future. In 2016, we started a Journey of Transformation throughout the Odebrecht Group. Among other actions, we defined a new corporate governance model and implemented new policies, including a new compliance system based on the best global practices. This report consolidates a summary of performance and highlights of the holding company and its Business related to the year 2017. Here, you will learn about our journey that begins in 2016, goes through the entire year of 2017 and includes the first months of 2018. You will notice the internal structuring changes of this journey are concluded. Updates and enhancements, like everything else we do, will continue to happen permanently. You will also learn about the role and the internal structure of Odebrecht S.A., our Businesses and the organizational and performance indicators of the Group. The latter, where appropriate, related to the Sustainable Development Goals (SDGs) proposed by the United Nations. We also adopted GRI standards referred in in the foot notes. By reading this report, you will share with us our commitments to develop and contract businesses with ethics, integrity and transparency, and to contribute to the development of societies where we operate and belong to. The Odebrecht Entrepreneurial Technology (TEO) is the set of principles and concepts that guide the attitude and corporate action of the members of the Odebrecht Group. One of the principles is trust in people, in their capacity and in their desire to evolve. For us, the future is already in place. Learn more at: https://www.odebrecht.com/en/odebrecht-group/odebrecht-entrepreneurial-technology. Odebrecht S.A. is a holding company of the Odebrecht Group. Messages Chair of the Board of Our Odebrecht S.A. 06 governance CEO of Odebrecht S.A. Odebrecht in 10 numbers Board of Directors Governance Our Commitment structure to ethics, Global Advisory integrity and Council transparency Our commitment Our Compliance 24 Businesses system Odebrecht portfolio Independent monitoring 38 Financial indicators The Path of Risk management compliance Asset divestment plan Business innovation for sustainability Our commitment to people Members’ profile Ability to 66 Our commitment accomplish in society Health, safety and well-being Commitments to 82 sustainability Reputation and About the Report engagement Odebrecht Award Material topics 94 Odebrecht Foundation 6 7 Odebrecht has a history of throughout the Group. Engineering and Construction. accomplishments of more than 74 This is a Governance of Getting us organized internally is not years. This story will continue. We Transformation. enough. We all know that winning will continue to improve our services new business across the Group and products for the benefit of our Principles, concepts, policies and and achieving good results, with customers, in the countries where we systems are imperative for practice, but recognized ethics standards, are also present, and in the communities where are not enough for a transformation that indispensable to regain our reputation. we operate. we all desire. The most important thing is the transformation that occurs in each I express my confidence in the Throughout our history, we faced one of us. members of the Board of Directors different challenges. We have of Odebrecht S.A. The richness of surpassed all of them based on solid All of us, Odebrecht members, are experience, the diversity and the principles and concepts expressed aware that developing and winning independency of the directors, in the Odebrecht Entrepreneurial business with ethics, integrity ensure that we will take the correct Technology (TEO) and, especially, and transparency is fundamental decisions, considering the best to under the leadership of competent, to proceed with our history of Odebrecht, to shareholders and to committed and aligned Teams. achievements. Since 2016 this is other stakeholders. We are conscious our commitment that constituted It has not been and will not be different of the relevance of our responsibility in the fundamental step stone of this time. this important period of the Odebrecht transformations. life, and we are motivated for the In 2016 and 2017, we embarked Our internal structuring challenges that we still face ahead. on a real Transformation Journey transformations are completed. We throughout the Group. We started I also entrust the CEO of Odebrecht will continue to refine our concepts from the convictions in our principles S.A., Luciano Guidolin and his team, and practices, and maintain focus on and concepts, and unfolded them into to manage our Business and our Message from innovation and in our competitiveness. policies that guide our way of thinking, investments, and to carry out the Our biggest challenges today are behaving and acting. necessary achievements and results external. the chair of we all need to reach increasing levels We implemented a new governance in We need to support the of development. all companies, including the decision the Board implementation of the imperative by Kieppe Patrimonial, indirect parent Above all, I trust the talent and the structural and cultural changes in company of Odebrecht S.A., of no determination of all our members, Brazil and in the other communities longer indicate any member of the especially our young people, some we operate. We need to support the Odebrecht family as CEO of the Group. precociously taken to the status of construction of fair and self-sustaining Leaders. It is mainly you, this new We defined the role of Odebrecht S.A., markets. generation, who have the opportunity as a holding of a dynamic portfolio We will comply with all the Leniency and the responsibility to boost the of Businesses and investments, all Agreements we signed, in the certainty construction of our history. with their own governance, aiming that public agencies will do likewise. at financial and operational self- We are going through a period where The essence of these agreements sufficiency and the compatible return we have to guarantee our survival. We is to ensure companies to return to to shareholders. will move to grow again, without losing full operations, thus promoting new our roots to continue pursuing the In 2018, we renewed the Board of development and job opportunities, perpetuity of Odebrecht. Directors of Odebrecht S.A., with generating value and further income a significant majority of external for society while providing services It is you, young people, who will assure independent directors. Boards at and manufacturing products the continuity of this course. specific businesses also included that improve the quality of life of relevant participation of external communities. independent directors. We are convinced that to generate We reviewed our Compliance Policy, results we need to engage team which among other definitions, members in all Businesses to defined a system based on ethics, innovate and operate with the Ruy integrity and transparency. This highest standards of productivity and system is now in place and in practice integrity, especially in the Business of Sampaio 8 9 Luciano Guidolin took over as CEO of Odebrecht S.A. in May 2017: “Everyone is committed to acting with ethics, integrity and transparency: shareholders, leaders and other members.” What are the strategic priorities their own Boards of Directors envision opportunities. at Odebrecht S.A. to guide where and management processes, are The macroeconomic scenario of 2017, investments will be concentrated and important to our financial health and still with many uncertainties and allocated? profitability. They make them even low growth, was a limiting factor for more attractive to new partners The focus of Odebrecht S.A. and further increases in operational results of the Business is to renovate and and associates. The holding’s role grow. The Odebrecht Group aims to within this context is to guarantee What are the main challenges and work in three areas simultaneously: that the concepts of Odebrecht goals for the holding in 2018? reconciling the past, overcoming Entrepreneurial Technology, which In 2018, we will focus on the the present and building the future. values people in a mutually trusting evolution of governance, in the Construction of this future includes environment, is present on every front conclusion of the process of enhancing the corporate governance of action at our Business, sustainably reducing leverage and improving the model, and this was one of the main creating value. Group’s financial liquidity. points we worked on in 2017. We have adopted a new strategic In the scope of Businesses, we Of the many changes to the position for our brands, suited to will focus on competitiveness and corporate governance model and to each Business and in pace with innovation, the conclusion of the processes at the holding company, changes. Some Business have already divestment process and the financial which were most relevant in 2017? announced their new identities to the rebalancing of some Businesses. market, while others are still in the We worked hard to define new policies In society and wherever we are as review process. at Odebrecht S.A. to bring the total to members of the Odebrecht Group, we 12 by the end of 2018. Five of them What is your assessment of are a committed to ethics, integrity have already been approved. The operational performance at and transparency. We must keep the Policy on Compliance with Ethics, Odebrecht S.A.