Ethics Ratings: Good Financial Performance, Efficiency and Good Ethics go Hand-in-Hand at Latin Blue Chips

Study Rates Most Popular Latin Equities

Madrid, 24 June, 2004: Latin American blue chip companies have been able to employ good ethics towards customers, suppliers, employees and investors to improve their efficiency and bottom lines, according to a study by the ethics rating agency Management & Excellence SA (M&E) in Madrid.

The established companies in mature industries such as (cement), the airplane producer and the mining company Rio Doce (CVRD) generally did best at making ethics pay off. Cemex is the most profitable cement producer worldwide and Embraer’s tough internal quality controls have helped worldwide expansion. “All use codes of ethics to motivate their work forces and high tech,” claims William Cox of M&E. Cemex integrated newly acquired companies within months instead of years. Cemex standardized operations throughout its 33 countries. Efficiency means good ethics towards customers: Cemex clients can track their orders online and get their cement or concrete in as little as 30 minutes.

Company Country Rating For years Femsa fostered AMBEV Bb goodwill among its America Movil C+b- employees and communities Bancomer BBVA Mexico Bb by holding regular local CEMEX Mexico B+b+ CVRD Brazil Bb+ parties and sponsoring art Embraer Brazil Bb+ exhibitions. “At Femsa FEMSA Mexico Bb headquarters, you see Grupo Modelo Mexico Bb banners with Femsa’s values TELEMAR Brazil B-b such as honesty and UNIBANCO Brazil Bb quality,” says Felipe Chediak of M&E.

Latin companies invest a lot into training their employees. The brewer AmBev has its own university carrying out courses for 13.500 employees annually, which includes an Executive MBA for ambitious managers.

“Newer companies--notably the telecommunications operators America Movil and Telemar, still seem busy digesting their strong growth and consolidating operations before dealing with ethics,” emphasizes Silvio Escudero of M&E.

The M&E study Ethics Pay Off for Latin Blue Chips is the first of its kind tailored to the financial community assessing opportunities and risks of management at the ten Latin American bluechips most widely held in funds worldwide.

Management & Excellence SA is the leading ethics rating agency for and was founded 4 years ago in Madrid. M&E has rated 70 companies, completed ethics studies on U.S. banks, world oil companies and U.S. bluechips, and is partnered with SR Rating in Brazil. Info from: www.management-rating.com ; email: [email protected]