2020 INTEGRATED REPORT BUILDING A SUSTAINABLE FUTURE The world population is expected to unique qualities that allow other sectors, reach 9.7 billion people in 2050. It is such as renewable energy, to develop at estimated that approximately 6.4 billion the speed necessary for us to achieve, of them will live in cities. Most countries as a society, the reduction of emissions will face challenges to meet the needs established by the Paris Agreement. of their growing urban populations. This includes essential provisions such as Concrete will be widely used in smart clean water and sanitation, basic services cities, combining technology, urban (such as education and health), and management and solutions that general infrastructure (including housing, improve people’s lives. The illustration transportation and energy generation). in the cover of our 2020 Integrated Report reaffirms our commitment to At Votorantim Cimentos, we want to building a more sustainable future. It help build the foundation for this growth also reinforces our efforts in continuing to happen in a sustainable manner. As to develop solutions to reduce our leaders in the building materials industry emissions at all stages of the civil in Brazil and one of the most important construction chain (aiming to deliver to companies in the sector internationally, society a carbon neutral concrete by the we seek to grow, innovate and increase year 2050), to respect diversity and to the operational efficiency of our contribute to the economic and social business, using sustainability as one of development of communities. our strategic drivers. Finally, the illustration features people Concrete has shaped modern society wearing masks as a reminder of the and is vital to enable urban growth and atypical year we had and to emphasize a meet the need for quality housing and behavior that can protect so many lives infrastructure across the planet. Known during this coronavirus pandemic. “Our for its excellent durability, versatility hope, our strength, is in you taking care and resistance, concrete is considered of yourself. It will be worth it; your life is a sustainable material and has made to last”. characteristics that make it resistant to fire, weather and floods. It also provides excellent thermal insulation in buildings and rigidity in road construction, reducing energy use and increasing vehicle efficiency. Concrete also has TABLE OF CONTENTS ABOUT THE REPORT 04 PERFORMANCE 67 Materiality 06 Customer Focus 69 COVID-19 Challenges 09 Economic and Financial Results 72 2020 Sustainability Agenda 76 MESSAGES FROM OUR Environmental Management 79 GLOBAL LEADERSHIP 11 A Message from the CEO 12 2030 COMMITMENTS 82 A Message from the Board 14 Our Sustainability Journey 83 The Impact of the Sector and the 2020 HIGHLIGHTS 16 Climate Emergency 85 Awards and Recognitions 19 Concrete as Part of a More Egalitarian and Sustainable Planet 85 OUR WAY OF BEING 21 Our Commitments 88 Solid, Flexible and Current 23 Local and International Operations 26 EXTERNAL READERS 93 Corporate Governance 30 Ethics and Integrity 32 ANNEX - GCCA CHARTER 97 ANNEX - GCCA KPIS 99 STRATEGY AND MANAGEMENT 34 ANNEX - GRI CONTENT INDEX 101 Business Model 36 Risk Management 38 ANNEX - GRI STANDARDS Circular Economy 40 DISCLOSURES 115 Innovation for the Future 45 ANNEX - ASSURANCE LETTER 146 CORPORATE INFORMATION 149 CARING FOR PEOPLE 49 Our Employees 51 Social Transformation 59 Supply Chain 64 VOTORANTIM CIMENTOS ABOUT 2020 OUR WAY STRATEGY AND CARING 2030 EXTERNAL 2020 INTEGRATED REPORT THE REPORT MESSAGES HIGHLIGHTS OF BEING MANAGEMENT FOR PEOPLE PERFORMANCE COMMITMENTS READERS ANNEX 4 Employees at a VCEAA plant ABOUT IN THIS CHAPTER Materiality THE REPORT COVID-19 Challenges VOTORANTIM CIMENTOS ABOUT 2020 OUR WAY STRATEGY AND CARING 2030 EXTERNAL 2020 INTEGRATED REPORT THE REPORT MESSAGES HIGHLIGHTS OF BEING MANAGEMENT FOR PEOPLE PERFORMANCE COMMITMENTS READERS ANNEX 5 ABOUT THE REPORT GRI 102-46 We are committed to being increasingly transparent in in the disclosure of climate risks and opportunities. providing information about our activities, guidelines In addition, we based this report on criteria from the and decisions, as part of a major effort of accountability Global Cement and Concrete Association (GCCA) and in disclosing the company’s strategies and impacts. This connected our activities to the principles of the Global Integrated Report contains the most relevant information Compact and to the United Nations (UN) Sustainable for 2020, including everything from investments and Development Goals (SDGs). stakeholder relationships to environmental performance and company management during the coronavirus The financial data includes the companies that are pandemic. The information covers the period between consolidated in our results and can be found on page January 1 and December 31, 2020 and was externally 103. Information relating to Argentina, where we do assured by Bureau Veritas. GRI 102-50, 102-52, 102-56 not have control of operations, is consolidated in the financial statements as equity income and does not In line with our pursuit of excellence, we prepared this include social and environmental disclosures. report based on international indicator benchmarks. The economic and financial information included in this report These guidelines are at the core of our everyday is in accordance with the International Financial Reporting activities at our locations in Brazil and around the Standards (IFRS), issued by the International Accounting world, and are especially systematized in this report, so Standards Board (IASB), and the guidelines of the that all stakeholders, including the general public, can International Financial Reporting Interpretations Committee follow our progress and grow with us. Questions and (IFRIC). This document also follows the guidelines of the additional information about this report can be directed Brazilian Accounting Pronouncements Committee (CPC). to [email protected]. GRI 102-53 Internally, we gathered the most relevant social, Most of the photos used in this report were taken before environmental, economic and corporate governance the COVID-19 pandemic. Since the beginning of the information. This report has been prepared in pandemic, all of our operations have followed hygiene accordance with the GRI Standards: Core option, and and social distancing measures dictated by the principle detail our created and shared value according to the global health agencies. In addition, corporate office guidelines of the International Integrated Reporting employees have been working remotely. Council (IIRC). GRI 102-54 Happy reading. This year, for the first time, this document also incorporates the recommendations from the Task Force on Climate-Related Financial Disclosure (TCFD) Employee at one of our plants in Brazil VOTORANTIM CIMENTOS ABOUT 2020 OUR WAY STRATEGY AND CARING 2030 EXTERNAL 2020 INTEGRATED REPORT THE REPORT MESSAGES HIGHLIGHTS OF BEING MANAGEMENT FOR PEOPLE PERFORMANCE COMMITMENTS READERS ANNEX 6 Materiality GRI 102-40, 102-42, 102-43, 102-44 A prerequisite for reporting sustainability responded to our consultation, a result that according to the GRI and IIRC methodologies, exceeds the ideal 10% sample. Since we materiality is a process that uses stakeholder are an international company, these groups engagement to determine the critical themes were consulted in their local languages; we for an organization. In 2020, the consulting firm obtained responses in Arabic, English, French, Report Sustentabilidade followed four steps to Portuguese, Spanish and Turkish. This diversity help us develop our new materiality matrix. was reflected in the findings of the consultation, which considered different points of view, In the identification phase, we used from different cultures, thereby producing internal and industry documents and representative and balanced results. benchmarks to map our stakeholders and the issues that have the greatest impact on In the analysis phase, we followed a specific our company. In the prioritization phase, methodology to weigh the perceptions of we identified the perception of stakeholders each stakeholder group and inserted them through nine interviews with our company into a matrix that crossed internal and external executives, six interviews with external perspectives, resulting in the eight most relevant experts, and an online consultation that themes. The last phase of this process was received 237 responses from different groups validation, where the themes were approved (employees, customers, suppliers, universities, by the company leadership, who considered communities, nonprofit organizations and additional criteria such as risks, opportunities government authorities). Of these 237 and business strategies. This phase also included responses, 165 came from employees and the validation of the correlation of each theme 72 from representatives of our external with the United Nations SDGs and their specific audiences. In total, 13% of participants targets, and with our own 2030 Commitments. Employee and his family at one of our plants in Brazil VOTORANTIM CIMENTOS ABOUT 2020 OUR WAY STRATEGY AND CARING 2030 EXTERNAL 2020 INTEGRATED REPORT THE REPORT MESSAGES HIGHLIGHTS OF BEING MANAGEMENT FOR PEOPLE PERFORMANCE COMMITMENTS READERS ANNEX 7 MATERIAL TOPICS GRI 102-44, 102-46, 102-47, 103-1, 103-2 Topic/Description Why it is material to VC Boundaries Involvement with the Stakeholder Alignment Related SDG and impacts group that with the