Contents Letter from the Chairman of the Board..................................................................................................................... 4 Letter from the Chief Executive Officer ................................................................................................................... 4 The Report .................................................................................................................................................. 5 Reading this Report .................................................................................................................................................. 5 Drawing up this report .............................................................................................................................................. 7 About us .................................................................................................................................................... 10 Hera today............................................................................................................................................................... 10 History .................................................................................................................................................................... 10 Services managed ................................................................................................................................................... 11 Mission and Values................................................................................................................................................. 12 Managing sustainability.......................................................................................................................................... 13 The instruments of governance............................................................................................................................... 20 Governing Corporate Social Responsibility............................................................................................................ 27 Dialogue with stakeholders...................................................................................................................... 34 Hera’s stakeholders................................................................................................................................................. 34 Dialogue and involvement initiatives ..................................................................................................................... 35 Dialogue on the Sustainability Report .................................................................................................................... 37 Results and Value Added......................................................................................................................... 39 Operating results..................................................................................................................................................... 39 Allocation of value added ....................................................................................................................................... 45 Workforce ................................................................................................................................................. 49 Objectives and performance ................................................................................................................................... 49 Breakdown.............................................................................................................................................................. 50 Turnover ................................................................................................................................................................. 53 Diversity and equal opportunities ........................................................................................................................... 56 Training and professional development.................................................................................................................. 59 Pay, salaries and bonuses........................................................................................................................................ 64 Health and safety .................................................................................................................................................... 68 Industrial relations .................................................................................................................................................. 71 Internal communication .......................................................................................................................................... 73 Cultural associations............................................................................................................................................... 75 Internal climate survey............................................................................................................................................ 75 Others dialogue and envolvement inititatives ......................................................................................................... 80 Customers ................................................................................................................................................. 82 Objectives and performance ................................................................................................................................... 82 Breakdown.............................................................................................................................................................. 83 Tariffs and billing ................................................................................................................................................... 85 Service quality ........................................................................................................................................................ 96 Quality of drinking water........................................................................................................................................ 98 Service security and continuity............................................................................................................................. 102 Customer relations................................................................................................................................................ 108 Customer satisfaction survey ................................................................................................................................ 113 Other customer listening, dialogue and involvement initiatives ........................................................................... 116 Shareholders ........................................................................................................................................... 118 Objectives and performance ................................................................................................................................. 118 Breakdown............................................................................................................................................................ 118 Corporate Governance and safeguards for shareholders....................................................................................... 121 Distribution of dividends ...................................................................................................................................... 122 Stock exchange share performance....................................................................................................................... 122 Relations with investors and financial analysts..................................................................................................... 124 Financial Institutions ............................................................................................................................. 126 Suppliers.................................................................................................................................................. 129 Objectives and performance ................................................................................................................................. 129 Breakdown............................................................................................................................................................ 130 Operations within local communities.................................................................................................................... 132 Qualification and selection of suppliers................................................................................................................ 134 Contract management ........................................................................................................................................... 138 Supplier relations.................................................................................................................................................. 140 Public Administration............................................................................................................................ 142 Breakdown...........................................................................................................................................................