Credits

Responsible for Sustainability | Mônica Alcântara

Responsible for the publication | Guilherme Bourroul

GRI Consultancy and Editorial Coordination | usina82

Graphic design and web development | GIZ Propaganda

Photography | Eduardo Moody e acervo Odebrecht Agroindustrial

Presentation

Message from the Business Leader

Our Annual Report, which has been uninterrupted since 2011, is an important tool to communicate the main results achieved during the harvest year to all stakeholders, with transparency and reliability. This edition presents information regarding the period from April 1, 2016 to March 31, 2017, covering the agricultural and industrial operations of the six Productive Poles located in Brazil. G4-28 G4-30

As we publish the Report, we expect our Members, Customers, Suppliers, Shareholders and society in general to understand how we create value in a sustainable way with our Business. Therefore, we have adopted the G4 Global Reporting Initiative (GRI) Guidelines, according to the Essential option, to highlight how we manage risks and extend the economic, social and environmental benefits of our activities. G4-32

For the first time, the document also meets the reporting requirements of the ten principles of the Global Compact, an initiative by the United Nations (UN), which we have become signatories of in 2016. In a transparent manner and in line with our objectives, we seek to demonstrate our contributions to promoting respect for human rights, decent working conditions, environmental responsibility and combating corruption.

As in the last edition, published in 2016, the Report was organized into sections that reflect the most relevant issues for our business, identified through inquiries with the public that is closest to the Company (Members, Clients, Suppliers, Civil Society and local governments) for building the Materiality Matrix. The economic-financial data has gone through external and independent auditing. The information related to socio-environmental aspects, including those that meet GRI prioritized indicators, was not verified by third parties, but was validated by the technical and administrative areas in the Company. G4-29G4-33

Doubts and comments on our Report are received through comunicacao.agroindustrial@odebrecht.com.
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Who we are
Founded in 2007, Odebrecht Agroindustrial is one of the largest producers of anhydrous and hydrated ethanol, sugar and bioenergy in the new agricultural boundary of Brazil. Our six Productive Poles are located in Goiás, Mato Grosso, Mato Grosso do Sul and São Paulo, totaling nine Units. G4-3G4-4G4-6G4-9

During these ten years, we have continuously increased our milling and currently process approximately 30 million tons of sugarcane per year. In the 2016/2017 harvest, the volume was 28.3 million tons. G4-9

As part of the Odebrecht Group, we have our administrative headquarters located in the city of São Paulo and we have an operations office in the city of Campinas (SP). We have approximately 11,000 Members, most of them active in the Central-West region of Brazil. G4-5G4-9

Participation in the production of ethanol by State
Goiás 17%
Mato Grosso 21%
Mato Grosso do Sul 29%
São Paulo 1%







Our Units



Nossas Unidades



Practically 99% of the hydrated and anhydrous ethanol we produce is commercialized in Brazil, mainly serving fuel distributors, but also biopolymers manufacturers – such as polyethylene produced from ethanol. The portion of biofuel exported is mostly intended to the United States market and also reaches South Korea. G4-8

The VHP sugar we produce is fully exported through agreements signed with trading companies, which market the product for refining in large consumer centers. G4-8

The electricity generated from the sugarcane bagasse supplies the energy demand of our Agroindustrial Units and the surplus is exported to the National Interconnected System (SIN), contributing to increase the presence of clean and renewable sources in the national energy matrix . This export is regulated and remunerated in accordance with the agreements signed with energy marketers and in the energy auctions promoted by the Electricity Trading Chamber (CCEE). Our assets concentrate 8% of the installed capacity in the country to generate electricity with sugarcane biomass. G4-8G4-DMA

Click here and get to know the environmental benefits of our products..





Reputation among our audiences
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From January to March 2017, we conducted a study to evaluate the Company’s reputation before our key stakeholders, by using the Reputation Institute’s RepTrack® Deep Dive methodology. Members, Clients, Agricultural Partners, Suppliers, community leaders and representatives of local governments, NGOs, universities and the press took part in this evaluation.

Our reputation has reached a general ratio of 68.8 on a scale of 0 to 100. Our Company is recognized especially for the quality of products and services and the commitment towards the development of people and society. Among the Members, the Company has a strong reputation, mainly for its attention regarding the health and safety of professionals, for the integrity in conducting business, for contributing with sustainable development and for its responsibility with the environment.

The reputation study considered seven dimensions in which respondents pointed out their perceptions about the Company’s performance and highlighted, in addition to their strengths, opportunities for improvement. Attributes related to products and services, innovation, work environment, governance and ethics, citizenship, leadership and management and financial performance were evaluated.


Corporate Governance
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Odebrecht Agroindustrial has a governance structure that ensures that decisions are made with transparency and independence, in line with the principles, concepts and criteria of Odebrecht Entrepreneurial Technology (TEO), which guide the performance of all the Odebrecht Group companies. G4-7

We have an Administration Board responsible for defining the long-term strategy for the business and for following the policies and guidelines of Odebrecht Agroindustrial. In the last crop year, following the best practices of the market, our Board began to operate with an independent member, recognized experience in agribusiness and specific knowledge on the sugar-energy sector. This development helps to widen the diversity of analyzes and improve governance.

The Administration Board has the support of three Permanent Committees:

• Finance, Investment and Audit Committee: it updates and monitors policies related to investments, financial matters and guarantees and insurance. It is responsible for the evaluation of proposed financial operations to the Board, particularly with regard to structure, costs and guarantees.

• People and Organization Committee: it updates and monitors policies related to the remuneration, development, evaluation and integration of People and sustainability. Among its main attributions is the monitoring of Safety, Health and Environment indicators.

• Compliance Committee: it was created in 2016 and accompanies the implementation of the Compliance System at Odebrecht Agroindustrial. The body is composed of at least three and no more than five members from the Administration Board, and one of them must be independent.

Our Executive Board is responsible for executing the strategies defined in the Board and for monitoring the Company’s operational and financial performance. The body is composed of the Business Leader and seven other Leaders, responsible for the development of the projects and activities in the areas that they would be entrepreneurs.

In its performance, the Executive Board is supported by thematic committees in which the Company Leaders participate. These include, for example, the HSE Committee, which meets semi-annually and counts on the participation of the Business Leader and of the Leader in the industrial area, and the Ethics Committee, which counts on the Compliance Area Leader in its structure.

Click here and get to know the Odebrecht Agroindustrial Compliance Policy.
Click here and learn more about our Ethical, Transparent and Fair operation.














Materiality Matrix
Our Materiality Matrix, built based on inquiry and the engagement of stakeholders, consolidates the most relevant themes for our strategy and subsidizes the continuous improvement of sustainability management, allowing us to make investments and improvements focused on reducing impacts and enhancing economic, social and environmental benefits. In the last crop year, we updated the Matrix in order to reflect the developments of the current sugar-energy sector scenario and the demands from society. G4-18G4-26

With this process, we consolidated our Matrix in five material themes:

• Business Performance
• Commitment towards Members
• Environmental impact
• Local Development
• Ethics, Transparency and Integrity.

The management of the Suppliers chain, key for the development of the business in a sustainable manner, is a cross-cutting theme that influences our performance in all other areas. In relation to the previous harvest, the only change of scope was the concentration of aspects and environmental indicators under the Environmental Impact theme.G4-23

For each of these themes, we have evaluated the topics of interest and expectations from the public engaged to define the projects and actions developed according to our annual planning. We have also considered the possible risks to be managed and the opportunities for generating value and synergy captures that exist in each aspect, with the objective of continuously improving our performance.

In the 2016/2017 harvest, we focused our efforts on identifying the risks and levers to generate value generation related to material themes. In this process, we prioritize the Member’s engagement and culture by presenting and discussing the connection between the Materiality Matrix and the Company’s operational activities.

The aspects listed by GRI considered relevant are related to the themes of our Materiality Matrix, as well as the key indicators for our governance and for the groups that are closer to the operations and social investment programs we conduct – Members, Clients, Suppliers, civil society and local governments. To communicate our performance in a clear, concise and transparent manner, responding to public demands, the material themes are portrayed in the sections structure of this Report. G4-24G4-25

Material theme Associated Risks Initiatives for generating value
Business Performance Inadequate hiring of Suppliers
Lack of planning
Failure to comply with business guidelines and procedures in operation
Increase productivity | Cost management
Assertiveness in planning | Trainings
Commitment towards Members Outsourced service (co-responsibility with the Partner)
Lack of Members Engagement
Awareness Campaigns (Attitude System)
Rigor in the qualification of Suppliers | Leadership example
Recognition of Members by sharing results
Environmental impact Inappropriate application of vinasse and agrochemicals
Proliferation of stables flies
Fires
Maintenance of equipment | Team capability and awareness
Use of by-products | Areas of Permanent Preservation and Legal Reserve
Clean energy | Monitoring of greenhouse gases
Local Development Economic dependence on the municipality
Messy growth
Increased cost of living
Generation of jobs and income
Qualification and professionalization of the community
Structured social investment – Social Energy
Ethics, Transparency and Integrity Fragility in the image
Delay in the payment of Suppliers
Ethics Channel | Codes of Conduct
Communication and engagement of Members, Suppliers and Community



Click here to know the material aspects of the GRI related to each material theme, as well as its internal and external limits.