We are adopt the highest level of ethics and comply strictly with laws, regulations and policies relevant to our activities. Our Code of Conduct is valid for the whole Algar Group and sets guidelines and principles that govern the internal and external relationships of our associates, regardless of their roles and responsibilities. The corporate policies and other guidelines take into account applicable laws and regulations to prevent incidents of corruption in business operations, highlighting Law 12846/2013 – Anti-Corruption Act, Law 8666/1993 (Bids), Law 10520/2012 (Trading), Law 12462/2011 (Special Public Procurement System) and other laws related to public bidding. Additionally, the Algar Group signed Instituto Ethos’ [Ethos Institute] Business Pact for Integrity and Against Corruption in 2006. In 2014, the Company paid no fines, monetary penalties and/or was sued due to non-compliance with laws and regulations.

In 2014, we launched the Compliance Program on the corporate level to undertake structured initiatives focusing on promoting the Code of Conduct, as well as prevent, detect and handle any incidents that may occur. To that end, we have established three fronts of action: i) Prevention: Code of Conduct, Integrity and Compliance Committee, (internal and external) Communications, Training, Policies and Procedures, Risks Assessment and Internal Controls; ii) Detection: Integrity Channel, Internal Audit and Independent Audit; and iii) Reaction: Research and Remediation Protocol.

The Integrity and Compliance Committee currently consists of eight members, representing all areas of the Algar Holding, to ensure independence from operations. It was formally created by the internal rules and regulations approved by the CEO to ensure the fulfilment of the responsibilities entrusted to this Commission, which is prepared to receive and investigate any incidents reported.

We have the Integrity Channel, an independent channel for members and stakeholders to report facts and concerns or ask questions about the practices and behaviors related to ethical conduct, internal policies, laws and regulations. The companies have an Ombudsman for questions, complaints and suggestions about operations.

We are very strict about preventing corruption within our companies. The Group also has clear rules for donations and sponsorship to ensure that they go to social, environmental and cultural initiatives in communities or areas in which the Group is present, including proof of the donation purpose, the institution's history, and formal aspects and limits of jurisdiction for approval. There are also rules for relationships with public bodies, including participation in bids, third-parties representing or acting on behalf of the Company, amenities, gifts, donations, sponsorship and remediation in the event of violations.

We also manage processes related to environmental licensing in compliance with the prevailing legislation. In 2014, Algar Agro was involved in five environmental lawsuits, most of which connected with treatment of effluents. The company handled these lawsuits promptly so that it received no fines and caused no environmental impacts.

Human Rights

The Code of Conduct bans using child, forced or compulsory labor, as well as accepting partners and suppliers that either use, or carry out activities that have significant risk for incidents of, child, forced or compulsory labor, or activities that violate, or conflict with, indigenous rights. To monitor and prevent these practices, our occupational safety department requires specific documentation from all independent contractors (working papers, associates’ records, health examinations, proof of payment of FGTS [Fundo de Garantia por Tempo de Serviço, or Workers’ Severance Pay Fund], PIS [Programa de Integração Social, or Brazilian Social Integration Program] and COFINS [Contribuição para o Financiamento da Seguridade Social, or Tax-Like Contribution for Social Security Financing]), checks the List of Slave Labor, published by the Ministry of Labor and Employment, and inspects partners and suppliers for these practices.

Our employment contracts contain clauses that require observing the principles of respect for human rights and labor practices. They also ban employing minors, except as apprentices, and having workers in unhealthy or hazardous places of employment. The Company recorded such incidents involving its own or its independent contractors’ operations in 2014. In addition, it identified no operations and suppliers in which the right to exercise freedom of association and collective bargaining may have been violated or at significant risk. Neither the Company’s locations of operations nor its suppliers’ violate, or conflict with, the rights of indigenous peoples. Three incidents of discrimination were reported and found to be true at Algar Tech in 2014. In two cases, the Company followed the recommendations and dismissed the leaders involved. In the third case, a formal warning and an apology to the aggrieved associate were recommended.