Sustainability Report
Algar Agro runs its business according to the best corporate governance practices, including the ones applicable to listed companies. Such practices follow the same principles as those inherited from its founder, Comendador Alexandrino Garcia, which are at present applied throughout the Algar Group. A commitment to transparency, accountabillity, equity and corporate responsibility sustains our policies which aim to create long term value to all stakeholders. At present Algar Agro does not have a formal process for engagement or definition of stakehoders. There is also no formal channel for the board to receive contributions from associates, though company culture and the network-enterprise model encourage such practice.
Board of Directors
Algar Agro’s Board of Directors has the mission to assure the sustainability of the Company, deciding the direction of the business and preserving its beliefs and values.
As of December 2011, Algar Agro had ten effective board members, of which six where external – not occupying any position within the Company or the controller and not part of the controlling group – elected by the General Assembly for one year with the possibility of reelection for the same period. The Board meets ordinarily six times per annum, according to a pre-established timetable, and, extraordinarily, anytime when necessary. As well as approving the annual budget and Algar Agros strategic plans, the board orients and evaluates the management in the running of the company so as to maximize sustainable returns at the same time respecting the interests of all interested parties.Since 2008 three non-deliberative committees have been set up to advise, instruct and guide the Board in its decision-making relating to specific themes. Committee members are Directors as well as outside specialists appointed by the Board, to whom they report.
Audit and Risk Management:'s mission is to ensure the quality, integrity, transparency and credibility of financial statements and the effectiveness of the processes of internal and independent audits, internal controls and compliance with applicable legislation. It also fulfills the role of ensuring the proper management of business risks. It consists of five members, three specialists, who meet every three months.
| Composition of the Board of Directors in Director 12/31/2011 | |
|---|---|
| Luiz Alberto Garcia | Chairman |
| Luiz Alexandre Garcia | Vice-Chairman |
| Alexandrino Garcia Neto | Director |
| Eliane Garcia Melgaço | Director |
| Mário Grossi** | Director |
| Hélio Marcos Machado Graciosa* | Director |
| Geraldo Sardinha* | Director |
| Walter Fontana Filho* | Director |
| Ozires Silva* | Director |
| Darc Antonio da Luz Costa* | Director |
| Eduardo Moreira da Costa* | Director |
** External Director, deceased in September 2011
Luiz Alberto Garcia (chairman) – Electronic Engineer graduated at the Escola Federal de Itajubá/MG, specialized in (i) Global Business Leadership, Georgetown University, Washington, DC (USA); (ii) Leading the Family Business, IMD, in Lausanne (Switzerland); e (iii) Owner/President Management Program of Harvard University (USA). He was the president of the National Association of Celullar Mobile Service Providers (Acel), of the Board of Anatel, of the Brazilian Association of Agribusiness (Abag), of Telebrasil and SindiTelebrasil. He was also a director of the Orsa Foundation. He is a Director of Fundação CPqD, member of the council of Fiemg, member of the Institute of Studies for Industrial Development (Iedi) and the Research Foundation of the Universidade Federal de Uberlândia (Fundap).
Luiz Alexandre Garcia (vice-chairman) – Economist graduated at the Universidade Gama Filho/RJ, with specialized courses in (i) Marketing, American University of Paris (France); (ii) MBA in the Catholic University of America, Washington, DC (USA); (iii) Leading the Family Business and (iv) Program for Executive Development, both with IMD, in Lausanne (Switzerland). Worked in IFC/World Bank, Washington, DC (USA), Ericsson, in Dallas (USA) and São Paulo as well as in Groupe Bull (France). Was President of the Commercial and Industrial Association of Uberlândia (Aciub), for two terms, and President of the National Association of Celullar Mobile Service Providers (Acel).. He belongs to the 3rd generation of Grupo Algar’s controlling family and has been, since 2006, CEO of Grupo Algar.
Alexandrino Garcia Neto (director) – Entrepreneur in the agribusiness sector and a member of Algar’s controlling group.
Eliane Garcia Melgaço (director) – Management graduate at the Pontifícia Universidade Católica de Minas Gerais (PUC/MG), specialized courses (i) MBA from the Catholic University, in Washington DC (USA); (ii) Leading the Family Business with IMD (Switzerland); and (iii) PGA at INSEAD, in Fontainebleau (France). Worked at the Banco Nacional, Cartão Unibanco and ATL in relationship and commecial marketing. Is a member of Grupo Algar’s controlling group and is at present corporate vice-president of Marketing and Sustainability of Grupo Algar.
Mario Grossi (external director) – Engineer graduated at the University of Livorno and Pisa (Italy), Management course at Bocconi University, in Milan (Italy) and specialized at INSEAD, in Fontainebleau (France). Was General Manager of Honeywell Bull for Latin America, Africa, Asia and Southern Europe (Spain, Portugal, Greece) and General Manager of Bull S.A., in Paris (France) for the banking products line. Was CEO of Grupo Algar from 1989 to 1997. He passed away in September 2011.
Hélio Marcos Machado Graciosa (external director) – Telecommunications Engineer and Master in Electric Engineering at the Pontifícia Universidade Católica of Rio de Janeiro (PUC/RJ*). Was Director of Research and Development at Telecomunicações Brasileiras S.A. – Telebras, President of the Telecommunications Society (SBrT) and Chairman of the Board of Telesc and Telebahia. At present he is the President of CPqD – Centro de Pesquisa e Desenvolvimento em Telecomunicações, in Campinas/SP, and of CPqD Technologies & Systems Inc., in Fort Lauderdale, Florida (USA) as well as Director of Institutional Relations at Cleartech. He is also President of the Advisory Council and member of the board of Telebrasil and other well-known companies.
Geraldo Sardinha Pinto Filho (external director) – Economist graduated at the Faculdade de Ciências Econômicas of the Universidade Federal de Minas Gerais (UFMG) specialized in Finance at the J.L.Kellogg Northwestern University (USA) and at INSEAD, Fontainebleau (France). Is a Director at Sardinha & Sant’Ana Consultoria Empresarial, onde atua como consultor de finanças corporativas para empresas de grande porte com foco na implantação de valor.where he works as corporate finance consultant for large companies. He is a Visiting Professor at the Sauder School of Business – University of British Columbia (Canada) and at INSEAD, Fontainebleau(France), as well as Associate Professor at the Fundação Dom Cabral (Brazil). He is a Board member at Hermis Pardini, Grupo Seculus, Dori Alimentos and Odonto System.
Walter Fontana Filho (external director) – Economist, graduated at the Pontifícia Universidade Católica de São Paulo, post-graduate in Economy at the same university and specialized in Marketing Management at the Fundação Getúlio Vargas. Was CEO and Chairman of the Board of Directors at Sadia. He is a Board member of the newspaper O Estado de São Paulo and of the Institute of Studies for Industrial Development (Ied).
Ozires Silva (external director) - Aeronautical Engineer graduated at the Instituto Tecnológico da Aeronáutica (ITA) with post-graduation in Aeronautics at the California Institute of Technology (CALTECH) – USA. He was the leader of the group that created Embraer – Empresa Brasileira de Aeronáutica SA, a company which he ran since its foundation, in 1970, until 1986 and later between 1991 and 1995, when he led the company’s privatization process. He was President of Petrobras – Petróleo Brasileiro S.A., Minister of State for Infrastructure and president of Varig S.A. At present he participates in several trade and public representation associations and is a member of the Boards of several renowned companies.
Darc Antonio da Luz Costa (external director) – Engineer, graduated at the Pontifícia Universidade Católica do Rio de Janeiro (PUC/RJ), Master of Production Engineering at the same university e Doctor in Production Engineering at COPPE/UFRJ. He was Vice-President of the Banco Nacional do Desenvolvimento Econômico e Social (BNDES). He is a member of the board of directors of the Centro Brasileiro de Estudos Estratégicos (Cebres), advisor to the Centro de Estudos Estratégicos of the Escola Superior de Guerra, where he was Coordinator, President of the Federation of Chambers of Commerce and Industry of South America, member of the Academia Brasileira de Ciências Morais e Políticas and Managin partner of DLC – Desenvolvimento, Logística e Cenários Simples Ltda.
Eduardo Moreira da Costa (external director) – Electric Engineer and M.Sc. in Computing at the UFMG and Electronics Ph.D. at Southampton University (UK). President of 2000ideias.com, an international company working with all aspects of innovation, based in Rio and Florianópolis, Professor of the Department of Engineering and Knowledge Management at UFSC and Professor of IAG at PUC/RJ. Consultant to the IADB, World Bank and UNCTAD in the areas of innovation, electronic business and electronic government. He was innovation director at Finep (2007-2010), creator of the programs Prime and Juro Zero; director of the CNPq (1993-1997), creator of the program Softex 2000 of incentives to Brazilian exports of software; and researcher at CPqD at Telebras, Member of the Order of Scientific Merit of the Brazilian Government (2010) and advisor to several entities and member of Boards of Directors.
Executive Board
Responsible for implementing management policies, executing the plans and reaching the targets established by the board of directors, the Executive Board has qualified professionals which work in the day-to-day operations of the Company. It has five members, of which one is the CEO and four operate in specific areas as follows: CFO, Industrial Manager, Director of Operations in the North and Northeast and Director of Retail and Marketing. The statutory members are the CEO, the CFO and the Industrial Director which were nominated at the Extraordinary Assembly which occurred on 30th May 2011 with mandates until 30th April 2014.
| Composition of the Executive Board at 12/31/2011 | |
|---|---|
| Leonardo Freitas | CEO |
| Gustavo Guimarães | CFO and Investor Relations Manager |
| Ademir Simão | Industrial Manager |
| Paulo Henrique Machado | Manager of Operations in Maranhão |
| Antônio Carlos Freitas | Retail and Marketing Manager |
Leonardo Freitas (CEO) – At Algar Agro since 1996, and CEO since 2011. He temporarily accumulated the function of Market and Finance manager, responsible for the origination and marketing of soybeans, coordination of logistics, international operations and risk management policy. Before joining Algar Agro, he built a career at the finance department of several agribusiness and retail companies. He has a Bachelor’s Degree in Business Administration at the Universidade Federal de Uberlândia e a Master’s Degree in Business Management at the Fundação Getúlio Vargas (FGV/SP).
Gustavo Guimarães (CFO) – Has worked for the Company since 2010. Responsible for Treasury and Finance, Planning, Accounting, Information Technology, Law Department and Supplies, the Company CFO has more than 15 years’ experience in financial management and auditing. As auditor, he worked for several local and multinational companies, in the areas of financial audit, accounting and internal controls, due diligence and accounting valuation reports. He is a graduate in Accounting at the Pontifícia Universidade Católica de Minas Gerais (PUC/MG) and has a Finance Executive MBA at IBMEC 2007. He has also been a member of the Regional Accountancy Council since 1997 and was a member of the Brazilian Institute of Financial Executives between 2004 and 2010.
Ademir Simão (Industrial Manager) – In the Company since 2007, amongst his responsibilities are environmental questions and quality guarantees aimed at maintaining Algar Agro’s international quality certifications. He also supports the logistic planning operations, focussing on expansion and consolidation of the company operations, as well as the operational control of the external reception and warehousing units of soybean. Previously, Ademir worked for Ceval Alimentos as manager, and for Bunge Alimentos as Superintendent and Industrial Manager. He graduated as a Chemical engineer at the Universidade Regional de Blumenau (UFRB), post-graduate course in Economic Engineering at the Universidade do Vale do Itajaí and MBA in International Management at Amana-Key.
Paulo Henrique Machado (Operations Manager North and Northeast) – Started his career in Algar Agro in 1990 as a soybean buyer. He is now responsible for operations in the North and Northeast Regions including the negotiations for the origination of soybean in the region, commercial area budget and cost control. He is an Agronomy graduate at the Universidade Federal de Uberlândia specializing in Soil Fertility (UFLA), and post-graduate in Business Administration and Marketing at the Universidade de São Paulo, with a vast experience in agriculture and grain production.
Antônio Carlos Freitas (Retail and Marketing Manager) – Graduate in Social Communications at the Pontifícia Universidade Católica do Rio de Janeiro (PUC/RJ) and post graduate in Business Administration at the Fundação Getúlio Vargas (FGV/RJ), he has 39 years experience in the commercial area, of which 28 years of experience in the management of Marketing and Sales. He worked in companies such as FBDE (Auditoria da Empresa e Marketing Consultoria e Vendas), EMS Indústria Farmacêutica, Fuscan Comercial de Automóveis and Cervejaria Kaiser. For the past 13 years he was senior consultant at ACT Consultoria Empresarial, his own business, during which he coordinated and/or executed more than 50 projects for restructuring and repositioning business in more than 40 companies in all parts of Brazil and abroad.
The company has four commissions to support management:
- Tax Commission
- Innovation Commission
- Sustainability Commission
- Associates Commission
Auditors
To continually improve the practice of corporate governance, Algar Agro counts with two auditors.
The Internal Auditor does the independent evaluation of the processes, to increase efficiency, and suggests ways to improve the control mechanisms of the company. It reports to the Board via the Audit and Risk Management Comittee and functionally to the group holding in order to preserve its autonomy and independence.
In order to prepare the financial information in accordance with the legislation, he company also has an external auditor, which since 2009 has been KPMG, one of the 'Big Four' accounting firms; a term which refers to the four largest auditing companies in the world.
Code of Conduct
The aim of Algar Agro’s code of conduct is to explain the rules of behaviour expected of all the associates, based on the Company’s principles and values. In a clear and precise way, the document states the practices necessary to maintain a trusting and lasting relationship, based on ethics and integrity, with all the stakeholders in the company: associates, clients, suppliers, the community and shareholders. The code of conduct can be acessed at:
www.algar.com.br/Conteudo/Institucional/File/Codigo-de-conduta-Algar.pdf (only portuguese)