Sustainability Report ENEVA 2020 slide image

Sustainability Report ENEVA 2020

8.1 SUPPLIERS [GRI 103-1 | 103-2 | 103-3-204-1 | 102-9 | 308-1] We seek long-term partnerships and prioritize engaging with local services and labor suppliers in order to promote regional development where we operate. In Maranhão, for example, we are one of the companies maintaining the supplier development program run by the Federation of Industries of the State of Maranhão (FIEMA). In 2020, especially in the context of the Covid-19 pandemic, we stayed even closer to our partner companies to ensure the health and well-being of contractors, as well as the continuity of operations and asset building. Our most strategic suppliers include those in generation operation & management (O&M), infrastructure, generation equipment, coal operation and supply, drilling rigs, seismic survey, as well as indirect suppliers (facilities), and international logistics suppliers. Contractors include all representatives, service providers, outsourced workers, any other individuals or corporations, and other commercial partners. In 2020, we spent around R$1.7 billion with the 1,648 active suppliers in our supply chain, with local supply (companies registered in the same state as our operations: Amazonas, Ceará, Maranhão and Roraima) accounting for about 10% of the amount. Compared to 2019, there was a 143% increase in the contracted amount referring to local suppliers without considering capacity increases. R$62.9 million was allocated for products and services from local companies. R$0.4 million were in Amazonas, R$8.9 million in Ceará, R$53.4 million in Maranhão, and R$0.02 million in Rondônia. [GRI 204-1] 8.1.1 Selection & Hiring To create value with a focus on commitment across the production chain, we select suppliers based on socio-environmental criteria, giving special attention to contracts that involve exposure to risk and require qualifications. Evaluations consider performance in regards to health, environmental, and safety (HES) issues; the amount and rate of accidents and incidents; the existence of standards and certifications; and the management of environmental impact risks by contractors. This analysis is supported by our HSE department which classifies the service to be contracted as high, medium, or low-risk, based on the technical scope and type of activity performed. In addition to this, suppliers, along with technical specifications, receive our "golden rules" and HSE annex documents to which they must attest understanding of. These precautions ensure the protection of people, the environment, and integrity of the facilities, in addition to meeting the minimum or specific compliance requirements. There is also a qualification process, with specific questionnaires for evaluation by the financial, legal, compliance, and HSE departments, as well as an integrity analysis questionnaire. When signing contracts, contractors must agree to abide by the HES appendix, golden rules, regulatory standards, and waste management, in addition to the technical scope that encompasses our contracted company management standards. Commissioning contractors for activities and/or services above R$500,000, either to represent us in interactions with government officials, with compensation by commission or success fees, and/or having been recommended by government officials, depends on prior approval by the board of executive officers and the compliance department, after performing due diligence. Contracts with these stakeholders include an anti-corruption clause and the relationship is governed by our third-party relations policy. ABOUT LETTER FROM ABOUT FIGHTING THIS REPORT MANAGEMENT ENEVA COVID-19 SUSTAINABILITY REPORT ENEVA 2020 INTELLECTUAL & ORGANIZATIONAL CAPITAL MANUFACTURED HUMAN CAPITAL CAPITAL SOCIAL & RELATIONSHIP CAPITAL NATURAL CAPITAL FINANCIAL CAPITAL APPENDICES GRI CONTENT INDEX SASB CONTENT INDEX PAGE 87
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