Suppliers

GRI HR1

GRI HR2

GRI HR5

GRI HR6

GRI HR7

GRI EC6

At the end of the 2012-2013 crop year, Odebrecht Agroindustrial had approximately 4,500 suppliers, from which it purchased products and services for a total amount of R$2.1 billion – such as sugarcane, pesticides, fertilizers, agricultural and industrial machinery, food and transport services, and so on. Even without a formal policy to favor use of suppliers from the municipalities in which it operate, the Company prioritizes local consumption as a way of stimulating the economy, thus enabling development for populations living in the surroundings of its operations. During the period, 48 % of these purchases came from local partners.

The company does not examine human-rights related aspects involving its partners, but it takes the same precautions to ensure quality of relationships throughout the value chain. All contractors are required to uphold the same standards for working conditions, environmental issues, and compliance with applicable legislation – especially sugarcane suppliers. These requirements are stated in their contracts and breaches may lead to fines and / or termination. Suppliers and service providers are given a copy of Odebrecht Agroindustrial’s Code of Ethical Conduct and instructed to follow it. The Company is developing a specific Code of Conduct for Suppliers.

Odebrecht Agroindustrial’s investment contracts that amount to over R$10 million are classified as significant. In the 2012-2013 crop year, 11 contracts of this nature were signed, all of which included human rights clauses and were forwarded to legal department for approval prior to signing.

To ensure compliance with all requirements before sign-offs, technical visits are made and Request for Information (RFI) questionnaires used in order to attest to the capability of the companies concerned. For management of contracts, the units asses Health, Safety and Environment (HSE) practices of service providers, and seek to ensure that all rights and labor standards are upheld – including freedom of association and no child labor or degrading working conditions. During the 2012-2013 crop year, there were no operations in violation of these rights, nor was there any child labor and/or forced or slave-like working conditions.

Expenses with Local suppliers

Clusters

Total spending – suppliers (R$’000)

Total spending – local suppliers (R$’000)

Proportion of spending through local suppliers (%) (¹)

São Paulo

411,412

268,342

65.22%

Mato Grosso do Sul

448,575

239,567

53.41%

Goiás

320,778

139,802

43.58%

Araguaia

462,875

236,514

51.10%

Taquari

461,289

119,081

25.81%

(1)    Local suppliers means those located in regions and municipalities around Odebrecht Agroindustrial units, irrespectively of the state.