Relátorio

This report contains information on Chesf’s economic, financial, social, and environmental performance in fiscal year 2017, including all the company’s operations in Northeast Brazil: 12 hydroelectric plants, two wind farms and one biofuel thermal plant. It also presents information on the 10 projects - generation and transmission - that Chesf has in Specific Purpose Entities (SPEs), although they were not included in the scope of analysis of GRI Standards indicators.

The document follows the GRI Core Standards. In order to find the indicators more easily, the numbers appear in parentheses immediately after the topic to which they refer. Through a materiality process, 168 items were selected for disclosure, broken down into 40 organizational profiles, 31 management approaches, 72 on performance (13 economic, 2 environmental, and 30 social) and 25 from the sector supplement. The indicators pointed out in this process reflect the work of Chesf regarding its strategies and the challenges faced in 2017, based on the views of its main stakeholders.



This publication, as well as all indicators considered material for the business, may be found at: www.chesf.gov.br > Sustentabilidade > Visão Geral > Relatórios de Sustentabilidade

MATERIALITY PROCESS

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The topics addressed in this report were defined through a materiality process based on the specific standards of GRI G4 and Standard. Tools such as RepRisk1, and the Global Reporting Initiative (GRI) study “Sustainability Topics for Sectors: What do stakeholders want to know?” were used to support the process.

The Company opted to consult internal stakeholders (executives) to prioritize the topics identified during the last cycle (2016), in addition to considering sector contents and interviews conducted from December 4 - 7, 2017 with the Chairman, four directors (Engineering, Operation, Administrative, and Financial), five leaders (in the areas of Governance, Strategic Planning and Sustainability, Environment, Institutional Relations, and Communities and Human Resources) and, in writing, with the CEO of Eletrobras.

The criteria used for prioritization involved issues important to Chesf’s business and strategy, in view of: financial implications of the impacts related to the topic, influence on long-term performance, level of reputation risk involved, and growth or gains in competitive advantage.

In total, 16 topics considered essential to the business were identified. Based on these topics, a form was applied that made it possible to classify perceptions regarding the importance of each topic and its level of impact as “very important,” “important,” “of little importance” or “unimportant.” The result of prioritization signaled five topics as very important and 11 important topics.

MATERIAL TOPICS 2017 >>>

> RANKING > > TEMA > > RELEVÂNCIA >
1 Operational Performance very important
2 Water very important
3 Risk and Crisis Management very important
4 Innovation, Diversification, and R&D very important
5 Employees and Employment very important
6 Corruption, Ethics Management important
7 Health and Safety important
8 Specific Purpose Entity important
9 Compliance Issues important
10 Communities important
11 Energy Matrix important
12 Climate Change important
13 Supplier Management important
14 Satisfaction (Customer and Employees) important
15 Volume of Assets important
16 Biodiversity important

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1 Ferramenta utilizada para identificação de riscos socioambientais.
2 Em português: “Tópicos de sustentabilidade para setores: o que as partes interessadas querem saber”.



Relátorio

With this result, it was possible to classify the level of importance of the topics for Chesf and its stakeholders, evaluating impacts (positive and negative) for both. Material topics, approved by the Executive Board, are correlated with the organization’s key sustainability and performance indicators, and flagged throughout the report, in the Attachments, and in the Index.

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Relátorio Impactos
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WHO ARE CHESF’S STAKEHOLDERS?

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Chesf considers stakeholders to be all parties directly and indirectly impacted by its results and actions. The identification of these stakeholder groups follows the Business Planning guidelines.

ENGAGEMENT PRACTICES

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The Company has in place a set of pre-defined practices to engage with its stakeholders throughout the year. The actions may vary from meetings, visits, telephone contacts, emails, information bulletins, contact by the suppliers’ service center, and client satisfaction surveys, depending on the need of each audience. There are also activities involving greater mobilization, such as: public hearings, campaigns carried out with government and society, actions for quality of life with employees and family, and sponsorships of social projects.

These engagement practices help identify the perceptions, suggestions, and concerns of these groups, giving responses and the appropriate treatment for each situation. The dialogue with Chesf’s stakeholders is guided by the Stakeholder Communication and Engagement Policy of the Eletrobras Companies, whose principles are:

  • > Agility and precision.
  • > Training, creativity, and innovation.
  • > Commitment and respect for human beings and the environment.
  • > Legal compliance.
  • > Business efficiency and effectiveness.
  • > Equity and respect for diversity.
  • > Ethics.
  • > Sustainability.
  • > Transparency.
  • > Appreciation and motivation of work teams.

GET TO KNOW CHESF’S MAIN STAKEHOLDERS AND HOW THEY RELATE:

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SHAREHOLDERS AND INVESTORS >>>

> DETAILS > > COMMUNICATION CHANNELS >
Eletrobras: 99,5780% Chesf, as a publicly-held company, is subject to the rules of the Brazilian Securities and Exchange Commission (CVM).
The Company’s relationship policy is ruled by the disclosure of information with transparency, characterized by respect for legal and ethical principles, in line with the standards to which it is submitted as a public utility company.
The Company has an information disclosure channel on its corporate portal on the Internet, www.chesf.gov.br, link “Investidores.” Communication with its shareholders is carried out through telephone service, face-to-face meetings, and email.
Ministry of Finance: 0,347%
Light: 0,016%
Others: 0,059%

CLIENTS >>>

> DETAILS > > COMMUNICATION CHANNELS >
Trading Segment
Potentially free consumers: 12 The relationship with customers is conducted through annual surveys, telephone contacts, meetings, direct mail, emails, publications on Chesf’s website, dissemination in newspapers and magazines, events such as congresses and lectures, websites specializing in the electricity sector, and energy sales auctions.
Free consumers: 4
Power Distributors: 49
Traders: 14
Transmission Segment
Generators (self-producer, PIE and ICG): 401 The relationship with customers is conducted through annual surveys, meetings, and direct contacts with their contract managers.
Transmitters: 31
Distributors: 11
Consumers: 21

SUPPLIERS >>>

> DETAILS > > COMMUNICATION CHANNELS >
Suppliers registered in the database With suppliers registered in its database, Chesf mainly maintains relationships through email, in order to encourage them to participate in their bids.
Materials: 16.710 fornecedores
Services: 11.683 fornecedores
Materials and Services: 3.622 fornecedores
Active suppliers in 2017 (with current contract): 1.090 With active suppliers and with bidders, Chesf relates more directly through the Supplier Service Center (CAF). With auctioneers, bidding commission coordinators, and contract administrators/inspectors, the Company interacts through formal communication, email, newsletters, meetings, assemblies and seminars, and publications on the website.

EMPLOYEES, PARTNERS, INTERNS >>>

> DETAILS > > COMMUNICATION CHANNELS >
Employees (workforce): 4.122 Meetings, assemblies of regulatory and operational bodies, email system, intranet, internal newsletters, bulletin boards, and climate research.
Outsourced employees: 2.358
Interns: 0
Apprentices: 114

FINANCIAL INSTITUTIONS >>>
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> DETAILS > > COMMUNICATION CHANNELS >
Private banks; state and quasi-public banks; national and international development banks; development institutions; and investment funds The relationship with financial institutions is carried out through telephone contacts, audio and video conferences, message exchange apps, face-toface meetings, emails, publications on Chesf’s website, dissemination in newspapers and magazines, events such as congresses and lectures.

PUBLIC AGENCIES AND PROGRAMS >>> > 102-40 >

> DETAILS > > COMMUNICATION CHANNELS >
Growth Acceleration Program (PAC) Implementation of generation and transmission projects integrating the PAC.
Pro-Gender Equity Program – Department of Policies for Women Participation in implementing the Pro-Gender Equity Program at Chesf
Municipal Environmental Council – Paulo Afonso (BA) Company representative in the Council.
Municipal Civil Defense Council Company representative in the Council.
Program Luz para Todos (Light for Everyone) – Ministry of Mines and Energy Coordination by the Director of Operations of the Light for Everyone Program in Northeast Brazil
National Program for the Conservation of Electricity (PROCEL) – Ministry of Mines and Energy and Eletrobras Operation in the Northeast, with Eletrobras, to implement projects (PROCEL in Schools, Municipal Energy Management, Public Buildings and Reluz).
National Forum on Ethics Management of Stateowned Companies Financial support and representation of the Company in the Forum.
National Electricity Agency (ANEEL) Participation in meetings and public hearings, workshops, and technical meetings, sending information by mail and email.
National Operator of the Electric System (ONS) Operational Relationship: Permanent contact between Chesf's Operation Centers and ONS's Operation Center based in Recife, aiming toward operating the National Interconnected System (SIN (Sistema Interligado Nacional).
Technical-Normative Relationship: occurs between Chesf’s operation, study, and maintenance bodies with the operation, studies and planning bodies of the ONS based in Recife and Rio de Janeiro, by mail, telephone calls, and meetings.
Institutional relationship between the Boards of Chesf and ONS.
Federal Court of Accounts (TCU - Tribunal de Contas da União) Communication between Chesf and TCU is formal and follows protocol. The instrument used by this control body is the official letter, and by Chesf, external mail. Another form of communication established during the execution of fieldwork is the “Letter of Request” addressed to the Presidency of Chesf. Chesf’s response is usually by email or by mail.
Federal Comptroller General (CGU - Controladoria Geral da União) Communication between Chesf and CGU is formal and follows protocol. The instrument used by this control body is via official letter, and by Chesf, external mail. Another form of communication established during the execution of fieldwork is the “Request for Audit” addressed to the Presidency of Chesf. The response is usually by email or mail.
Standing Committee on Gender Issues of MME and Related Companies Company representative.

SOCIAL AND ENVIRONMENTAL ORGANIZATIONS AND COMMUNITIES >>>

> DETAILS > > COMMUNICATION CHANNELS >
Abrigo Cristo Redentor (Christ the Redeemer Shelter) (Maintenance) Chesf maintained a formal partnership relationship with these organizations in order to carry out social and environmental projects through agreements, terms of cooperation, or terms of partnership.
Hospital Nair Alves de Souza (HNAS)
Development actions for agricultural producers and fishermen in the territory surrounding the Sobradinho-BA Dam (Semi-Arid Embrapa)
Project Construindo Cidadãos do Amanhã (Building Citizens of Tomorrow) (Instituto D. Helder Câmara)

UNIONS AND TRADE ASSOCIATIONS >>> > 102-40 >

> DETAILS > > COMMUNICATION CHANNELS >
Federação Regional dos Urbanitários do Nordeste (FRUNE - Regional Federation of Urban Services Providers of the Northeast) Chesf maintains relationships with these trade union entities through periodic meetings and formal contacts to develop a Term of Commitment on Profit Sharing (PLR) and Collective Labor Agreement (ACT).
Communication also takes place through monitoring the pardon process regarding Law 8,878/1994 and participating in Joint Committees.
Sindicato dos Trabalhadores nas Indústrias Urbanas no Estado de Alagoas (Urban Industries Workers Union in the State of Alagoas)
Sindicato dos Eletricitários da Bahia (Bahia Electrical Workers Union)
Sindicato dos Eletricitários do Ceará (Ceara Electrical Workers Union)
Sindicato dos Trabalhadores nas Empresas de Distribuição de Energia Elétrica no Estado da Paraíba (Electric Power Distribution Company Workers Union of the State of Paraíba)
Sindicato dos Trabalhadores nas Indústrias Urbanas da Paraíba (Urban Industries Workers Union of Paraíba)
Sindicato dos Trabalhadores nas Indústrias Urbanas no Estado de Pernambuco (Urban Industries Workers Union of the State of Pernambuco)
Sindicato dos Eletricitários de Sergipe (Electrical Workers Union of Sergipe)
Sindicato dos Trabalhadores nas Indústrias Urbanas do Estado do Piauí (Urban Industries Workers Union of the State of Piauí)
Sindicato dos Engenheiros no Estado de Pernambuco (Engineers Union of the State of Pernambuco)
Sindicato dos Trabalhadores nas Indústrias de Energia Elétrica do Rio Grande do Norte (Electric Power Industries Workers Union of Rio Grande do Norte)

UNIVERSITIES AND RESEARCH CENTERS >>>

> DETAILS > > COMMUNICATION CHANNELS >
Federal University of Pernambuco Research, development, and innovation projects (R&D+I) and courses of different academic nature (specialization, masters, and doctorate).
Federal University of Campina Grande
Fundação para Inovações Tecnológicas (FITec - Foundation for Technological Innovations)
University of Pernambuco (UPE)
Federal University of Itajubá (UNIFEI)
Federal Rural University of Pernambuco (UFRPE)
Federal University of Paraíba (UFPB)
Centro de Pesquisa e Desenvolvimento em Telecomunicações (CPQD - Telecommunications Research and Development Center)
Instituto Nacional de Pesquisas Espaciais (INPE - National Institute of Space Research)
Centro de Pesquisas de Energia Elétrica (CEPEL - Electricity Research Center)
Sunlution - Soluções de Geração Solar LTDA.
WEG S.A.
Universidade Federal do Amazonas (UFAM)

PRESS/MEDIA >>> > 102-40 >

> DETAILS > > COMMUNICATION CHANNELS >
Major newspapers Actions that are part of the daily activities of the Special Coordination of Institutional Relations (REC):
- Sending releases with suggestions of positive articles about Chesf;
- Organizing exclusive and collective interviews;
- Courtesy visits to major newsrooms;
- Chesf actions and presence on social media (Twitter, Facebook and Youtube);
- News about the Company on the Chesf Portal;
- Assistance to requests for information and requests for interviews.