Question

CEMIG, Electric Utilities, Brazil

1. Environmental aspects
2. Social aspects
3. Human aspects ( Note - Human capital is different from Social capital )
4. Business Model and Innovation
5. leadership and governance
6. Leadership and Governance

pls find out the aspects of that particular company in the above mentioned fields

Answer 1

1. ENVIRONMENTAL ASPECTS-

The scope of Cemig's environmental management includes all its operational and support processes, from planning, construction, and operation, to the decommissioning of projects. The way the Management Systems is put together ensures that the premises are considered and applied by the whole of Cemig's workforce.

The Environmental Management System - SGA allows for the adoption of best practices to minimize environmental risks and optimize operating costs. According to this rationale, SGA aims at minimizing possible environmental impacts, reduce occurrences, prepare employees appropriately to respond to emergencies, and also achieve greater assertiveness in the execution of the environmental strategy and the commitments taken on before the competent bodies.

2.SOCIAL ASPECTS -

Cemig acknowledges that its business causes direct and indirect impacts to several communities. The Company also believes that the success of its business and the quality of its products depend on the relationship with several categories of stakeholders. Therefore, it values a harmonious interaction, respecting and considering the needs and contributions of each stakeholder.

The primary focus of the company's social management has been strengthening relationships and promoting social development in the communities

(i) surrounding hydroelectric plants,

(ii) along transmission networks, and even

(iii) in places mostly influenced by Distribution, such as large urban centers.

3.HUMAN ASPECTS -

Cemig had 5,596 own employees. This number represents a reduction of 8% compared to 6,083 employees in 2018, meeting the expectations of the Company for the adequacy of the workforce. Of this total, 4,851 are men (86.6%) and 745 are women (13.3%). Regarding the presence of women in leadership positions, even though there are no women on the Executive Board, women occupied 10.2% of the jobs considered to be management positions within the Company. Among these, 9.3% are managers and superintendents (top management positions), 8.5% are in management positions (first level) and 8% in leadership positions in the revenue generating functions.

Black, mixed-race, oriental, and indigenous employees, in turn, amount to 35.8% of Cemig's in-house workforce. In terms of gender and race diversity, at the end of 2019 the workforce had 3.9% of black and brown women and 30.7% of black and mixed-race men. Regarding representativeness in management positions, black and mixed-race employees occupy 15.6% of those positions.

4.BUSINESS MODEL AND INNOVATION

Cemig is recognized for its size and technical competence, and is the largest integrated company in the power sector in Brazil. In Minas Gerais, it accounts for 96% of the concession area, with over 8.5 million consumers in 774 municipalities. It is also (i) the largest supplier of energy to free customers in the country, holding 25% of the market; (ii) the third largest generator group; (iii) the second largest transmitter; and (iv) the largest distribution group in Brazil.

MAIN ELEMENTS OF CEMIG'S

The technical capacity and quality of its workforce, acknowledged both domestically and internationally for its expertise;

• Natural resources, mainly water, as a large part of its installed capacity comes from hydroelectric plants;

• The financial resources of the government and other shareholders required for the development of the business;

• Inputs provided by suppliers and customer, consumer, and local community loyalty

5.LEADERSHIP AND GOVERNANCE

The main characteristic of Cemig's leadership and governance model is a clear definition of the roles and responsibilities of the Board of Directors and the Executive Board in the formulation, approval and execution of the policies and guidelines that relate to conducting the Company's business. The members of the Board of Directors, who are appointed by the General Shareholders' Meeting, elect their Chairman and Vice-Chairman and appoint Cemig's Executive Board. The structure and composition of the Board of Directors and the Executive Board are identical in wholly-owned subsidiaries Cemig D S.A. and Cemig GT S.A., with possible exceptions, so as to be approved by the Board of Directors.

The focus of the Company's governance has been the balance between the economic, financial, environmental and social aspects of Cemig's projects, in order to continuously contribute to sustainable development. This includes transparency about its management and performance geared at improving its relationship with shareholders, customers, employees, the society and other interested parties.