CAP

SUSTAINABILITY
REPORT
2016

5


SOCIAL
PERFORMANCE

INTEGRATION WITH
THE COMMUNITIES

Since its beginnings, CAP has been characterized by been an active and responsible member of the communities in which its operations are inserted. In order to continue to build relations on the basis of trust and its own corporate values, in addition to maintaining a high proportion of local workers, the Group has focused on integration efforts at two levels: establishing direct relationships with the communities, and setting up public/private alliances.

96% of local workers.

In recent years, we have observed a greater empowerment of the civil society and a growing distrust towards institutions and companies. In order to sustain the company’s responsible development it is necessary to achieve and maintain good communications, integration and collaboration with the communities and the authorities. Only in this way it is possible to find effective solutions aimed at improving the welfare of the inhabitants.

CAP Minería

This company’s operations are located in areas of marked differences between their communities. In the province of Huasco, of agricultural traditions, it is only during this past decade that they have lived together with industrial mega-projects. On the other hand, the Copiapo Valley and the sector of La Higuera and Romeral have a historical mining tradition.

Infraestructura

Relationship in this area has been conducted by CAP Mineria, which has maintained an active communication with the communities, fostered, in some sectors, through task forces.

CAP Acero

There is a history of commitment and contribution to the Region of Biobío, promoting initiatives that have contributed to improving the quality of life of its inhabitants. Although it is deployed over an industrial area, years ago the authority permitted the installation of urban populations in its vicinity.

Cintac

Its plants are located in industrial areas, in the region that concentrates the country’s greatest amount of resources and population. The company focuses its efforts in contributing to capacity development in its value chain, focusing on the so-called client-community.

Tupemesa

Its facilities are located in an industrial area of Lima, Peru. Its efforts focus on contributing to the development of their client-community.

TASA

It is located in the municipality of Tigre, Argentina, in an industrial area close to a neighborhood inhabited by several company employees. The relationship with the community has focused on working with the Government and other local organizations aimed at improving the quality of life of the inhabitants.

It is a policy of the CAP Group for all its companies to maintain a commitment with their neighboring communities and with the protection of the environment associated to their productive activities and projects, in full compliance with the current legislation, the corresponding environmental regulations and the other commitments eventually undertaken by the companies (organization).

Among the social actors (stakeholders) with which the Group interacts are: governmental and non-governmental organizations, authorities, community organizations, trade unions of other productive sectors, and indigenous peoples.

Current efforts focus on strengthening direct relationships with the communities and on promoting public/private alliances for sustainable development.

Integration with the community

The relationship is carried out through constant meetings and through the participation of the company in the activities organized by the local entities, such as task forces, by attending seminars with authorities and by supporting initiatives undertaken by the municipalities.

In the case of CAP Mineria, there are persons (focal points) in charge of dealing with the communities who play an active role in continuous and direct communications, addressing the company’s environmental and social issues. These persons are also responsible for receiving complaints and requirements, in addition to channeling and managing actions with the community. In Huasco there is an Office to link up with the community. Another such office will be opened soon in Caldera.

Other means of communication between the company and the community are: the website, the social networks, the corporate newsletter and annual reports. It is worth mentioning that during 2016, the company organized community visits to the work site. Moreover, the company’s Shareholders’ Meeting was webcasted live as a way of contributing transparency and trust, reducing asymmetries of information and revalidating the importance of the regions.

During 2016, it is worth highlighting the visits of the community to the work site, and the live webcast of the general meeting of shareholders, which was intended to contribute to transparency and confidence, to reduce asymmetries of information, and to revalidate the importance of the regions.

The Group has made available to the community an online system to denounce questionable practices or actions inconsistent with its Code of Ethics and Good Practices.

Public/Private alliances

The company has made progress in increasing the participation of different social groups in the decision-making process for development and the strengthening of ties through the implementation of various initiatives. CAP Acero, for example, has been a member of the Gaete- Tripartite Freedom Commission for the last 14 years, which brings together neighbor associations, companies of the area and local authorities. This entity develops numerous life-enhancing projects for the community. In 2016, it carried out the Music & Art in my Neighborhood cycle (a 2015 cultural subsidy program) that offered gratuitous attractive and varied musical shows.

On the other hand, CAP Mineria executed in 2015 the Clean Production Agreement in the Huasco Valley, which seeks the sustainable development of the province though improved productive and environmental management practices of the companies deployed in this territory.

The CAP Group and its companies participate in a number of instances and organizations that relate it with the public sector regarding regional development and sustainability issues.

Dialoguing for the settlement of disputes

The Group believes that communications open the way toward the settlement of disputes, and that every conflict resolution process allows developing a greater understanding among all parties.

A reflection of the foregoing was what happened on May 2, 2016, when the Punta Totoralillo Port was taken over and occupied by a group of members of the Caldera Crewmembers’ Work Union. They demanded financial support, given the precarious situation of small-scale fisheries in the area. Upon dialoguing with the authorities and the leaders of the fishermen, an agreement was reached to desist from such manifestation. Subsequently, their concerns were channeled through the Caldera’s Public/Private Fisheries Task Group that regularly looks after development projects of this productive trade.

The main social risks for the Group are the apprehensions of the community about the impact of the operations of the company to the safety and the health of area residents and the environment.

In order to maintain an operation that is safe to its workers and its communities, CAP maintains safety measures to combat emergencies (fires, earthquakes and others) that prioritize three action levels: training its workers through the Emergency Training Program; having adequately, equipped and highly-competent emergency brigades; and, maintaining a continuous coordination with other local safety institutions and entities.

The road flow, in addition to its environmental impact, generates congestion and the risk of causing accidents. In order to minimize such risk, the company supports road safety initiatives. In its new projects, the Group is attempting to address these problems from their inception, by designing sustainable operations. In the case of CAP Mineria, its new projects favors transporting ore via a concentrate pipeline from the mine to the port, which reduces the use of the road infrastructure.

During the initial stages of the projects and in the mining industry there is also the risk of the impact caused by the increased floating population in the communities. But, CAP Mineria workers live in their own homes, not at the work site, and 97% of them come from the region in which they work, thereby significantly reducing this risk.