ESG stands for Environment, Social & Governance. This concept refers to a set of good business practices that take into account environmental, social and corporate governance criteria. Companies with good corporate governance practices tend to have lower legal risks, for example, so these concepts are relevant to investors when choosing which assets to invest in.
Environment
As a technology company, CSU Digital does not generate significant amounts of carbon, waste or pollutants. Nevertheless, the company has a series of initiatives for the efficient use of natural resources and the appropriate disposal of waste.
The actions and monitoring of the indicators are carried out by two specific superintendencies, Information Technology and Infrastructure, which consolidate the information and report to managers on a monthly basis.
As part of the actions, we have initiatives disseminated by “infra agents” who act as facilitators and disseminators of knowledge about this agenda. They also make rounds at each of our sites, recording calls and observing checks on electricity availability and water consumption, among other things, in order to improve the management of the indicators.
CSU has consistently reduced energy consumption by replacing fluorescent lighting with LED lighting. It has also redesigned and retrofitted its air conditioning systems to improve energy efficiency.
In addition, the company is always trying to promote water conservation among employees through campaigns. On some occasions, we have opted for artesian well water supplies, since the way it is collected is less harmful to the environment.
The main materials used by CSU are paper, detergents and soap. As a result, we have internal awareness campaigns and a unified contract with cleaning, maintenance and security service providers, which guarantees the optimization of resources. Sediment is collected by a partner company with all the necessary licenses and certifications, which separates it by type of waste and disposes of it properly. Certified companies, in accordance with environmental legislation, also dispose of CSU light bulbs and electronics.
Social
CSU Digital plays an important role in society not only because of the number of people it employs (+4,000 people), but also because it is one of the most important companies offering first jobs to thousands of people. The demand for professionals in our sector provides constant opportunities for new talent.
In addition, the company pays special attention to compliance with labor standards in all its business units, including compliance with time and attendance standards, payroll transparency, measures to improve the organizational climate, and audits.
We also have the CSU Institute, a non-profit organization that manages the company’s social projects, training professionals for the market through social and digital inclusion, with free computer courses using state-of-the-art equipment and qualified teachers. More than 30,000 people have been trained, including young people, women, retirees and workers with special needs.
Governance
In terms of governance, CSU Digital was the first company in its segment to be listed on the B3 segment of the Novo Mercado in 2006, a segment composed of companies with the highest level of corporate governance.
In this way, the company voluntarily commits itself to good corporate governance practices and greater disclosure of information than is already required by Brazilian law.
We have several sections on this website dedicated to this topic. In them, you can learn more about our major shareholders, management and committees, view the minutes of meetings and Board of Directors’ meetings, our bylaws, policies and codes, and also access our Governance Report.
Below are some of the items that investors should be aware of:
Corporate Governance Practices and Novo Mercado
In 2000, the BOVESPA introduced three special listing segments, known as Level 1 and 2 of Differentiated Corporate Governance Practices and New Market (Novo Mercado), aiming at fostering a secondary market for securities issued by Brazilian companies with securities listed on the BOVESPA, by prompting such companies to follow good practices of corporate governance. The listing segments were designed for the trading of shares issued by companies voluntarily undertaking to abide by corporate governance practices and disclosure requirements in addition to those already imposed by Brazilian law. These rules generally increase shareholders‘ rights and enhance the quality of information provided to shareholders.
To be listed on the Novo Mercado, in addition to the obligations imposed by current Brazilian law, an issuer must meet all of the following requirements:
- Issue only common shares;
- Grant tag-along rights to all shareholders in connection with a transfer of control of the company, the acquirer being required to hold a public offer for acquisition of the shares to the other shareholders, at the same price per share paid for the controlling block;
- Ensure that shares of the issuer representing at least 25% of its total capital are effectively available for trading;
- Adopt offering procedures that favor widespread ownership of shares whenever making a public offering;
- Comply with minimum quarterly disclosure standards;
- Follow stricter disclosure policies with respect to transactions made by controlling shareholders, directors and officers involving securities issued by the issuer;
- Submit any existing shareholders´ agreements and stock option plans to the BOVESPA;
- Disclose a schedule of corporate events to the shareholders;
- Have a board of directors comprised of at least five members with a term limited to one year;
- Within two years after listing shares on the Novo Mercado, prepare annual financial statements in English, including cash flow statements, in accordance with international accounting standards, such as U.S. GAAP or International Financing Report Accounting Standards (IFRS);
- Adhere exclusively to the arbitration rules of the BOVESPA, pursuant to which the BOVESPA, the company, the controlling shareholder, the management and the members of fiscal council, if any, agree to resolve by arbitration any dispute or controversy related to the Novo Mercado listing rules;
- Hold public meetings with financial analysts and any other interested third parties at least once a year to present information regarding its financial and economic position, projects and prospects; and
- If a decision to delist from the Novo Mercado is made, the issuer´s controlling shareholder must launch a tender offer for the acquisition of all outstanding shares at a minimum price to be established based on an independent appraisal.
Regulation of the Brazilian Securities Market
The Brazilian securities markets are regulated by the CVM, which has regulatory authority over the stock exchanges and securities markets, by the National Monetary Council and by the Central Bank, which has, among other powers, licensing authority over brokerage firms and regulates foreign investment and foreign exchange transactions. The Brazilian securities markets are governed by the principal law governing the Brazilian securities markets, by the Brazilian Corporation Law, and by regulations issued by the CVM, the CMN (Brazilian National Monetary Council) and the Central Bank. These laws and regulations provide for, among other things, disclosure requirements, restrictions on insider trading and price manipulation and protection of minority shareholders. However, the Brazilian securities markets are not as highly regulated and supervised as U.S. securities markets.
Under the Brazilian Corporation Law, a company is either publicly held and listed, a “public company”, or privately held and unlisted, a “closed company”. All listed companies are registered with the CVM and are subject to reporting and regulatory requirements. To be listed on the BOVESPA, a company must apply for registration with the BOVESPA and the CVM and is subject to regulatory requirements and information publishing requirements.
A company registered with the CVM may trade its securities either on the Brazilian exchange markets, including the BOVESPA, or in the Brazilian over-the-counter market. Shares of companies listed on the BOVESPA may not simultaneously trade on the Brazilian over-the-counter market. The shares of a listed company may also be traded privately, subject to several limitations.
The Brazilian over-the-counter market, whether or not organized, consists of trades between investors through a financial institution registered with the CVM, and authorized to trade in the Brazilian capital market. No special application, other than registration with the CVM, is necessary for securities of a public company to be traded in the non-organized over-the-counter market. The CVM must receive notice of all trades carried out in the Brazilian over-the-counter market by the respective intermediaries.
The trading of securities on the BOVESPA may be suspended at the request of a company in anticipation of a material announcement. Trading may also be suspended on the initiative of the BOVESPA or the CVM, among other reasons, based on or due to a belief that a company has provided inadequate information regarding a significant event or has provided inadequate responses to inquiries by the CVM or the BOVESPA.
Disclosure and Use of Information
Pursuant to CVM Rule # 44, of January 3, 2002, the CVM revised and consolidated the requirements regarding the disclosure and use of information related to material facts and acts of publicly held companies, including the disclosure of information in the trading and acquisition of securities issued by publicly held companies.
Such requirements include provisions that:
- Establish the concept of a material fact that gives rise to reporting requirements. Material facts include decisions made by the controlling shareholders, resolutions of the general meeting of shareholders and of management of the Company, or any other facts related to the Company‘s business (whether occurring within the Company or otherwise somehow related thereto) that may influence the price of its publicly traded securities, or the decision of investors to trade such securities or to exercise any of such securities‘ underlying rights;
- Specify examples of facts that are considered to be material, which include, among others, the execution of shareholders‘ agreements providing for the transfer of control, the entry or withdrawal of shareholders that maintain any managing, financial, technological or administrative function with or contribution to the Company, and any corporate restructuring undertaken among related companies;
- Oblige the officer of investor relations, controlling shareholders, other executive officers, members of its board of directors, members of the audit committee and other advisory boards to disclose material facts;
- Require simultaneous disclosure of material facts to all markets in which the corporation‘s securities are admitted for trading;
- Require the acquirer of a controlling stake in a corporation to publish material facts, including its intentions as to whether or not to de-list the corporation‘s shares, within one year;
- Establish rules regarding disclosure requirements in the acquisition and disposal of a material stockholding stake; and
- Restrict the use of insider information.
Arbitration
The Company, its shareholders, managers and the members of the Fiscal Council agree to settle by arbitration any and all disputes or controversies that may arise, especially those related to or arising from the application, validity, effectiveness, interpretation, breach and the effects of breach of the provisions in the Brazilian Corporate Law, the Company‘s Bylaws and the rules issued by the National Monetary Council, the Central Bank of Brazil and the CVM, as well as any other provisions applicable to the running of the capital market in general, in addition to those in the Novo Mercado‘s Listing Rules, the Novo Mercado Membership Agreement and the Arbitration Rules.
We also have programs to promote and monitor ethical business conduct and a compliance and anti-corruption program, including procedures to prevent money laundering and terrorist financing (PLDFT).