(103-1) (103-2) (102-26) The corporate governance framework in Grupo Argos is contained in the Good Governance Code, which is a guide for proper management of its businesses. This governance policy is based on the following: fair and equal treatment to shareholders and investors; equitable, timely and regulated supply of the relevant information that they require to make their decisions; transparency, fluidity and integrity of the information provided to the market; and establishment of clear and general rules for the actions taken by the governing bodies, members of the Board of Directors (”Directors”) and employees.
The corporate governance practices enshrined in the aforementioned code are subject to constant review and update with respect to the highest international standards in this matter.
Therefore, the code is a dynamic tool that gives management a clear and defined framework for business management.
(103-2) When the External Circular 028 of 2014 was issued by the Financial Superintendence of Colombia – by which a new Code of Best Corporate Practices (Country Code) was implemented – Grupo Argos along with its affiliates developed the Policy on Relationships between the Affiliated Companies; this Policy provides a specific statement of the unified purpose that should guide the actions of all companies that comprise the group.
(103-2) This policy aims to establish the rules and principles that must be followed by the companies that comprise the Argos Corporate Group, its Directors, managers and employees in their economic, legal, administrative and operational relationships. The foregoing always seeks to contribute to the strengthening of business value, the preservation of corporate reputation, the consolidation of organizational identity and the unification of criteria. During 2016, this Relationship Policy was approved by the Boards of Directors of Grupo Argos’ subsidiaries and this puts the company at the forefront of self-regulation in these issues.
(102-18) (102-22) (102-20) (102-19) The company’s governance is comprised of different bodies, such as: the General Shareholders’ Meeting, the Board of Directors, the CEO and Senior Management. Additionally, the Board of Directors has three support committees, which are designated by the Board and are composed of some of its members. The meetings of these committees are attended by some members of Senior Management, who participate with voice but without vote. In addition, within its governance structure, Grupo Argos has the following internal steering committees: the Steering Committee, composed of the company’s CEO and Vice Presidents; committees of Vice Presidents, which are composed of the primary group of each of these; synergy boards, which are developed around topics and staffed by employees of the company and of each of the affiliates; the Central Committee of Conduct, composed of the Vice Presidents of human management and corporate affairs of Grupo Argos and each of its affiliates; and the Sustainability, Risk, Hiring, Data Security, Procurement, Treasury and Credit Committees, which are comprised of employees from various areas of the company and focus on topics listed by their name.
(103-3) (102-33) (102-31) (102-21) The strategic, relevant and urgent issues that may be subject to discussion by the Board of Directors are previously proposed in the committees supporting the Board, internal bodies described above, the internal committees, focal committees and the synergy boards. Issues of importance for stakeholders are included among these topics. Additionally, the Sustainability and Corporate Governance Committee monitors progress and implementation of corporate governance issues. This year corporate governance indicators were approved, which will serve as basis for the audit that will handle the assessment of corporate governance.
With regard to subsidiaries, the issue of Corporate Governance and possible modifications or adjustments are discussed in the focal committees and synergy boards of corporate governance.
(102-31) (102-34) The following matters were submitted to the Board of Directors for consideration, and all the requirements established in the by-laws and the Good Governance Code for approval were met:
- Acquisition of Odinsa.
- Acquisition of Opain.
- Establishment of the Pactia private equity fund and its link to the Fondo de Pensiones Protección S.A. (Pension Protection Fund)
- Approval of the Enterprise Risk Management System.
- Analysis of real estate business prospects.
- Analysis of coal business prospects.
- Various issues regarding human resources.
- Talent Management.
- Comprehensive Human Rights Management System.
- Strategy against climate change and progress on environmental sustainability goals.