PART II - DRIVE MANAGEMENT MODEL: SUSTAINABILITY

Sustainability

Represents responsible management model and commitment to ethics, transparency, justice as well as collaboration with our stakeholders regardless of the location where we operate.

Social Action

One of the priorities of Gonvarri Steel Services is to help local development in the areas that we have a presence. For this reason, collaboration agreements with non-profit organizations have been established with whom corporate and local activities of varied nature are set in motion:

We also carry out developmental programs and actions with the local communities in various countries. We would like to highlight the central offices and our plants in Spain, Brazil, the United Kingdom, Portugal, Puebla (Mexico) and Poland. The main areas of action in the communities are detailed hereunder:

Emotional Driving

Having an impact on the reduction of traffic accidents, in volume and severity, is possible in two ways.

On one hand, we can take action on Passive Road Safety, which is to say, by acting on the improvement of road conditions, the improvement of the signaling and the placement of containment systems. We can also take action through the sensitization of drivers to avoid unsafe behaviors at the wheel. Companies can try to tackle this by sensitization of their workers and by implementing Road safety plans. Gonvarri takes action in both areas.

Helping to save lives, through road safety, is part of Gonvarri´s commitment to the Society; a commitment it pursues as part of its Business Model, through its Road Safety division, developing and improving the protection and containment mechanisms on highways.

Since 2014 we have promoted a culture of ¨Road safety ¨ through the program Emotional Driving, in line with our commitment to the Sustainability Development Goals, specifically with section 3.6, to contribute to the reduction of traffic accidents and fatalities.

This year a brochure was designed and distributed in which the what, why and how Emotional Driving is done was summarized. This was in addition to the actions taken which were focused on different groups of interest, such as employees “Our drivers”, youths “Motivated drivers” and children “Future drivers”.

The Code of Ethics

The Code comprises of an express declaration of the values, principles and behavioral guidelines that must be adopted by the people of the Group in their professional role, regarding topics such as relations with customers, employees, collaborators, providers and the community, and so consolidating the existing trust between the Group and third parties.

Furthermore, the Compliance Committee and the Ethics Channels have been redefined to bring to their attention any of the undue situations, doubts, queries or shown malpractices, as well as legal or disciplinary measures. An audit plan will be made annually to verify its adequate dissemination and compliance. A new Code of Ethics and Conduct was approved by the Board of Directors in September 2017 and the so were the Action Protocols of the Ethics Channel in January 2018.

Energy and Energy Efficiency

The energy efficiency for Gonvarri is focused on keeping production highly efficient through the integration of new technologies and high-performance equipment, that contribute to the continuous improvement of the operational and production processes.

In 2017, 17 replacement and improvement measures were taken, mainly in Europe and Brazil. These measures are estimated to lead to a theoretical reduction in energy consumption of 2.74 GWh/year. Likewise, in 2018 20 possible new measures have been studied, which are currently pending approval.

With the introduced ESMs we have, from the beginning of the project to the 31st of December

2017, estimated an annual saving of 7.96 GWh/year. The objective is to reach savings of 12 GWh/year by 2020.

Climate Change and CO2 emissions

By measuring its carbon dioxide (CO2) emissions, Gonvarri Steel Services contributes to improving the communication of its impact and to the collection of specific data with the aim of setting possible improvement goals.

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