ETHICS AND INTEGRITY
United National Global Compact Principles: 1, 2 and 10.
GRI 102-5, 102-15, 102-16, 102-18, 102-19, 102-20, 102-22, 102-23, 102-26, 102-28, 102-29, 102-30, 102-31, 102-32, 103-2, 103-3, 405-1
Material topics: Labor practices
OUR MISSION IS TO CONTRIBUTE TO THE SUSTAINABLE DEVELOPMENT OF THE AGRICULTURAL SECTOR, GUIDED BY ETHICS, RESPECT FOR PEOPLE, COMMITMENT TO THE ENVIRONMENT AND PROFESSIONALISM.
We are an Argentine company whose corporate purpose is the production of granulated urea, storage, distribution, wholesale and retail sales and export of surplus. The corporate composition of Profertil SA is as follows:
Argentina’s main energy company, leader in exploration and distribution of oil and gas products, both of conventional and non-conventional origin.
Canadian company, leader in the production and commercialization of inputs and services for agriculture worldwide. It was consolidated through the merger of PotashCorp and Agrium Inc. in January 2018.
Efficiently produce nitrogen fertilizers and commercialize other fertilizers, in a sustainable way, meeting the expectations of shareholders, clients, employees, suppliers and the communities where we operate.
To lead the wholesale nitrogen fertilizer production and commercialization in the Southern Cone.
We have a Governance Management, made up of six regular directors and six alternate directors and made up, in equal parts, of members of YPF SA and Nutrien Inc.
María Martina Azcurra
Miguel Eduardo Morley
María Martina Azcurra
Gabriel César Grzona
Miguel Eduardo Morley
Trevor Leigh Williams
Andrew John Fereday
67% OF ARGENTINE NATIONALITY
33% OTHER NATIONALITIES
Composition to the date of this report.(1)
None of these directors hold executive or operational positions
(1) 83% Men – 17% Women. 33% Between 30 and 50 years old. 67% Above 50 years old.
The Board of Directors is responsible for the administration, policy implementation, and management of Profertil’s activities. In this sense, it makes all decisions related to this purpose, designing the corporate governance structures and practices. The basic pillars of the Company’s corporate governance system are covered essentially in the Bylaws, the Shareholders’ Agreement and the Code of Conduct. The internal policies are transparency, integrity, honesty, shareholder participation, the proper functioning of the Board of Directors and the independence of the external auditor. Its members actively participate in the meetings, which are held once every three months and through which fundamental decisions are made for the proper functioning and management of the company.
Up to December 2021, the executive governance structure, on which the Company’s daily management depends, consists of a Steering Committee composed of nine managers:
Eng. Horacio Federico Veller
ADMINISTRATION AND FINANCES
Acc. Carlos Loustalet
Eng. Mario Suffriti
Eng. Claudio Pajean
Eng. Gustavo Lucero
PLANNING, STRATEGIC INPUTS AND MANAGEMENT CONTROL
Acc. Martín León
ENVIRONMENT, HEALTH, AND SAFETY
Bioch. Raúl Meder
Lic. Marcelo Bertolino
COMPLIANCE & LEGAL
Dr. Ariel Diego Blázquez
100% MEMBERS OF ARGENTINE NATIONALITY
They are responsible for supervising and managing the Company’s performance through its Integrated Management System (IMS), implemented through procedures and policies (Mission, Vision, Values, Code of Ethics, Integrated Quality Policy, Health, Safety, Environment and Energy, and Management Objectives and Indicators), which define the Company’s actions. Among their functions are:
• Prepare the annual budget.
• Elaborate the strategic plan.
• Consolidate the risk matrix and develop the mitigation plan.
• Monitor the Integrated Management System.
The performance of the Management Team is measured through the degree of compliance with its annual economic, social and environmental objectives, such as reduction to zero of the number of physical accidents and the occurrence of environmental incidents, the satisfaction indicators of the institutional programs and the opinion of the different stakeholders, among others. Once these objectives are established, their evolution is monitored through the tracking of indicators and is submitted to the highest governing body for its information.
To respond to emergencies, as is the case of COVID-19 in 2021, we have an Incident Command System (Sistema de comando de incidentes, CIE), in which all the Company’s management, departments or areas participate and take responsibility for decision making. It has a series of components, which work together interactively and provide the basis for the concept of effective operation of the CIE: common and simple terminology, modular organization and integrated communications.
The CIE is formed by:
ETHICS, ANTICORRUPTION AND LEGAL COMPLIANCE
GRI 102-16, 102-17, 102-25, 103-2, 103-3, 205-2, 205-3, 307-1, 406-1, 416-2, 417-2, 417-3, 419-1
Material topics: Legal compliance and anticorruption, Sustainable agriculture, Labor practices, Practices with distributors and agricultural producers.
Because we always strive to maintain the highest standards of ethical and legal conduct in all of our activities, and because our shareholders are listed on the U.S. Stock Exchange, we must comply with various laws, including the Foreign Corrupt Practices Act (LPCE) and the Criminal Liability Act 27,401, which were included, in general, in our Code of Ethical Conduct, where the principles and values with which we carry out our business activity and to which all the staff adheres without restrictions are detailed.
The head of our Compliance and Legal Management also assumes the role of Compliance Officer, whose main objective is to continue consolidating our robust compliance culture. This has been forged over the years under the light of our basic principles of action:
• Ethics: We conduct our activities with integrity and honesty, acting consistently.
• Respect: We promote mutual respect between people and responsible care for the environment and safety.
• Engagement: Each person gives the best to achieve the agreed objectives.
• Professionalism: We perform our tasks applying the best knowledge and quality standards for each situation.
COMPLIANCE MANAGEMENT PROCESS
To consolidate our strong compliance culture, we continue to develop the Integrity Program, aimed at guaranteeing total transparency in each of the organization’s activities. An external auditor periodically reviews this to evaluate its robustness and make recommendations for improvement. After updating the Compliance Risk Matrix during 2020, which allowed identifying the risks and assigning owners to each of them, the Follow-up and Management Program was started. This was developed through meetings over the course of the year, in order to evaluate the effectiveness of the mitigation actions implemented, define the need to implement new actions and/or improve those established and update the values and impacts and the probability of each risk identified.
In 2021, an Integrity Program Maturity Level Assessment was conducted. The information was obtained through various interviews with the Company’s personnel. This assessment provided a detailed report on the maturity status of the Company. The result of the assessment showed us the strength of our Integrity Program, with an outstanding level in the High Level Commitment dimension and recommendations for the different dimensions of the program, which, depending on their importance, range from 9 to 30 months of implementation. Several of these recommendations have already been implemented, while others are in the process of implementation.
The Ethics Committee, composed of the Steering Committee, is responsible for resolving issues related to the interpretation of the Code and periodically recommending improvements to be approved by the Board of Directors. The Compliance Officer is responsible for coordinating the general aspects of the implementation of the Code and related regulations. He/she is in charge of managing the complaints that are made and transfers them to the Ethics Committee for follow-up and investigation, in accordance with the established procedure. Meetings are held periodically to deal with the complaints that are presented and to analyze cases of conflict of interest or specific cases to be resolved.
CODE OF ETHICAL CONDUCT
Our Code of Ethical Conduct defines the guidelines and standards of integrity and transparency for all people who act and interact with Profertil: employees, interns, directors, suppliers, contractors, partners and those who provide services to the Company or act on its behalf. It regulates the principles of conduct that must be respected in the workplace, while reaffirming our commitment to people’s health and safety, environmental protection and sustainable development. It also embodies the guidelines to promote respect for diversity and inclusion, establishes guidelines for liaison with third parties, and provides for various measures to secure the Company’s assets, among other relevant points.
The Code of Ethical Conduct contains the principles of conduct in the workplace, in business practices and in asset security:
Conduct principles in the workplace:
• Compliance with the legislation and procedures of Profertil SA.
• Conduct in the workplace.
• Accounting and auditing.
• Environmental protection and safety.
Conduct principles in business practices:
• Relations with suppliers and contractors.
• Relations with shareholders and investors.
• Political contributions.
• Money laundering prevention.
• Anti-corruption policy..
• Conﬂicts of interest (gifts, relationships with third parties, supply of Company goods or services, employments out of the company, financial interests in other organizations).
• Hiring of business partners.
• Defense of competition or unfair competition.
• Company property.
• IT policy.
• Use and management of internal information.
ALL PERSONNEL ADHERE TO THE CODE OF ETHICAL CONDUCT AND, DURING 2021, THIRD PARTY CONTRACTORS ADHERED TO IT THROUGH THE CERTRONIC PLATFORM, CREATING A SPECIFIC ETHICS AND COMPLIANCE SECTION.
In 2020, we redesigned the Code of Ethical Conduct to allow for a more user-friendly reading and a better understanding of its contents. We also developed different formats for this document to make it more accessible, both in paper and digital format, and thus facilitate its permanent consultation. We have also created a Code of Ethical Conduct for Third Parties, which establishes the basic principles required to enter into a relationship with the company, setting specific guidelines on environmental and safety protection, prevention of money laundering, anti-corruption policy, conflicts of interest, gift policies, defense of competition and unfair competition, and use and handling of information, among others.
In 2021, in order to consolidate the Due Diligence processes of Third Parties in Ethics and Compliance, a Massive Adherence Program to the Code of Ethical Conduct for Third Parties was conducted, through the Integrated Control System for Contractors, by means of the creation of a specific section on Ethics and Compliance.
In turn, during 2021, from the Compliance & Legal Management, we started a project that will allow us to evaluate the Third Party Integrity Programs, using the same platform of the Management System. This development will help us to diagnose the soundness of the Integrity Programs of Third Parties in a dynamic and permanent way, allowing us to promote and accompany third parties in the evolution and improvement of their Integrity Programs.
WE ARE COMMITTED TO MAINTAINING THE HIGHEST STANDARDS OF ETHICAL CONDUCT AND LOYALTY IN ALL OUR ACTIVITIES, AND IT IS THE DUTY OF ALL PROFERTIL PERSONNEL TO ADHERE TO THE PRINCIPLES AND VALUES ARISING FROM THE CODE OF ETHICAL CONDUCT. THE PRINCIPLES AND VALUES ARISING FROM THE CODE OF ETHICAL CONDUCT.
ETHICAL CONDUCT LINE
We have an anonymous and confidential Whistleblower Channel that has been in operation since 2012 and is managed by an independent third party: the company RESGUARDA(2) To ensure the dissemination and understanding of the Code of Ethics, the Foreign Corrupt Practices Act and the Criminal Liability Act 27,401, staff are trained through a multimedia platform. At the end of this training, the participants receive their annual Certifications, after sending the form to Human Resources that proves they have completed the training and accepted the Code’s regulations.
THE ETHICAL CONDUCT LINE IS A COMMUNICATION CHANNEL FOR-PROFERTIL PEOPLE AND THIRD PARTIES TO REPORT ANY IRREGULARITY OR SITUATION THAT VIOLATES THE PROVISIONS OF OUR CODE OF ETHICAL CONDUCT.
(2) During 2021, 2 complaints were received, one of low severity and one of medium severity. Both completed their investigation during the year and appropriate actions were taken. We did not receive significant fines or non-monetary sanctions for non-compliance with environmental, social or economic legislation or regulations, nor for cases of discrimination or corruption. Likewise, we had no claims, fines or non-monetary sanctions related to impacts on people’s health and safety from products sold and services provided, as well as in relation to product and service labeling, or non-compliances derived from our marketing communications.
ANNUAL TRAINING PROGRAM
As part of the Education and Training Program, the following training was provided:
• Resguarda: 2 webinars were held to promote and give visibility to the tool.
• Inductions: During 2021, all new hires received specific induction on Compliance.
• Fraud, Corruption and Money Laundering Prevention: An e-learning course was designed and implemented, to reinforce knowledge regarding prevention, fraud, corruption and money laundering. The course is held annually for people occupying positions defined as critical for these issues, and new personnel are incorporated as they move into these positions.
In turn, the Compliance Team participated in meetings and business workshops, with the objective of sharing experiences and good practices, creating synergy with Compliance areas of other companies, collaborating in the strengthening of Integrity Programs and working together to build the ethical culture of each company.
100% of the Steering Committee and personnel have been trained in anti-corruption matters.
100% of our business partners have received communication on the Company’s anti-corruption policies and procedures.
We know that IT security is an increasingly challenging issue, given the hyper-digitized times we are living in. For this reason, we have a team that accompanies us and is always attentive to take care of us.
In 2021, we conducted cyber risk management and the personal data protection project, involving all areas of the Company in a cross-cutting manner. We continued to raise awareness among users and incorporated new policies in computer equipment to reinforce the security of the Company’s computer network. Likewise, work began on the accessibility of corporate services from mobile devices and the systematization of corporate document flows.
In turn, during Cybersecurity Awareness Month, we share some key recommendations to be able to navigate the virtual world safely. We conducted a campaign to promote, through training and awareness-raising, the dissemination of good practices that help us to protect ourselves from cyber risks.