Governance Practices

According to the Brazilian Institute of Corporate Governance (IBGC), corporate governance is the system by which companies are managed and monitored, and involves the relations among shareholders, board of directors, board of executive officers, independent auditors and the audit committee. The basic guiding principles are: (1) transparency, (2) fairness, (3) accountability, and (4) corporate responsibility.

Grupo Fleury is committed to maintaining the highest corporate governance standards based on the principles that value transparency and respect to shareholders. For that incorporates in its management and reporting structure the best practices observed in the market, including the presence of 30% of independent directors in the composition of its Board of Directors, the structuring of committees to advise the Board of Directors and an internal control system, besides publishing annual sustainability reports according to the guidelines of the Global reporting Initiative (GRI) and external audit.

Information on the corporate structure, the composition of the Board of Directors, Executive Board and Advisory Committees, as well as documents such as bylaws, code of conduct, policies and internal regulations are publicly available on the Investor Relations website.

Corporate Governance Structure

The corporate organization chart established by the Company serves the best market practices and the governance is supported by the structures that are part of our Internal Control System: Internal Audit, Compliance, Risk Management and Information Security.

Novo Mercado segment

Since its Initial Public Offering (IPO) in december 2009, the Company joined the Novo Mercado listing segment with the highest standards of Corporate Governance of BM&FBOVESPA. Companies that enter this segment submits voluntarily to certain stricter rules than those present in the Brazilian legislation. For example:

  • issue only common shares;
  • keep at least 25% in the free float;
  • detail and include additional information in the quartely reports; and
  • providing annual financial statements in English and based on internationally accepted accounting principles.

Corporate Governance Practices of the IBGC

In addition, the Company adopts the main practices recommended by the IBGC in its Code of Best Practice of Corporate Governance. The main ones are as follows:

  • capital stock consisting of common shares only, ensuring that all shareholders have voting rights;
  • in addition to the attributes set forth in Brazilian Corporate Law, it is incumbent on the Shareholders’ Meetings to: (a) elect or remove, at any time, members of the Board of Directors and Audit Committee; (b) determine the overall annual compensation of the Board of Directors and Board of Executive Officers, as well as the Audit Committee, if installed; (c) amend the Bylaws; (d) deliberate on the transformation, merger, incorporation, spin-off, dissolution or liquidation of the company; (e) attribute bonuses in shares and decide on any eventual stock splits or reverse splits; (f) approve any stock option or share subscription plans for the Company’s directors, executive officers and employees, as well as the directors, executive officers and employees of other companies directly or indirectly controlled by the Company; (g) deliberate on management proposals for the allocation of annual net income and the payment of dividends; (h) in the case of the Company’s liquidation, elect the liquidator and the Audit Committee for the duration of the liquidation period; (i) deliberate on the Company’s delisting from the Novo Mercado segment of the BM&FBOVESPA ; (j) deliberate on the Company’s delisting as a publicly-held company before the CVM, except when determined otherwise by the Bylaws; (l) select from among those companies indicated by the Board of Directors the specialized company responsible for preparing the valuation report on its shares, in the event of the Company’s delisting as a publicly-held company or withdrawal from the Novo Mercado, as determined by the Bylaws; and (m) deliberate on any other matter submitted by the Board of Directors;
  • maintenance and disclosure of a registry containing the number of shares owned by each partner, identifying them by name;
  • in the case of a transfer of the Company’s control, the purchase offer must be extended to all partners and not just the members of the controlling block. All shareholders must have the right to sell their shares under equal conditions and the price must be transparent. If the entire controlling block is sold, tag along rights must be extended to all shareholders;
  • the hiring of independent auditors to audit the balance sheets and financial statements;
  • Iinstallation of an Audit Committee predicted in the bylaws;
  • a clear definition in the Bylaws of (a) the means for convening a Shareholders’ Meeting and (b) the means for electing and removing members of the Board of Directors, as well as determining their term of office;
  • transparency in the public disclosure of management’s annual report;
  • the non-election of alternate members of the Board of Directors;
  • the resolution, through arbitration, of any eventual conflicts that may arise between the company, its shareholders, directors, executive officers and members of the Audit Committee.