INDICATORS (GRI AND SASB)

The priority topics, as well as the reported indicators, are defined based on a materiality process that involves listening to our stakeholders, as presented here.

In this edition, which refers to the 2020/2021 harvest, we began to integrate the integrate information regarding our assets in Argentina, acquired from Shell in 2018. Another advance was the adoption of the Sustainability Accounting Standards Board (SASB) indicators for the following sectors: Agricultural Products, Biofuels, Refining and Marketing, and Midstream. The scope of each indicator is explained in footnotes throughout this material.

We remain committed to transparency by improving our reporting and communication with all links in our chain at each harvest.

GENERAL DISCLOSURES

Organizational profile

GRI 102-7 Scale of the organization

* The figures for the 2018/2019 harvest do not include the results of operations in Argentina.

GRI 102-8 Information on employees and other workers

At the end of the 2020/2021 harvest, our team in Brazil consisted of 28,941 employees—83% men and 17% women—the majority (89%) concentrated in the Southeast¹. In Argentina, there were 1,150 people—81% men and 19% women—of which 27 were contractors (19 men and eight women).

*All data were for active and dismissed employees in March 2021, and do not include trainees for Brazil and Argentina and contractors for Brazil. Data for harvests prior to 2020/2021 do not include Argentina.

* Data for harvests prior to 2020/2021 do not include Argentina..

* Full-time considers over 150 work hours/month. Data for harvests prior to 2020/2021 do not include Argentina.** Employees with a temporary contract are those whose contract registered in the internal systems has an end date.

GRI 102-9 Supply chain

Brazil:

Our supply chain is composed of sugarcane suppliers, carriers, and companies responsible for supplying equipment and materials and for providing services.

• Sugarcane suppliers

Our partner producers are located in the states of São Paulo, Goiás, Minas Gerais, Mato Grosso do Sul, and Paraná. In 2020, more than R$4 million was invested in relationship actions with this audience. More information is provided in the Value Partnerships section of this report.

• Carriers

We have truck drivers to transport sugarcane and distribute fuel. These suppliers are located in all regions of Brazil, with a higher concentration in the Southeast and South regions. During the year, R$2 million were invested in the scope of initiatives such as those described in the Value Partnerships section of this report, in addition to R$1.8 billion in freight.

• Procurement

Our supply chain is composed of companies responsible for supplying equipment and materials, and for the provision of services, referring to all processes—production and non-production—as shown in the following breakdown of the contracted scopes:

• Industrial Projects and Operations
• Technical services
• Maintenance, Repair, and Operations (MRO)
• Materials and Services for Renewable Energies, Industrial Inputs, Packaging, Lubricants, and Markers
• Crop inputs and services
• Information Technology
• Corporate, Human Resources, and Health, Safety, and Environment (HSE)
• Marketing
• Logistics Services
• Automotive equipment and parts
• Agricultural Operations & Sugarcane and Biomass Transportation

In 2020/2021, supplier spending exceeded R$4 billion, as described below:

• Services: R$2,013,653,465.11
• Materials: R$2,030,905,648.81

Of the total spent on suppliers of Materials, Equipment, and Services, the amount spent on traceable suppliers was R$3,343,346,085.61, with most of the contracts established with companies from São Paulo (75.56%).

The supplier qualification process in the supply chain can involve up to three steps, depending on the scope of supply:

• 1st step: self-assessment conducted on the Supplier Portal. The questionnaire includes questions related to HSE, Quality, and technical specifications.
• 2nd step: commercial analysis of the supplier in which fiscal, financial, tax, labor, and social responsibility aspects are checked according to established criteria.
• 3rd step: the supplier is registered in the database and continues to be assessed through the measurement of the records of non-compliance (RNC) and analysis of punctuality in delivering the materials. In addition, the supplier's registration documents are checked for compliance on a monthly basis, thereby eliminating the risk of fines.. This procedure is performed automatically by a query robot.

In addition to approving suppliers and monitoring their results, we give recognition, through the RAIZ Partner Award, those who complied with all requirements stated when they were hired. All suppliers of materials and/or service providers with sales within the current crop year are eligible to participate. Click here to learn more.

The Procurement area also has a Sustainable Procurement Policy in place to ensure an efficient procurement process that adheres to the requirements of compliance and sustainability for a fair and honest competitive process. The purpose of the document is to ensure that procurement is carried out in accordance with market practices and that internal procurement requirements are met, based on the socioeconomic development of all stakeholders.

Argentina:

Our supply chain consists of producers of crude oil and biofuels, carriers of crude oil, fuel, and biofuel, and companies responsible for the provision of supplies, equipment, and materials, and services. In 2020/2021, contracts with these suppliers totaled more than US$1.5 billion (R$8.1 billion)².

• Producers of Crude Oil

We purchase oil from 23 local producers of crude oil from different locations, mainly from the Neuquén Basin, where most of the local production is produced, and no imports of the product were recorded in this period. The heavy oil deposits of these producers are located in the province of Santa Cruz and in Chubut, while the intermediate or light deposits are located in Neuquina. Lighter oil comes from the province of Tierra del Fuego. By 2020/2021, spending on oil suppliers exceeded US$1 billion (R$5,4 billion).

• Producers of Biofuels

We have contracts with 22 local producers of biofuels, necessary for our fuel production processes. These producers are mainly concentrated in the Central and Northern regions of the country. In 2020/2021, more than US$130 million (R$699 million) was spent on this category.

• Shipping and land transport companies

These provide crude oil transportation services by sea to the refinery, and by river to the deposits for fuel distribution from our refinery and fuel depots to the interior of the country. Transportation companies are located in Central and Northern Argentina, and most of them are concentrated in the Metropolitan Region and the interior of the country, mainly in the provinces of Córdoba, Santa Fé, and Buenos Aires. As for the supply chain, we mostly work with local service providers at the Buenos Aires Refinery and Lubricants Plant, as well as in the warehouses in the interior of the country. In 2020/2021, more than US$100 million (R$538 million) was spent on suppliers in this group.

• Procurement

The group is composed of companies responsible for supplying equipment and materials, and for the provision of services, referring to all our production and non-production processes, as shown in the following breakdown of the contracted scopes:

• Industrial maintenance services
• Industrial and steel projects
• Maintenance, Repair, and Operations (MRO) and Personal Protective Equipment (PPE)
• Chemicals and additives
• Industrial supplies and containers and packaging
• Equipment and services at fuel stations
• Information technology and corporate equipment and services (facilities)
• Marketing materials and services
• Corporate consulting (benefits and the like).

In 2020/2021, more than US$270 million (R$1.4 billion) was spent on suppliers, of which approximately 60% correspond to services, for the operation and maintenance of our refinery, lubricant plant, warehouses, and distribution in airports.

• Contract management

The Contract Management or Efficient Contract Management activities are carried out to identify deviations, whether in terms of Health, Safety, and Environment (HSE), or in relation to meeting deadlines and deliveries.

Internal meetings and/or meetings with suppliers are held periodically to evaluate the performance of commercial partners. Performance reports are also generated to ensure proper contract management.

The selection, qualification, and evaluation of suppliers, as well as reevaluations, are divided into cycles that consist of specific processes: the static cycle, carried out upon registration in our base and repeated after the term of the contract, refers to pre-assessment, technical evaluation, and Integrity, Financial, and HSE analysis; and the dynamic cycle, carried out during the term of the contract, consists of delivery monitoring and quality surveys of the product/service offered.

To analyze and define the first-line purchases from local and foreign producers, all suppliers are submitted to evaluation, selection, and qualification processes in accordance with the policies of each production or supply sector.

GRI 102-10 Significant changes to the organization and its supply chain

The following significant changes occurred during the 2020/2021 harvest:

• Change of address of Raízen Combustíveis' headquarters.
• Changes to the composition of the executive officers of Raízen Energia and Raízen Combustíveis.
• Application for registration as a securities issuer - Category "A", with the Brazilian Securities and Exchange Commission ("CVM") was filed on behalf of Raízen Combustíveis.
• Company name changed from Raízen Argentina S.A. to Raízen Argentina S.A.U. (Raízen Argentina Sociedad Anónima Unipersonal). The change of the company name did not result in a change in the Single Tax Identification Code nor in the contractual obligations assumed by the company.

The corporate restructuring of Raízen's Trading companies was completed on March 31, 2021 and had the following changes:

• New Trading headquarters established through the creation of a company in Switzerland called Raízen Trading S.A., replacing Raízen Trading LLP, located in the United Kingdom.
• Opening of a branch of Raízen Trading S.A. in the United Kingdom.
• Creation of a subsidiary in the Netherlands, called Raízen Trading Netherlands BV.

In the period, there was also a relevant change in the Procurement Policy for Equipment, Materials, and Services, making it a Sustainable Procurement Policy, highlighting ESG aspects in the selection, hiring, and management of contracted suppliers.

Our capital structure did not have any significant change.

GRI 102-13 Membership of associations

In Brazil, we participate in the following organizations:

• União da Indústria de Cana-de-Açúcar (UNICA) - Brazilian Sugarcane Industry Association
• Associação Brasileira de Biotecnologia Industrial (ABBI) - Brazilian Association of Industrial Biotechnology
• Associação da Indústria de Cogeração de Energia (COGEN) - Energy Cogeneration Industry Association
• Associação Brasileira dos Terminais Portuários (ABTP) -Brazilian Association of Port Terminals
• Bonsucro (organization responsible for certification of sustainability aspects in sugarcane production)
• Associação Brasileira do Agronegócio (ABAG) - Brazilian Agribusiness Association
• Associação Brasileira de Biogás e Biometano (ABiogás) - Brazilian Biogas and Biomethane Association
• Associação Nacional dos Usuários do Transporte de Carga (ANUT) - Brazilian Association of Freight Transport Users
• Instituto Brasileiro do Petróleo (IBP) - Brazilian Petroleum Institute
• Associação Brasileira de Autoprodutores de Energia Elétrica (ABIAPE) - Brazilian Association of Self-Producers of Electric Energy
• Associação Brasileira de Energia Solar (ABsolar) - Brazilian Solar Energy Association
• Associação Brasileira de Bioinovação (ABBI) - Brazilian Association of Bioinnovation
• Instituto Combustível Legal
• Instituto ETCO
• Conselho Empresarial Brasileiro para o Desenvolvimento Sustentável (CEBDS) - Brazilian Business Council for Sustainable Development
• Rede Empresarial Brasileira de Avaliação de Ciclo de Vida (Rede ACV) - Brazilian Business Network for Life Cycle Assessment

In Argentina, we participate in projects and/or commissions of the following organizations:

• Cámara Argentina de la Energía (CADE)
• Instituto Argentino del Petróleo y del Gas (IAPG)
• Asociación Empresarial Argentina (AEA)
• Instituto para el Desarrollo Empresarial de la Argentina (IDEA)
• AmCham (American Chamber of Commerce)
• Consorcio del Puerto de Dock Sud
• Fundación de Investigaciones Económicas (FIEL)
• Cámara Argentina de Lubricantes
• Comisión Permanente del Asfalto
• Asociación Argentina de Carreteras
• Asociación Regional de Empresas del Petróleo y Gas (Arpel)
• Latin America Refining Technology Conference (LARTC)
• Asociación de Grandes Usuarios de Energía Eléctrica de la República Argentina (Agueera)
• Sociedad Argentina de Mejora Continua (SAMECO)
• American Petroleum Institute (API)
• Instituto Argentino de Normalización y Certificación (IRAM)
• Asociación de Higienistas de la República Argentina (ARHA)
• Corrosion Institute (NACE)
• Asociación de Corredores de Turismo Carretera (ACTC)

Of these organizations, we have seats in governance bodies at CADE, FIEL, and the Consorcio del Puerto Dock Sud.

Our presence is considered strategic in the CADE to channel the joint demands of the industry for regulatory and tax issues; in the IAPG, because the institution investigates, analyzes, and defines the technical position of the industry in the various issues that are inherent to it; in the AEA, because it is an important space for relationship and discussions with the CEOs of the most important companies in the country, the association promotes meetings and discussions with government and authorities to debate and analyze issues that are common to the business community; in the Consortium of the Port of Dock Sud, because it is the autarky that has jurisdiction over the wharf of our refinery, a neural point of entry and exit of raw materials and finished products; and in the Argentine Chamber of Lubricants, an entity that brings together the main producers and traders of this product and represents the interests of the sector as a whole.

Ethics and Integrity

GRI 102-17 Mechanisms for advice and concerns about ethics

* Since the methodology for reporting this indicator has changed, there is no track record. Data from the Ethics Channel includes Argentina, while the Customer Service and Ombudsman figures include only the operations in Brazil.
** Covers all contact channels (Customer Service, Ombudsman, Social Media, Reclame Aqui, Consumidor.gov) with consumers of Shell service stations and Select/OXXO stores.

The Ethics Channel receives reports of unethical behavior that violates our Code of Conduct. The types of grievances/complaints received in the 2020/2021 harvest by the Ethics Channel were divided into categories: Moral/Sexual Harassment (Inappropriate Behavior, Moral Harassment, Sexual Harassment, Discrimination, and Violence against women), Fraud (Fraud in internal records , Tampering with documents / receipts and Fraud in business relations), Bribery (Payment or receipt of values), Embezzlement/Theft (Theft or misappropriation of materials/products, Destruction or damage to property and misappropriation of property - company assets), Conflict of Interest (Improper use of company resources and/or assets, Improper favoritism of third parties, Intimate relationship with direct report, Relationship between leader and subordinate, Conflict of interest, and Leakage of confidential information), HSE (No registration or reporting of accidents, Unsafe working conditions, Unsafe transportation conditions, Use of drugs and/or illegal substances, Violation of environmental laws, Lack of training to perform the work, Threat to life and/or physical aggression, Lack of outpatient care, Unavailability of PPE/CPE, and Unreported product leak) and Miscellaneous (non-compliance with standards and policies, non-compliance with labor laws, and other issues not listed above).

Contacts from consumers include complaints about customer service, product quality, prices, payment problems, as well as compliments and questions.

Governance

GRI 102-25 Conflicts of Interest

We respect employees' right to privacy in their personal activities. However, it is possible that personal interests could cause an actual or potential conflict with the duty of loyalty to the team. Therefore, it is up to each employee who is in a situation of conflict, actual or apparent, to report the situation in the Conflict of Interest Reporting Tool on the intranet, so that the appropriate measures can be taken, according to each situation.

Any member of our Board of Directors is required to abstain from participating in a particular discussion if: he or she has a conflict of interest involving the interests of the shareholder who appointed such member; there is a risk of placing us at a potentially unfavorable competitive disadvantage or in violation of applicable antitrust and competition laws. Conflicts of interest are not disclosed to stakeholders.

GRI 102-35 Remuneration policy

The members of the Board of Directors are entitled to a fixed remuneration consisting of 12 monthly payments, whose amount is determined based on their responsibilities, competencies, the time they dedicate to their duties and their service in the market.

The remuneration of the Directors is composed of fixed and variable elements. The fixed element of the compensation is determined according to the complexity and level of responsibility of the work performed and market practice. In the case of variable pay, to ensure differentiation and meritocracy, individual performance indicators are taken into account, which are in part behavioral, and in part linked to financial and project goals. More information is available in the Remuneration section of this report.

GRI 102-36 Process for determining remuneration

The overall remuneration of the Board of Directors and the Executive Board is determined annually at a general meeting, and the Board of Directors is responsible for the allocation, structure, and distribution of this remuneration among the members of the Board of Directors and the Executive Board. The guidelines to be observed and applied are described in our Remuneration Policy.

External consultants periodically analyze the remuneration scenario in the market, making a recommendation to adjust the remuneration of the executives. This recommendation is previously analyzed by the People Committee and submitted for approval by the Board of Directors. Salary ranges are also determined based on this consulting methodology. Remuneration is generally managed within 60% to 120% of these ranges.

GRI 102-37 Stakeholders’ involvement in remuneration

We have a committee composed of shareholders and executives that meets quarterly to discuss and define the main guidelines for remuneration. We also have a relationship with more than 90 local unions to discuss the terms of collective agreements and/or collective conventions that are reflected in the salaries and benefits of our employees.

Stakeholder engagement

GRI 102-41 Percentage of total employees covered by collective bargaining agreements

In Brazil, 100% of the team is covered by collective labor agreements or conventions. In Argentina, the proportion is 32%.

GRI 102-43 Approach to stakeholder engagement

We have several channels in place to receive demands from our stakeholders. In addition to the Ethics Channel (learn more here), we have Customer Service (SAC), Ombudsman, social media, and we monitor websites such as Reclame Aqui and Consumidor.gov.

In the 2020/2021 harvest, we received more than 21,000 contacts from customers and more than 31,000 requests from other audiences. Contacts from consumers include complaints about customer service, product quality, prices, payment problems, as well as compliments and questions.

The contacts received from other audiences include questions about human resources, transportation, excessive noise, pollution, the environment, and potential customers.

* Covers all contact channels (Customer Service, Ombudsman, Social Media, Reclame Aqui, Consumidor.gov) with consumers of Shell service stations and Select/OXXO stores.
** Covers all contact channels (Customer Service, Ombudsman, Social Media, Reclame Aqui, Consumidor.gov).

GRI 102-44 Key topics and concerns raised

Same as 102-43.

MATERIAL TOPICS

Climate change and energy transition

Management Approach

GRI 103-1 | Explanation of the material topic and its Boundary

Our ambition is to lead the energy transition by providing the energy society needs today while developing new forms of energy for the future, contributing to a low-carbon economy. In addition to our strategy for mitigating the effects of climate change, this topic includes both how we monitor our air emissions and energy consumption and how we support our customers in reducing their carbon footprint.

This topic is material for all businesses, especially for the Renewables and Marketing & Services fronts, and reflects society's concern to curb global warming, in line with globally established goals such as the Paris Agreement.

GRI 103-2 | The management approach and its components

This topic is managed by several areas, with emphasis on the Energy Department and Sustainability Area, and is guided by our Sustainability Policy, whose guidelines include the periodic monitoring of our Greenhouse Gas (GHG) emissions, which are measured annually based on the guidelines of The Greenhouse Gas Protocol and its national version, the Brazilian GHG Protocol Program. Our inventory is voluntarily submitted to independent auditing, which results in an analytical report on each of our emission sources. The goal is to ensure the energy efficiency of our processes and map risks and opportunities arising from climate change and which may impact our operations. We also answered the Carbon Disclosure Project (CDP) questionnaires, having achieved the "A-" level, placing us among the companies with the best practices (Leadership).

We also operate in accordance with national energy policies, defined by relevant government agencies, such as the Ministry of Mines and Energy (MME), the National Energy Policy Council (CNPE), the National Petroleum, Natural Gas and Biofuels Agency (ANP) and the National Electric Energy Agency (ANEEL).

While we perform robust emissions management, we have diversified our portfolio, particularly through the use of biomass and other renewable energy sources. More information is available in the Energy Transition and Advanced Technologies sections of this report, where we describe our steps toward a circular economy model—not only to promote efficiency in our operations, but to drive the transformation of the energy mix. This topic also includes our performance in relation to risk and opportunity management, presented here.

Directly related to this topic, we have made the following commitment by 2030³:

To reduce the carbon footprint of ethanol and sugar by 10%

GRI 103-3 Evaluation of the management approach

The evaluation of the management approach for this topic is monitored based on the performance of our operations, as determined by the following indicators:

Indicators

GRI 201-2 Financial implications and other risks and opportunities due to climate change

The potential financial implications are disclosed through the Carbon Disclosure Project (CDP) Report (Topic C.2 - Risks and Opportunities), available here. More information is available in the Risk management section and the response to SASB indicator FB-AG-440a.1.

GRI 302-1 Energy consumption within the organization

In 2020, our energy consumption in Brazil exceeded 168,432,046.39 GJ, of which 8,697,506.65 GJ were sold through government auctions or on the spot market. In Argentina, energy consumption was 16,549,405 GJ.

* The conversion factors available in the World Energy Balance 2020 were used. The information is collected for calculating emissions using the methodology of the GHG Protocol and was taken from the Report on Greenhouse Gas (GHG) Emissions. We do not control the total energy consumed and sold for heating, cooling, and steam.

* Mass balance performed from the Solomon EII Refinery & Methodology; Conversion used: PCI calorific value of fuels: - Natural Gas: 47,971 kJ/kg - Refinery Fuel Gas: 48,553 kJ/kg - Heavy fuel oil: 41,172 kJ/kg - Coke CCU: 39,330 kJ/kg - Steam Conversion: 2,790 kJ/kg. Data include only the refinery. This indicator does not include the Administrative Office in Argentina, located outside the Refinery.

GRI 302-2 Energy consumption outside the organization

We map energy consumption to transport our products and employees. In 2020/2021, fuel consumption by contracted carriers totaled 7,893,314.5 GJ.

* The conversion factors available in the World Energy Balance 2020 were used. The information is collected for calculating emissions using the methodology of the GHG Protocol and was taken from the Report on Greenhouse Gas (GHG) Emissions.

This indicator does not include Argentina, which does not monitor this information.

GRI 302-3 Energy intensity

Brazil

In the 2020/2021 harvest, energy intensity was 2.65 GJ, consumed per ton of sugarcane crushed from scopes 1 and 2 sources. The energy used to calculate this indicator included the energy consumed internally and the energy sold (from the burning of sugarcane bagasse). The intensity rate considers only the energy used within the organization.

* In the 2017/2018 harvest, only scope 1 sources were considered. For the other years, scope 1 and 2 sources were considered.

Argentina

In the 2020/2021 harvest, energy intensity was 130.70. The calculation takes into account only the energy used within the Buenos Aires refinery.

* Rate calculated based on the Solomon Energy Intensity Index (EII), an oil refinery energy efficiency metric that compares the actual energy consumption of a refinery with the "standard" energy consumption of a refinery of similar size and configuration. This indicator does not include the Administrative Office in Argentina, located outside the Refinery.

305-1 Direct (Scope 1) GHG emissions

We adopt the operational control approach, based on which 100% of the emissions from any organizations and production units over which we maintain control or influence are included in our inventory, even when this control is shared. As of the 2019 inventory, data on greenhouse gas emissions have included the operations in Brazil and Argentina, and 2020 was the first year in which the data were included in the GRI indicators.

Gross direct greenhouse gas (GHG) emissions (scope 1), were 2,427,764.7 tCO₂eq and indirect GHG emissions from acquired energy (scope 2) were 11,740.9 tCO₂eq. The other gross indirect GHG emissions (scope 3)—excluding indirect emissions from power generation, heating, cooling, and steam purchased and consumed—were 44,582,401.5 tCO₂eq.

Total biogenic emissions are calculated separately from the gross direct Greenhouse Gas emissions. In 2020, total biogenic emissions were 17,453,982 tCO₂eq in scope 1 and 12,229,273 tCO₂eq in scope 3.

The gases included in the calculation were: CO₂, Methane (CH₄), nitrous oxide (N₂O), sulfur hexafluoride (SF6), nitrogen trifluoride (NF3) and the families of hydrofluorocarbon (HFC) and perfluorocarbons (PFC) gases. Emissions from NF3 and PFC gases are not applicable to our activities. However, in the case of indirect emissions from the purchase of energy, emissions only include CO₂ gas, as per the calculation performed and made available by the Ministry of Science, Technology, and Innovation.

* Data prior to 2020 do not include Argentina.

* Data prior to 2020 do not include Argentina.

We consider 2013 as a baseline year since it better represents the scope of our activities. In that year, we incorporated into our inventory the emissions from vinasse and filter cake, which accounted for 14% and 18%, respectively, of total emissions from fertilizers.

Calculation was done according to the specifications of the Brazilian GHG Protocol Program—developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD)—managed in Brazil by the Center for Sustainability Studies (GVces) of the Business Administration School of the Getulio Vargas Foundation (FGV-Eaesp); and standards NBR ABNT ISO 14.064-1—guidance to quantify and report emissions and removal of Greenhouse Gases. Where applicable, the methodology also followed the determinations for calculations set out in the 2006 IPCC Guidelines for National GHG Inventories of the United Nations and in the Reference Report of the Second National Inventory. The main sources of the emission factors used were:

• IPCC, 2006

• Ministry of Science and Technology (MTC)
• US EPA Solid Waste Management and Greenhouse Gases, 2006
• 2017 Guidelines to Defra / DECC's GHG Conversion Factors for Company Reporting
• Australian National Greenhouse Accounts NGA Factors
• Greenhouse gases emissions in the production and use of ethanol from sugarcane in Brazil: The 2005/2006 averages and a prediction for 2020;
• Calculation tool of the GHG Protocol Agriculture Guidance
• Third Brazilian Inventory of Anthropogenic Greenhouse Gas Emissions: Benchmark Reports Nitrous Oxide Emissions from Agricultural Soils
• Internal studies.

The global warming potential rates adopted as reference used the PAGs presented by the IPCC Fourth Assessment Report: Climate Change - Errata (2007) for a 100-year time horizon.

For more information about our emissions, click here.

305-2 Energy indirect (Scope 2) GHG emissions

Same as 305-1.

305-3 Other indirect (Scope 3) GHG emissions

Same as 305-1.

GRI 305-4 GHG emissions intensity

In 2020, the overall intensity rate of our GHG emissions was 0.039 tCO₂eq by ton of sugarcane crushed. The amount was determined from the summation of scope 1 and 2 emissions, divided by the total sugarcane crushed.

Scope 1 emissions are a result of stationary combustion, mobile combustion, waste treatment, process emissions, fertilization, and fugitive emissions. Scope 2 emissions are a result of the purchase of electricity.

The GHG included in the emission calculations are those controlled by the Kyoto Protocol: CO₂, CH₄, N₂O, SF6, NF3 and the families of HFC and PFC gases. Emissions from NF3, SF6, and PFCs are not applicable to our activities.

*Base of calculation: summation of scope 1 and 2 emissions divided by the total sugarcane crushed in the period. Data prior to 2020 do not include Argentina.

GRI 305-7 Nitrogen oxides (NOx), sulfur oxides (SOx), and other significant air emissions

In Brazil, the main sources of gas/steam generation for generation of the electricity used in the industrial process are the sugarcane bagasse boilers. Air emissions for units that generate energy by burning sugarcane bagasse in boilers must be monitored by controlling the pollutants Particulate Matter (PM) and NOx (nitrogen oxides), based on the Terms of Reference of the Environmental Company of the State of São Paulo (CETESB) for the Air Emissions Monitoring Plan (PMEA). Monitoring frequency is linked to environmental permit. Comparisons of emission limit results for air pollutants from heat generation processes from external combustion of sugarcane biomass were adopted according to CONAMA resolution 382/06 and 436/2011.

In Argentina, emissions are calculated based on API Compendium of Greenhouse Gas Emissions Methodologies for the Oil and Natural Gas Industry August 2009 Refinery Gas. We do not emit Persistent Organic Pollutants (POPs) at the Buenos Aires refinery. The monitored parameters of hazardous air pollutants (HAP) are included in the VOCs.

* Emissions of SOx gases, persistent organic pollutants (POPs), volatile organic compounds (VOCs), and hazardous air pollutants (HAPs) are not monitored in Brazil.

SASB RR-BI-120a.1 | Air emissions of the following pollutants: NOx (excluding N2O), SOx, volatile organic compounds (VOCs), particulate matter (PM10), and hazardous air pollutants (HAPs)⁴

Same as 305-7.

SASB EM-MD-110a.1 Gross global Scope 1 emissions, Percentage methane, Percentage covered under emissions-limiting regulations

Same as 305-1.

SASB EM-MD-110a.2 Discussion of long- and short-term strategy or plan to manage Scope 1 emissions, emissions reduction targets, and an analysis of performance against those targets

Same as FB-AG-110a.2.

SASB FB-AG-110a.1 Gross global Scope 1 emissions

Same as 305-1.

SASB FB-AG-110a.2 Discussion of long- and short-term strategy or plan to manage Scope 1 emissions, emissions reduction targets, and an analysis of performance against those targets⁵

The purpose of our Strategic Sustainability Plan is to address actions and define goals according to each prioritized topic, aiming at business continuity. The guideline is composed of long-term goals, short- and medium-term action plans, and targets to be strategically structured and cascaded throughout the harvests for each material topic, one of which refers to climate change, with the ambition of becoming a leading player in the transition to a low-carbon economy. To this end, one of our strategies is to continue managing greenhouse gas (GHG) emissions.

We keep a robust management of our emissions by annually monitoring them through an emissions inventory, which uses the globally recognized methodology of The Greenhouse Gas Protocol and its national version, the Brazilian GHG Protocol Program. This performance gives us a reliable history of the evolution of our emissions profile, supporting actions to reduce and gain efficiency in our operations. The inventory has been voluntarily submitted to independent audit since 2013.

We also perform an annual product life cycle analysis (LCA), an internationally recognized methodology that assesses the carbon footprint of products, identifying the emissions associated with each stage of the production process. The result is submitted for critical analysis by an independent third party, which ensures the reliability of the data.

We are an important player in markets that aim to decarbonize their energy mix and that use specific programs with tools and standards to calculate their carbon footprint. Seeking to go further, we have made a public commitment to reduce the carbon footprint of ethanol (MJ) and sugar (Kg) in our operations by 10% by 2030. The target is based on intensity compared to the 2018/2019 harvest and with projection based on the 2029/2030 harvest.

We invest in research and development, and we are constantly seeking innovations that increase productivity and energy efficiency and reduce the carbon footprint of our products. At a tactical level, the emissions of all projects that involve the most relevant sources of carbon footprint (such as use of synthetic fertilizers, amendments to the soil, or diesel consumption) are estimated and projected prior to execution.

SASB FB-AG-130a.1 | Operational energy consumed, percentage grid electricity, percentage renewable⁶

Same as 302-1.

SASB EM-MD-110a.1| Gross global Scope 1 emissions, percentage covered under emissions-limiting regulations

Same as 305-1.

SASB EM-RM-110a.2 Discussion of long- and short-term strategy or plan to manage Scope 1 emissions, emissions reduction targets, and an analysis of performance against those targets

Same as FB-AG-110a.2.

SASB FB-AG-440a.1 Identification of principal crops and description of risks and opportunities presented by climate change⁷

We conducted a study on climate change scenarios in the Brazilian states using the current climate and the future climate, years 2021 to 2040 and 2081 to 2100 as time horizons, respectively. This study was based on global climate model ensembles provided by the Program for Climate Model Diagnosis and Intercomparison (PCMDI) and made available by the Earth System Grid data portal. The main variables analyzed were daily and monthly precipitation averages, near-surface air temperature, near-surface wind, and simulated relative humidity for the observed climate.

Climate change projections based on the average of the IPCC5 (IPCC AR5) climate model ensemble indicate an increase in temperature across South America, and the range of temperature variation projected by the ensemble average for Brazil is between:

- Current climate: in an optimistic scenario, 1-2°C increase; and in a pessimistic scenario, 2-3°C increase.

- Future climate: in an optimistic scenario, 2-3°C increase; and in a pessimistic scenario, over 5ºC.

Regarding projections for changes in precipitation, the average of the model ensemble in question indicated a small increase in precipitation over the summer for most of South America for 2081-2100; however, several studies reported low reliability in the precipitation projections given the discrepancies found.

The effect of climate change on sugarcane crops was evaluated because previous episodes have shown how climate fluctuations can negatively impact production, although the crop is more resilient compared to others. Considering the joint effects of rising temperatures and changes in rainfall patterns, increased sugarcane yields and increased water use efficiency are expected.

Sugarcane is one of the crops whose productivity will be less impacted by changes, with gains or few variations in productivity, especially in the Southeast region, and these aspects are replicated in our sugarcane supply chain. Findings were compared with market trends and the reality of all operations, including cultivation, sugar, ethanol, and bioenergy production and fuel distribution. Risks and opportunities were mapped in all sectors.

Once all the risks and opportunities had been mapped, internal areas were involved to rate the risks with the greatest impact on the business, classifying them as physical, regulatory, reputational, or market risks. The impacts associated with the mapped risks could lead to decreased productivity or damage to our physical structures, while the opportunities result in increased market share, easier access to low-cost credit, and revenue generation through carbon pricing mechanisms.

To manage these risks and opportunities, we monitor market demands and trends and take internal measures, such as robust management of our emissions through the annual monitoring of the greenhouse gas inventory (GHG) and life cycle analysis (LCA), which assesses the carbon footprint of products.

Management of health, safety, and environment

Management Approach

GRI 103-1 | Explanation of the material topic and its Boundary

We want to be recognized for efficiency in water management and excellence in land use management as the leading example in the sectors in which we operate. This topic covers policies and practices related to risk management, health, safety, and the environment (such as water, biodiversity, waste, and workplace accidents), considering the specifics of each business. It also includes issues related to the integrity of operations and cybersecurity.

This topic is material for all businesses.

GRI 103-2 | The management approach and its components

Water withdrawal is in compliance with legislation and we have initiatives in place to reduce consumption and discharge in production units—such as the ReduZa program, (see more here). As part of this initiative, goals are set annually to encourage teams for the rational use of water resources. In addition to measuring the volumes of water withdrawn, effluents, and various water currents in the energy cycle, we have strict quality control in place at all stages of the industrial process.

Regarding land use management, since 2007 we have been a signatories to Protocolo Agroambiental Etanol Mais Verde (Greener Ethanol Agri-Environmental Protocol). This is an agreement entered into the government of the State of São Paulo and the São Paulo Sugarcane Industry Association (UNICA - União da Indústria de Cana-de-Açúcar), which lists principles and technical guidelines to be adopted by the industries in the sugarcane chain regarding environmental issues. One of these principles is the advancement of the legal deadlines established to eliminate burning during sugarcane harvest. To achieve this goal, Raízen made significant investments in monitoring and responding to fire in the sugarcane fields, using high-definition, long-range cameras to identify fire outbreaks and responding rapidly to prevent spread. Learn more about our position regarding this topic here.

The safety of people and operations is driven by guidelines provided in our Health, Safety, Environment, and Sustainability (HSE) Policy. We also have the Integrated Operations Management System (SIGO)—learn more here.

This topic also includes our performance in relation to managing risks and opportunities, as presented here; and, for more comprehensive approach to the topic of safety, this report includes the measures that have been reinforced since the 2019/2020 harvest regarding cybersecurity (see more here).

This topic is managed by several areas in a multidisciplinary manner. Directly related to this topic, we have made the following commitment by 2030⁸:

• Reduce water withdrawal from external sources by 10%
• Increase the GJ/ha indicator by 15% (greater efficiency and more energy from the same area)
• Maintain all units in operation certified by an internationally recognized standard

Demands received in connection with this topic:

* Since the methodology for reporting this indicator has changed, there is no track record. The Customer Service (SAC) and Ombudsman numbers cover only the operations in Brazil.

GRI 103-3 Evaluation of the management approach

The evaluation of the management approach for this topic is monitored based on the performance of our operations, as determined by the following indicators:

Indicators

GRI 303-1 Interactions with water as a shared resource⁹

Water is used in our industrial processes for cooling, steam generation, and dilution, among other applications. Our sources are surface water and water taken from sugarcane, minimizing withdrawal from external sources.

We invest in actions to reduce water withdrawal/consumption, such as closing water circuits (sugar manufacturing, cooling of fermentation, and condensation of ethanol, among others), installing cooling towers, using steam condensate (water generated in the process) in production stages, thereby ceasing to consume water in these processes.

Given the diversity of our plants and their different locations, each unit is responsible for its water balance, with detailed water currents against the consumption in each stage of the industrial process. Industrial waste from production units and distilleries is recovered and treated through internal controls. The techniques used are: recirculation, reuse of waste, more efficient equipment, less polluting processes, and crop fertigation. External control consists of waste treatment systems required for the waste and effluents to comply with legislation.

The necessary systems are as follows: treatment of the cane washing water by decantation; treatment of the flue gas scrubber water by decantation-flotation; various cooling, in cooling towers or sprinkler tanks; treatment of the effluents generated from washing floors and equipment in sand and grease traps; and treatment of domestic sewage in accordance with regulations.

All sources of supply are authorized by the regulatory agency, which analyzes the critical conditions of the water body and issues a use permit. Internally, we have developed the ReduZa Program (see more here), through which we monitor each unit's consumption on a daily basis in order to maximize reuse and reduce withdrawal from external sources. This program uses several tools, such as real-time monitoring systems, quality assurance of flow meters, and sharing of best practices through internal and external benchmarking.

Through the Brazilian Sugarcane Industry Association (UNICA), we participate in meetings of the Watershed Committees, a forum for discussing issues related to water resources. In addition, we are part of the Members Council, an international association whose aim is to reduce negative social and environmental impacts (and enhance positive ones) in the production of sugarcane through an internationally recognized standard, the Bonsucro certification.

Our water consumption per ton of sugarcane is kept within the limits established by the Agro-environmental Zoning, according to SMA 88/2008, which defines the guidelines for licensing projects in the sugar and ethanol sector in the State of São Paulo. These goals are also monitored under the Protocolo Etanol Mais Verde (Greener Ethanol Protocol), a good practice agreement between the São Paulo State Government and the sugar and ethanol sector.

GRI 303-2 | Management of water discharge-related impacts*

In Brazil, we monitor the quality of the effluents generated in accordance with the legislation in effect, as established in the technical requirements for our environmental permits. Through investments in Effluent Treatment Plants (ETP) and Wastewater Treatment Plants (WWTP), we seek to improve the quality of the effluents that have been authorized for discharge. To reduce effluent generation, investments are made in technology projects for water reuse, monitoring and mapping of use per process, closing of circuits, and cooling towers for water reuse.

In Argentina, the limits for discharging liquid effluents on the surface are set by the Water Authority of the Province of Buenos Aires, in accordance with Resolutions 336/03 and 335/08. In addition, the Matanza Riachuelo Watershed Authority (ACUMAR - Autoridad de Cuenca Matanza Riachuelo), sets the limits through Resolution 283/19.

** This indicator does not include the Administrative Office in Argentina, located outside the Refinery.

GRI 303-3 Water withdrawal¹⁰

In the 2020/2021 harvest, 51,200.42 ML of fresh water were withdrawn from agricultural and manufacturing operations in Brazil. None of the water withdrawal regions is classified as a water stress area.

* Data for water withdrawal is obtained from the summation of the flow meters installed in each of the units at the withdrawal points. This indicator does not include the Administrative Office in Argentina, located outside the Refinery.

GRI 303-4 Water discharge

100% of the water is discharged in regions that are not under water stress. In the 2020/2021 harvest, discharge in Brazil was 4,123 ML and 151,084 ML in Argentina.

* This indicator does not include the Administrative Office in Argentina, located outside the Refinery.

GRI 303-5Water consumption

In the 2020/2021 harvest, water consumption in Brazil was 51,200.42 ML. In Argentina, total water consumption was 144,648.04 ML, based on data obtained from the summation of the flow meters installed in each of the units at the withdrawal points.

* Data for water consumption is obtained from the summation of the flow meters installed in each of the units at the withdrawal points. Data for harvests prior to 2020/2021 do not include Argentina. This indicator does not include the Administrative Office in Argentina, located outside the Refinery.

GRI 304-1 | Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas¹¹

We operate industrial units in the states of São Paulo, Goiás, and Mato Grosso do Sul, where we also lease sugarcane cultivation areas from third parties - a total area of more than 800,000 hectares. We also have administrative units; however, most of the activities that may be close to areas of high biodiversity value are related to agricultural operation activities such as cultivation, harvesting, and transportation.

Of the 23 production units in operation in the 2020/2021 harvest, 22 hold Bonsucro certification, which ensures sustainable sugarcane production. The goal is to have all units certified by 2022. Among the criteria established by this standard is the requirement not to grow sugarcane in areas of high conservation value. Within the scope of Bonsucro standards, each production unit has an updated Environmental Management Plan (EMP), a document that guides actions to minimize the negative environmental impacts of the activities, including: preservation and development of wildlife and flora, awareness campaigns, dialogues with employees, procedure for reporting animal sightings, wildlife studies and mapping of regeneration of Permanent Preservation Areas, among others.

GRI 304-2|Significant impacts of activities, products, and services on biodiversity¹²

We do not have a specific methodology, matrix, or indicator that shows which impacts on biodiversity are positive, negative, significant or otherwise, direct or indirect. However, the certification of our production units guides actions and initiatives such as wildlife studies and monitoring campaigns to assess impacts of sugarcane activities on biodiversity and ecosystem services. We have also registered our own areas in the Rural Environmental Registry (CAR) and are signatories of the Greener Ethanol Agri-Environmental Protocol, through which we have voluntarily committed to eliminating the burning of sugarcane fields for harvesting. More information is provided in the Value Partnerships section of this report.

GRI 304-3 Habitats protected or restored¹³

Biodiversity is one of the topics addressed in the Environmental Management Plan of Bonsucro certified units. It is a document composed of measurable actions, whose goal is to demonstrate the management conducted by each of the production units to minimize the environmental impacts of their activities.

The actions include protection and conservation of wildlife through the identification and preservation of existing species in the areas of agricultural operations; environmental education of employees for preservation of species; and a strategic plan for monitoring wildlife in certain regions to evaluate the impacts of operations on biodiversity.

Preservation of flora is considered when selecting the areas for cultivation of sugarcane following environmental criteria (compliance with the Agro-Environmental Zoning, leasing of farming areas only, analysis of the deed, registration in the Rural Environmental Registry, etc.), and when cultivating the soil with respect to Permanent Preservation Areas and springs, soil management techniques to prevent erosion, among others.

Actions to preserve biodiversity are carried out in the agricultural areas of the production units and the protection measures developed were approved by companies that provide certification on international sustainability standards, such as Bonsucro and International Sustainability & Carbon Certification (ISCC).

The assessment of each protected or restored area is conducted through:

• Dashboard of sightings of wild animals in the units' agricultural operation areas.
• Identification of agricultural locations with a higher incidence of animals for subsequent installation of signage, in order to warn about the prohibition of fishing and hunting activities and the risk of run-over.
• Results of the strategic biodiversity monitoring plan in certain regions by means of three indicators: Specific Knowledge of Biodiversity, Mapping of Environmental Sensitivity, and Proposed Management Actions.
• Mapping the regeneration stage of Permanent Preservation Areas and local development actions to promote preservation.

The rules and premises adopted to perform the actions related to management of biodiversity were:

• Environmental Management Plan (PGA - Plano de Gestão Ambiental): document prepared according to the guidelines established by the Bonsucro Production Standard, containing ten topics with specific actions and goals for each of them, demonstrating the management conducted at the units to minimize the impact of their operations.
• Strategic Biodiversity Monitoring Plan: In certain regions, assessments of the impacts of sugarcane activities on biodiversity and ecosystem services are conducted by applying concepts of biodiversity conservation and landscape ecology, in accordance with the requirements of the Bonsucro Standard.
• Mapping of the regeneration stage of the PPAs: Diagnosis carried out by a contractor identifying the regeneration stages of the Permanent Preservation Areas by mapping the hydrography, delimiting the PPA according to the guideline defined in the Forestry Code, and mapping of land use and coverage in the PPAs.

GRI 304-4 IUCN Red List species and national conservation list species with habitats in areas affected by operations¹⁴

Same as 304-2.

GRI 306-3 | Waste generated

The waste generated in the 2020/2021 harvest in Brazil totaled 18,875,260.18 tons and 10,887.34 tons in Argentina. The total waste generated during the crop year was 18,886,147.52 tons.

*Data for harvests prior to 2020/2021 do not include Argentina.

GRI 306-4 | Waste diverted from disposal

Waste diverted for disposal in the 2020/2021 harvest in Brazil totaled 18,870,649 tons and 5,635 tons in Argentina.

*Data for harvests prior to 2020/2021 do not include Argentina.

GRI 306-5 | Waste directed to disposal

Waste directed to disposal in the 2020/2021 harvest in Brazil totaled 4,611.18 tons and 5,251.85 tons in Argentina.

*Data for harvests prior to 2020/2021 do not include Argentina.

*Data for harvests prior to 2020/2021 do not include Argentina.

GRI 403-1 | Occupational health and safety management system

Occupational health services are developed based on the study of work processes, environments, and tasks; and they propose measures to prevent risks and health problems that workers may face in performing daily activities. The programs implemented under the responsibility of the Occupational Health area are part of the Integrated Operations Management System (SIGO) and are subject to internal and third-party audits. See more in the Safety section of this report.

GRI 403-2 Hazard identification, risk assessment, and incident investigation

Disclosure in the Safety section of this report.

GRI 403-3 | Occupational health services

Disclosure in the Safety section of this report.

GRI 403-4 Worker participation, consultation, and communication on occupational health and safety

In Brazil, employees are consulted whenever necessary for the development and improvement of the Health, Safety and Environment (HSE) policy processes. They can also participate in meetings of the Internal Commission for Accident Prevention (CIPA) and send feedback to the HSE team of the business line. Leaders and employees also participate in HSE Committees, at least once a month, with well-defined minimum agendas, according to the guidelines of the Integrated Operations Management System (SIGO).

In Argentina, all operating units establish periodic mixed committees composed of employees' representatives, human resources staff, occupational health service, and operational lines. This is a legal requirement and takes place at least quarterly. Topics of interest that may affect the health and safety of workers are discussed. The primary responsibility of the employees' representatives is to discuss issues in these committees and to report back to the people they represent. Our responsibility is to manage the risk issues identified in the Acceptable Risk Limit (ALARP).

GRI 403-5 | Worker training on occupational health and safety

Disclosure in the Safety section of this report.

GRI 403-6 | Promotion of worker health

In Brazil, employees are covered by health plans regulated by the National Health Agency (ANS), through which the beneficiaries have access to consultations, exams, therapies, and clinical and surgical hospitalizations included in the list of procedures with mandatory coverage by the health insurance company, established by ANS In addition, in partnership with health insurance companies, we offer medical assistance doctors for outpatient care in some of our units, focusing on primary health care, including monitoring pregnant women, patients with chronic diseases, and hospitalized employees, performed by a specialized technical team and by phone, on a regular basis. Employees are also offered a telemedicine service through the PAE program with psychological, legal, social, and financial assistance.

In Argentina, employees and their families have prepaid plans, with high-level coverage that ensures easy access to quality medical services in more than 93% of the cases, provided by an independent healthcare organization. This coverage is nationwide. It also has a nutritional health program in place, in person and remotely, and a psychological and emotional support channel (CAPE). In coordination with the learning area, courses on health are also provided. These courses are suggested based on the analysis of the prevalent pathologies in our area of operation..

GRI 403-7 | Prevention and mitigation of occupational health and safety impacts directly linked by business relationships

In Brazil, we provide information concerning our products through technical documents prepared based on the Globally Harmonized System (GHS) criteria, documents for the transportation, handling, storage, and disposal of hazardous products (MSDS/FISPQ) and the procedure for authorizing the use of new chemical products and raw materials.

In the case of contractors, a selection and approval process is in place for suppliers, and for the provision of services, legal documents that attest to the contractor's compliance with the health and safety of its workers are evaluated in advance.

In Argentina, to prevent or mitigate significant negative impacts on occupational health and safety that are directly linked to our operations, risk analyses are performed for HRA (Health Risk Assessment), HEMP (Hazards & Effects Management Process), and PSRA (Personal Safety Risk Assessment). Each of these sets limits to maintain the ALARP risk. The HRA, which is performed by function within the organization, evaluates the different risk agents to occupational health, chemical, physical, biological, and ergonomic. It contains the control and recovery measures to keep the risk as low as practicable. Assessments are always conducted using a Risk Assessment Matrix (RAM). The quantifiable agents are measured and compared to the maximum tolerable limits under the current regulatory framework. In the case of PSRA, hazards that can cause harm to people are similarly assessed, for each function, and barriers to keep them ALARP are described. We have always used the Control Hierarchy concept in occupational health and safety impact analyses.

GRI 403-8 Workers covered by an occupational health and safety management system

*Third parties are covered by our management system, but were not considered in the disclosure of the indicator.Data for harvests prior to 2020/2021 do not include Argentina.
** Internal and external audit is conducted by sampling. The number provided is taking into account the areas (business lines) that are within the scope of the Management System.

GRI 403-9 Work-related injuries

In the 2020/2021 harvest, there were two fatalities in maintenance activities at our production units. One of them involved our employee and the other a contractor. The events were investigated based on the assumptions described in the Integrated Operations Management System (SIGO). A corrective action plan was implemented to eliminate possible failures. The result of the investigation was presented and validated by the Corporate and Shareholders' committees.

* The types of injuries mainly include hand injury, fracture, and burns. This indicator includes company employees and contractors in all businesses, and does not include third parties. Data for harvests prior to 2020/2021 do not include Argentina.
** A total of 107 million hours were worked in the period.
*** A total of 104 million hours were worked in the period.

GRI 403-10 Work-related ill health

* Data refer to company employees. We do not manage the health problems of contractors. Data were compiled as follows: diseases - information on the CATs (Work Accident Communication) that were recorded/opened during the 2020/2021 harvest period due to occupational diseases; risk agents - based on mapping risks provided in the Environmental Risk Prevention Program (PPRAs), Ergonomic Work Analysis (EWA), medical records, and statistical data. Data for harvests prior to 2020/2021 do not include Argentina.
** The main types of problems identified in the last four seasons were musculoskeletal problems.

The agents of work-related risks mapped as possible triggers of health problems are:

• Physical agents: noise, heat from artificial sources, vibrations, humidity, non-ionizing radiation, ionizing, ultraviolet, infrared radiation, etc.
• Chemical agents: metal fumes, dust in the form of sugarcane bagasse or mineral, benzene - present in gasoline, oils and greases, agricultural pesticides (herbicides/insecticides), kerosene, gasoline, etc.
• Biological agents: pathogenic agents
• Ergonomic aspects: weight lifting, working position, physical effort, weight support with upper limbs, etc.

To minimize or eliminate these risks, we have a number of initiatives in place: use of noise dampers, exhaust fans, fume hoods, rotations, trolleys, cranes, manual cranes, and overhead cranes; Workplace Workout Program - Agricultural Area; Safety Dialogues (DDS) for lifting and transporting weight; use of Personal Protective Equipment (PPE); and environmental assessments.

Health risks consider concentration/intensity, duration of the task, frequency of the task, and the probable damage. The risks identified in this indicator have been classified as "carefully acceptable." The agents classified as “acceptable” were not considered and, currently, the area does not map “unacceptable” agents.

Specifically in Argentina, the main types of work-related health problems are musculoskeletal and joint pathology, identified as minor trauma. In the 2020/2021 harvest, there were no recordable work-related illnesses and no fatalities as a result of work-related health problems. Work-related hazards were identified through environmental measurements and ergonomic studies that resulted in: engineering controls regarding thermal insulation; isolation and/or elimination of toxic or hazardous substances (asbestos); administrative controls involving action protocols and specific procedures; and monitoring the proper use of PPE. Work-related accidents or pathologies are registered with the Occupational Risk Insurance (ART) and reported in compliance with the internal protocols of the Occupational Health Service, with all contingencies detailed and filed.

SASB EM-MD-160a.1 Description of environmental management policies and practices for active operations

See the Risk management section of this report.

SASB EM-MD-160a.4 Number and aggregate volume of hydrocarbon spills, volume in Arctic, volume in Unusually Sensitive Areas (USAs), and volume recovered¹⁵

During the 2020/2021 harvest there were 6 hydrocarbon spills with 100% of the volume recovered, in other words, removed from the environment. The actions taken to contain the spill are defined by the Emergency plan for business lines. All spills are investigated in order to identify root causes and solutions to prevent recurrences. Vehicle accidents were recorded in the period because of fatigue and deviations in behavior. The main solutions identified were the installation of a fatigue sensor and reinforcement in the behavioral observation program. For operational and equipment deviations, we reinforced the behavioral observation program.

* 1 bbl = 159 liters.

SASB RR-BI-140a.2 Description of water management risks and discussion of strategies and practices to mitigate those risks¹⁶

The main impact is associated with water scarcity, which can reduce the production capacity of a given unit. To anticipate this risk, we have developed short- and long-term strategies within the scope of the ReduZa Program. Read more in the Effectiveness and efficiency section of this report.

SASB RR-BI-430a.1| Discussion of strategy to manage risks associated with environmental impacts of feedstock production¹⁷

See the Value partnerships and Risk management sections of this report.

SASB FB-AG-140a.2 Description of water management risks and discussion of strategies and practices to mitigate those risks¹⁸

Same as RR-BI-140a.2. See more in the Effectiveness and efficiency section of this report.

SASB FB-AG-430a.3 | Discussion of strategy to manage environmental and social risks arising from contract growing and commodity sourcing¹⁹

See the Value partnerships and Risk management sectors of this report.

SASB EM-MD-540a.4 Discussion of management systems used to integrate a culture of safety and emergency preparedness throughout the value chain and throughout project lifecycles

Our environmental management system consists of nine elements, one of which is the part relating to emergency response. A plan was developed and implemented in each unit to map emergency scenarios, including drills with people involved in the scenarios and assessment to address possible gaps. Plans are reviewed annually by each unit.

SASB EM-RM-320a.2 Discussion of management systems used to integrate a culture of safety

See the Safety section of this report.

SASB EM-RM-540a.1 Process Safety Event (PSE) rates for Loss of Primary Containment (LOPC) of greater consequence (Tier 1) and lesser consequence (Tier 2)

* Data for harvests prior to 2020/2021 do not include Argentina.
**The rate is calculated as follows: Total Tier 1 PSE Count / Total Hours Worked) × 200,000.
*** The rate is calculated as follows: Total Tier 2 PSE Count / Total Hours Worked) × 200,000.

This indicator includes only the operations in Argentina. More information is provided in the Safety section of this report.

SASB EM-RM-540a.2 | Challenges to Safety Systems indicator rate (Tier 3)*

* Data for harvests prior to 2020/2021 do not include Argentina. The rate is calculated as follows: Total Tier 3 indicator count / total hours worked × 200,000.

This indicator includes only the operations in Argentina. More information is provided in the Safety section of this report.

SASB EM-RM-540a.3 | Discussion of measurement of Operating Discipline and Management System Performance through Tier 4 Indicators

In Argentina, five indicators are considered Tier 4: (1) Management of change deviations (MOC); (2) Temporary MOCs expired; (3) Integrity deviations and project windows; (4) Exceptions to Essential Process Safety Rules (RESP); (5) RESP active derogations; (6) SP observations. Each change is made in accordance with Shell Group design standards (DEPs) and globally recognized engineering standards. Inspection and preventive maintenance activities of Process Equipment and Critical Process Safety Equipment are also monitored. All losses of containment found are reported, including those under 10 kg, and are analyzed and investigated according to their potential. A process safety review plan was defined, and is continuously running, to manage the detected risks according to the accepted levels.

This indicator includes only the operations in Argentina. More information is provided in the Safety section of this report.

SASB FB-AG-140a.1 Total water withdrawn, total water consumed, percentage of each in regions with high or extremely high baseline water stress

Same as 303-3.

SASB RR-BI-140a.1 Total water withdrawn, total water consumed, percentage of each in regions with high or extremely high baseline water stress

Same as 303-3.

SASB FB-AG-140a.1 Total water withdrawn, total water consumed, percentage of each in regions with High or extremely high baseline water stress

Same as 303-5

SASB RR-BI-140a.1 Total water withdrawn, total water consumed, percentage of each in regions with high or extremely high baseline water stress

Same as 303-5

Governance, ethics, and compliance

Management Approach

GRI 103-1 | Explanation of the material topic and its Boundary

In selecting our raw material, we use social and environmental criteria in an effort to ensure the traceability of 100% of the sugarcane we crush, both our own and third-party sugarcane. We also dedicate efforts to a robust ethics and compliance program, so it becomes a reference in the segments in which we operate and synonymous with good governance practices in the market in general. This topic also involves dissemination of internal policies and principles of conduct, as well as the fight against different forms of corruption, unfair competition, and other practices that we repudiate.

This topic is material for all businesses.

GRI 103-2 | The management approach and its components

The management approach for this topic can be found in the Corporate governance, Ethics and compliance, and Value Partnerships sections of this report. The components include:

• Code of Conduct (see more here)
• Anti-Corruption Policy
• Social Performance Policy
• Sustainability Policy
• Ethics Channel, for reporting violations of the Code of Conduct, internal policies and applicable legislation (see more here).
• Procedures for selection, qualification and re-qualification of suppliers of equipment, materials, and services
• Certifications such as Bonsucro and International Sustainability and Carbon Certification (ISCC) - see more here.
• Assessment of sugarcane suppliers under the ELO Program and inspections of contract carriers (see more here).

Directly related to this topic, we have made the following commitment by 2030²⁰:

• Guarantee a robust system for traceability of 100% of the volume of sugarcane crushed
• Actively influence our strategic partners to eliminate the risk of violating our ethics and compliance values

GRI 103-3 Evaluation of the management approach

The evaluation of the management approach for this topic is monitored based on the performance of our operations, as determined by the following indicators:

Indicators

GRI 205-1 Operations assessed for risks related to corruption

In 2020/2021, 100% of our operations were assessed for risks related to corruption, all of which provide access to the Ethics Channel, which reported 63 operations (a total of 8%) with risks related to corruption. 530 assessments of risks related to corruption were also conducted. Assessments include third-party counterparty analysis based on the risk of the transaction and preventive actions.

The risks refer to negotiations with counterparties under administrative or judicial investigation, in Brazil and abroad; Trade negotiations with Politically Exposed Persons (PEP); and exposure of employees interacting with public agencies, municipalities and quasi-public corporations.

GRI 205-2 Communication and training about anti-corruption policies and procedures

In 2020/2021, in Brazil, all members of Senior Management, in addition to 28,941 employees, were made aware of the anti-corruption policies, totaling 100% of the team. 4,896 training courses were also provided, i.e., 56% of our employees. All employees above the seniority level set out in Item 4.1 of the Training Policy and who have access to a computer must take the online Code of Conduct, Anti-corruption, and Competition Compliance training every two years For senior management and employees identified by the Compliance area as being at risk, two training courses are provided in addition to the online courses: Anti-corruption training for the risk audience and competitive compliance training for the risk audience. Both must be taken every two years and last 1h30-2h each.

In Argentina, all employees have been communicated about the anti-corruption policies and procedures. Training was provided to 814 employees, to be completed within 3 months of the launch date. 214 completed the courses, accounting for 26% of the employees. 61% of the training courses are currently being finalized and some employees have been dismissed due to being in the high-risk group for the COVID-19 pandemic.

* Data for harvests prior to 2020/2021 do not include Argentina.

* Data for harvests prior to 2020/2021 do not include Argentina.

GRI 205-3 Confirmed incidents of corruption and actions taken

34 corruption cases were confirmed in Brazil, which were closed in the crop year. As a result of the investigations, 27 cases were registered resulting in dismissal of employees and four contracts with business partners were terminated or not renewed in the same period. The cases fell into the categories of fraud, embezzlement/theft, bribery and antitrust. No lawsuits regarding corruption were brought against our organization or employees. In Argentina, a case of corruption was confirmed and led to the termination of the employee involved after an investigation and evaluation was completed. There were no cases of corruption with business partners and no lawsuits.

GRI 206-1 | Legal actions for anti-competitive behavior, anti-trust, and monopoly practices

None. In 2019/2020, we were acquitted in the administrative proceeding for alleged cartel practices, which was underway in the Administrative Council for Economic Defense (CADE)

GRI 307-1 Non-compliance with environmental laws and regulations²¹

In 2020/2021, infraction notices were issued with significant fines (over R$500,000) totaling R$15.6 million. In the same period, there were also 64 notices of violation that imposed non-monetary sanctions and/or non-significant fines.

The aforementioned notices of violation, which do not represent a materially relevant impact to operations or the environment, are being handled administratively and/or judicially in our regular course of defense, and technical and legal clarifications are being provided to the relevant agencies.

* Amount greater than R$ 500,000.

GRI 308-1 | New suppliers that were screened using environmental criteria²²

100%.

GRI 308-2 Negative environmental impacts in the supply chain and actions taken²³

• Sugarcane suppliers

In 2020/2021, approximately 2,000 producers participated in the ELO Program, through which they received support from the technical team. At the close of the 2019/2020 harvest, 96% of the sugarcane suppliers were included in the ELO Program. No negative social and environmental impacts were identified for these suppliers. More information is available here.

• Carriers

In 2020/2021, 35 fuel carriers were assessed for social and environmental impacts, which included requirements from our Road Transport Manual (MTR - Manual de Transportes Rodoviários), Health, Safety, and Environment (HSE) controls, and legal requirements.

Because it is an activity with high exposure to accidents, all carriers can generate potential negative impacts; however, since their management system is effective, the actual impact is zero. In terms of potential impacts alone, the following can occur: serious accidents, ergonomic problems, and excessive working hours. Nevertheless, we monitor 100% of the carriers to ensure that potential events do not become actual events. In the last two years, only one carrier had its contract terminated, because the approval system filters suppliers whose profile is not suitable to operate in our team.

• Supply chain

The following are considered negative social and environmental impacts: having contracts with companies that employ people under slave or slave-like labor conditions or that do not pay their employees' taxes on time; negotiating with suppliers involved in acts of corruption, suppliers with fiscal irregularities, and those who do not comply with the contractual conditions in terms of delivery time and quality.

Of 2,477 suppliers monitored by the Procurement area, 61 strategic suppliers were identified as having pending issues. These suppliers participated in a performance evaluation (Supplier Qualification Index - IQF), which blocked five companies for not meeting our minimum requirements in terms of delivery time and quality. Additionally, the labor risk management process (GRT) ensures compliance with current labor legislation for each critical supplier monitored. In 2020/2021, four suppliers were identified in the list of ineligible and suspended companies in the National Registry; one supplier was listed as having been declared for legal reorganization; and seven were pending submission of labor documentation. These suppliers have also been blocked from our base.

In the 202/2021 harvest, 202 meetings were held with the strategic suppliers monitored through the IQF, which account for 80% of our purchasing volume. These meetings are about the quality of materials and on-time delivery. The main objective is to improve the performance of this audience. No environmental impacts for the supply chain have been identified.

GRI 414-1 New suppliers that were screened using social criteria²⁴

100%.

GRI 414-2 | Negative social impacts in the supply chain and actions taken²⁵

Same as 308-2.

GRI 415-1 Political contributions

In compliance with our Code of Conduct, we do not make contributions for political parties, donations to election campaigns, or any other form.

GRI 419-1 | Non-compliance with laws and regulations in the social and economic area

We conduct our business in full compliance with the regulations in force, which are reflected in Internal Policies, Protocols, and Management Systems to ensure compliance with the Brazilian Legal System. Should there be any questioning, notices of infractions, or penalties imposed for alleged non-compliance, our Legal Department will assess the measures, together with the other areas, to identify the cause and address the problems based on the legislation in force.

The contingency related to significant fines, notices of infraction, or sanctions drawn up by public agencies, object of administrative or judicial proceedings for alleged non-compliance with tax, civil and labor laws and regulations in the period is duly reported in our Financial Statements (between pages 76 and 83), available here.

SASB RR-BI-120a.2 | Number of incidents of non-compliance with air quality permits, standards, and regulations.²⁶

In the 2020/2021 harvest, four alleged incidents associated with air quality regulations were recorded. The environmental fines, which were submitted to our regular technical and legal defense process, resulted from one-off instabilities in the emissions control system, which were promptly addressed and quickly normalized, with no adverse environmental impacts. We point out that stack emissions are periodically monitored, in accordance with technical and legal parameters.

SASB RR-BI-140a.3 Number of incidents of non-compliance with air quality permits, standards, and regulations.²⁷

In the 2020/2021 harvest, seven alleged incidents associated with water quality regulations, arising from pipeline leaks during the handling and transportation of by-products for sugarcane fertigation, were recorded, with no adverse environmental impact.

The vinasse fertigation operation is regulated by the Vinasse Application Plan (PAV - Plano de Aplicação de Vinhaça), filed with the relevant environmental agency. The operation is monitored and, in the case of any operational occurrence, all containment and structure repair measures are adopted, minimizing financial, agronomic, and environmental impacts. The environmental fines were submitted for technical and legal defense.

SASB FB-AG-140a.3 | Number of incidents of non-compliance with air quality permits, standards, and regulations²⁸

Same as RR-BI-140a.3.

SASB RR-BI-430a.2. Percentage of biofuel production third-party certified to an environmental sustainability standard

50% of our raw material comes from our own sugarcane, on leased land, and 50% from suppliers' sugarcane. Regarding our own sugarcane, we have made a public commitment to adopt the Bonsucro standard. Currently, 22 of our 23 bioenergy plants in operation are certified.

Aiming to share knowledge and good practices with the suppliers responsible for the other 50% of our raw material, we developed the ELO Program. This is a new initiative in the global sugarcane production chain and is intended to promote the continuous improvement of the participants. Currently, the nearly 2,000 sugarcane suppliers assisted by ELO, located in the states of São Paulo, Goiás, Minas Gerais, Paraná, and Mato Grosso do Sul, account for 96% of the volume purchased from third parties. An external inspection of the producers' properties by the Institute for Forest and Agricultural Management and Certification (Imaflora) is one of the stages of the program. This stage includes an analysis of the program's internal management system, as well as the practices adopted by our suppliers (see more here).

In this way, 78% of our production comes from certified sugarcane in the 2020/2021 harvest. Our goal is to continue increasing the number of certified units.

*Certified biofuel volumes refer to estimates according to the volume of certified sugarcane and the production plan for the beginning of the harvest.

SASB FB-AG-430a.1 | Percentage of agricultural products sourced that are certified to a third-party environmental and/or social standard, and percentages by standard²⁹

Same as SASB RR-BI-430a.2.

SASB RR-BI-530a.2 Discussion of corporate positions related to government regulations and/or policy proposals that address environmental and social factors affecting the industry

We are increasingly geared toward balancing economic and social and environmental aspects. This stems not only from our commitment to sustainability, but also from the expectations of society, customers, employees, regulatory agencies, and investors, who more than ever are looking at how companies create value throughout their supply chains.

The priority of this topic in the agenda of the government and of the organized civil society is a reality, imposing risks, such as costs to adapt to new regulations, increased transparency, and granting of state incentives such as subsidies and public funding linked to the fulfillment of environmental requirements. On the other hand, we have a diversified portfolio of renewable products that offer relevant opportunities in view of public policies that reward producers for the positive externalities of biofuels, such as Renovabio.

We manage risks and opportunities by: monitoring the Brazilian federal, state, and municipal political scenario; communicating to the business areas what is being discussed in terms of bills, decrees, ordinances, and resolutions; engaging with strategic stakeholders to generate opportunities for business development in public policies and mitigate decision risks, and contributing to the development and implementation of public policies; preparing documents on our positioning; institutional representation with public and private agencies, institutions, and organizations; monitoring and representation at trade associations, among others.

To perform these activities, we are supported by tools such as a system for capturing and monitoring topics in the executive and legislative branches, and internal thematic committees led by the Government Relations team that involve the business and support areas to define strategies for action regarding government proposals and programs. The topics discussed are handled by a committee that involves the following areas: Sustainability, Health, Safety, and Environment (HSE), and Government Relations.

Innovation, development, and circular economy

Management Approach

GRI 103-1 | Explanation of the material topic and its Boundary

The search for incremental or disruptive innovation is part of the daily routine of our team: do things now, with an eye on the future. This topic addresses issues related to energy efficiency and the maximum use of our raw material and natural resources, as well as investments in new technologies to improve processes, research and development of products and services, anticipation of market trends, and a continuous search for circularity in our supply chain and business.

This topic is material for all businesses.

GRI 103-2 | The management approach and its components

The management approach for this topic is described in the Integrated Ecosystem and Advanced Technologies sections. The components include:

• Sustainability Policy
• Pulse (see more here)
• ReduZa Program (see more here)
• Shell Box (see more here)
• Lean-Agile Center of Excellence (LACE) – see more here
• Advanced analytical solutions (see more here)

This topic is managed by several areas in a multidisciplinary manner; and, directly related to it, we have made the following commitment by 2030³⁰:

• To reduce the carbon footprint of ethanol and sugar by 10%
• Reduce water withdrawal from external sources by 10%
• Increase the GJ/ha indicator by 15% (greater efficiency and more energy from the same area)

GRI 103-3 Evaluation of the management approach

The evaluation of the management approach for this topic is monitored based on the performance of our operations.

Community relations

Management Approach

GRI 103-1 | Explanation of the material topic and its Boundary

Our intention is to enhance socioeconomic development in the areas surrounding our operations by integrating them with our business strategies; to become a reference in positive social impact in the sectors in which we operate by offering meaningful experiences for employees and communities; to drive a supportive network; to mobilize public and private resources in a planned, monitored, and systematic manner; and to promote social transformation and business generation across the value chain. This topic addresses our Social Performance Strategy and the actions taken by the Raízen Foundation for the development of independent children and adolescents, players, and citizens.

GRI 103-2 | The management approach and its components

We have a series of institutionalized policies and procedures in place aimed at the sustainable development of the areas surrounding our operations in a safe, respectful, transparent, and integrated manner, in line with our business strategies, leveraging local talent and empowering people.

• Code of Conduct (see more here)
• Social Performance Policy
• Sustainability Policy
• Ethics Channel, for reporting violations of the Code of Conduct, internal policies and applicable legislation (see more here).
• Customer Service (SAC) and Ombudsman.
• Raízen Foundation (see more here)
• Creando Vínculos (see more here)

In Brazil, the work of our Social Performance team was focused on governance improvements to ensure that this topic is at the core of the strategy and connected to our business ambitions. In Argentina, the External and Governmental Affairs Department has been working on the development of our Social Investment and Sponsorship Policy. The document is expected to be published in the next harvest. See more in the Social performance section of this report.

Directly related to this topic, we have made the following commitment by 2030³¹:

• Have 100% of neighboring communities ³²supported by the Raízen Foundation

GRI 103-3 Evaluation of the management approach

The evaluation of the management approach for this topic is monitored based on the performance of our operations, as determined by the following indicators:

Indicators

GRI 202-1 | Ratios of standard entry level wage by gender compared to local minimum wage

We seek to maintain attractive salary ranges compared with other companies in the market. In 2020/2021, in Brazil, the lowest salary paid to men and women is equivalent, respectively, to 101% and 106.8% of the local minimum wage, which ranges from R$1,111.00 to 1,499.00 depending on the position and location of the employee. The salaries considered were proportional to 220 working hours and included only active employees, excluding those on leave and laid off. In 2019/2020, the lowest salary paid for men and women was equivalent, respectively, to 113.7% and 121.9% of the national minimum wage.

We have policies in place that promote career and salary development for employees based on meritocracy, and we have approved pay floors above the state/national level for several careers through local unions.

The indicator is not yet monitored by Argentina.

GRI 203-1 | Infrastructure investments and services supported

Brazil:

* Includes people benefited directly and indirectly and considers estimates for the calculation of those benefited indirectly
** Projects covering 1.8 million people or more were considered separately, totaling approximately 22 million people benefited.
*** Number impacted by cancellation of events during the pandemic.
**** The Amigo Leal (Loyal Friend) project was restructured and the Volunteer Program was impacted by the pandemic.

* Projects supported by incentive laws: FUMCAD, PRONON, PRONAS, FMI, ROUANET, PROAC, PIE, and ICMS/RJ.
** Education and development projects for early childhood and youth offered to the community free of charge.
*** Company resources for projects focused on education, culture, sports, sector events, and professional development.
**** Matchfunding - Salvando Vidas (Saving Lives).

The investments in maintenance of rural roads, which provide benefits to the communities near our operations, totaled R$46.7 million. These investments ensure that the rural roads are in usable conditions for transporting the harvest and for the surrounding population. Specific projects were conducted such as renovation and construction of bridges, and legalization and improvement of access roads and detours. These projects reduced the flow of heavy vehicles on the highways, improving the safety of road users. These initiatives received R$4.2 million.

We also invested R$26.8 million in fighting and preventing agricultural fires, which includes maintenance and operation of the structure dedicated to this operation (trucks, firefighters, light vehicles, and dedicated personnel) as well as actions to raise awareness among the surrounding populations about prevention and risk of fires.

We also made several donations to fight COVID-19, establishing partnerships with other companies and entities in the sector (learn more here). Our costs exceeded R$1.4 million for general management expenses in the Social Performance area, and R$256,000 in volunteer hours from our employees. 5,710 hours of volunteer work were provided during paid hours.

Argentina:

* Initiative to solve the problem of access to running and drinking water for 200 families neighboring the Refinery.

GRI 203-2 Description of significant indirect economic impacts ³³

We invest in research and technology to develop alternative energy sources and renewable energy mix, which are important for the future and can result in changes to the economy as a whole.

Many of our production units are in municipalities with low population density. This contributes to tax collection, job generation, circulation of goods, and regional economic development.

We support and implement local projects that improve the quality of life in the communities around us, enabling social inclusion, education, access to culture, preservation of natural capital, and social mobilization. We also played a massive role in minimizing the impact of the COVID-19 pandemic, for example by donating 70% alcohol to hospitals. Through social partnerships with educational institutions and public authorities, we offer courses focused on training and professional inclusion, aimed at students, workers, and the community in general in the municipalities close to our operations, strengthening the social and human capital of these locations. In addition, the Raízen Foundation operates through two programs that offer quality education and encourage social-emotional skills: Ativa Infância (Active Childhood) and Ativa Juventude (Active Youth). Ativa Infância is aimed at the full development of early childhood, with full regular education and extracurricular activities, and Ativa Juventude encourages young people to discover their vocations and professional paths, encouraging them to stay in school and engage in lifelong learning.

Finally, the opening or closing of a unit can generate impacts depending on the size of the operation and the economic dependence of the municipality. To mitigate possible risks and impacts, we have developed tools that assess the socioeconomic context of the locations and provide us with data for decision-making.

GRI 204-1 | Proportion of spending on local suppliers

In 2020/2021, approximately R$4 billion was spent on suppliers in Brazil, with 10% of this amount referring to contracts with local suppliers. This indicator considers the supply of equipment, materials, and services used in production and non-production processes.³⁴

Argentina does not manage this indicator.

* To obtain the amount spent on local suppliers, two requirements were followed: the transaction (order) needs to be identified as a Raízen Center and the supplier needs to be identified by a SAP code. Subsequently, the Raízen Center location was identified and included in an IBGE micro-region classification (source: Index of /organizacao_do_territorio/estrutura_territorial/divisao_territorial/2020 (ibge.gov.br)), as well as for supplier locations. When the two micro regions are equal, it is regarded as Local Supplier.
**Other locations: BA, PA, RO, MT, ES, PI, TO, DF, RN, PB, PE, SE, SC.

GRI 411-1 | Rights of indigenous peoples³⁵

In Brazil, there were no cases of violation of rights of indigenous peoples. We maintain our commitment to protect the rights of the indigenous communities living near the production unit located in Caarapó, Mato Grosso do Sul, and we strictly follow our conduct of not acquiring sugarcane from suppliers in areas declared indigenous in the region. This guideline has become part of our Compliance Policy and is now established throughout the operation.

Given the pandemic, we adopted a contingency plan to ensure the preservation of the health and well-being of the team, as well as the safety and continuity of essential operations. Indigenous employees living in villages, which are considered high risk, were removed from their activities with no change in pay for the fixed term of the contract. To ensure food security, given the recommendation not to leave their villages, they were also supported with donations of baskets of staple products. All indigenous employees living in the villages were tested before they left and received a kit containing a mask, liquid soap, hand sanitizer, and a pamphlet with instructions in their native language (Guarani). We also have Medical Center with assistance in their native language (Guarani) and an indigenous nurse dedicated to them. We also support the Special Department for Indigenous Health (SESAI) with vaccination against H1N1 and we support the municipality with donations of beds and mattresses in order to set up an isolation area in the case of contamination. At the beginning of 2021, after administering the two doses of the COVID-19 vaccine and the period recommended by the Ministry of Health, they were rehired to work in our operations. To protect them, despite the vaccination, we have chosen to maintain health and safety protocols.

GRI 413-1 | Operations with local community engagement, impact assessments, and development programs

During the 202/2021 harvest, we implemented stakeholder engagement programs in 41% of our facilities in Brazil and 60% in Argentina, in addition to impact assessments and local development programs, respectively, in 80% and 61% of the locations.³⁶

*We do not report the percentage of operations that conduct environmental impact assessments and continuous monitoring; public disclosure of results of environmental and social impact assessments; comprehensive local community consultation committees and processes that include vulnerable groups; company councils, occupational health and safety committees and other workers' representation bodies to manage impacts; and that have formal processes for grievances from the local community because the internal management does not consider these breakdowns, but rather the information provided in the indicator. Data for harvests prior to 2020/2021 do not include Argentina.
** For airport bases, we do not consider third-party operations.

* For airport bases, we do not consider third-party operations. Data for harvests prior to 2020/2021 do not include Argentina.

Specifically in Argentina, we identified the most relevant social organizations in each of the locations of our operations, mainly in our refinery, which is located across from a large cluster of families in vulnerable conditions (see more here). Similarly, we perform regular monitoring to identify the main concerns and demands of local communities. To this end, communication channels are available via telephone (0810-999-7435), WhatsApp groups, and face-to-face meetings.

GRI 413-2 Operations with significant actual and potential negative impacts on local communities

In Brazil, we map the social and environmental aspects and impacts of the business, conduct analyses of direct and indirect risks to communities, and monitor them through the Plan for Mitigating Negative Impacts on Communities, which takes into account, among other tools, the application of the Risk Factor Matrix, the dissemination of direct communication channels, such as Customer Service (SAC), and the implementation of awareness and prevention campaigns.

In applying the Risk Factor Matrix, we consider factors such as the probability and consequence of the identified impacts; those classified as potentially significant require an action plan for control. All production units, terminals, and airport bases present risks of actual or potentially negative social impacts.

• Production units
  • Actual: spraying, dust, noise, waste, and effluents
  • Potential: Blasts, fires, and hibernations
• Distribution terminals
  • Actual: dust, noise, and traffic
  • Potential: Blasts, fires, and spills
• Airport bases
  • Actual: dust, noise, and traffic
  • Potential: Blasts, fires, and spills

In the 2020/2021 harvest, we developed a hibernation tool, whose application allows us to predict socioeconomic effects arising from potential hibernation in a given location, enabling early action and minimizing risks and impacts.

To prevent fires, during the period we launched a pilot project for a direct communication channel so that any person (employee or otherwise) can alert us to the occurrence of fire outbreaks close to our operations. Institutionally, we established a multidisciplinary committee to ensure the management of this topic, which is of great concern to us, since it exposes workers and the environment to risky situations, in addition to damaging the environment and the production chain as a whole. We monitor our sugarcane fields every day to prevent and fight any fires of unknown or accidental origin. We invest in environmental education and the sustainable development of the cities where we operate, raising awareness about forms of prevention and alerting the surrounding communities to the risks of fire. For more information, go to the Safety section of this report.

In relation to spills, we monitor any events in contained and uncontained areas, regardless of their significance. Significant events are those exceeding 100 liters in contained areas and any volume in uncontained areas. All events are recorded, their causes are investigated, and actions are planned to mitigate impacts and prevent recurrences. More information is provided in disclosure 203-1 of this report.

In Argentina, the actual and potential negative social impacts are mainly associated with the refinery. There are also impacts from fuel transfer and distribution and, to a lesser extent, at land terminals and airports, the lubricant plant, and service stations.

Operations are located in Avellaneda in the Province of Buenos Aires, Santa Fe, and Arroyo Seco (Province of Santa Fe), Puerto Vilelas (Province of Chaco), Barracas (Autonomous City of Buenos Aires), and at the airports Ezeiza (Province of Buenos Aires) and Metropolitano Airport (Autonomous City of Buenos Aires).

The potential impacts identified are:

• Air quality and odors.
• Soil and water contamination.
• Hydrocarbons in effluents discharged into the river.
• Risk of product spill (on land or water).
• Blasts and fires as a result of handling highly flammable products.
• Circulation of trucks and large vehicles near urban settlements.

Human rights, diversity, and inclusion

Management Approach

GRI 103-1 | Explanation of the material topic and its Boundary

We aspire to mobilize our value chain in eliminating the risks of human rights violations and in promoting equality and respect for individuality. This topic covers the mitigation of risks related to harassment, discrimination, and slave, degrading, or child labor—both on and off our team. It also includes matters related to union and individual freedoms.

This topic is material for our businesses.

GRI 103-2 | The management approach and its components

We have a number of institutionalized policies and procedures in place to ensure human rights are respected throughout the production chain and in the surroundings of our operations:

• Code of Conduct (see more here)
• Anti-Corruption Policy
• Social Performance Policy
• Sustainability Policy
• Ethics Channel, for reporting violations of the Code of Conduct, internal policies and applicable legislation (see more here).
• Procedures for selection, qualification and re-qualification of suppliers of equipment, materials, and services
• Certifications such as Bonsucro and International Sustainability and Carbon Certification (ISCC) - see more here.
• Assessment of sugarcane suppliers under the ELO Program and inspections of contract carriers (see more here).
• Diversity and Inclusion Committee and equity practices in people management

Directly related to this topic, we have made the following commitment by 2030³⁷:

• Guarantee internationally recognized sustainability programs for sugarcane sources
• Make progress with respect to human rights in our operations and in our supply chain
• Have 30% of women in leadership positions, above management level, by 2025

GRI 103-3 Evaluation of the management approach

The evaluation of the management approach for this topic is monitored based on the performance of our operations, as determined by the following indicators:

Indicators

GRI 401-3 | Parental Leave

The following strategic actions are being discussed to promote an inclusive culture and a differentiated experience with multiple teams: Equitable development and management of people; Alerting about unconscious biases in the people management cycle; Active spaces and channels of speech; Humanized environments; Stimulation for intersectional journey; Targeted mentoring.

*Starting in 2019, Raízen began reporting this indicator according to GRI's premise, which recommends considering all professionals covered by the organization's policies, agreements or contracts that include leave. Data for harvests prior to 2020/2021 do not include Argentina.
**27 employees have temporary contracts and therefore are not included in the total number of this indicator.

More information is provided in the Diversity and inclusion section of this report.

GRI 405-1 Diversity of governance bodies and employees

Brazil:

* As of the 2020/2021 harvest, there was a change in the data calculation methodology, and all employees classified as Production were classified under the Operation and Administration categories.

* As of the 2020/2021 harvest, there was a change in the data calculation methodology, and all employees classified as Production were classified under the Operation and Administration categories.

* Data on PwD began to be collected in the 2020/2021 harvest.

Argentina:

Until the 2020/2021 harvest, Argentina did not monitor employees in other diversity categories.

* Some categories do not apply (n/a) because we do not have employees in these categories in Argentina.

GRI 406-1 | Incidents of discrimination and corrective actions taken

In Brazil, 36 reports of discrimination were received in 2020/2021, 10 of which through the Ethics Channel and 26 resulting from labor claims received by the Legal area. The cases were investigated by the corresponding areas and, if confirmed, administrative measures were taken, such as verbal and written reprimand or even termination of the employee for cause. A lawsuit, filed in 2017, is still in the collation of facts phase pending a decision. However, no evidence of discriminatory dismissal was found in the information collected for preparing the defense.

In Argentina, a case of discrimination was identified in the same period; it was investigated and deemed unfounded.

GRI 407-1 Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk³⁸

None. Our managers are informed of the union's role, the dynamics of collective bargaining, and current labor legislation.

GRI 408-1 | Operations and suppliers at significant risk for incidents of child labor ³⁹

There is no significant risk of child labor in the supply chain. This risk is managed through technical follow-up, visits to suppliers, among other actions. These follow-ups are conducted as part of the ELO Program, which is described in the Value Partnerships section of this report.

Since 2018, we have been signatories to the Business Pact Against Sexual Exploitation of Children and Adolescents on Brazilian Highways, proposed by Childhood Brasil and the Ethos Institute. The main objective of the pact is to preserve childhood and youth through a comprehensive joint effort to end this serious violation of human rights. We have internal and external actions in place, engaging our value chain.

GRI 409-1 | Operations and suppliers at significant risk for incidents of forced or compulsory labor⁴⁰

Same as 408-1.

GRI 412-1 Operations that have been subject to human rights reviews or impact assessments

Our operations, in Brazil or Argentina, are 100% covered by the Ethics Channel, while 17% (or 34 locations) have been assessed for risks related to human rights.

GRI 412-2 | Employee training on human rights policies or procedures

In the 2020/2021 harvest, in Brazil, we provided almost 8,170 hours of Human Rights training to 5,415 employees, which accounts for 18.7% of trained employees.

Economic-financial performance and business expansion

Management Approach

GRI 103-1 | Explanation of the material topic and its Boundary

This covers excellence in economic and financial management, business expansion strategy, and discipline in capital allocation, combined with the implementation of ESG criteria in the decision-making process.

GRI 103-2 | The management approach and its components

All areas are dedicated to achieving results regarding this topic. Our robust corporate governance structure stands out for defining and clearly communicating the strategic objectives and goals for the business (see more here). The expansion strategy is described in the Integrated ecosystem section of this report. This topic also includes our performance in relation to risk and opportunity management, presented here.

No commitments are directly associated, since this is a cross-cutting topic that guides the execution of the others; we have always treated the EESG concept, with the addition of Economics, as our fourth sustainability pillar and value creation mechanism for the future.

GRI 103-3 Evaluation of the management approach

The evaluation of the management approach for this topic is monitored based on the performance of our operations, as determined by the following indicators:

Indicators

GRI 201-1 Direct economic value generated and distributed

RAÍZEN ENERGIA

The reported amounts are in R$ 1,000, according to Financial Statements disclosed to the market and filed with the Brazilian Securities and Exchange Commission (CVM - Comissão de Valores Mobiliários).

RAÍZEN COMBUSTÍVEIS

Since there was a change in how the information was reported in the 2017/2018 harvest, we did not include data referring to previous harvests. To consult these data, visit: raizen.com.br/sustentabilidade/transparencia/relatorio-anual

OTHER INDICATORS

The following indicators are not material, but we disclose them because they are strategic:

GRI 404-1| Average hours of training per year per employee

* The indicator has no track record because it started to be reported in the 2020/2021 harvest, when it was considered strategic. Some of the categories do not apply (n/a) because we do not have employees in those categories or do not monitor data for those categories.
**This includes the training hours for the 33 interns, which are not included in indicator 102-8.

GRI 404-2 Programs for upgrading employee skills and transition assistance programs

Disclosure in the Capacity building and development section of this report.

GRI 404-3 Percentage of employees receiving regular performance and career development reviews by employment category and gender

*Regular performance and professional development assessments in Argentina apply exclusively to those who are included in the annual people management cycle. Therefore, it does not include trainees, and for contract staff, it does not include the operational category. Therefore, only employees eligible for this type of review were considered, since employees considered "Within Agreement" are governed by the Collective Agreement or Collective Bargaining Agreement, in which the rules to be followed are established for each Union Organization. The Collective Bargaining Agreement that governs the activity in Argentina does not state that a performance evaluation must be performed as we do with the staff Outside the Agreement. For this reason, the methods for performance evaluation, establishing remuneration, etc. differ from one group of employees to another.

Activity metrics, by sector:

Biofuels:

SASB RR-BI-000.A. Biofuel production capacity

SASB RR-BI-000.B. Production of: (1) renewable fuel, (2) advanced biofuel, (3) biomass-based diesel, and (4) cellulosic biofuel.

* Considers total ethanol produced (considering 1GE and 2GE).

SASB RR-BI-000.C. Amount of feedstock consumed in production

Midstream:

SASB EM-MD-000.A.| Total metric ton-kilometers of natural gas, crude oil, and refined petroleum products transported, by mode of transport

*We do not transport natural gas.

Agricultural Products:

FB-AG-000.A. Production by principal crop

FB-AG-000.B. Number of processing facilities

FB-AG-000.C. Total land area under active production

1 Data on gender is compiled by Human Resources, which uses data taken from SAP as a basis.

2 The US Dollar to Real conversion rate, used for all conversions, was the rate at the end of the 2020/2021 harvest (R$5.37).

3 The baseline for the commitment is the 2018/2019 harvest.

4 Biofuels sector indicator. Does not include Argentina.

5 Product life cycle analysis is performed only for Brazil.

6 Agricultural Products sector indicator. Does not include Argentina.

7 Agricultural Products sector indicator. Does not include Argentina.

8 The baseline for the commitments is the 2018/2019 harvest.

9 This indicator does not include data on operations in Argentina.

10 This indicator does not include data on operations in Argentina.

11 This indicator is not reported by Argentina because it is considered material mainly in agricultural operations.

12 This indicator is not reported by Argentina because it is considered material mainly in agricultural operations.

13 This indicator is not reported by Argentina because it is considered material mainly in agricultural operations.

14 This indicator is not reported by Argentina because it is considered material mainly in agricultural operations.

15 Midstream sector indicator(distribution). Does not include Argentina.

16 Biofuels sector indicator. Does not include Argentina.

17 Biofuels sector indicator. Does not include Argentina.

18 Biofuels sector indicator. Does not include Argentina.

19 Biofuels sector indicator. Does not include Argentina.

20 The baseline for the commitments is the 2018/2019 harvest.

21 This indicator does not include data on operations in Argentina.

22 This indicator is not reported by Argentina. It will be reported in the next cycle.

23 This indicator is not reported by Argentina. It will be reported in the next cycle.

24 This indicator is not reported by Argentina. It will be reported in the next cycle.

25 This indicator is not reported by Argentina. It will be reported in the next cycle.

26 Biofuels sector indicator. Does not include Argentina.

27 Biofuels sector indicator. Does not include Argentina.

28 Biofuels sector indicator. Does not include Argentina.

29 Biofuels sector indicator. Does not include Argentina.

30 The baseline for the commitments is the 2018/2019 harvest.

31 The baseline for the commitment is the 2018/2019 harvest.

32 Commitment applicable to neighboring communities capable of receiving the model.

33 This indicator is not reported by Argentina. It will be reported in the next cycle.

34 To obtain the amount spent on local suppliers, two requirements were followed: the transaction (order) needs to be identified as a Raízen Center and the supplier needs to be identified by a SAP code. Subsequently, the Raízen Center location was identified and included in an IBGE micro-region classification (source: Index of /organizacao_do_territorio/estrutura_territorial/divisao_territorial/2020 (ibge.gov.br)), as well as for supplier locations. When the two micro-regions are equal, it is regarded as Local Supplier.

35 This indicator does not include data on operations in Argentina.

36 These programs mobilize financial resources and contribute to increasing employability around our facilities.

37 The baseline for the commitments is the 2018/2019 harvest.

38 This indicator is not reported by Argentina because it is considered material mainly in the agricultural suppliers' operations.

39 This indicator is not reported by Argentina because it is considered material mainly in the agricultural suppliers' operations.

40 This indicator is not reported by Argentina because it is considered material mainly in the agricultural suppliers' operations.