COMMITTED
TO THE
FUTURE
INTEGRATED
ANNUAL
REPORT
2016
Financial Report
Sustainability Report
2
STATEMENT OF RESPONSIBILITY
“This document contains true and sufficient information on the operations of Graña y Montero S.A.A.
during the year 2016. Notwithstanding the responsibility of the issuer, the undersigned assume
responsibility for the contents here of in accordance with applicable laws”.
LUIS DIAZ OLIVERO
Chief Executive Officer
JULIA CABRERA CALLE
Corporate General Accountant
Lima, May 2018
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future CONTENT
WHAT
WE DO IT
MESSAGE
FROM SENIOR
MANAGEMENT
4
HOW
WE DO IT
WHY
WE DO IT
OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero
key figures
- Corporate
governance
6
7
8
9
16
3
GRAÑA Y MONTERO GROUP
83 YEAR HISTORY
BUSINESS AREAS
- Engineering and Construction
- Infrastructure
- Real Estate
- Services
SUSTAINABILITY STRATEGY
- Ethics
- People development
- Operational excellence
- Safety
- Environment
- Communication
- Well-being of society
APPENDIX
- Report of projects delivered
before the deadline
- Compliance of corporate
governance principles
- Sustainability report (SMV)
- GRI content index
25
44
53
63
69
66
69
75
88
95
102
112
119
137
25
66
140
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future
MESSAGE FROM
SENIOR MANAGEMENT
4
MESSAGE FROM
SENIOR MANAGEMENT
To the Shareholders of Graña & Montero,
We, the signatories herein, take responsibility for the leadership of the Graña & Montero Group
during 2017, during a context in which the Company undertook one of the most challenging
years of its history, arising from the partnership with Brazilian company Odebrecht. On a second
front, the Company’s resilience was tested by the uncertain financial scenario resulting from
of the cancellation of the Gasoducto Sur Peruano project.
In consequence of the aforementioned events, which were made public during 2016, year
covered by this Annual Report, we have gone through a complex and difficult series of events
which have led the Company to overhaul its corporate procedures and begin a strengthening
and transformation process looking towards the future.
In this context, this Annual Report for 2016 was not able to be filed in time, and today, with
its filing, we have fulfilled a major milestone promised to you, our shareholder, and other
interested parties.
We would now like to share a summary of financial facts from our different business areas
during the 2016 fiscal year.
Graña & Montero had a backlog for 2016 of USD 3,137 million. And annual sales reached
USD 1,925 million.
Our different business areas were awarded important contracts:
The Construction and Engineering area was awarded works for the Talara Refinery and
the Toquepala Mine Extension, two of the major projects in the Hydrocarbons and Mining
sector of the Peruvian economy. In Colombia, our Construction and Engineering area
was awarded the Guajira Transmission Line project; and a construction project focused
on improving the Colombian education infrastructure by building 60 schools, which
extended Morelco´s, our Colombian subsidiary, scope and backlog.
The Infrastructure area is working on the addition of 20 trains for the LÍNEA 1 del Metro
de Lima, massive public transport solution, in order to improve the service offered and
meet the growing demand.
The Real Estate area, led by our subsidiary Viva GyM, was named by the Peruvian
Government´s Fondo Mi Vivienda as the leading broker of socially relevant homes,
highlighting the Los Parques de Comas project as the year´s featured project.
The Services area, through our subsidiary CONCAR, was awarded two major contracts
for the maintenance of highway roads extending 778 kilometers.
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future
MESSAGE FROM
SENIOR MANAGEMENT
5
MESSAGE FROM
SENIOR MANAGEMENT
This administration was characterized by an outstanding social and environmental
performance, in line with our commitment to all of you and following United Nations Global
Compact guidelines, which is shown in our sustainable management.
We would like to conclude this letter by reassuring all of you that we will continue our
corporate strengthening process to achieve our goal of being the leading reference in Risk
Management and Compliance in the region. We will seek to be named as a Company
committed to the improvement of Peru. We are committed to our shareholders.
Sincerely,
- Augusto Baertl -
Chairman of the Board
- Rafael Venegas -
Independent Director
- Alfonso de Orbegoso -
Independent Director
- Pedro Pablo Errazuriz -
Independent Director
- Jose Antonio Rosas -
Independent Director
- Manuel Del Rio -
Independent Director
- Alfonso Garcia Miro -
External Director
- Roberto Abusada Salah -
External Director
- Carlos Montero -
External Director
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future 6
OUR
VALUE
PROPOSITION
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
7
VALUE PROPOSITION
DIVERSIFICATION
What started as a construction
company, today has become a
group of companies divided in
business lines. Each business
line gathers together companies
with similar operations and
management systems. This
solution allows us to build the
capacities and strengthen the
skills of the different areas and
to boost the group’s internal
synergies. (G4-17)
* Organizational chart of Graña
y Montero Group updated
to december 2016.
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
8
REGIONALIZATION
STRATEGIC
PARTNER
FOR PROJECT
DEVELOPMENT
in the region.
Mexico
WE HAVE
DEVELOPED
PROJECTS IN 13
COUNTRIES OF
LATIN AMERICA
we have offices
installed in Peru,
Chile and Colombia.
Costa Rica
Panama
Colombia
Ecuador
Peru
Chile
Dominican
Republic
Jamaica
Venezuela
Guyana
Bolivia
Argentina
Engineering & Construction
Infrastructura
Real State
Services
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
9
2014
2014
2015
2015
2016
2016
S/. Thousands
US$ Thousands
S/. Thousands
US$ Thousands
S/. Thousands
US$ Thousands
7,008,680
2,344,824
7,815,495
2,289,919
6,469,606
951,569
507,429
299,744
911,851
11,254,921
1,733,630
12,988,551
318,357
169,765
100,282
305,069
3,765,447
580,003
4,345,450
6,819
649,974
154,616
7,096
732,355
13,781,034
1,529,834
15,310,868
190,441
45,302
2,079
214,578
4,037,807
448,237
4,486,044
4,809
603,419
-563,404
-509,699
41,823
10,541,583
2,327,822
12,869,405
1,925,478
179,589
-167,680
-151,696
12,447
3,137,376
692,804
3,830,180
5,611
KEY FIGURES
Sales
Gross Profit
Profit before Taxes
Net Profit
EBITDA
Backlog
Recurring business
Backlog and recurring business
Professionals
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
10
Sales by business line
2014
2014
2015
2015
2016
2016
Engineering and Construction
Infrastructure
Real Estate
Services
GMH and Eliminations
TOTAL
S/. Thousands
US$ Thousands
S/. Thousands
US$ Thousands
S/. Thousands
US$ Thousands
5,035,674
884,766
224,560
1,208,168
-344,488
1,684,735
296,007
75,129
404,205
-115,252
7,008,680
2,344,824
5,829,441
1,018,292
215,764
1,151,621
-399,623
7,815,495
1,708,011
298,357
63,218
337,422
-117,089
2,289,919
4,159,539
912,094
411,518
1,401,781.43
-415,327
6,469,606
1,237,958
271,457
122,476
417,197
-123,609
1,925,478
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the futureKEY FIGURES OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
11
Ventas (Millones US$)
Sales (US$ Millions)
$2,345
$2,290
$2,051
$2,134
$1,573
2.8%
CAGR
$1,925
Backlog (Millones US$)
Backlog (US$ Millions)
$4,170
$3,935
$3,765
$4,038
$2,494
4.7%
CAGR
$3,137
2011
2012
2013
2014
2015
2016
2011
2012
2013
2014
2015
2016
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the futureKEY FIGURES OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
12
Sales by business line (US$ Millions)
EBITDA by business line (US$ Millions)
Net Profit by business line (US$ Millions)
$417
20%
$35
18%
$122
6%
$271
13%
Sales by
business line
Engineering
and Construction
Infrastructure
Real Estate
Services
GMH
TOTAL
$50
25%
$1,238
61%
S/. Millions
US$ Millions
EBITDA by
business line
Engineering
and Construction
Infrastructure
Real Estate
Services
1,238
271
122
417
-124
GMH
1,925.5
TOTAL
4,160
912
412
1,402
-415
6,470
$4
5%
$23
29%
$32
16%
$81
41%
$-28
-35%
$25
31%
S/. Millions
US$ Millions
106
272
167
117
-620
42
32
81
50
35
-185
12.4
Net Profit
by business line
Engineering
and Construction
Infrastructure
Real Estate
Services
GMH
TOTAL
S/. Millions
US$ Millions
-93
84
77
15
-592
-510
-28
25
23
4
-176
-151.7
Engineering and Construction
Real Estate
Infrastructure
Services
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the futureKEY FIGURES OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
13
VALUE
CREATION
Distributed economic value
Through our businesses, we seek to generate economic, social
and environmental value. Therefore, not only do we develop the best
engineering and infrastructure solutions, but we also seek to go beyond
business by promoting the growth of our different stakeholders.
Regarding economic value, in 2016 Graña y Montero Group generated
income for an amount of US$ 1,925 million. 61% of this income was
distributed among suppliers of goods and services, and this contributed to
stimulate the economy, especially in the different local communities where
we operate. 18% was intended for the payment of personnel (employees
and laborers), financing over 28 thousand positions throughout
the year. Lastly, 10% was allocated to the State through tax contributions,
and 11% was reinvested.
11%
Reinvestment
(Capex)
10%
State
(taxes)
61%
Suppliers
TOTAL:
US$ 1,925
MILLION*
18%
Collaborators
(salaries, bonds and profits)
*Sales plus sales taxes
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
14
VALUE
DISTRIBUTION
CONTRIBUTION TO SUSTAINABLE
DEVELOPMENT OBJECTIVES
At Graña y Montero, though we contribute in a cross-cutting
manner to Sustainable Development Goals, we consider
our management efforts focus especially on the following
four areas:
Likewise, our actions and the development of our operations
under a sustainable approach allows us to contribute
positively to the development of the Objectives of Sustainable
Development, as are SDGs 6, 12, 13 and 16. Throughout the
document, we will show references to specific contributions
in each of these topics.
4 Quality education / 8 Decent work and economic growth / 9 Industry,
innovation and infrastructure / 11 Sustainable cities and communities
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future KEY
FIGURES
From the social and environmental standpoint, we deploy
significant efforts to improve people’s quality of life and
generate well-being with our operations and projects. Some
of our main actions focus on skill building inside and outside
the organization, safety, design of efficient environmental
solutions, operational excellence, among other topics
that will be addressed throughout this document.
This comprehensive view allows us to build a better future
and leave upcoming generations a legacy that has made
us feel proud of for 83 years.
OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
15
184
THOUSAND
HOURS
of training to
clients, suppliers,
and communities
100%
LOCALLY
HIRED
unskilled
manpower
419
THOUSAND
MAN-HOURS
of personnel
training
0
SOCIAL
CONFLICTS
with formal
trade unions
9
YEARS
in the Good
Corporate
Governance
Index of the Lima
Stock Exchange
67
MILLION
m3 of treated
wastewater thanks
to PTAR La Chira.
US$88
MILLION
dollars in
local purchases
0.40
ACCIDENTS
for every
200,000
work hours
44
THOUSAND
tons of CO2 were
avoided thanks to
Lima Metro Line 1
Network
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future
OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
16
BOARD OF DIRECTORS IN 2016 *
01. JOSÉ GRAÑA MIRÓ QUESADA Chairman of the Board - External Director
02. CARLOS MONTERO GRAÑA Vicepresident, External Directoro
03. PEDRO PABLO ERRÁZURIZ DOMÍNGUEZ Independent External Director
04. MARK HOFFMAN ROSAS Independent External Director
05. FEDERICO CÚNEO DE LA PIEDRA Independent External Director
06. MARIO ALVARADO PFLUCKER Internal Director, CEO
07. HERNANDO GRAÑA ACUÑA Internal Director
08. HUGO SANTA MARÍA GUZMÁN Independent External Director
*The Board of Directors was renewed on March 31, 2017.
CORPORATE
GOVERNANCE
During 2016, we approved some modifications to the Rules
of the Board of Directors to stay in line with the best market
practices regarding corporate governance, specifically including
an option for the Board to carry out a self-evaluation or
appoint third parties to assess them. A valuation criterion was
expressly embedded to be used for transactions between the
company and its subsidiaries, and the name of the Committee
of Human Management and Social Responsibility was changed
to Committee of Human Management and Sustainability,
aligning it to the Policy of Sustainability, which was approved
by the Board of Directors in January 2016.
Another improvement of our management was the
implementation of a more active intervention of independent
directors in the Strategic Plan, not only for the parent company
but also for its subsidiaries. Thus, independent directors in
the Operative Committees of the business departments where
they participate listened to the strategic plans of the subsidiary
companies directly from their general managers. Similarly, in
the Graña y Montero Board of Directors, the managers of the
Business department presented their strategic plans, following
the same methodology.
Finally we participated actively in the Companies Circle meeting
that took place in Sao Paulo, Brazil, where we invited one of
our independent directors who had the chance to share and
exchange best practices of corporate governance with directors
of other participant companies from Colombia, Costa Rica,
Brazil and Peru.
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future
17
BOARD COMMITTEES AND OPERATIVE BOARD COMMITTEES IN 2016 *
AUDITING AND PROCESSING COMMITTEE
ENGINEERING AND CONSTRUCTION COMMITTEE
REAL ESTATE COMMITTEE
- Mario Alvarado Pflucker, presidente
- José Graña Miró Quesada,
- Hugo Santa María Guzmán
- Hernando Graña Acuña
- Carlos Montero Graña
The committee held twelve
meetings during 2016.
INFRASTRUCTURE COMMITTEE
- Mario Alvarado Pflucker, presidente
- José Graña Miró Quesada
- Hugo Santa María Guzmán
- Hernando Graña Acuña
- Pedro Pablo Errázuriz Domínguez
The committee held twelve
meetings during 2016.
- Mario Alvarado Pflucker, presidente
- José Graña Miró Quesada
- Mark Hoffmann Rosas
The committee held twelve
meetings during 2016.
SERVICES COMMITTEE
- Mario Alvarado Pflucker, presidente
- José Graña Miró Quesada
- Carlos Montero Graña
- Federico Cúneo de la Piedra
The committee held twelve
meetings during 2016.
- Federico Cúneo de la Piedra,
presidente y experto financiero
- Hugo Santa María Guzmán
- Mark Hoffmann Rosas
The committee held five
meetings during 2016.
HUMAN MANAGEMENT AND SOCIAL
RESPONSIBILITY COMMITTEE
- Pedro Pablo Errazuriz Domínguez, presidente
- Federico Cúneo de la Piedra
- Mark Hoffmann Rosas
The committee held four
meetings during 2016.
INVESTMENTS AND RISKS COMMITTEE
- José Graña Miró Quesada, presidente
- Hugo Santa María Guzmán
- Pedro Pablo Errázuriz Domínguez
The committee held three
meetings during 2016.
*The Board of Directors was renewed on March 31, 2017.
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future 18
THE
EXECUTIVE
COMMISSION
HELD ELEVEN
MEETINGS
IN 2016
EXECUTIVE COMMISSION IN 2016 *
The Executive Commission,
responsible for coordinating
the Group was made up by
the following persons:
MARIO ALVARADO PFLUCKER
Chief Executive Officer –
Chairman of the Executive Commission
LUIS DÍAZ OLIVERO **
Chief Operating Officer
GONZALO FERRARO REY
Chairman of the Infrastructure
business line
JUAN MANUEL LAMBARRI HIERRO
Engineering and Construction
business line Officer
ANTONIO CUETO SACO
MÓNICA MILOSLAVICH HART
Chief Financial Officer
ANTONIO RODRÍGUEZ CANALES
Chief Commercial Officer
JORGE LUIS IZQUIERDO RAMÍREZ
Chief Human Resources
Management Officer
Infrastructure business line Officer
CLAUDIA DRAGO MORANTE
Chief Legal and CorporateAffairs Officer
ROLANDO PONCE VERGARA
Real Estate business line Officer
JAIME DASSO BOTTO
Services business line Officer
* Since March 2017, the Executive Committee
renewed its members, counting, as of May
2018, with a new team.
** Luis Diaz Olivero assumed general
corporate management in February 2017.
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future 19
CONTACT WITH
122 INVESTORS
DURING 2016
INVESTOR
RELATIONS
During 2016, we participated in six international conferences
in Chile, Buenos Aires, United States, London and Lima.
We also contacted 122 investors through visits, calls,
conferences and non-deal roadshows. In addition, in May
2016, a non-deal roadshow was put together in Boston
and New York, where we visited 15 institutional investors.
WE PARTICIPATED
IN SIX
INTERNATIONAL
CONFERENCES
in Santiago,
New York, Miami,
Buenos Aires,
London and Lima
BOARD OF DIRECTORS’ SELF EVALUATION
In 2016 we carried out the Board's Self-evaluation process.
As a result, we received suggestions from the directors, opening
direct communication channels in order to share information in
real time, extending Board meetings in order to have more space
for strategic discussions, as well as implementing improvements
to the strategy definition process of the Group, increasing
the space for the participation of independent directors,
and seeking to improve the relationship between the general
managers of the subsidiary companies and the directors
of the Group.
This process was repeated throughout the main subsidiaries
of the Group.
A NON-DEAL
ROADSHOW IN THE
UNITED STATES
to visit
institutional
investors
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
20
FAMILY
RELATIONSHIPS
MAIN
SHAREHOLDERS
Mr. Jose Graña Miró Quesada, who was Chairman of the Board until February 2017, is related
within the first degree of consanguinity with Maria Teresa Graña Canepa, shareholder of the
company and director of our subsidiaries GyM, Viva GyM, GMD, GyM Ferrovías and GMI; and
within the third degree of consanguinity with Miss Yamile Brahim Graña, shareholder of the
company; and he is related within the fourth degree of consanguinity with the ex director and
shareholder Hernando Graña Acuña who was Chairman of the Boards of our subsidiaries GyM
and STRACON GyM, and who is also director of our subsidiaries Vial y Vives-DSD S.A. and
Morelco.
COMPANY NAME
Graña y Montero S.A.A. is a Company established by public deed on August 12, 1996, as a result
of a spin-off process of Inversiones Graña y Montero S.A., and was registered in the 131617
Record and registered under electronic entry 11028652 of the Registry of Companies of Lima.
EQUITY CAPITAL
The Company’s equity capital by December 31, 2016 amounts to S/. 660,053,790.00,
represented by 660,053,790 shares with a par value of S/.1.00 each.
As of December 31, 2016 we have 2,000 shareholders, out of which approximately 99.40%
own less than 1% of the equity capital and close to 0.45% hold between 1 and 5%. Our main
shareholders are JP Morgan Chase Bank NA, as the depository and representing all the ADS
holders, GH Holding Group, represented by Jose Graña Miró Quesada, Chairman of the
Board until February 2017; and Bethel Enterprises Inc., represented by Carlos Montero Graña,
Vice-president of the Board of Directors until February 2017.
LIST OF MAIN SHAREHOLDERS
AS OF 31.12.16
FIRST AND LAST NAMES
JP Morgan Chase Bank NS as depository
and representing ADS holders
GH Holding Group
Bethel Enterprises Inc.
AFP Integra (ING Group)
Profuturo AFP (Grupo Scotiabank
Subtotal
Other shareholders
Total
NUMBER OF
SHARES
265,185,035
117,538,203
33,785,285
38,394,976
36,968,166
491,871,665
168,182,125
STOCK
COUNTRY
40.18%
United States
Panama
Panama
Peru
Peru
17.81%
5.12%
5.82%
5.60%
74.52%
25.48%
660,053,790
100.00%
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
21
STOCK
VALUE EVOLUTION
The price of one share at the year end closing amounted to S/. 4.70. The volume negotiated during
the year reached S/. 320,616,237.06. Finally, the S&P BVL Peru General Index showed an increase
of 58.06%, with respect to the year 2015, and, similarly, the S&P BVL Peru Select Index increased
by 64.01%, compared to 2015. It should be noted that the volatility in the GRAMONC1 share rose
by 138.58% compared to the price at the 2015 year-end closing (including the effect of the issuance
of stock dividends).
2016 PRICES
ISIN CODE
MNEMONIC
YEAR-
MONTH
OPENING
S/.
CLOSING
S/.
MAXIMUM
S/.
MINIMUM
S/.
AVERAGE
PRICE
S/.
PEP736351005
GRAMONC1
2016-1
1.97
1.60
1.97
1.60
1.73
PEP736351005
GRAMONC1
2016-2
1.60
2.60
3.00
1.60
2.51
PEP736351005
GRAMONC1
2016-3
2.60
2.75
2.85
2.48
2.70
PEP736351005
GRAMONC1
2016-4
2.75
4.58
4.95
2.70
3.90
PEP736351005
GRAMONC1
2016-5
4.57
4.25
4.65
4.25
4.41
PEP736351005
GRAMONC1
2016-6
4.25
4.64
5.00
4.35
4.59
PEP736351005
GRAMONC1
2016-7
4.66
5.23
5.23
4.64
4.91
PEP736351005
GRAMONC1
2016-8
5.20
5.60
5.82
5.25
5.58
PEP736351005
GRAMONC1
2016-9
5.60
5.56
5.90
5.45
5.70
PEP736381005
GRAMONC1
2016-10
5.61
5.65
5.84
5.62
5.76
PEP736381005
GRAMONC1
2016-11
5.65
4.35
5.83
4.35
5.21
PEP736351005
GRAMONC1
2016-12
4.35
4.70
5.18
4.43
4.67
25,000
20,000
15,000
10,000
5,000
0
22,508
5.60 5.56
5.65
5.23
18,755
4.58
4.64
4.25
2.75
2.60
5,312
5,881
160
611
6,353
7,177
4,335
3,503
4,144
4.70
4.35
8,866
7,827
soles
6
5
4
3
2
1
0
Amount in K USD
Closing Price (S/.)
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the futureJan.16Feb.16Mar.16Apr.16May.16Jun.16Jul.16Aug.16Sep.16Oct.16Nov.16Dic.16 OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
22
DISTRIBUTION
OF 30
TO 40%
OF PROFITS
COMPANY DURATION
Graña y Montero S.A.A. was established for an unspecified period of time.
DIVIDEND POLICY
The company’s dividend policy applicable in 2016 was to distribute as dividends between
30% and 40% of the profits made in each fiscal year, based on the results of the Graña y
Montero S.A.A. Consolidated Financial Statements only if individually they present sufficient
results to cover the above-mentioned amount; if the results of those Financial Statements
are not sufficient, they will be distributed only to their limit. There will be no distribution
of advances of dividends.
CORPORATE PURPOSE
The company’s main purpose is to engage in investments and commercial operations at large:
purchase, transfer and negotiation of shares, stocks or shares, securities and other liability
instruments, credit titles and derivative products, issued by Peruvian or foreign companies,
regardless of their economic activity, and whether they operate directly or through the Stock
Exchange. The company is also engaged in delivering managerial and administrative services
to related companies and/or other corporations.
The company can also develop all aspects, forms and types of construction business, erect
buildings and other urban works, develop real estate projects in general, as well as execute
heavy construction works and electro-mechanic projects. Additionally it can perform all sorts
of assemblies and set-ups, and carry out all the engineering and construction activities in both
fields, taking part in all types of selection processes, whether public or private. It can provide
services in mining exploration, development, exploitation and related tasks, provide services
to the hydrocarbon industry related to drilling, exploitation activities and services
for wells of oil and gas, including the construction and maintenance of oil pipes, gas pipes,
gas, petroleum and byproduct processing plants, refineries and all sorts of infrastructure for
the petrochemical industry. The company can invest in the construction, repair, conservation
and exploitation of public infrastructure works and services through the concession system,
and also buy and lease movable and immovable urban or rural assets to carry out any act
or activity directly or indirectly related with its purpose that contributes to the achievement
and fulfillment of its objectives.
ISIC – 6619
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future
OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
23
GRAÑA Y
MONTERO S.A.A.
Company name:
Address:
Telephone:
Investor Relations:
Person in Charge:
E-mail:
Incorporation of the company
Public Registry
Equity Capital
Shares
Portfolio of Equities
Main Shareholders and Economic Group
Company’s Purpose
ISIC 6619
Duration
Events
Graña y Montero S.A.A.
Av. Paseo de la República 4667, Surquillo
51-1-213 6565
51-1-2136573
Samantha Ratcliffe *
Samantha.ratcliffe@gym.com.pe *
Public Deed dated 12 August 1996
Record 131617-under Electronic Entry 11028652
S/ 660,053,790.00
660,053,790 totally subscribed and paid-in
None
See Corporate Governance Section
See Corporate Governance Section
6619
Unspecified Period of Time
See Historical Review
Business Sector and Competitors
Graña y Montero S.A.A. is an investment company, whose main subsidiaries operate in the following Sectors:
Construction, Engineering, Hydrocarbons, Information Technology, Concessions and Shopping Centers and Entertainment.
Besides, it also provides managerial services on an exclusive basis to its subsidiaries, so in fact, it does not compete in the market.
Net Sales
All services were provided within the country
Investment Plans
Leases
Managment
US$ 232 MM
2015
7,502,870.81
63,077,319
2016
* The head of Relations with Investors was taken over by Adriana Caballero in April 2018. Contact: adriana.caballero@gym.com.pe
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future OUR VALUE
PROPOSAL
- Diversification
- Regionalization
- Graña y Montero key figures
- Value Distribution
- Corporate governance
24
SHARES
GyM S.A.
GMP S.A.
GMD S.A.*
Concar S.A.
GMI S.A. Ingenieros Consultores
Concesión Canchaque S.A.C.
Survial S.A.
Viva GyM S.A.
Norvial S.A.
Promotora Larco Mar S.A.
GyM Ferrovías S.A.
PERCENTAGE
SHARES
98.24
95.00
89.31
99.81
89.41
99.96
99.99
63.44
67.00
46.55
75.00
Larcomar S.A.
Generadora Arabesco S.A.
Concesionaria Vía Expresa Sur S.A.
Concesionaria Chavimochic S.A.
TECGAS N.V.
Recaudo Lima S.A.
GyM Colombia S.A.S.
Agenera S.A.C.
ADEXUS S.A.
Negocios de Gas S.A.
Compañía de Gas del Amazonas S.A
Promotores Asociados de Inmobiliarias S.A.
CAM Holding S.P.A. Chile
100.00
100.00
Concesionaria La Chira S.A.
CAM Servicios del Perú S.A.
PERCENTAGE
79.66
99.00
99.98
26.50
51.00
70.00
66.20
99.00
91.03
99.99
50.99
50.00
73.16
Judicial, Administrative-law or Arbitration Proceedings
See Notes to the Audited FFSS
Responsible For Preparing And Revising the Financial Information
Gonzalo Rosado Solis - General Corporate Accountant
Mario Alvarado Pflucker - Chief Executive Officer (Until February 2017)
External Auditors
Price Waterhouse Coopers
* GMD ceased to be part of the Group in June 2017
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the futureGRAÑA YMONTERO S.A.A. MEMORIA ANUAL
INTEGRADA 2016
Memoria Financiera
Resporte de sostenibilidad
25
25
Construyendo
un futuro mejor
CONTENIDO
WE DEVELOP THE
INFRASTRUCTURE
COUNTRIES
NEED FOR THEIR
GROWTH
We provide infrastructure, engineering
and construction services through
our business lines. We generate economic
value and welfare in the societies
in which we operate.
WHAT
WE DO
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26
1930
1933
GRAMONVEL
FOUNDATION
THREE FOUNDERS
- Carlos Graña
- Alejandro Graña
- Carlos Montero
1937
BAÑOS DE
MIRAFLORES
The most important
architectural work of
the time. It rests on piles
and it can hold up to 500
people (Lima – Perú).
1940
1942
DAIRY PLANT IN VENEZUELA
First work abroad built for Nestlé,
over an area of 9,800 m2.
1942
EL PATO AIR BASE
Built during the Second
World War as a military base
of the USA in Talara – Peru.
1945
CONSTRUCTION OF THE CITY
OF TALARA
Located in north Piura. We built five
districts with 4,322 houses, schools,
markets, churches, commercial area,
the refinery, and an airport.
1949
MERGER BETWEEN MORRIS
Y MONTERO AND GRAÑA
Y MONTERO
Gramonvel and Morris y Montero
merge. They build new capacities
to develop infrastructure projects.
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1950
1952
HOSPITAL DEL EMPLEADO
Installation of 1,250 beds in an area of
130,000 m2. The Eduardo Rebagliati
Hospital -as it is known today- is still
the most important hospital in Lima,
due to its large healthcare capacity.
1954
MINISTRY OF
ECONOMICS AND FINANCE
We built 12 floors
with a 42.000 m2 area.
1957
CAÑÓN DEL PATO POWER PLANT
One of hydro electrical plants that
supplies most energy to the National
Interconnected System in Peru.
1953
CARRETERA PANAMERICANA SUR
(SOUTH HIGHWAY)
430 km, from Lima to Arequipa (Peru).
1956
MINISTRY OF EDUCATION
The first building constructed with
metal structure in Peru.
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1960
1960
JORGE CHÁVEZ
INTERNATIONAL
AIRPORT
We paved the most important airport
in Peru, which is also one of the most
visited in Latin America.
1967
PASEO DE LA
REPÚBLICA
EXPRESSWAY
Major traffic road in the city
of Lima.
1970
1972
HOTEL SHERATON
First International
Five-Star Hotel in Peru.
It was an icon of that age.
1977
CIVIC CENTER TOWER
With 109 meters, it
was the highest building
in Peru until 2011.
1968
SECOND GENERATION
José Graña Miró Quesada and Carlos Montero Graña joined the company. The
company was going through a tough crisis; the Military Government expropriated
the companies that happened to be our best customers. About these rough times,
José Graña says: “I learned my first business lesson and I had to make my first
decision. I had discovered that companies are not inherited, we are supposed to
make them grow, and I had accepted the challenge of being the second generation”
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1980
1983
DIVERSIFICATION
Growing and
diversifying is the new
business challenge.
1984
MACHU PICCHU
POWER PLANT
The greatest energy
investment project
of southern Peru.
1990
1990
GMI GOES INTERNATIONAL
Hotel Meliá Bávaro, Punta
Cana, Dominican Republic.
1991
GMP STARTS OPERATIONS
IN TALARA
We were granted
Block I oil concession.
1994
CONCAR STARTS OPERATIONS
Carretera Arequipa – Matarani
(Arequipa-Matarani highway),
first road concession in Peru.
1994
ENVIRONMENTAL CONSULTING
Throught the acquisition of
ECOTEC S.A., we incorporated
capabilities for environmental
consulting development.
1997
CREATION OF THE
GRAÑA Y MONTERO HOLDING
To sustain the Group’s diversified
growth and leverage the synergies
among the companies.
TRADING IN LIMA’S
STOCK EXCHANGE
Access to investors and capacity
to develop new businesses.
1998
HOTEL MARRIOTT
AND LARCOMAR
Located in one of the main
tourist areas of Lima.
1999
CREATION OF THE CORPORATE
LEARNING CENTER
The Corporate Learning Center
(CCA), currently known as
Academia Graña y Montero, is
aimed at promoting the generation
and sharing of knowledge and
developing talent in the Group.
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2000
2001
MALVINAS GAS PLANT –
CAMISEA PROJECT
Start-up of the strategy in the
natural gas industry.
2007
LOS PARQUES DE EL AGUSTINO
First housing project
with social interest in Peru.
2003
STEADY FLOWS
Active participation in infrastructure
concession businesses to increase the
stability of the Group’s cash flows.
2009
PARIÑAS GAS PLANT IN TALARA
We built our own automated
natural gas fractionation plant.
2010-2012
2010
INTERNATIONALIZATION
The internationalization process
gains more strength with the
incorporation of the first regional
company of the Group: CAM,
which currently operates in
Peru, Chile and Colombia.
2011
COMPANY GROUPING BY
BUSINESS LINES
Our organizational structure
allows us to complement our
service offering so as to provide
comprehensive solutions to our
customers, enabling us to be part
of the projects that countries need
to keep growing.
2012
PURCHASE OF
VIAL Y VIVES – CHILE
Investment in the mining sector at
regional level. It joins to Engineering
and Construction.
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2013-2016
2013
TRADING IN NEW YORK’S
STOCK EXCHANGE
Access to investors worldwide.
PURCHASE OF DSD
CONSTRUCCIONES Y MONTAJES
- CHILE
New mining capabilities
are added to the Group.
2015
OPENING OF THE ACADEMIA
GRAÑA Y MONTERO
Strengthening of CCA and
enhancement of the Group’s
knowledge management culture.
2014
BIRTH OF VIAL Y VIVES – DSD
The merger of Vial y Vives and
DSD Construcciones y Montajes
gave rise to Vial y Vives – DSD,
one of the best-qualified companies
to serve the Chilean mining sector.
PURCHASE OF MORELCO
– COLOMBIA
Consolidation of the Group’s
experience in the oil and gas
sector. It joins to Engineering
and Construction.
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“ Starting a new project is a
great technical and professional
challenge, and also an
opportunity to contribute to the
development and employability
of the people in the area. It is
gratifying to us to know that
through our work, we leave
a positive mark on society.”
Richard Guzmán
Project manager at GyM
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BUSINESS
AREAS
- Engineering and Construction
- Infrastructure
- Real Estate
- Services
33
US$
1,238
MILLION
on sales
IMPORTANT
SYNERGIES
among companies
CONTRACTS
AWARDED FOR
MAJOR PROJECTS
in the oil and mining
sectors in Peru
US$
1,978
MILLION
in backlog
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- Infrastructure
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34
During 2016, low metal and oil prices, which
led to reduced investment in the mining and
oil and gas sectors, in addition to an electoral
environment that put many infrastructure
projects on hold, affected the performance
of the Engineering and Construction
business line.
Despite the circumstances, we were able
to generate sales of US$ 1,238 MM and end
the year with a backlog of US$ 1,978 MM. The
lower backlog is due to the recent elimination
of the GSP from our list of projects.
The most relevant aspects of our
management in 2016 are related to
the different synergies created among our
Engineering and Construction companies,
which were the result of our strategy to
consolidate our value proposition at the
regional level and, with it, provide a complete
service to our customers.
For example, we were able to obtain an
EPC contract between Vial y Vives-DSD
(Chile) and GMI (Peru) on the development
of a system for loading copper concentrate
in Totoralillo for Chile’s most important
iron mining group. Another example is the
contract between GyM and STRACON GyM,
both based in Peru, to carry out an important
energy project in Panama.
It is also important to note the achievements
of Morelco, our company that diversified
its services to the energy and construction
sectors, also as a result of synergies with
other companies in the area.
Other noteworthy occurrences in the area
are the awarding of the contract for the Yellow
Line, an important road that will join 11
districts in the city of Lima, and the contract
for the project to increase the transportation
capacity ofLine 1 of the Lima Metro.
« San Ramón Project
Colombia
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GMI
We signed a contract to supervise the
construction work at the new airport in
Chincheros (Cusco), a project which will
last six years that we will execute through
a consortium with AYESA, a Spanish
company, and U.S. based AECOM.
In addition, we began supervising the EPC
project that will carry out the Santo Domingo
combined-cycle thermal power plant project
(Lima) for our customer, Termochilca. Thanks
to this project, the plant’s power generation
level will increase by 100MW, producing
a total of 2,476.6GWh per year.
In the transportation sector, we are working
on the basic and detailed engineering design
to increase the transportation capacity of of
Line 1 of the Lima Metro. Our services include
supervision of the infrastructure improvement
until 2018.
In the water sector, we were awarded
contracts for the supervision of two
wastewater water treatment plants. One
is the EPC project for Antapaccay, a mining
company in Cusco, and the other is the
EPC project for Agrokasa, located in Ica.
ECOTEC
We were in charge of environmental
management for the construction of the new
plant for IQ Farma, a company dedicated
to drug research, manufacturing, and
commercialization.
THANKS TO THE
TERMOCHILCA
PROJECT
the output of the Santo
Domingo thermal power
plant will be increased
by 100MW
» Antapaccay Mining Project
Cuzco, Peru
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GyM
ENERGY
In August 2016, we completed
the construction of the Cerro del Águila
Hydroelectric Station in Huancavelica,
Peru. It is Peru’s second largest hydroelectric
station and produces 510 MW of energy.
In Panama, we started the construction of
130 km of transmission lines, in consortium
with STRACON GyM.
CONSTRUCTION
We completed the construction of the
Open Plaza shopping mall in Huancayo,
which has an area of over 96 thousand m2.
In addition, we completed construction of
the new América TV production center in
Pachacamac, Lima. With its 53 thousand m2
of area, it is Peru’s largest television station.
Additionally, in 2016 we worked on the
construction of the Talbot hotel, which belongs
to the Holiday Inn chain.
Another relevant event was the recognition
of the Universidad de Ingeniería y Tecnología
(UTEC) building by the Royal Institute of
British Architects (RIBA), which named it
the world’s best new building. It was built
by GyM and designed by Grafton Architects.
» Universidad
de Ingeniería
y Tecnología
Lima, Peru
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TRANSPORTATION
OIL AND GAS
AND URBAN ROADWAYS
We obtained the contract for the completion
of the construction of the Yellow Line Project
for our customer, Vinci Concessions. This
project will join the district of Ate with the
province of Callao, making the distance a
20-minute trip. It will have a two-kilometer-
long tunnel, Lima’s longest, and will pass
through 11 districts.
We were also awarded the contract on
the design and construction to improve the
infrastructure of Line 1 of the Lima Metro,
which will make it possible to increase its
transportation capacity and reduce the trains’
time interval.
MINING
Within the framework of the expansion plan
for Southern Copper Corporation’s Toquepala
and Cuajone mines, GyM obtained five
important contracts that include the civil
works and electromechanical assembly
for both projects, located in southern Peru.
We began the electromechanical work
on the sector’s most important Project in
2016, for our Técnicas Reunidas client. It
consists of the modernization and expansion
of the infrastructure of the Talara Refinery
in northern Peru, which will make it possible
to increase its production capacity by
45%, produce cleaner fuel and protect
the environment.
THE YELLOW
LINE PROJECT
will make the distance
between the district of Ate
and the province of Callao
a 20-minute trip
» Cerro del Águila Hydroelectric Power Station
Huancavelica, Peru
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STRACON GyM *
During 2016, we completed construction of the
San Ramón mine in Antioquia, Colombia, for
Red Eagle Mining, and it is now in operation.
Currently, we are working on the development
of the underground part of the mine.
The Shahuindo project in Cajamarca, where
STRACON GyM has an operation contract,
we achieved commercial production of 48
thousand ounces of gold. In addition, we
were awarded a contract for construction,
earthworks and civil works for the crushing
and agglomeration system. This project will
be of key importance in making the Shahuindo
operation efficient, starting in 2018.
At Constancia, the copper project located
in Cusco, we continued with construction
of the mine. With regard to the operation
service, we achieved a transfer of knowledge
on mining and equipment maintenance,
so that the customer can take charge
of this service with its staff.
In addition, we were awarded a new contract
on the extension of the La Zanja mining project
in Cajamarca, and another one on the San
Rafael mining project in Puno for MINSUR.
COMMERCIAL
PRODUCTION
OF 48 THOUSAND
OUNCES OF GOLD
WAS ACHIEVED
in the Shahuindo Project
located in Cajamarca
With regard to internal management at
STRACON GyM, it is important to note that,
for the second year in a row, we placed 17th in
the “Great Place to Work” ranking. In addition,
insurance companies Rimac and Mapfre once
again recognized our company ' s high safety
standards and risk prevention, giving us
the 2016 “Excellence in Risk Prevention”
and “Excellence in Safety” awards respectively.
* STRACON GyM ceased to be part of the Group
in March 2018
» Shahuindo Project
Cajamarca, Peru
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VIAL Y VIVES – DSD
In 2016, Vial y Vives – DSD completed the
construction of the combined cycle Kelar
(Mejillones) plant, with a 540 MW generation
capacity, due to which it is considered one
of Chile's most important energy projects.
In the mining sector, we were awarded the
contract for engineering, procurement and
construction of the iron concentrate loading
system for CAP in Totoralillo, which is being
carried out in close collaboration with GMI,
the Group`s engineering company.
In addition, Vial and Vives – DSD
was awarded a contract for equipment
maintenance services at the BíoBío refinery
owned by Empresa Nacional de Petróleo
(ENAP), located in Region VIII. During
the year, it was also awarded a mechanical
maintenance contract by the same customer.
» Kelar Combined
Cycle Power Plant
Mejillones, Chile
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MORELCO
Morelco is a Colombian construction
company specializing in the oil and gas
sector, which joined the Graña y Montero
Group in 2014. Due to the current situation
in the sector, it was decided to diversify
Morelco's services, taking advantage of
the knowledge and skills of other companies
in the Engineering and Construction area.
In this manner, in 2016 the company
was awarded two important contracts: the
construction of 3,000 classrooms for the
Ministry de Education in consortium with
GyM, and the construction and operation
of a transmission line in La Guajira.
These projects enabled Morelco to enter
the construction and energy sectors.
In the second project, called “Regional
Transmission System”, we are responsible
for the design, procurement of supplies,
construction, operation and maintenance
of the Riohacha - Maicao 110KV and
Riohacha - Cuestecitas 110KV Line electrical
reinforcement in Guajira. Morelco is working
on this EPC project in a consortium where it
has a 70% interest with three local companies.
It should also be noted that in December,
we completed the “Energy and Steam” project
for our customer, Ecopetrol. In addition,
for the same customer, during the year
we continued working on the maintenance
of oil pipelines that run through seven
of Colombia's departments.
In the first project, we are in charge of the
design, technical studies and construction
of educational infrastructure in 14 Colombian
cities. These works are part of the Colombian
National Plan, which seeks to make Colombia
Latin America's best educated country.
» Oil Pipeline Maintenance
Colombia
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“ Belonging to the Infrastructure
team is knowing that your
work is important, that the
time and effort we put into a
project are worth it because, in
the end, we create a new reality
that changes people's lives for
the better.”
Baruc Ingar
Proyect manager at Graña y Montero
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PTAR
LA CHIRA
in operation since
July 2016
US$
25
MILLION
in net profit
US$
271
MILLION
in the activity
of the area
US$
301
MILLION
in backlog
PTAR = Wastewater treatment plant
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Our activities in this sector began in 1994
with the Arequipa-Matarani highway, the
first road concession in Peru. Through this
business line, we conceptualize, develop,
finance and manage projects that require a
high level of investment and entail long-term
contracts. We participate significantly in the
growth of the countries in which we operate,
whether by channeling private investment
to projects of public interest, bearing
performance and level-of- service risks, or
contributing the skills of the private sector
in highly regulated environments with the
highest standards.
During 2016, the most relevant events were
the issuance of the purchase order to increase
the service capacity of Line 1 of the Lima
Metro; the startup of PTAR La Chira, our
first water treatment concession; substantial
progress on the second phase of Norvial;
and the start of GMP's drilling campaign
in the new Lot IV.
net profit. At the end of 2016, the area's backlog
plus recurring business totaled US$ 301 MM.
The Peruvian Southern Gas Pipes was part
of this business line. Although this project
is now out of the Graña y Montero business
portflio, we ratifiy our commitment to
continue participating in oil and gas sector
projects, because we consider that by doing
so we continue to support the region's energy
development.
In addition, during the year we continued
working on the different phases of our private
initiatives. A relevant occurrence was when,
at year end, the Lake Titicaca Basin Waste
water Plant project, which Graña y Montero
submitted as a private initiative in 2014, was
declared feasible. This means it is a socially
profitable, sustainable project that follows
the policy guidelines of the sanitation sector,
which is an indispensable requirement
for its execution.
With regard to the activity of the business line,
we reached a total of US$ 271 MM, with an
EBITDA of US$ 81 MM and US$ 25 MM in
Given the achievement of these milestones
during 2016, we expect considerable activity
for 2017 and a promising future for the area.
« Rails of LINE 1 of the Lima Metro
Lima, Peru
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TRANSPORTATION
LINE 1 OF THE LIMA METRO
During 2016, the Lima Metro system made
over 107 million trips, which were provided
to our customers in a reliable, modern and
safe manner. The regularity indicator, which
measures the punctuality of the trips, was 98%,
and we achieved an 87% satisfaction level.
Due to high demand for this public service,
GyM Ferrovías formulated operation plans
to ensure quality of service, such as the
Ola Verde (Green Wave) plan for efficient
management of amounts received at the
stations, and the Christmas plan to manage
increased usage at Christmas time.
During the year, we also issued a purchase
order for 20 new trains, in order to improve
the infrastructure and expand the service
capacity to handle the high demand. With
these trains, the waiting time will decrease
from six minutes to three during rush
hour. The trains will be able to transport
a total of 48 thousand passengers per hour,
making at least 500 thousand trips a day,
according to Ministry of Transportation and
Communication projections. This expansion
is expected to be completed by late 2019.
« LINE 1 of the Lima Metro
Lima, Peru
» Linea 1
Lima - Perú
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WATER
PTAR LA CHIRA
During 2016, we completed construction and
started up the operation of La Chira waste
water treatment plant (PTAR La Chira),
which makes it possible to treat wastewater
from 18 Lima districts, benefiting over
2.5 million people. The plant can treat up
to 11.3 m3/s of wastewater, which is then
released into the ocean through a 3.5 Km-
long submarine outfall. Our operations also
include continuous monitoring of the ocean's
envoromental parameters, in order to assess
the project's impact on the decontamination
of the Lima coastline.
CHAVIMOCHIC
The project continued the construction
of phase III of Chavimochic, making
70% progress on the first stage of the project.
» La Chira Waste Water
Treatment Plant
Lima, Peru
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ROAD CONCESSIONS
NORVIAL
The concessionaire of the road from Ancón to
Pativilca, located in northern Lima, recorded
a 7.12% increase in tollable traffic compared
to 2015, reaching a total of 20 million axles.
The execution of the second phase of the road
was 90.5% complete by the end of the year.
This second phase involves an additional 57
km of roadway, from Huacho to Pativilca,
and includes interchanges and bridges. These
improvements will make a significant positive
impact on transportation quality and times
between Lima and northern Peru.
THE PAVED
ROAD FROM
HUACHO TO
PATIVILCA
will make a considerable
positive impact on
transportation quality
and times between Lima
and the northern part
of the country
» Ancón - Huacho - Pativilca
Highway Toll Unit
Lima- Peru
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SURVIAL
This road concession, which runs from San
Juan de Marcona in the department of Ica
to Urcos in the department of Cusco, varies
widely in elevation and has considerable
impact on connectivity between the
highlands and the coast for the population of
southern Peru. Operating this road is a great
technical challenge, due to the geographical
characteristics of the areas it passes through,
weather conditions, and the high elevation
of many of its sections.
In 2016, the operation of the new
Pampamarca toll unit started in the town
of Pilluni, Apurímac, located at nearly
4,360 masl.
« Survial Highway
Ayacucho, Peru
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THE ROAD
CONCESSION IN
NORTHERN PERU
has a great impact on
the connectivity and
development of economic
activity in the area
» Maintenance work on the Canchaque Highway
Piura, Peru
CANCHAQUE
This road concession, which runs from
the junction of the IIRSA North highway
near Buenos Aires - bound to the town
of Canchaque in the highlands of Piura in
northern Peru, makes a strong impact on
connectivity and economic activity in the
area. In 2016, traffic on the road continued to
increase sharply, with 3.7% growth in heavy
transport traffic compared to 2015.
VESUR
This project will lengthen the city of Lima's
Paseo de la República expressway, connecting
it with the South Pan-American highway.
The purpose of the project is to make a direct
connection between the city center and
the highway out of the south side of the city.
During 2016, progress was made on
preparatory activities for its execution. The
design approved for the project entails the
construction of alternative toll-free roads, a
4.9 Km toll road and new road interchanges.
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OIL AND GAS
GMP
EXPLORATION & PRODUCTION
GMP specializes in the operation and
development mature fields. During a
complicated year for the oil and gas sector,
our oil company achieved average production
of 2,756 barrels of crude per day among
the four lots it operates in Talara, Paita and
Los Órganos, located in Peru’s Piura region.
In addition, an average of 8.30 MMSCF
of natural gas were sold per day.
Toward the end of 2016, a 33-well drilling
campaign was started in Lot IV. In the last
nine weeks of the year, 11 wells were drilled,
increasing production by 218 BBls per day
as of December 31.
GMP is an important private-sector player in
the economy of the area it meets high quality,
safety and environmental protection standard
and is also known for the positive social
impact of its community activities.
AVERAGE
PRODUCTION OF
2,756 BARRELS OF
CRUDE PER DAY
among the four lots
the company operates
in Talara, Paita and
Los Órganos
NATURAL GAS
The Pariñas gas plant achieved a utilization
factor of 75%, increasing 3% compared
to 2015.
Over the course by 2016, 12.15 BSCF of natural
gas were processed, which is equal to 33.3
MMSCFD; that is, the flow of processed gas
increased 1.6 % per day. Average production
of liquids was 1,263 barrels per day and
recovery efficiency reached 94%.
The majority of the gas is used to generate
electricity in northern Peru.
» Pariñas Natural Gas Processing and
Fractionation Plant
Piura, Peru
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TRANSPORTATION & DISTRIBUTION
COGA
This business unit covers the three contracts
we have for the operation of 10 oil storage
terminals in northern, central and southern
Peru. Two consortiums are responsible for the
operation of these terminals: Terminales del
Perú, which operates the ones in northern and
central Peru (Chimbote, Salaverry, Eten, Supe
and Callao), and Consorcio Terminales, which
is in charge of those in the southern part
of the country (Pisco, Mollendo, Ilo, Cusco
and Juliaca).
It is responsible for the operation and
maintenance of TGP, the trans-Andean gas
pipeline from Camisea in Peru. It is one
of the most complicated pipelines to operate,
since it runs a total of 730 Km from the
jungle, over the Andean mountains to the
Pacific coast. The natural gas transportation
capacity for the local market is 920 million
cubic feet per day and, in the case of natural
gas liquids, our current capacity is 130
thousand barrels per day.
Terminales del Perú is executing a
modernization and expansion plan
that entails an investment of US$ 37MM
over the next 4 years.
Consorcio Terminales is executing a US$
25MM investment plan through August 2017,
when the 2-year extension of the contract
expires.
The purpose of this investment is to improve
the infrastructure of the facilities and to expand
the operating capacity and reception system.
The Transportation and Distribution unit
contributes to the safety and efficiency of the
fuel distribution system, making it possible for
economic agents to supply the local population
in a timely manner throughout the highlands
and coastal areas of southern Peru.
*In 2017, Coga ceased to belong to the Group.
THREE
CONTRACTS
FOR THE
OPERATION OF
10 OIL AND GAS
TERMINALS
in northern, central
and southern Peru
» Oil and Gas Terminal in Puno
Juliaca, Peru
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“ Through my work, I enable
many families to achieve their
dreams of owning their own
home, a safe and comfortable
place that improves their
families’ lives. It is truly
gratifying to see how happy
people are when we hand
over their new home to them”
Herminia Aranguren
Sales supervisor at VIVA GyM
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1,711
REAL
ESTATE UNITS
sold
#1
COMPANY
IN SALES
of low-income housing
STAR
PROJECT
Los Parques
de Comas
US$
122
MILLION
total sales volume
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In 2016, the Peruvian real estate market
maintained the same level of sales as in 2015
and 2014. However, there was growth in the
sales of the Techo Propio product due to an
increase in supply of the product, as the sales
price increased to 20 UIT (tax units), and the
housing subsidy rose from 4 UIT to 7.1 UIT.
All of this had a highly positive impact on
Real Estate, which ended the year with a total
of 1,711 real estate units sold; that is, 80%
more than in 2015. According to Mi Vivienda
Fund reports, VIVA GyM was the number
one company in sales of low-income housing
units in Peru.
The star project of 2016 was Los Parques de
Comas. Each of its products—whether Techo
Propio, with S/. 80,000 apartments; the Villa
Los Molles condominium, with S/. 130,000
apartments; or Alborada Club Residencial,
with S/. 170,000 apartments—had the
highest number sold in the country. Of the
1,711 units sold in the year 2016, 986 were
at Parques de Comas.
In addition, there were substantial
improvements in sales of our other projects,
such as Los Parques de Carabayllo II, Los
Parques de Villa El Salvador II, Los Parques
del Callao, and Los Parques de San Martín
de Porras.
We ended 2016 with a total sales volumen of
US$ 122 MM and a net profit of US$ 23 MM.
The results for the year corroborated our
strategy of continuing to work with projects
financed by the Mi Vivienda Fund and Techo
Propio, as well as our decision to develop a
very large portfolio that enables us to reach
a bigger market.
It is also important to mention that,
for the 6th year in a row, VIVA GyM was
recognized by Great Place to Work, placing
6th in the category of companies with 30
to 250 workers. Additionally, in May 2016,
we placed 33rd among the best places
to work in Latin America.
« 3D image of El Nuevo Rancho
Lima, Peru
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90% OF
OFFICES
SOLD
in the Navarrete
building
VIVA GyM
OFFICES
During 2016, we continued with sales of
the Rivera Navarrete building in the business
area of San Isidro, where 90% of the offices
offered for sale were sold.
In August 2016, we completed the
construction and handover of the Panorama
office building in La Molina. By the end
of the year, 75% of the offices had been sold.
In addition, we continued construction of
the Real 2 building in the Centro Empresarial
business park in San Isidro. By the end
of 2016, 94% of the offices had been sold.
« Riviera Navarrete Building
Lima, Peru
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TRADITIONAL HOUSING
We completed the construction of the El
Nuevo Rancho condominium in Miraflores.
It has a total of 116 apartments, of which 65%
have been sold. These homes were handed
over in December 2016, and we expect
to sell the rest during 2017.
In 2016, we continued the construction of
the emblematic Klimt Project on Avenida
Pezet in San Isidro. By the end of the year, 17
apartments out of a total of 32 had been sold.
We also began sales on our Parques del Mar
project in San Miguel. It will be a building
with an ocean view and approximately
290 70 m2 apartments.
Additionally, in order to continue satisfying
demand from the high-income segment, we
purchased another piece of land on Avenida
Pezet in San Isidro. This project will
be a continuation of the Klimt project.
By the end of 2016, we had also arranged
to buy a piece of land in Barranco, facing
Malecón Paul Harris.
« 3D image of the future Los Parques del Mar Project
Lima, Peru
NEW PIECE
OF LAND
will give continuity
to the Klimt Project
« 3D image of an
apartment in the
Klimt Project
Lima, Peru
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LOW-INCOME HOUSING
ALMONTE
In Lima, the Los Parques de Comas project
sold at a very good pace, making it the VIVA
GyM star project. By the end of 2016, we had
turned over 1,022 apartments in different
formats: 729 50 m2 Techo Propio apartments,
105 60 m2 apartments in the Villa Los Molles
condominium, and 188 72 m2 apartments
in Alborada Club Residencial.
We also maintained a good level of sales in
our Los Parques de Carabayllo II, Los Parques
de Villa El Salvador II, and Los Parques del
Callao projects, as well as our two projects
in San Martín de Porres.
In Piura, we started the construction of
phase II of the Los Parques de Piura project,
where we have already sold 92 apartments.
In addition, we began the sale of our next
product for Piura, which consists of two-
story, 70 m2 houses.
In summary, we sold 1,618 low-income
housing units, which have a total area
of approximately 97,500 m2.
INDUSTRIAL LOTS
It should be mentioned that we have also
begun the sale of our new real estate product
located in Huancayo, which consists of the
sale of serviced lots. This first project has
approximately 429 lots, divided in 4 phases
with approximately 107 lots each. We started
selling them in the month of October 2016
and, by the end of the year, we had sold
81 lots out of 107 in the first phase.
We were the first to have an approved
comprehensive plan en Lurín, and the first
to obtain urban authorization status. We
have 300 hectares of net saleable area yet
to develop, and in the first quarter of 2017 we
will be doing the commercial launch of phase
II of the project.
During 2016, we sold 4 real estate units,
which represent approximately 250 thousand
m2 of land sold.
« 3D image of the future Los Parques
de Ancón Project
Lima, Peru
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“ We work to serve people
and fulfill their needs with
efficient solutions. Our services
contribute to the growth of the
companies we serve, improve
people’s lives, and contribute
to the country’s development.”
Joe Estrada Ponte
CAM Warehouse Assistant
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US$
858
MILLION
in backlog
MAJORITY
PARTICIPATION
in Adexus,
a regional company
US$
417
MILLION
annual activity
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In 2016, a relevant fact was the growth
of the activity of Services business line. We
achieved to US $ 417 MM of annual activity
and US$ 35 MM of EBITDA.
The Backlog also had a significant growth
in most of the companies, wich allowed us
to obtain US$ 858 MM.
On the organizational level, CAM had
advances in the structure of the Electric
and Telecomunication Business unit.
In summary, 2016 was a good year for
the service area and this was reflected in
the financial results obtained by different
companies.
In 2016, we became the majority shareholders
of Adexus, a regional IT company.
For its part, CONCAR, a company that
operates infrastructure, got two important
contracts to rehabilitate and preserve more
of 750 km of roads in Peru. At the end of the
year, it entered the Chilean market; through
a contract that allows receive electrical
maintenance to the Lines 4, 4A and extension
of Metro Line 5 of Santiago de Chile.
« Toll collection on the
Ancón - Huacho - Pativilca Highway
Lima - Peru
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GMD
BUSINESS PROCESS AND
INFORMATION TECHNOLOGY
OUTSOURCING
GMD started its operations in 1984, as
the first technology outsourcing company
in Peru. It provides business process and
IT outsourcing services to the industry and
commerce, banking and finance, government
and mining sectors, and now has over
2,300 workers.
During 2016, we continued with the
consolidation of our Help Desk service,
incorporating new customers from the public
and private sectors, such as Ferreyros, Aceros
Arequipa, Lindley, SEDAPAL, MINEDU,
and FONAFE, among others. Currently,
we provide support to over 70 thousand
nationwide.
With regard to Datacenter services,
we expanded our Cloud, Security,
Database and SAP activities. Additionally,
in Application Outsourcing services, we
continued promoting Testing services in the
Banking and Finance sector. We also created
the Digital Transformation area, in order to
foster innovation and specialization through
mobile and Internet-of-things solutions
in our customers’ companies.
« Our Help Desk team
Lima - Perú
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Another relevant event was the signing of the
20-year concession contract on the Collection
System for Public Transportation in Trujillo,
which comprises the design, implementation,
operation and maintenance of the electronic
collection and fleet management system.
In the sanitation sector, we continued
consolidating our activity through the
management of 400,000 meters on the south
side of Lima and our work with the largest
customers in Lima. In addition, we became
involved in the implementation of Telemetry
Solutions for remote service delivery
management.
We continued strengthening our
document management services, with over
130 million documents digitized to date,
and over 48 million bills of exchange, checks
and promissory notes processed.
With regard to internal management in 2016,
for the third year in a row, GMD was named
a great place to work (GPTW) in Peru,
placing 14th in the ranking of companies
with over 1,000 employees.
« Data Vault
Lima, Peru
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CONCAR
OPERATION AND MAINTENANCE
OF ROAD AND RAILWAY
INFRASTRUCTURE
In 1994, CONCAR became Peru's first
road concessionaire. Today, it is the leading
company in infrastructure operation and
maintenance in Peru and is in the process
of consolidating its position in the region.
In January, CONCAR was awarded a contract
for the management, improvement and
maintenance of the 209-kilometer Molle
Puquio road. In addition, in February, it was
awarded a contract (as part of a consortium)
to manage, improve and maintain 569
kilometers of highway between Dv. Abancay
and Dv. Ayaviri. These projects directly
benefit the departments of Apurímac,
Cusco, Ayacucho and Puno.
At the end of 2016, in December, CONCAR—
in consortium with our electrical services
company, CAM Chile—was awarded a five-year
contract for the electrical maintenance of Line
4, Line 4A and the extension of Line 5 of
the Santiago, Chile metro. This experience is
in addition to the operation and maintenance
contract CONCAR has had since 2011
on Line 1 of the Lima Metro.
« Railway infraestructure operation
Lima, Peru
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CAM
OPERATION AND
MAINTENANCE OF ELECTRICAL
AND TELECOMMUNICATIONS
INFRASTRUCTURE
CAM is a regional company that operates in
Chile, Peru and Colombia.
In January, our branch in Colombia various
was awarded a contract on services for
Electricaribe S.A., a company belonging
to the multinational Spanish Gas Natural
Fenosa group. In addition, in November,
CAM Colombia was awarded a contract
on loss control services for EmCali.
CAM Peru was awarded a contract for the
Complete Construction and Maintenance
Service in Medium and Low-voltage project for
Edelnor; in the month of May, it was awarded
a contract for technical and commercial
activities to reduce and monitor power losses
in low voltage for Hidrandina and Enosa;
and in the month of September, it was awarded
a 3-year contract for general services
and works at Telefónica del Perú facilities.
» Single-phase meters
CAM Peru headquarters
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Our Chilean branch was awarded a
contract with Asociación Chilena de
Eficiencia Energética for the changeover
of 7,500 light points to LED technology
in the community of La Pintana in the
city of Santiago. In addition, an important
contract with Movistar for the installation,
repair and outside plant services for zone
4 and the south side of Santiago, Chile
was renewed. Lastly, CAM Chile obtained
a five-year contract—in consortium with
our infrastructure operation company,
CONCAR—for the electrical maintenance
of Line 4, Line 4A and the extension
of Line 5 of the Santiago, Chile metro.
» Work on high
voltage line
Lima, Peru
IN 2016, WE
CONSOLIDATED
OUR RANGE
OF SERVICES
in the telecommunications
sector
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We were also in charge of the implementation
of a private 4GLTE communications network
in Tierra del Fuego for a major oil and
gas exploration and production company.
Through the implementation of IoT solutions,
we facilitated communication, data and video
operation and services in remote areas, which
enabled us to establish a pioneering service
in the country and the southern hemisphere,
in one of the most remote and inhospitable
places on earth.
ADEXUS
WE LIVE AND BREATHE
INNOVATION
ADEXUS is a company with over 26 years
of experience in the Outsourcing Services
and Information Technologies market,
with operations in Chile, Ecuador and Peru.
On the commercial level, during 2016
Adexus was awarded important contracts
in the banking, government, and industry
and trade sectors, which enabled it to revamp
and expand Operational Continuity and ICT
Outsourcing services throughout Chile.
An example of this is the contract to provide
support services and operational continuity
solutions for the Caja Vecina POS network
throughout Chile for Banco Estado,
the institution with the largest network
in the country.
In addition, Adexus was awarded a contract
to develop the software for the Vote Recount
System for electoral processes, and to operate
the Computer Center for the 2016 municipal
elections and the 2017 presidential election.
« Mobile technology
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OUR
COMMITMENT
TO DOING
THINGS RIGHT
At Graña y Montero, we guarantee
a responsible management of our
businesses and contribute to the growth
of the societies where we operate.
HOW
WE DO IT
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- Sustainability strategy
67
SUSTAINABILITY STRATEGY
As part of Graña y Montero´s work style, we seek to create value
in the long term, i.e. we want to develop profitable businesses
that are socially and environmentally responsible . This allows
us to build trust and transcend as an organization by promoting
a virtuous development circle from which both business and
society can profit.
In accordance with this strategy, the Group’s Board of Directors
approved the Corporate Sustainability Policy in January 2016,
which updates and integrates the previous Environmental
(1998), Risk Prevention (1999) and Corporate Responsibility
(2005) policies. This document defines clear guidelines
and commitments related to the seven most important topics
of our sustainable management, which have been defined
from the evaluation of our risks and impact on stakeholders.
Given the nature of our businesses, it is essential to ensure
a comprehensive non - financial risk managment. Therefore,
as part of the 2017 Strategic Planning Process, our Board of
Directors approved the incorporation of an “Environmental,
Social and Governance” category in our different companies’
risk matrixes.
Additionally, every year we carry out evaluation processes to
identify improvement opportunities and set action plans. In
this regard, we participated in 2016 in the French Agency Vigeo
Eiris’ review, under the “2020 Sustainable Leadership Agenda -
ALAS20”, and we received a distinction as a Socially Responsible
Company by the association Perú 2021.
1 We consider the definition of sustainability proposed in the Dow Jones
Sustainability Index by Jhon Elkington (1997)
OUR MANAGEMENT PRIORITIES
Ethical
behaviour
Share
well-being
Communication
SUSTAINABILITY
POLICY
Personnel
Development
Operational
excellence
Environment
Safety
and health
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HOW DO WE DETERMINE
THESE PRIORITIES?
Every other year, the 10 most important
companies of the Group carry out internal
workshops to review and prioritize their
environmental, social and governance risks
(ASG). The perceptions of the main stakeholders
are also collected, and international trends and
best practices of leading companies are reviewed
to complement this. (G4-18)
RISK AND
IMPACT
ANALYSIS
10 internal
Workshops
PERCEPTIONS OF
STAKEHOLDERS
+
Surveys,
interviews and
external sources
+
INTERNATIONAL
TRENDS AND
BENCHMARKING
22 leading
companies analyzed
=
MANAGEMENT
AND
COMMUNICATION
PRIORITIES
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DETAILED PRIORITIES ACCORDING TO BUSINESS AREA (G4-19)
Engineering
and Construction
Infrastructure
Real Estate
Services
Topics
Ethical behaviour
Professional development
Operational excellence
Safety and health
Environment
Communication and dialogue
Sharing welfare
Specific aspects
Compliance and fight against corruption
Good corporate governance
Professional development
Knowledge management
Turnover and retention
Quality
Compliance with deadlines
Compliance with service levels
Innovation and technology
Safety and occupational health
Road safety
Waste management
Spill prevention
Energy and emissions
Environmentally efficient products and services
Relationship with the government
Relationship with strategic partners
Relationship with client companies (B2B)
Relationship with customers (B2C)
Relationship with the community
Skill development – Community
Transfer of standards – Suppliers
Citizenship promotion – Clients
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ETHICAL
BEHAVIOR
" One of the things with which I identified greatly when
I entered Graña y Montero was the company’s values,
taught through personal example. Our way to do things
has shaped my life and I’m sure that it has also left
a positive impact on the environment."
Maria del Pilar Sabogal
Legal Manager
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SUSTAINABILITY STRATEGY
- Ethical behavior
71
ETHICAL BEHAVIOR
9
YEARS
in the Good Corporate
Governance Index
of the Lima Stock
Exchange (BVL).
OF OUR EMPLOYEES
85%
AND 97% OF
OUR EXECUTIVE STAFF
have been trained on
anti-corruption issues
CORPORATE
GOVERNANCE
LEADER IN 2016
as per the ALAS20 award
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ETHICAL BEHAVIOR
For the Graña y Montero Group, it is crucial to behave
with integrity, in an ethical and transparent way. We are
committed to abide by the law in all the countries where
we operate, including the U.S Foreign Corrupt Practices
Act (FCPA) that applies to us as a result of our shares
being listed in the New York Stock Exchange.
In this sense, we have put in place a corporate and ethical
compliance system, which is undergoing an improvement
process, training on, preventing, detecting and punishing
potential corruption acts in our business deals and
relationships with our stakeholders. Though in the last few
years significant progress was made, we believe that our
efforts are still not enough, and now, more than ever, we
know that these systems are essential for the continuity
of our business and the protection of our good reputation.
Managament
tools
- Ethics Charter (1995)
- Code of Conduct (2012) *
- Ethics Channel and Ethics
Committee (2017) *
- Anti-corruption compliance
programa (FCPA) and anti-
corruption policy (2015) *
* They were reinforced during 2017 and 2018
by the Risks and Compliance area
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DEVELOPMENTS IN OUR
ANTI-CORRUPTION SYSTEM
During 2016, our efforts regarding
compliance and prevention were focused on
the deployment of the Anti-Corruption Policy
in the various Group’s companies. As part
of this process, we implemented a training
program on the main anti-corruption
guidelines, which trained 85% of employees.
These training sessions were combined
with ten on site specialized courses, such
as one on “Money laundering prevention”,
addressed to employees from the
construction and real estate areas.
Additionally, as part of the Senior
Management’s commitment to send out a
clear message of zero tolerance to bribery and
corruption, we have included these topics in
the Board of Directors’ periodic agenda, and
we also have a Compliance officer who reports
to the Audit and Processes Commission.
At the process level, we keep on performing
Due Diligence for mergers and acquisitions,
and we have spread the “Know Your
Partner” (2015) initiative, through which
preventive assessments were performed on
111 potential strategic partners, 13 suppliers
and 9 potential recipients of grants. In this
regard, anti-corruption clauses were included
in contracts with suppliers, and a specific
donation procedure was implemented.
Since 2013, we have implemented an Ethics
Channel that constitutes the main channel
for reporting potential complaints. An
independent company operates this channel
in order to guarantee that the cases are
handled in an unbiased, transparent and
confidential way. During 2016, we received
34 cases, out of which 26% were solved, 59%
are still under investigation and 15% were
declared inadmissible. Since this tool was
created, we have received 211 complaints,
none of which was related to bribery
or corruption of public officials.
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2016 PROGRESS
- We strengthened our culture of prevention
in anti-corruption topics, training 85%
of our employees.
- We implemented the “Know Your Partner”
initiative and we established anti-corruption
clauses in contracts with providers and
intermediaries.
- Together with CAPECO, we helped
create the Code of Ethics of the construction
sector in Peru.
2017 CHALLENGES
- Update our matrix of existing risks,
processes and controls.
- Revise and continue to reinforce our policies
and procedures, mainly those related to the
choosing of strategic partners and providers.
- Implement a segmented training
plan in accordance with companies,
areas and critical roles.
- Strengthen the area of compliance
in the Group.
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PERSONNEL
DEVELOPMENT
“ I feel that the company is concerned about my personal
growth; it offers me permanent training and helps
me accomplish my professional and personal goals.
I know that here I will have opportunities to go far. "
Renzo Justo Casaretto
Field Assistant (GyM)
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PERSONNEL DEVELOPMENT
28,000 +
DIRECT
JOBS
created
419,000 +
MAN HOURS
of training for employees
and laborers
10
YEARS
without social conflicts
with formal labor
unions
83%
OF WORKERS
feel they work at a great place
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SUSTAINABILITY STRATEGY
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PERSONNEL DEVELOPMENT
We acknowledge that our people are the
organization`s most valuable resource, and
we are convinced that with “the right person
in the right place” we will achieve better
results. Therefore, we seek to attract and
develop top talent, offering them a place for
growth and learning in line with the Graña
y Montero Style, and a work environment
of respect, camaraderie and trust.
Management
model
"The right person
in the right place"
1.- Attraction
2.- Performance management
3.- Development
and loyalty-building
Graña y Montero
style
- Corporate policies and values
- Ethics Charter, Code of
Conduct, and Anti-corruption
Policy
- Book titled "El Estilo
Graña y Montero"
(Graña y Montero´s Style)
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OUR TEAM
In 2016, the Graña y Montero Group
was made up of 28,079 people, including
employees, laborers and consortium
personnel. This figure represents a reduction
of 3.3% in comparison to 2015, due to
lower economic activity and the completion
of important projects, such as the Cerro
del Águila Hydroelectric Station.
The Graña y Montero Group Team
24,259
15,841
14,706
11,026
6,662
2016
TOTAL:
28,079
17,591
8,493
3,317
1,995
30,000
25,000
20,000
15,000
10,000
5,000
0
2014
2015
2016
Employees
Laborers
Consortium personnel
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Composition of the team
Distribution of workers, by country
7%
Consortium
personnel
27%
Laborers
5%
Panama
14%
Chile
TOTAL
28,079
TOTAL
28,079
66%
Employees
21%
Colombia
60%
Peru
Distribution of employees, by gender
Distribution of laborers, by gender
18%
Female
TOTAL
17,591
3%
Female
TOTAL
10,488
82%
Male
97%
Male
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OUR TEAM
Principales resultados 2016
As our Ethics Charter and Corporate
Sustainability Policy states, at Graña
y Montero we reject any form of
discrimination, and we provide the same
access and development opportunities to all
of our workers. Currently, 18% of the people
on our employee payroll are women; in
the case of Viva GyM and Graña y Montero
(headquarters), this number rises to 54%
and 53% respectively. In addition, 17% of our
management positions are held by women.
Although only 3% of our laborers are female,
we see this situation as an opportunity to
promote respectful behavior among men and
women through workshops and psychological
advice aimed at preventing violent situations
in and outside the company.
As signatories of the Global Compact,
we are committed to the protection of
fundamental rights in the workplace and
decent employment, which implies freedom
of association, rejection of forced labor
and child labor, and the elimination
of any type of discrimination.
WE PROMOTE
FORMAL,
DECENT JOB
POSITIONS
OF EMPLOYEES
99%
AND 100%
OF LABORERS2
received a salary
above the country`s
legal minimum wage3
73%
OF OUR
EMPLOYEES
received some
type of training
during the year
81%
OF OUR
EMPLOYEES
consider they have
the necessary
resources, tools, and
equipment to carry
out their work
WE REJECT
ANY FORM OF
DISCRIMINATION
88%
OF OUR
EMPLOYEES
felt they are treated
fairly, regardless
of their gender
0
COMPLAINTS
ABOUT
DISCRIMINATION
in the Ethics
Channel
68%
OF OUR
LABORERS
felt they are
treated fairly,
regardless of their
social status4
WE RESPECT
FREEDOM OF
ASSOCIATION
20 +
CONSTRUCTION
PROJECT
COMMITTEES
and labor
unions
0
CONFLICTS
WITH FORMAL
LABOR UNIONS
over the
last ten years
2 Laborers subject to the civil
construction regime include GyM
and STRACON GyM, which represent
77% of the total number of laborers.
3 Annual salary
4 Considers laborers of GyM as per
GPTW 2016 survey.
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OUR TEAM
We maintain good relations with labor unions
in all circumstances. For the past 11 years we
have participated at the negotiations table of
the collective agreement between CAPECO
and civil construction labor union federations
at the national level, where we have contributed
to reaching agreements within the established
time periods, with benefits and improvements
in line with the sector´s growth.
We also promote the formation of the
Construction Project Committees in all
of our projects with more than 20 people,
in order to establish organized, fluid
communication between the company and
the workers. As an innovation in labor union
management, GyM has implemented a
social and labor monitoring system that
gives us a better understanding of workers
and Construction Committees needs.
In 2016 we successfully dealt with more than
20 Construction Project Committees and
labor unions. This preventive approach made
it possible to avoid having any social conflicts
with formal labor unions.
5 GyM: 8 works committees and 4 unions,
Stracon GyM: 1 works committee, CAM
Chile: 8 unions
GMP: 1 union
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OUR PEOPLE
MANAGEMENT MODEL
In 2016 the strategy of the Group’s people management was
based on the “the right person in the right place” motto. With
this view, we reaffirm that our people are the differentiating
factor in the execution of our operations.
1
ATTRACTING
TALENT
2
PERFORMANCE
MANAGEMENT
1. ATTRACTING TALENT
Our objective is to attract professionals and technicians
with high potential and to identify in them the competencies
required by the Group and the values of the Graña y Montero
Style. For this purpose, we implemented competitive and
transparent selection processes aligned with the needs
of our projects and operations.
One of the most important initiatives is the Trainee program,
which selects the most outstanding young people from the
country’s top engineering schools and trains them for six
months. Since its creation in 2010, this program has enabled
us to recruit 766 junior engineers from Lima and other
provinces, helping to reduce the barriers many young people
face in obtaining formal employment.
Our selection processes also take into account the social
expectations of the of the social environment. For example,
through the Developing Skills for Job Placement program,
we make significant efforts to provide training for members
of the communities surrounding our projects, which enables
us to hire 100% of the unskilled labor locally.
Local Hiring 2016
Main initiatives in 2016:
- We enhanced our online recruiting platforms: Jobsite
(150,000 resumes of potential employees), LinkedIn and
the Chambita web portal (21,600 applications for operations
positions, 38% more than in 2015).
- We conducted a monthly average of 250 selection processes
for employees.
- We obtained over 105,000 applications for operating
positions through our decentralized offices in Lima,
Arequipa, Cajamarca, Cusco, Moquegua, Talara and Tacna.
- We have a database of over 127,000 civil construction
resumes (GyM).
- We implemented a training program for heavy machinery
operators that provided 4,590 hours of training and made it
possible to hire 27 members of the community as equipment
operators (STRACON GyM).
3
DEVELOPMENT
AND LOYALTY-
BUILDING
Percentage of local employment out of total unskilled labor
Percentage of local employment out of total under the common regime
Percentage of local employment out of total under the civil construction
regime
GyM
100%
70%
51%
STRACON
GyM
Morelco
CONCAR
100%
65%
79%
100%
79.9%
Not
applicable
(*)
Not
applicable
(*)
(*) The distinction between the common and civil construction labor regimes is not applicable to Morelco and CONCAR.
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2. PERFORMANCE MANAGEMENT
We recognize that the achievement of our strategic objectives
is intrinsically linked to our workers’ daily performance.
Therefore, we seek to clearly establish and explain what is
expected of them in terms of attitudes and results, measure
their progress, and know their expectations with regard to
their role in the organization.
In 2016, we continued conducting assessments, covering 79%
of our employees and 11% of our laborers (civil construction).
The results of these processes are an important input for
promoting career paths and objective recategorization,
which in 2016 made it possible to cover 235 job openings
with Group workers and to promote 263 laborers.
INTEGRATEDANNUAL REPORT 2016 Financial ReportSustainability ReportCONTENTCommittedto the future 3. DEVELOPMENT AND LOYALTY-BUILDING
We are committed to the professional and personal
development of all of the Group’s workers. Therefore,
we have the Graña y Montero Academy, which is the main
place used for training, learning, exchange of experiences
and knowledge management in the Group. Through it, we
provide an attractive, up-to-date curricular structure with
846 online and face-to-face courses that seek to develop the
competencies and skills required by the organization, with
the active participation of our 505 in-house instructors.
In addition, the Academy has diverse technological tools that
facilitate connectivity between people and rapid access to
information.
HOW WE DO IT
SUSTAINABILITY STRATEGY
- Personnel development
84
In 2016
- We offered 202 courses through the Virtual Classroom,
- We maintained our Network of Experts, made up of over
with 166,897 sessions recorded on the platform.
3,000 professionals, where 7,604 sessions were registered.
- Over 300 workers participated in the 23 traveling courses
held at the projects.
- We have a large virtual library with over 2,800 documents
(books, dissertations, internal and external papers, videos,
talks, blogs, manuals, documents from workshops and
conferences, etc.)
- We implemented 14 knowledge communities, in order to
brind professionals from related fields together to share
ideas, good practices and solutions to common problems.
- We organized the first edition of Conecta 2016, for the
purpose of sharing knowledge among the different
companies in the Graña y Montero Group. This space
seeks to approach innovation and technology topics
relevant to our business.
Training 2016
Item
Total man hours
of training
Average man hours per
employee
Percentage of workers
that received training
at least once during
the year
Number of in-house
instructors
Engineering
and
Construction
Infrastructure
Real Estate
Services
Holding
Team
Total Group
2016
2015
49,685
15,552
3,564
310,385
1,431
380,617
386,047
15
59%
101
28
28
23
8
22
26.3
91%
100%
75%
78%
73%
85%
31
20
338
15
505
551
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In the case of our laborers, we provide specific training
sessions that responded to the projetc’s needs and also enhance
their knowledge, in order to counteract the temporary nature
of projects and the cycles of the construction sector.
In addition, we want our workers and their families to
feel motivated and close to the company, so we offer them
programs geared toward a good work-life balance.
- Preventive check-up: We provide annual check-ups in order
to care for our workers` health, creating a culture of disease
prevention. In addition, our laborers received talks on health,
policies, and insurance.
- We provided over 38,000 man hours of training for
laborers, with four objetives: technical updating, attitudinal
development, skill development and complementary training,
and risk prevention (GyM).
- We organized different theory and practical workshops to give
our workers the opportunity to specialize. Among these were
tile work, masonry, and electrical installation workshops, as
well as other. A total of 274 workers participated (CONCAR).
- We seek to reinsert our workers in the basic educational
system through the CONCAR School Project, so that they can
complete their primary and secondary studies. Workers attend
classes at the Alternative Basic Education Centers (CEBAS)
closest to their homes, with flexible schedules and at zero cost.
In 2016, the number of workers participating in this program
increased 27.7%.
- Recognitions: Every year, we award employees with
the Corporate Values recognition (for having a high level
of performance and exemplifying the Group values) and
for Years of Service (25 years with the Group). In the
case of our laborers, we honor the best worker of the year.
- Gym at the office: We encourage our workers to engage in
physical activity on company facilities. Therefore, we have
a gym at our administrative offices in Surquillo, where they
can work out whenever it is convenient for them, with access
to a personal trainer and nutritional advice.
- Keeping the family close: We carry out initiatives for our
workers` children, such as recognition of children with
outstanding performance at school, drawing contests, visits
to the projects, etc.
- Corporate celebrations: Every year, we celebrate another year
of operations with the workers from all of the companies in the
Graña y Montero Group. The purpose of this celebration is to
thank our workers for their invaluable contribution.
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THE ROLE OF GRAÑA Y MONTERO’S LEADERS
Leaders play a key role in guaranteeing our workers`
performance, commitment and development, as well as in
transmitting the Graña y Montero Style by their example.
Their work begins with the identification the business's
need, which translates in job positions, functions and
competencies. In addition, the feedback and follow-up
they provide their teams for the purpose of increasing their
potential through access to new experiences and learning
opportunities is essential.
With them, we work on three training programs, which made
it possible to train 177 of the organization`s leaders in 2016:
Executive Program (50 high-level executives), Executive
Training Program (150 high-level executives), and leadership
workshops aim to all of our workers in supervisory positions.
Lastly, all of our leaders are evaluated through a leadership
survey, the results of which reached 82%, showing a 6 - point
improvement.
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2016 PROGRESS
- We strengthened our personnel management system
with an execution-based comprehensive approach.
- We increased the use of the virtual classroom, especially
in Colombia and Chile.
- We came in 5th in Merco Talento’s ranking of the top companies
for attracting and retaining talent in Peru.
- We placed 1st in Laborum’s Employer Branding Study - Construction
and Real Estate category.
- For the seventh year, our companies were recognized as the best
companies to work for (GPTW): Viva GyM placed 6th, GMP placed
7th, GMD placed 14th, and STRACON GyM placed 17th in their
respective categories.
2017 CHALLENGES
- To continue working on the concept of “the right person
in the right place,” with emphasis on execution.
- To strengthen the self-development culture so that the workers
take better advantage of the training tools available.
- To meet the Peruvian Ministry of Labor’s requirements related
to the certification of laborers.
- To standardize and expand the scope of the performance
evaluation process for laborers on every project.
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OPERATIONAL
EXCELLENCE
“ We work with discipline to meet and exceed the clients’
expectations, delivering efficient and high quality results.
Getting things done and enhancing their value makes
me feel proud of our work."
Soledad Silva Arroyo
Lab Inspector (CAM Perú)
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OPERATIONAL EXCELLENCE
100%
PROJECTS
before the deadline6
6 The companies that audit the compliance of their projects; deadline through
an independent third party are: GyM, GMI, GMP, Viva GyM, and GMD.
90% +
COMPLIANCE
with service availability,
regularity and cleanliness indicators
on Metro Lima LINE 1
81% +
COMPLIANCE
in operational management
of companies in the service area
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OPERATIONAL EXCELLENCE
At Graña y Montero, operational excellence
is one of our main competitive advantages
which is evidenced in terms of the quality,
efficiency, compliance and profitability
of our projects.
Our Operational Excellence Model, inspired
by the Lean philosophy, seeks to maximize
the value generated for the client. Thus,
we define the key success factors in all
of our projects and we provide training to
the corresponding teams on methodologies
and good practices focused on continuous
improvement.
Management
system
People
To have good processes
To have capable people
- Process quality
- Simple reports
- Evaluation of capabilities
- Hands-on training
Management
discipline
To guarantee that people
follow these processes
- That processes
are carried out
- That processes are
reviewed and improved
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MAIN INITIATIVES 2016
Engineering and Construction
Infrastructure
Real Estate
Services
- We conducted audits of over 70% of
our projects, in order to measure the level
of operational excellence, and we made
adjustments to the control processes for
the purpose of improving the predictability
of our results (GyM).
- We began conducting evaluations to analyze
the fulfillment of roles and functions in 5
projects (GyM).
- We initiated a digital transformation project
for the recording of man hours worked by
laborers (GyM).
- We recertified our quaility management system
according to ISO 9001:2015 and maintained
our Integrated Management System (GMI).
- We implemented a productivity measurement
and labor monitoring system in each projects
(Morelco).
- We sought to optimize our purchasing
processes and redesigned reception,
storage and dispatch processes (GMP).
- We handed over 100% of our projects
before the contractually established
deadline (Viva GyM).
- We designed a standardized reporting
system for the service companies, with
standardized productivity indicators.
- We surpassed contractually established
service levels: availability (99.95%),
regularity (97.75%) and cleanliness
(94.95%) Metro Lima LINE 1.
- We consolidated tools to ensure good project
startups, as well as a Production Planning
Model (CAM).
- We implemented operating indicators,
making it possible to measure and optimize
the use of resources and costs among
the operations teams (CAM Perú).
- We consolidated productivity indicators
by line business (GMD).
- We measured the levels of operational
excellence of 4 projects (CONCAR).
The strategic planning process was strengthened in all of the companies in the Group according to the Execution method
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OUR PERFORMANCE IN 2016
Compliance before the deadline
Indicator
Percentage of projects handed
over before the deadline
Compliance with service levels
Indicator
Percentage of compliance
in operational management
(contracts and/or services)
Percentage of projects/operations
evaluated according to operational
excellence levels
GyM
100%
GMI
100%
GMP
100%
Viva GyM
100%
CAM
Chile
91%
CAM
Colombia
83.3%
CAM
Peru
81%
CONCAR
GMD
81%
96.39%
100%
90%
54%
91%
100%
INNOVATION AT GRAÑA Y MONTERO
We consider that innovation is part of our operational
excellence standards, and that it delivers value to our clients.
Along these lines, in 2016, we created Digital Transformation
and Applied Technology, a corporate project whose main
objective is to encourage rethinking our procedures, skills,
operations and business models to build upon the changes
and opportunities generated by technological and digital
breakthroughs.
The project will seek to catalyze this important change
endevor, hand in hand with our business areas and companies,
thus setting a joint vision, strategic alignment along and
commitment with the culture of innovation at all levels
of the organization.
In addition, during the reporting year, we created an
Innovation Department in Viva GyM, in order to boost further
innovation in our products, services and financing procedures.
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In 2016, our operations were certified according to the following international standards:
International standards
Company
GMI
GyM7
Morelco
VIAL Y VIVES - DSD
GMP 9
Ferrovías GyM
GMD
CONCAR
CAM Chile
CAM Colombia
CAM Peru
Adexus
ISO 9001
(quality)
ISO 14001
(environmental)
OHSAS 18001
(safety)
ISO 27001
(information
security)
ISO 20000
Other standards
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X8
X10
X11
X12
X13
X
X
X
X
7 ISO 9001 for Electromechanical Division and Transport´s Lines of Hydrocarbons; ISO 14001 and OHSAS 18001 for Electromechanical Division.
8 ASME ESTAMPES U/S NATIONAL BOARD ESTAMPER.
9 Oil and gas production processes in lots I and V, gas processing at the Pariñas plant, storage and dispatch of hydrocarbons-derived products in Terminals
and processes carried out at the head office.
10 NCh ISO 17025 Calibration Laboratory, NCh ISO 17025 Testing Laboratory and NCh ISO 17065 Product Certification Agency
11 ISO/IEC 17020 Certification and ISO/IEC 17025 accreditation
12 NTP ISO 17020
13 ISO/IEC 27001, ISO/IEC 20000-1, SAP Provide of Hosting Partner and SAP in Cloud Provide
In line with ISO 27001, at GMD we work with high safety
standards for safeguarding our customers’, users’ and workers’
information. During 2016, we implemented a training plan
to raise awareness in the company regarding our policies on
confidentiality, integrity and the availability of information.
In addition, we conducted internal and external audits,
which enabled us to identify opportunities for improvement.
Along this same line, in order to protect our customers’
information, we have controls in place over the software
used for databases, using the Genesys tool.
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SUSTAINABILITY STRATEGY
- Operational excellence
94
2016 PROGRESS
- We continued with the consolidation of the
operational excellence areas, developing cross-
cutting guidelines and standardizing roles,
macro processes, the management system
and indicators.
- We made improvements in warehouse and
distribution center processes, which enabled
us to reduce operating costs (GyM).
2017 CHALLENGES
- To increase the use of technology in providing
services, in order to improve efficiency and
control over the operation.
- To continue with the digitization of
construction project processes, seeking greater
efficiency and better results for our customers
(GyM).
- To develop specific Operational Excellence
Training programs for the services companies,
working with the Academy.
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SAFETY AND
HEALTH
“ At Graña y Montero, safety is the first and foremost
priority, and that is very reassuring for my family
and me. We all participate in a permanent zero accidents
campaign and take care of the future we are building."
Eyner Niquin Aguirre
Earthworks Official (STRACON GyM)
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SUSTAINABILITY STRATEGY
- Safety and health
96
SAFETY AND HEALTH
IFR
0.40
for every
200 thousand
hours worked
14 The man-hours taught on safety issues are not included in the "Personnel
Development" chapter.
PRIZE
“EXCELLENCE
IN SAFETY 2016”
for STRACON GyM,
as best mining contractor
10
COMPANIES
OF THE
GROUP
certified with
OHSAS 18001
+1
MILLION
man hours
of training
in safety 14
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SUSTAINABILITY STRATEGY
- Safety and health
97
SAFETY AND HEALTH
Protecting the lives of all the people
participating in our operations and services
is a priority for Graña y Montero. For this
reason, we provide safe working conditions
and promote preventive culture principles
in order to attain our “zero accidents” goal.
Management system
- Corporate Sustainability Policy
- Policy on risk prevention
for each Risk Prevention Policy
for each business line
- OHSAS 18001 Guidelines
- Corporate Commission on Safety
- Identification matrixes and risk
evaluation, prevention plans
and performance indicators
Preventive culture
a. Leadership-based safety
- Technical training
- Aligned economic incentives
b. Behaviour-based safety
- Risk perception
- Good practices in the work place
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SUSTAINABILITY STRATEGY
- Safety and health
98
In 2016, we continue promoting the
Safety based on leadership and Safety based
on behavior approaches in all levels of the
organizations. Under this framework, as a
Group we provided over 100 thousand hours
of training in risk prevention for managers
and directors, 794 thousand hours of training
for employees and nearly 200 thousand
hours of training for subcontractors.
Additionally, to improve the leadership and
commitment of our chain of command, these
training sessions were complemented with
periodic manager’s visits to projects, the setting
of annual safety goals based on the type of
activity, the generation of opportunities to
share lessons learned, and the monitoring
of safety panels by the Board of Directors.
794
THOUSAND
HOURS
of training for
collaborators and nearly
200
THOUSAND
HOURS
of training for
subcontractors.
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HOW WE DO IT
SUSTAINABILITY STRATEGY
- Safety and health
99
ROAD SAFETY
MAIN INITIATIVES 2016
Due to the nature of our operations,
road accidents are some of the main risks
that we are exposed to. We have over 4,300
cars subject to our safety management
system, which cover 87 million kilometers
during the year, transporting people
and materials.
Aware of this risk, in 2016 we signed a
working partnership with MAPFRE insurance
company to implement the Road Safety Audit
Program in the main companies of the Group
in Peru. This audit assessed the degree of
implementation of our Technical Road Guide
in 37 projects and identified improvement
opportunities in four factors: people, vehicles,
road infrastructure and corporate behaviors.
The audit ended in December and the results
will allow us to enhance the preventive actions
plans for 2017.
Engeneering
and construction
Infrastructure
Real State
Services
- The Competent Supervisor
program was implemented to
enhance the chain of command
ability to identify dangers and
apply controls (GyM).
- Monthly safety forums
continued with the
participation of chains of
command, and an incident
report was consolidated (GMP).
- The leadership in safety program
was promoted, including 360°
evaluations and proactive
monthly review of indicators
with the chains of command
(STRACON GyM).
- Three instructors were certified
in defensive management,
and they trained and granted
management authorizations to
266 collaborators and
99 contractors (GMP).
- A new technology was introduced
for monitoring and road safety
control in Colombia (Morelco).
- Preventive medicine programs
were implemented in relation to
ergonomics, solar radiation and
healthy lifestyles (GMI).
- The Ola Verde (Green Wave)
program is still ongoing to
prevent concentration of
users in stations and platforms.
An ambulance service was
enabled for users (Metro Lima
LINE 1).
- Management visits to work
- The OHSAS 18001 certification
sites and security performance
evaluations were consolidated
as part of residents’ meetings.
process was started and the
Equipo de la Vida (Equipment
for Life) program was
implemented to reduce the
number of road accidents
(CONCAR).
- OHSAS 18001 was recertified
(GMD).
- The Safety office was created.
It monitors the beginning and
the end of each service through
voltage detectors placed in
the technicians´s helmets and
vehicles cameras (CAM Chile).
- Safety curricular structures were
developed for each contract,
and airbag jackets were given
to 100% of motorcycle drivers
(CAM Colombia).
- The handbook on safety
procedures and the Safety
Peru Plan were implemented
(CAM Peru).
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SUSTAINABILITY STRATEGY
- Safety and health
100
OUR SAFETY RECORDS
In 2016, risk prevention efforts continued,
allowing us to obtain an accident rate
injury frequency rate (IFR) of 0.40 for every
200,000 hours worked, thus remaining
at a level similar to 2015 and confirming
the positive trend of the last three years.
These outcomes are consistent with the
Group’s declining number of accidents,
with 172 accidents at the end of 2016, a
considerably lower number compared to the
368 cases in 2014. As to the degree of severity,
an improvement was observed, going from a
ratio of 124 to 67 non-worked days for every
200,000 hours worked.
The Engineering and Construction,
and Real Estate areas had an outstanding
performance. Thanks to the consistency
of the managers visits to projects and follow
up of safety indicators in the meetings of
engineer residents, the accident rate was
reduced from 0.38 to 0.34 and from 0.53
to 0.38, respectively.
Injury frequency rate per business area
BUSINESS AREA
Engineering
and construction
Infrastructure
Real State
Services
Grupo Graña
y Montero
2016
0.34
0.20
0.38
0.52
0.40
2015
0.38
0.22
0.53
0.45
0.39
90.0
80.0
70.0
60.0
50.0
40.0
30.0
20.0
10.0
0.0
Injury frequency rate - Grupo Graña y Montero
Injury frequency rate and number
of accidents per year - Grupo Graña y Montero
0.41
0.41
0.40
0.40
0.40
0.39
0.39
0.37
0.37
0.37
0.37
0.33
0.50
0.45
0.40
0.35
0.30
400
368
300
0.59
200
100
0
245
0.39
0.40
172
0.70
0.60
0.50
0.40
0.30
0.20
0.10
0.00
jan
feb
mar
apr
may
jun
jul
aug
sep
oct
nov
dic
2014
2015
2016
Hours
worked in 2016
IFR 2016
Number
of accidents
IFR
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SUSTAINABILITY STRATEGY
- Safety and health
101
2016 PROGRESS
- We strengthen our teams’ technical skills by providing
over 1 million hours of training in risk prevention.
- We kept improving our performance in safety, reducing the
number of accidents in the Group and the degree of severity.
- We completed 100% of the road audit work, including
the evaluation of 37 projects in Peru.
2017 CHALLENGES
- To standardize safety processes in the different Group’s
companies, especially in projects outside the countries
and consortia.
- To implement the road safety action plan, by introducing
the audit's road safety recommnendations.
- To improve dissemination and learning mechanisms
in the projects lessons learned.
- To provide the Risk Prevention Team with training in
negotiation and leadership skills, and continue with
segmented training plans for managers and workers.
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ENVIRONMENT
“ I am proud to work for a company that shares
my concern for the environment. I believe that
it makes genuine efforts to look for solutions
to the environmental problems that affect us."
Nelson Anibal Briceño Polo
Minibus driver (STRACON GyM)
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- Environment
103
ENVIRONMENT
67
MILLION
cubic meters of waste-water
treated by the La Chira
Waste Water Treatment
Plant (720 times
the volume of Lima´s
National Stadium)
+ 26
TONS
of recycled electronic
and common waste
products
9
COMPANIES
of the Group with ISO
14001 certification
We improved the
coverage of our
2016
CARBON
FOOTPRINT
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SUSTAINABILITY STRATEGY
- Environment
104
ENVIRONMENT
In Graña y Montero, environmental
management is conducted along three main
intervention lines: (i) reduce the environmental
impact of our operations and services; (ii) foster
a culture of environmental responsibility, in
and outside the organization; and (iii) design
engineering solutions that make it possible
to improve the environmental performance
of our clients and society at large.
Management
system
- Corporate Sustainability
Policy (2016)
- Environmental Policy
of each business
- ISO 14001 guidelines
- Environmental risk
identification and
assessment matrices and
performance measurement
Enviromental
culture
- Graña y Montero Style
- Awareness- raising
campaigns in and outside
the organization
Enviromental
solutions
- Environmentally efficient
engineering designs
- Public-private partnerships
that improve the country’s
environmental performance
- Environmental consulting
services
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SUSTAINABILITY STRATEGY
- Environment
105
ENVIRONMENTAL MANAGEMENT IN OUR OPERATIONS AND SERVICES
All the Group’s companies prioritize their environmental risks by analyzing the context
and nature of their activities. This allows us to focus our efforts and resources on issues
that will allow us to objectively reduce our environmental footprint, as well as comply
with the law of the places where we operate.
Energy consumption
ENERGY AND EMISSIONS
During 2016, the Group consumed 115.6 million kWh of electric power, mainly through the
Infrastructure area (61%), related with the operation of the Metro Lima LINE 1 and the
operation of the Talara Gas Plant (GMP). In addition, the Engineering and Construction
area accounted for 82% of fuel consumption, related with earth-moving activities for mining
operations.
This year we improved the coverage of our Carbon Footprint to include, for the first time,
not only the emissions of our administrative offices but also the ones from our operation.
Accordingly, we recorded of 203,859 tons of CO2, which will allow us to develop action plans
to improve our performance in coming years.
Operations and services
Energy type
Engineering
and
Construction/1
Infrastruc-
ture/2
Real
Estate/3
Services/4
Adminis-
trative
offices /5
Total
Electric power
(kWh)
24,143,443
70,979,629
Fuel (Gl)
12,628,197
133,574
NA
NA
14,839,029
5,864,181
115,826,283
2,529,926
61,341
15,353,038
1/ Engineering and construction: includes the information about GMI, GyM, STRACON GyM and Morelco projects.
2/ Infrastructure: includes the information about operations of Lima Metro Line 1 and GMP (Gas Plant and Terminals)
3/ Real Estate: mainly has commercial and administrative activities included in “Administrative offices”
4/ Services: includes information about operations of Concar, GMD, CAM Perú, CAM Chile, CAM Colombia and Adexus.
5/ Administrative offices: Includes Surquillo, Petit Thouars, Bogotá, Nuevo Mundo and Talara.
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SUSTAINABILITY STRATEGY
- Environment
106
- Services: We installed Dual Satellite GPS units in the
personnel transport vehicles in order to improve monitoring
of timetables, speed and routes, which allowed us to reduce
fuel consumption (Concar). We also implemented the
HuellaChile program, with which we can quantify, manage
and report the company’s greenhouse effect emissions
to national authorities (CAM Chile).
At corporate level, we are assessing a project to replace the
lighting system of the Surquillo administrative facilities with
LED lighting. This will allow us to reduce our offices’ electric
power consumption by almost 64%.
- Engineering and Construction: We installed solar water
heaters in all the Shahuindo Project camps, which saved
about 30% of electric power. We also implemented a
software to measure and optimize the fuel consumption
of La Zanja Project, which reduced the emissions of yellow
line equipment by 3% (STRACON GyM).
- Infrastructure: We automated the lightning and air
conditioning systems in the control tower of the Villa El
Salvador workshop, which saved 4.26% of electric power
consumption (Lima Metro Line 1). We also developed a
reforestation program under which more than 650 seedlings
of native plant species were planted in Talara, which
contributed to capture and reduce carbon dioxide (GMP).
- Real Estate: We implemented movement sensors and LED
lightning in the common areas of our Villa Los Molles, Los
Girasoles and Los Nogales social housing projects, as well
as in the Proyecto Panorama Plaza housing and commercial
building. We incorporated residential connections to the
natural gas pipeline and we are working on the design of
bicycle lanes that will connect the public recreation areas
with the residential areas in future projects (Viva GyM).
Main initiatives 2016
Graña y Montero Group 2016 Emissions
(GEI= 203,907 Tn CO2 eq)
1%
Administrative
offices
14%
Services
17%
Infrastructure
68%
Engineering
and Construction
15 2016 Greenhouse Effect Gases Inventory prepared by Libélula Comunicación
Ambiente y Desarrollo S.A.C. The 2016 Carbon Footprint was calculated under
scopes 1 and 2 and included the following companies: GyM, GMI, STRACON
GyM, Morelco, GMP, Lima Metro Line 1, Viva GyM, CONCAR, GMD, Cam
Peru, Cam Chile, CAM Colombia and Adexus.
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SUSTAINABILITY STRATEGY
- Environment
107
WATER
Main iniatitives 2016
In 2016, the Group consumed 1.6 million cubic meters of water,
which represents a 50% reduction as compared to consumption
in 2015. This is mainly due to the completion of the Cerro del
Águila Hydroelectric Power Station Project (GyM) and to the
decreased activity of the Constancia Project (STRACON GyM).
At the administrative office level, we recorded a consumption
of 37.9 liters per employee per day.
- Engineering and Construction: As part of our dust control
processes for the access roads to mining projects, we used a
mixture of water and molasses that kept the ground humid
for a longer time. This saved 2.17 gallons per square meter
of road (STRACON GyM).
- Infrastructure: We have a water treatment and recycling
system that allows us to recycle water used for train cleaning
(Metro Lima LINE 1).
- Real Estate: As part of the Eco Viva program, we
implemented wetlands to use the showers’ greywater for
green areas irrigation in the social housing condominiums
(Viva GyM).
- Services: We installed water-saving flush valves in the
sanitary facilities of our administrative sites, conducted
leakage inspections and water saving campaigns. This
allowed us to reduce by 40% the water consumption
by employee (CAM Colombia).
2.17
GALLONS
PER M2
saved on road
irrigation
(STRACON GyM)
Water consumption
Water
Engineering and
Construction/1
Operations and services
Infrastructure/2
Real Estate/3
Services/4
Administrative
offices /5
Total
Total water volume (m3)
1,173,722.39
198,636.71
-
177,862.26
17,170.00 1,567,391.36
1/ Engineering and Construction: includes the information about GMI, GyM, STRACON GyM and Morelco projects.
2/ Infrastructure: includes the information about operations of Lima Metro LINE 1 and GMP (Gas Plant and Terminals)
3/ Real Estate: mainly has commercial and administrative activities included in “Administrative offices”
4/ Services: includes information about operations of Concar, GMD, CAM Peru, CAM Chile, CAM Colombia and Adexus.
5/ Administrative offices: includes Surquillo and Petit Thouars administrative sites.
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SUSTAINABILITY STRATEGY
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108
SOLID WASTE
The Group’s companies foster the re-utilization and suitable
management of the waste products of their operations.
During the past year, the Group generated 48,827 tons
of waste, approximately 13% of which were re-utilized.
Main initiatives 2016
- Engineering and Construction: Through ECOTEC, our
environmental consulting company, we entered into an
agreement to fill a non-metal quarry with construction
waste. We also began the process to install the first heap
in Peru with DIGESA’s approval (GMI). Thanks to a
collaboration agreement with RLG Perú we recycled 11.73
tons of electronic device waste (GyM).
- Infrastructure: We set up collection points for recyclable
waste sorting at the Villa El Salvador station (Lima Metro
LINE 1).
- Real Estate: We reused materials that were in good conditions
from our model houses and sales stands (Viva GyM).
- Services: The regular maintenance management provided on
highways included the recycling of approximately 4,177 tons
of asphalt, reducing power consumption, quarry stone and
the amount of waste generated (CONCAR). Additionally, we
recycled 1.83 tons of electronic and electric waste within the
framework of our Management Plan and RAEE Producers’
Annual Declaration (GMD).
In our administrative offices, we have updated our Solid
Waste Managment Plan. We recorded around 80 kg of waste
per employee and 14.4% was recycled, thanks to a partnership
with Ciudad Saludable.
Finally, we continued being part of the Technical Committee
For Standardization of Construction Waste Management,
working along with the Ministry of Housing, Construction
and Sanitation, CAPECO and other stakeholders to update
the local technical standards for this kind of waste.
MANAGEMENT AND
PREVENTION OF SPILLS
In spite of preventive efforts, unfortunately
in 2016, our subsidiary company GMP registered
three liquid spills in Lot III, Terminal of Ilo,
that were reported to the proper authorities.
In response to these events, we incorporated
mechanisms of remediation, such as the
removal of contaminated material, soil analysis,
and transport of and final deposit of waste
in secure landfills.
In STRACON GyM, thanks to the programming
of preventive inspection and the use of hosing
caps during maintenance, we managed to
reduce the frequency of spills by 65% compared
with 2015.
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SUSTAINABILITY STRATEGY
- Environment
109
ENVIRONMENTAL CULTURE
We foster a culture of environmental responsibility, not
only among our workers, but also among the users, suppliers
and communities with which we work.
Main initiatives in 2016
- Engineering and Construction: We organized awareness
and training workshops for resident engineers, budgets
and sales areas to improve our waste management (GyM).
- Infrastructure: We trained the adjoining communities to
Lots III and IV so they can get involved, together with the
company, in the environmental monitoring actions (GMP).
Furthermore, through Lima Metro LINE 1 in partnership
with Villa El Salvador Municipality, we have planted
3,600m2 of new green areas surrounding the metro duct.
- Real Estate: We organized workshops about environmental
care meant for children from the building condominiums
of Los Girasoles, Los Nogales and Parques de San Martín
de Porres.
- Services: We raised the awareness of our collaborators
regarding the reduction in paper consumption and
hazardous waste such as toner and printer ink (Adexus).
Additionally, at corporate level we re-launched the
Ecopuntaje (Ecoscore) campaign that evaluates proper waste
sorting and aims to activate worker´s enviromental awareness
of environmental responsibility. Thanks to this campaign,
we managed to recycle 14.44 tons of paper and plastic waste,
comparable to saving 220 ten-year old trees.
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SUSTAINABILITY STRATEGY
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110
ENVIRONMENTAL SOLUTIONS
We are aware that the services we provide must reduce
the climate change risks and its consequences. For this reason,
we have developed solutions, projects and technologies that
will generate environmental benefits for our clients and
for society at large.
Main initiatives 2016
- Engineering and Construction: We provided technical
support for the installation of Security Landfill in Ica
and developed the Environmental Impact Assessment.
Furthermore, we have been working on the engineering,
procurement and construction of two waste-water treatment
plants in the agribusiness and mining industries (GMI).
- Infrastructure: We were granted the viability to perform
the feasibility studies of the Lake Titicaca Waste Water
Treatment System Project, with a capacity to handle the
liquid effluents of ten cities in Puno, which will benefit
870,000 people.
- Real Estate: We developed office buildings according
to LEED17 standards, including the Panorama Plaza
project that earned the LEED Gold certificate, and Rivera
Navarrete that achieved the LEED Silver (Viva GyM).
- Services: We provide specialized services to reduce power
waste. Within the year, we performed the energy balance
in over 20,000 power supplies. We installed 10,650 hubs
and identified energy losses, which resulted in cost savings
for our customers of 10.7 million kWh (CAM Peru).
WASTE WATER TREATMENT PLANT – LA CHIRA
In 2016, the La Chira project entered in operation, treating 25% of the city of
Lima’s waste water, which -until recently- had been disposed directly into the
ocean. This project has required an approximate investment of S/.360 million
and treats 11.3 m3 of water per second that comes from 18 city districts
(2.6 million inhabitants).
In April of 2016, we completed the construction phase, where we
succeeded in installing of one of the longest marine outfalls in Latin
America, with a length of 3.6. kilometers and a weight of 6,100 Tn.
Currently the plant is already in operation and generates a very positive
environmental impact. Monitoring stations meet with the contractually-
established environmental quality standards, and we have prevented
the disposal of 7 thousand Tn of waste into the ocean.
The La Chira Waste Water Treatment Plant allows us to recover beaches
and marine flora and fauna, enable tourist activities, reduce the risk of illness
and improve the standard of living of the population.
16 LEED Standards: Scoring system used by the Green Building Council of the United States to ensure the sustainaibility
of new and existing buildings with respect to water and energy savings and use of resources, among others.
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SUSTAINABILITY STRATEGY
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111
2016 PROGRESS
- We entered into an agreement that enables the enclosure
of a non-metallic quarry with construction waste, and we
initiated the process of installing the first construction waste
landfill in Peru authorized by DIGESA.
- We expanded the carbon footprint coverage of our projects,
which will allow us to develop efficient energy plans.
- We participated in updating the Technical Norms
of Construction and Demolition Waste Management.
- We re-launched Ecopuntaje, an initiative that evaluates
the proper sorting of recyclables in our offices.
2017 CHALLENGES
- To automate the report process of environmental
information, reinforcing the use of technology.
- To initiate a study to explore and increase
the reuse of construction waste.
- To measure and quantify the environmental
benefits of Eco Viva.
- To consolidate an environmental culture among
our collaborators.
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COMMUNICATION
AND DIALOGUE
“ Constantly we listen to our users to understand their needs.
We want them to place their trust in us and to know that we are
always prepared to offer an appropriate and prompt response."
Admer Galindo Pichihua
Station Supervisor in Los Cabitos (Metro Lima LINE 1)
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- Communication and dialogue
113
COMMUNICATION AND DIALOGUE
40,000 +
MONTHLY
VISITS
90,000
FOLLOWERS
to the website and
on Facebook
7 OF THE
MAIN COMPANIES
OF THE GROUP
obtained a customer satisfaction
level over 80%.
2ND BEST
COMPANY
in Investor Relations
(ALAS20).
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- Communication and dialogue
114
COMMUNICATION AND DIALOGUE
We construct positive relationships with
our different stakeholders based on dialogue
and trust. Both before beginning a new
business and on a regular periodic basis,
we identify the main actors and their
perceptions, implementing communication
channels that allow us to take into account
their doubts and concerns and to increase
their involvement with our Group.
Stakeholders of
Graña y Montero (G4-24)
Employees
Investors
Suppliers
Strategic
Partners
Clients
State
Communities
Communication
Media
Environment
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HOW DO WE DIALOGUE
WITH OUR STAKEHOLDERS?
Stakeholder (G4-26)
Relationship mechanisms
Employees
Investors
Suppliers
- Open door policy that puts employees and teams
closer to the chain of command
- Mass media: bulletins, in-house magazines,
intranet and websites
- Shareholder Service Office
- Quarterly open phone calls and meetings
with investors and analysts
- Integrated Annual Report
- Supplier’s Portal (SISPROV System)
- Direct and permanent relationship
Strategic partners
- Business meetings
- Corporate Website
Client
State
Community
Media
Corporate Client (B2B)
- Client - partner workshop
- Satisfaction surveys and interviews
- Company Magazines
- Integrated Annual Report
- Website of each company
- Satisfaction survey
- Integrated Annual Report
- Community relation specialist
- Queries and complaints systems
- Social situation analysis and report
- Liaison meetings
- Informative breakfasts
- Interactive media: Facebook, Linkedin
- Knowledge Portal
- Leadership surveys, feedbacks and Great Place to Work survey
- Quarterly management reports
- Publication of important features and press releases
- Corporate website
- Dialogue meetings
- Integrated Annual Report
Client User (B2C)
- Customer service office (Viva GyM and Lima Metro LINE 1)
- Complaints book and suggestion box
- Call center and call-free service
- Social networks: Facebook (Grupo Graña y Montero, Viva GyM,
Lima Metro LINE 1) and Twitter of Lima Metro LINE 1
- Website of each company
- Monthly Bulletin (Viva GyM)
- Institutional Relations Management
- Participation in trade shows and events
- Academic environment: conferences, exhibitions, forums, guilds
- PI Engineering Portal
- Social networks: Facebook and Twitter of LINEA 1 Lima’s Metro.
- Interviews on strategic issues
- Press releases
Relationship
frequency
Daily
Variable
Variable
Daily
Variable
Variable
Daily
Variable
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OUR RELATIONSHIP
WITH CUSTOMERS
In 2016, we defined clear guidelines, processes, roles and
responsibilities to manage -in a transparent manner- the
relationships between the Group’s executives and the State’s
senior officials. These guidelines are consistent with our
Ethics Charter, Code of Conduct and Anti-Corruption Policy.
Throughout the year we consistently seek to strengthen
our opportunities for dialogue with our corporate customers.
CAM Chile stands out for organizing the first Customer-
Partner workshop, while Adexus implemented face-to-face
satisfaction surveys with its ten most important customers,
thus completing the information from customer satisfaction
surveys carried out by the Help Desk.
Regarding our users, Metro Lima LINE 1 continued to
implement the Ola Verde (Green Wave) program to properly
manage the surplus demand on the system. Presently, the
metro delivers 9 million trips per month (demand expected for
year 2035), thus generating major challenges in safety, clients’
experience, order and coexistence.
In view of this situation, Metro Lima LINE 1 determined
maximum capacity quotas for each station, controlled through
traffic lights located in the outer areas. This has enabled us
to control the risk of accidents, improve the order of access to
the stations, save clients’ time and increase their satisfaction,
reaching 87.8%.
100% OF
COMPLAINTS
TAKEN CARE OF
within the established
time frame.
(Lima Metro LINE 1)
In addition to the different mechanisms of dialogue that we
implement with our stakeholders, to generate trust we need
to have an adequate management of complaints and claims.
Therefore, our subsidiaries have specific procedures based
on their business, which allows them to receive, analyze and
respond opportunely to each case. This issue is particularly
important for companies that have relations with end
customers, such as Viva GyM and Metro Lima LINE 1,
which reported success rates of handling complaints within
the expected deadline of 71% and 100%, respectively.
Satisfaction surveys 2016
Company
Engineering and construction
Score obtained
GMI
Morelco
Infrastructure
Metro Lima LINE 1
Real estate
Viva G y M
Services
Adexus
CAM Chile
CAM Colombia
CAM Peru
CONCAR
GMD
87%
98.56%
87.8%
68%
84%
84%
80%
77%
79%
90.1%
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BRAND STRATEGY
We have a brand strategy that seeks to reinforce Graña y
Montero's positive positioning and maintain our reputation.
In 2016, we focused on positioning four main attributes of
the Group: Seriousness, Internationalization, Infrastructure
and Sustainability. These issues were developed in different
communication materials and released through external
communication channels, such as Facebook, company
website, brochures, strategic events, among others.
We also distributed the Communication in Crisis
Manual, which aims to raise awareness among employees
in identifying risks related to the company's image, as
well as defining their roles when facing a potential crisis.
Finally, with a preventive approach, we continue to monitor
the media and digital platforms, which allows us to be
constantly informed of what is being said about our brand.
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2016 PROGRESS
- We developed guidelines to liaise
with the Goverment.
- We implemented client-partner workshops
at an international level.
- We disseminated and trained key areas
of the Group on the Communication
in Crisis Manual.
2017 CHALLENGES
- To consolidate registration and follow-up
of customer complaints.
- To implement a communication strategy
to recover our reputation among public.
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SHARING
WELL-BEING
“ I’m grateful to be a member of this team and I feel motivated
to continue to grow and to believe in myself. Being part of the
"Gestión en la Construcción" (Managment in Construction)
program has opened many doors for me and I believe that it
is a great opportunity for young people who, like myself, pursue
a career in engineering and construction. "
Mirian Otayza Sigueñas
Technical Office Assistant (GyM)
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SHARE WELL-BEING
184,000+
MAN-
HOURS
in training clients,
suppliers and
communities 17
17 Does not include training on occupational health and safety.
250
ACTIVE
VOLUNTEERS
US$
90
MILLION+
in local
purchases
4TH EDITION
of Construction Management
Training Program with
100% OF ITS
GRADUATES
currently working at Graña y Montero
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WITH OUR CLIENTS
We interact with millions of clients through
the various companies in the Group, either by
delivering public services or selling housing
projects. In this way we develop skills that
promote the appropriate use of infrastructure
and responsible citizen behavior.
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AYNI PROGRAM
Viva GyM promotes a respectful coexistence
among the new homeowners of its housing
projects. The Ayni Program trains and advises
residents about legal and administrative
issues, budget planning, conflict resolution
and leadership, among other topics, that
enable them to enjoy a better life quality
in these new urban communities.
As part of this initiative, in 2016 we
implemented activities that promote
environmental awareness and respect,
addressed to children of social housing
projects. Supplementing these efforts, we
launched the fourth edition of the Ayni
contest to reward the best practices related
to the use of public spaces in residential
housing complexes.
During 2016:
- 100% of social housing
projects implemented
the Ayni Program
- 80% of the homeowners
participated in at least
one workshop
- 1,466 families received training
- 86% of the community
members feel that Ayni
has improved their living
conditions
During 2016:
- 91% of the users considered
that LINE 1 Metro de Lima
promotes citizenship.
- 2,500 copies of the “Lima y
sus Patas” training program
were issued.
- 80+ artistic and cultural
performances.
- 77% of the shows were
performed by local groups
living in the area of
influence
CULTURA METRO PROGRAM
The Cultura Metro Program turns the
stations and trains of Metro Lima LINE 1
into spaces of citizenship education, where
we promote proper behavior based on respect
and tolerance. The Lima y sus Patas (Lima
and its Friends) initiative was designed in
2016 as part of this program, looking for the
reinforcement of positive behavior in the daily
use of the metro by using cartoon characters
and children’s stories.
Additionally, since 2013, we have
implemented the Arte Vecinal (Neighborhood
Art) initiative to promote weekly cultural
activities in the busiest metro stations. As
a result, we contributed to revitalize artistic
exhibitions (performing arts, dance, music
and visual art) produced by local groups
that live in the metro’s area of influence, and
we reasserted ourselves as a public service
that goes beyond rendering transportation
services. As of 2014, the Ministry of Culture
has endorsed this activity, giving the
participating groups more opportunities
for public exposure and recognition.
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TOGETHER FOR THE CITY
ROAD AND TRAFFIC SAFETY
Metro Lima LINE 1’s goal is to recover public
spaces surrounding the viaduct, areas that are
neglected and in unsanitary conditions. We
aim to transform Lima into a safe and clean
city of which we can all be proud.
Eight interventions were conducted in
2016, among which the recovery of the
surroundings of the Gamarra Station stands
out. Not long ago this area had been used
as a garbage dump and today it boasts
green areas, pedestrian facilities and artistic
murals. To accomplish this we worked in
partnership with local authorities, private
entities and different resident organizations
in the area.
During 2016:
- 5553 m2 of recovered
public spaces.
- 45,035 residents
benefited by
the program.
EDUCATION PROGRAM
Concar, the Group´s company that
operates and maintains highways and seeks
to convey its prevention-based safety culture
to all of the users and communities adjacent
to its roads. In 2016, several workshops
and educational campaigns were conducted
by Norvial, Survial, Canchaque, Pasco
and Chinchaypujio projects, leaded by
our own staff.
During 2016:
- 69 workshops were
conducted
- 4,420 beneficiaries of the
Road and Traffic Safety
Education Program
- 4,000+ man-hours in safety
training
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2016 PROGRESS
- Despite the surplus demand in the system,
we improved the overall satisfaction of the
metro users from 82.5% to 87.8% (Metro
Lima LINE 1).
- 86% of the local residents consider that
Programa Ayni has helped to improve their
social harmony (VIVA GyM).
- We provided over 4000 man-hours training
of road and traffic safety education (CONCAR).
2017 CHALLENGES
- To maintain the metro users’ satisfaction level
and safety levels during infrastructure expansion
(Metro Lima LINE 1) .
- To promote a wider dissemination of the Ayni
Program benefits (Viva GyM).
- To remodel the Road and Traffic Safety
Education Program to involve transport
companies (CONCAR).
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WITH OUR SUPPLIERS
We promote responsible performance among
our suppliers consistent with the guidelines
defined in our Code of Business Ethics and
Anti-Corruption Policy. This allows us to grow
together, ensuring the standard of excellence
required by our operations and contributing
to raise the bar of the industry standards.
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BUYING FROM SUPPLIERS
We worked with over 13,000 suppliers in 2016, whose
payment represented 59.2% of the Group’s income.
We implemented specific procedures to assess them before
entering them in our database records. This enables us to
ensure that the minimum standards regarding legal, financial,
tax and work-related issues are duly met. Furthermore,
we included an anti-corruption clause in all of our contracts
and purchase orders.
We are very aware of the impact and economic drive that our
activities generate. It is for this reason that we seek to promote
decentralized local purchases, encouraging growth in areas
that lie near our operations. In 2016, the main companies
of the Group invested over US$90 million in local purchases.
Decentralized and local purchases
Indicators
Number
of suppliers
Percentage
of decentralized
purchases/1
PERCENTAGE
OF LOCAL
PURCHASES/2
Engineering and Construction
Infrastructure
Services
GyM
STRACON
GyM
GMI
Morelco
GMP
CONCAR
CAM Peru
3,300
1,334
807
3,574
13%
31%
19%
39%
602
57%
1,933
36%
3%
25%
NA
39%
41%
36%
819
12%
NA
1 Purchases from suppliers with National Register of Taxpayers (RUC) issued in a province.
2 Purchases from suppliers whose tax address coincide with the project’s location (regional level).
Development with local suppliers
Capacity development and formalization of our local
suppliers are both very important to ensure quality
in the goods and services we offer.
Main initiatives in 2016:
- GMP: In partnership with Centro de Apoyo a la
Microempresa (Micro-enterprise Support Center)
of the Universidad de Piura, we implemented
a program geared towards developing the
capabilities of the local community companies
that work with us.
- CONCAR: Our first Supplier Meeting took place
to promote the company’s performance standards
and clear any doubt related to our homologation
processes, contracts and safety standards. Banks,
audit entities and internal areas of the organization
participated as speakers at the meeting.
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- Services: We implemented a thorough
evaluation and qualification process for our
key suppliers, carried out by an independent
company, thus accomplishing certification
for 29 suppliers, 79% of which obtained
an optimum rating and received feedback
about their results. The business category
“business continuity strategy” was included
within the issues reviewed, in order to
promote awareness of future prospects
and risk management (GMD).
- Services: We audited 51 suppliers by
reviewing their labor background and
pension payments, in order to ensure
their compliance with employee-related
regulations. In addition, we carried out
more than 9,600 man-hours of training
on our hiring policies and compliance
standards (CAM Chile).
SUPPLIER EVALUATION
AND HOMOLOGATION PROCESS
The Group’s companies have different types
of homologation programs, which enable
them to identify and evaluate their key
suppliers with more detail in the following
aspects: legal, financial, commercial, quality,
safety, environment, and community respect
performance.
This allows us to reduce risks and count on
reliable suppliers, which not only insures the
supply of quality goods and services, but also
guarantees their responsible and sustainable
performance.
Main initiatives 2016
- We certified 48 suppliers, after assessing
their financial statements, management
systems, and the quality of the services
they offer to other clients both in Peru
and abroad. This qualification procedure
enabled us to define a list of Preferred
Suppliers, as well as to hold regular quality
control meetings to provide our feedback
on their performance (GMP).
- We approved 20 strategic suppliers via
an external audit entity and we trained
30 suppliers in our invoicing processes,
corporate policies, risk prevention and
environmental management (CONCAR).
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2016 PROGRESS
- We standardized our Oracle supplier creation and registering
system, as well as purchase orders and contracts (GyM).
- We boosted our supplier monitoring system, which we
will begin to implement in a centralized way in 2017 (GyM).
- We integrated all the Logistic teams of the Engineering and
Construction department in Peru, in order to boost synergy
and create better negotiation conditions.
- We updated our key and active suppliers database (GMD).
2017 CHALLENGES
- To implement the reformulated supplier homologation
program (GyM, GMI and STRACON GyM).
- To apply centralized monitoring, including several different
performance assessments (GyM, GMI and STRACON GyM).
- To align the different homologation programs, in order to
generate synergy between the Corporate Group’s companies.
(Corporate level).
- To incorporate random audits to suppliers and third party
intermediaries (Corporate level).
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WITH OUR COMMUNITIES
We strive to go beyond our businesses in
order to generate well-being for our society.
We focus on developing capabilities and
skills that favor the creation of new jobs
and fostering responsible citizen behavior.
This approach allows us to build positive
relationships within the community and
to better manage risk for our business.
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DEVELOPING SKILLS FOR JOB
PLACEMENT PROGRAM (GYM)
Since 2006, we have trained our projects’
neighboring communities on basic
construction techniques, risk prevention
and leadership in order to improve their
employability and foster their job placement
in the construction sector.
During the eleven years that the program
has been in operation (2006-2016), we have
trained more than 22,600 people, providing
more than a million man-hours of training.
In 2016, thanks to this program, 45% of the
participants began to work for GyM, and
100% of the unskilled labor (helper or hand
categories) came from the local community.
During
2016:
- 77,568 man-hours
of teaching.
- 84 workshops that benefited
1,616 people.
- 45% of participants began
to work for GyM.
CONSTRUCTION MANAGEMENT
EDUCATION PROGRAM
During
2016:
At the technical education level, the Group
discovered a great opportunity to share
its engineering knowledge and foster the
employability of young people in construction
projects. Together with Fe y Alegría, we
designed and implemented the Construction
Management Education Program, which
offers a 2-year course of study with
internships in Graña y Montero, and allows
alumni to obtain a technical degree endorsed
by the Ministry of Education.
- The program benefited
145 students, of whom 19
graduated during the year.
- 100% of alumni began to
work for Graña y Montero.
- 73,758 man-hours
of training imparted
throughout the year.
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ESCUELA DE PAZ PROGRAM
We implemented the Escuela de Paz Program
through the Morelco Foundation. This
program fosters the strengthening of skills
in children and in young people from areas
of Colombia that are affected by violence.
The program has two main courses of action:
the Music School and the Drama School,
both of which focus on building values
and developing empathy, self-knowledge,
tolerance and respect for others.
During
2016:
- 192 workshops given to more
than 178 children and young
people.
- 17,088 man-hours
of teaching.
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GRAÑA Y MONTERO CORPORATE
VOLUNTEERING PROGRAM
The Corporate volunteerism Program strives to foster
leadership and social action within the Group’s workers. It
brings together enthusiastic workers who are committed to
the dream of a better future and who want to leave a “positive
footprint” on their environment by volunteerism their time
and knowledge to improve the community.
The Corporate Voluntering projects focus on three main
courses of action:
- Environment: We pursue living in environmentally-friendly
cities, with citizens that give priority to protecting their
natural resources and developing Eco-efficient lifestyles.
In order to generate experiences that are more challenging for
our volunteers and to obtain high-impact results that benefit
the communities, in 2016 we launched the first edition
of "Ideas que Trascienden" (Ideas that Trascend), a contest
that promotes innovative social projects.
Twenty-five teams of volunteers from the Group’s various
companies participated in this contest, receiving technical
consultancy from the Volunteer Work Association. Awards
were given to the four best projects; the audience chose one
of them and an external jury selected the others. The winners
were awarded 8,000 soles each to implement their projects
in the first semester of 2017.
During
2016:
- 225 active volunteers
- 1500+ beneficiaries
- US$ 37,000+ invested in
the volunteering program
- First Edition of “Ideas que
Trascienden”, innovative
social projects competition.
- Safety: We pursue living in safer cities that foster and
respect regulations.
- Social Inclusion: We want all people to be able to take
full advantage of their environment’s opportunities for
growth by developing knowledge, skills and attitudes
and through the appropriate use of public spaces.
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For the Group, the concept of community includes not
only its projects’ areas of direct influence, but also other
collectives such and the Engineering, Academic and Scientific
communities. Together we strive to foster research and
innovation in the engineering field.
FOSTERING SHARED
INNOVATION PROGRAM
We strive to motivate young engineers to research, to
be connected, to access knowledge and to create value.
This program includes:
- Estructura tus IDEAS: A competition of scientific papers
for undergraduate Engineering and Architecture students.
In the third edition, 65 participants were enrolled
in the competition, 12 of which received nominations.
- Graña y Montero Applied Engineering Award:
Acknowledges the value of research and rewards talent
and dedication in engineering professionals. In 2016, the
sixth edition incorporated the Engineering Innovation
category and focused on the water, energy, hydrocarbons,
infrastructure, mining, housing and transportation sectors,
all of which are of special interest to the Group. In 2017, the
Environment category will be included. Since this award
was established, 270 researche papers have been submitted.
- Student volunteering – PI Agents: A platform that
promotes the participation of university students in
knowledge-spreading activities, allowing them to convey the
value of research within their communities. In 2016,
43 volunteers participated.
The social initiatives undertaken by the Group implied an
investment of US$ 866,310 and promoted a complementary
investment of US$167,000 on behalf of our strategic allies.
- Engineering Portal (PI): A web platform created to
interchange knowledge among the members of the
engineering community. This platform was re-launched
in 2016 and currently has more than 184,000 followers
on social networks.
Social investment
Initiative type
Related training
Non-related training
1. TRAINING
Social investment
Environmental investment
Economic investment
Venture philanthropy
2. OTHER COMPANY
ACTIVITIES
TOTAL ACTIVITIES (1+2)
Number of direct beneficiaries
Training in man-hours
Investment in US$
13,680
10,444
24,124
94,224
10,802
40
23,450
128,515
152,639
154,400
18,538
172,938
3,584
5,096
2,696
80
11,456
184,394
210,468
124,222
334,690
256,586
54,282
10,061
210,691
531,619
866,310
%
24%
14%
39%
30%
6%
1%
24%
61%
100%
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2016 PROGRESS
- We enhanced our coverage of the Construction
Management Education Program, which
welcomed its fourth class of students.
- We strengthened our Corporate volunteering
to focus on environment, safety and social
inclusion.
- We reached our 11th year implementing the
Capacity Building for Work Insertion program,
which has provided more than one million
accumulated man-hours in training.
- We restructured the sixth edition of the
Graña y Montero Award, which included
the “innovation in engineering” category.
2017 CHALLENGES
- To develop programs under the Works
by Tax modality.
- To continue evaluation of the development
and technical skills flagship program.
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- AWARDS AND HONOURS
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IMPORTANT RECOGNITIONS AND AWARDS RECEIVED BY THE GRAÑA Y MONTERO GROUP IN 2016
1. One of the Most Admired Companies in Peru, for the fifth
year in a row according to PwC and G de Gestión magazine.
2. For ninth year in a row, we received the Lima Stock
Exchange’s Good Corporate Governance Index.
6. We placed 7th in the ranking of the 100 Peruvian
companies with the best reputation, according to a study
conducted by Merco international consulting firm, with
the support of KPMG.
3. For second year in a row, we were given an Alas 20 Company
recognition for having the highest cumulative score in
2016, awarded by the Lideres Sustentables 2020 Agenda.
4. For second year in a row, we won the category of Leading
Company in Corporate Governance – Peru, awarded by
the Lideres Sustentables 2020 Agenda, for achieving the
highest score in corporate governance in 2016.
5. Socially Responsible Company (ESR) Badge given to
GYM on behalf of Asociación Peru 2021.
7. Placed 5th in the ranking of the Best Companies
to Attract and Retain Talent in Peru, according
to the Merco reputation monitor.
8. Ranked the third most attractive company to work for in
Peru, and first in the Construction and Real Estate Sector,
according to Laborum’s Employer Branding 2016 study.
9. Education Allies recognition from the Ministry
of Education of Peru.
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IMPORTANT AWARDS WON BY
COMPANIES IN THE GROUP IN 2016
1. STRACON GyM received the Excellence in Safety 2016, award from
Mapfre, for being the best mining outsourcing services company.
2. VIVA GyM was placed sixth in the companies with less than 250
workers category, in the Best Companies to work for ranking, by Great
Place to Work Peru.
3. GMP was placed seventh in the companies with 251-1000 workers
category in the Best Companies to work for ranking, by Great Place to
Work Peru.
4. GMD placed fourteenth in the companies with more than 1000
workers category, in the Best Companies to work for ranking, by Great
Place to Work Peru.
5. STRACON GyM placed seventeenth in the companies with more than
1000 workers category in the Best Companies to work for ranking,
by Great Place to Work Peru.
6. For second year in a row, Viva GyM was recognized as One of the Best
Companies to Work for in Latin America, in the ranking by Great
Place to Work.
7. The building of the Universidad de Ingeniería y Tecnología (UTEC)
designed by Grafton Architects and built by GyM was recognized as the
best building in the world by the Royal Institute of British Architects.
AWARDS AND RECOGNITIONS RECEIVED
BY OUR BOARD IN 2016
1. The Chairman of our Board, Jose Graña received the III Premio
Enrique V. Iglesias for his contribution to the development of an
Iberoamerican business community.
2. The Chairman of our Board, Jose Graña was awarded second place in
the Best Director of a Leading Company in Sustainability -2016
category, granted by the Lideres Sustentables 2020, Agenda.
3. Our general manager, Mario Alvarado was the runner up in the Best
General Manager Leader in Sustainability – 2016 category, awarded
by the Lideres Sustentables 2020 Agenda.
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WHY WE
DO IT
WE BUILD A BETTER FUTURE.
THROUGH OUR WORK WE
SEEK TO LEAVE A LEGACY
TO SOCIETY – 80 YEARS OF
ACCOMPLISHMENTS THAT
MAKE US FEEL PROUD AND
HAVE ALLOW TO TRANSCEND
BEYOND THE COMPANY.
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GRAÑA Y MONTERO S.A.A.
SPECIAL REPORT ON PREVIOUSLY AGREED UPON PROCEDURES APPLIED TO THE SCHEDULE OF WORKS
PROJECTS AND SERVICES PERFORMED, COMPLETED AND DELIVERED DURING THE YEAR ENDED DECEMBER 31, 2016
CONTENTS
I
II
III
SCOPE
PREVIOUSLY AGREED-UPON PROCEDURES
REPORT
EXHIBIT A -
GYM S.A.: SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED
DURING THE YEAR ENDED DECEMBER 31, 2016.
EXHIBIT B -
GMD S.A.: SCHEDULE OF SERVICES PERFORMED, COMPLETED AND DELIVERED
DURING THE YEAR ENDED DECEMBER 31, 2016.
EXHIBIT C -
GMI S.A. INGENIEROS CONSULTORES: SCHEDULE OF PROJECTS PERFORMED, COMPLETED AND DELIVERED
DURING THE YEAR ENDED DECEMBER 31, 2016.
EXHIBIT D -
VIVA GYM S.A.: SCHEDULE OF PROJECTS PERFORMED, COMPLETED AND DELIVERED
DURING THE YEAR ENDED DECEMBER 31, 2016.
EXHIBIT E -
SUMMARY BY COMPANY OF WORKS, PROJECTS AND SERVICES PERFORMED, COMPLETED AND DELIVERED
DURING THE YEAR ENDED DECEMBER 31, 2016.
S/. = PERUVIAN SOL
US$ = UNITED STATES DOLLAR
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future
139
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureGRAÑA Y MONTERO S.A.A.SPECIAL REPORT ON PREVIOUSLY AGREED UPON PROCEDURES APPLIED TO THE SCHEDULE OF WORKS PROJECTS AND SERVICES PERFORMED, COMPLETED AND DELIVERED DURING THE YEAR ENDED DECEMBER 31, 2016 140
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureGRAÑA Y MONTERO S.A.A.SPECIAL REPORT ON PREVIOUSLY AGREED UPON PROCEDURES APPLIED TO THE SCHEDULE OF WORKS PROJECTS AND SERVICES PERFORMED, COMPLETED AND DELIVERED DURING THE YEAR ENDED DECEMBER 31, 2016 141
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureGRAÑA Y MONTERO S.A.A.SPECIAL REPORT ON PREVIOUSLY AGREED UPON PROCEDURES APPLIED TO THE SCHEDULE OF WORKS PROJECTS AND SERVICES PERFORMED, COMPLETED AND DELIVERED DURING THE YEAR ENDED DECEMBER 31, 2016 142
EXHIBIT A
GYM S.A.
SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016
No.
Project
Customer
Project description
1
2
3
1833 - Magia - Local de
asistencia social
1834 - Habilitación
Urbana El Nuevo
Rancho
1846 - Edificio
Commons - Colegio
Roosevelt
Asociación de
Voluntarias por los
Niños con Cáncer -
Magia
Viva GyM S.A.
The social assistance establishment for children
with cancer, Magic, aims to provide temporary
accommodation to children without resources,
especially those coming from the interior of the
country and whose treatment will be given at INEI
and have nowhere to stay.
"El Nuevo Rancho" project is a condominium of 116
apartments of different types. It has two levels of
parking with a capacity for 420 vehicles.
To be read together with the report issued by Gaveglio, Aparicio y Asociados on March 21, 2016.
Contractual
delivery date
Date of delivery to
customer
Performance Bonds
August 19, 2016
July 11, 2016
US$
-
December 30, 2016 December 8, 2016
-
S/
-
-
-
Instituto Educacional
Franklin Rossevelt
The project consists of a high school building and has
an area of 4,419mt2.
November 2, 2016
September 28, 2016
564,630
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future
143
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
November 30, 2016 November 30, 2016
20,000
US$
S/
-
EXHIBIT B
GMD S.A.
SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016
No.
Project
Customer
Project description
CONSORCIO
TERMINALES
Inspection services, quantity control and quality of
products loaded in the tanker truck and sealing of
hatch valves of tanker truck in various terminals.
1
2
3
4
5
6
7
8
PROY__BPO -
CONSORCIO
TERMINALES -
PRECINTADO
PROY__BPO -
RECOSAC - ATENCION
TERMINALES
PROY__HD -
PACIFICO
REPSOL COMERCIAL
S.A.C.
Administrative and operational service of billing and
dispatch terminals.
November 30, 2016 November 30, 2016
-
526,256
PACIFICO VIDA
COMPAÑÍA DE
SEGUROS Y
REASEGUROS S.A.
Service based on service levels (SLA), which includes
the implementation of a single point of contact
to receive, service and channel customer service
requests.
January 31, 2016
January 31, 2016
-
PROY__HD-BARRICK-
MDA N2 Y N3
MINERA BARRICK
MISQUICHILCA S.A.
Systems support service in mine facilities.
July 31, 2016
July 31, 2016
99,268
PROY__HD-DUKE-
MDA N1 Y N2
DUKE ENERGY
EGENOR S. EN C. POR
A.
Support and maintenance service (Help Desk) of
DUKE ENERGY and/or AGUAYTIA ENERGY
computer systems located in different cities.
July 31, 2016
January 31, 2016
-
PROY__AO-GYM-SWF GYM S.A.
Factory software service to maintain corporate
systems and develop new solutions based on
information technologies.
November 14, 2016
September 30, 2016
-
PROY__HD - VIAL Y
VIVES - MDA N1
VIAL Y VIVES - SDS
S.A.
"Help Desk" service to the users of VIAL and VIVES
SDS, through a Help Desk.
December 31, 2017
February 28, 2016
PROY__STE-
OSCE-DISCOS SAN
LN310090
ORGANISMO
SUPERVISOR DE LAS
CONTRATACIONES
DEL ESTADO - OSCE
Four effective 8TB Magnetic disk arrays for OSCE
Storage Systems (HP EVA P6350).
January 31, 2016
January 31, 2016
-
-
-
-
-
-
-
80,340
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future
144
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
January 31, 2016
January 31, 2016
-
US$
S/
276,000
January 31, 2016
January 31, 2016
-
251,700
April 26, 2016
April 26, 2016
-
-
374,652
-
No.
Project
Customer
Project description
9
10
11
12
PROY__STE-OSCE-
UPGRADE V7000
LN310090
PROY__STE-
OSCE-CORES Y VM
LN310090
PROY__STE-OEFA-
VMWARE LN310090
ORGANISMO
SUPERVISOR DE LAS
CONTRATACIONES
DEL ESTADO - OSCE
Acquisition of storage disks for the OSCE
technological platform, according to the Technical
Specifications of the Public tender No. 001-2015-
OSCE.
ORGANISMO
SUPERVISOR DE LAS
CONTRATACIONES
DEL ESTADO - OSCE
Acquisition of cores from the OSCE's technological
platform, according to the Technical Specifications of
tender No. 002-2015-OSCE.
ORGANISMO DE
EVALUACIÓN Y
FISCALIZACIÓN
AMBIENTAL - OEFA
Updating subscription and technical support of
VMWARE virtualization software, according to the
terms of reference of Public Tender No. 015-2015-
OEFA / CE.
PROY__ISO-GMP-
OUT
CONSORCIO
TERMINALES
Windows server hosting service, Cisco ASA5520
firewall hosting and Cisco Catalyst 3750 Switch and
Cisco 1841 and Fortigate 110C router housing.
May 31, 2016
May 31, 2016
To be read together with the report issued by Gaveglio, Aparicio y Asociados on March 21, 2016.
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureEXHIBIT BGMD S.A. SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016 145
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
US$
S/
October 15, 2016 October 15, 2016
-
1,090,638
EXHIBIT C
GMI S.A. INGENIEROS Y CONSULTORES
SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016
No.
Project
Customer
Project description
1
2
3
4
5
6
7
Proyecto Sistema de recepción
almacenamiento y embarque de
minerales y amarradero "F" en
bahía islay
Proyecto Racaycocha
Proyecto Génesis: Servicio de
actualización del plan monitoreo
arqueológico para la rehabilitación
urbana.
Proyecto Génesis: Monitoreo
Complmentario Calidad de Aire
para la nueva planta de Fabricación
de Acumuladores Etna - Chilca
Proyecto Génesis: Estudio de
balance de agua para la nueva
planta Chilca.
Informe técnico sustentatorio para
Ampliación Capacidad de la Planta
de Fabricación de sacos pliegues de
papel.
CONSORCIO
SUPERVICION
MATARANI (TISUR)
Supervision of engineering and Phase II supervision
of construction and equipment of work.
MINERA PEÑOLES
DEL PERU S.A.
Elaboration of the basic engineering study for the
Racaycocha Project infrastructure.
February 29, 2016 February 29, 2016 31,000
ETNA S.A.
Update service of the Archaeological Monitoring Plan
for urban rehabilitation ETNA - Chilca.
December 16,
2016
December 1, 2016 -
ETNA S.A.
ETNA S.A.
FORSAC
Development of the environmental monitoring of
air quality at two points located within the project's
influenza area.
January 4, 2017
December 21,
2016
Elaboration of water balance for the New Plant for the
Manufacture of Accumulators ETNA - Chilca.
December 31,
2016
December 31,
2016
-
-
"- Preparing a technical report supporting the
Extension of capacity of the bag-manufacturing plant
- (sheet of paper).
- Monitoring of the environmental
quality of the bag-manufacturing
plant multi-sheet paper - Los Olivos.
MELIA
Supervisión y control de las obras en diversas
especialidades hasta la puesta en marcha de las
instalaciones.
3/31/16
3/31/16
-
-
-
-
-
-
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146
No.
Project
Customer
Project description
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
8
9
10
11
12
13
March 23, 2016 March 23, 2016
-
US$
July 25, 2016
July 25, 2016
-
Estudio Definitivo de Ingeniería
de las Obras Complementarias del
segundo grupo de la Red Vial 05
Panamericana Norte.
Estudio de Pre-inversión para el
puente y acceso a Chuquibamba.
NORVIAL S.A.
SHAHUINDO S.A.C.
Elaboration of Final Engineering Study (Technical
File) of the Complementary Works of the second
group of the Red Vial 05 Panamericana Norte. Ancón-
Huacho section.
Improvement of the departmental highway route CA-
111 section emp.pe-3n (DV Santa Elena) - DV-Colcas
-Chuquibamba, province of Cajabamba, region of
Cajamarca.
Elaboration of the reinvestment studies at activity
level of the project "Improvement of the geometric
design of the curves of sector 3.1, Nasca - Puquio.
Mejoramiento del diseño
geométrico de las curvas del Sector
3.1 Nasca - Pucquio.
Modificación de alcantarillas:
Líneas Submarinas de Refinería
Conchán a Terminal Portuario.
Consultoría para la supervisión
del comisionamiento y puesta en
marcha de tres tanques de 120 MB
en feinería Talara.
SURVIAL S.A.
November 15,
2016
November 15,
2016
PETROPERU
Consultancy for the modification of sewer of
submarine lines of refinery Conchán to Port Terminal.
May 22, 2016
May 22, 2016
PETROPERU
Supervision of manufacture works, assembly and
interconnection of 3 tanks of 120 MB each for storage
of Biodiesel B-100 and Turbo A-1, Talara Refinery.
April 15, 2016
April 14, 2016
-
-
-
Desarrollo de Estudios de Ingeniería
de las Facilidades Superficie Lote X.
CNPC PERU S.A.
Development of engineering studies of the surface
facilities in block X with No. 14-027-PX-B
May 4, 2016
May 4, 2016
5,461
-
S/
-
-
-
-
49,767
To be read together with the report issued by Gaveglio, Aparicio y Asociados on March 21, 2016.
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureEXHIBIT CGMI S.A. INGENIEROS Y CONSULTORES SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016 147
EXHIBIT D
VIVA GYM S.A.
SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016
No.
Project
Customer
Project description
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
1
2
3
4
5
6
7
8
9
10
11
12
13
US$
Empresa: 3000 - Almonte
JORGE LUIS
VILLAVICENCIO
GUTIEREZ
Property located in the district of Lurín, with an area
of 50,000 m2
February 2, 2016
February 2, 2016
-
PROYECTO: 0011 - Los Parques de
Comas I
SUPERMERCADOS
PERUANOS S.A
Lote futuro, Land Manzana D
PROYECTO: 0011 - Los Parques de
Comas I
COLEGIOS
PERUANOS S.A
Lote futuro, Land Manzana D
PROYECTO: 0011 - Los Parques de
Comas I
VALLE VERAMENDI
MILAGROS
Residencial Los Nogales, Building 02, Apartment
N °: 103, Parking N ° 171.
December 23,
2016
December 23,
2016
December 22,
2016
December 22,
2016
-
-
October 31, 2016 October 20, 2016 -
PROYECTO: 0011 - Los Parques de
Comas I
SANCHEZ GUILLEN
LADY KATHERINE
Residencial Los Nogales, Building 03, Apartment
N °: 401, Parking N ° 67
May 27, 2016
May 11, 2016
PROYECTO: 0011 - Los Parques de
Comas I
CHAVEZ ANICETO
ERNAN EDWIN
Residencial Los Nogales, Building 02, Apartment
N °: 103, Parking N ° 171.
March 1, 2016
March 1, 2016
PROYECTO: 0011 - Los Parques de
Comas I
BCJ CONSTRUCTORES
S.A.C
Residencial Los Nogales, Building 02, Apartment
N °: 703, Parking N ° 173
December 22,
2016
November 15,
2016
PROYECTO: 0011 - Los Parques de
Comas I
JUAN CARLOS
ESPINOZA CRUZ
Residential Los Nogales, Building 03, Apartment
N °: 1008
April 13, 2016
April 2, 2016
-
-
-
-
PROYECTO: 0011 - Los Parques de
Comas I
SANTOS ALCANTARA
GUSTAVO DANIEL
Residential Los Nogales, Building 03, Apartment
N °: 903
February 3, 2016
January 26 2016
-
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
CORDOVA ROMERO
EUSEBIO
Building A, Apartment N °: 105, Parking N ° 1
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
NUREÑA MENDOZA
ROBERTO RODOLFO
Building N, Apartment Nr .: 203.
September 30,
2016
September 13,
2016
September 30,
2016
August 10, 2016
-
-
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
SEGURA MILLA
YESENIA PATRICIA
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
PINEDO LONG LUCAS
KERRY
Building M, Apartment Nr .: 202.
February 15, 2016 January 30, 2016 -
Building O, Apartment Nr: 301
October 30, 2016 October 21, 2016
-
S/
-
-
-
-
-
-
-
-
-
-
-
-
-
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future
148
No.
Project
Customer
Project description
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
ESPINOZA SUAREZ
GILMER
Building N, Apartment N °: 505, Parking N ° 151
April 30, 2016
April 9, 2016
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
POMA VASQUEZ
MABEL ROXANA
Building N, Apartment N °: 601
Building M, Apartment N °: 401
November 29,
2016
November 20,
2016
September 30,
2016
July 27, 2016
Building N, Apartment N °: 1001, Parking lot 148
May 30, 2016
May 2, 2016
Building O, Apartment Nr: 1001
July 30, 2016
June 18, 2016
Building B, Apartment Nr: 806
April 29, 2016
April 15, 2016
Building M, Apartment N °: 901, Parking N ° 87
March 23, 2016 March 2, 2016
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
PINO PINO DE
GONZALES ROXANA
VERONICA
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
ESTEBAN GONZALES
YOSSELIN PRISSYLA
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
ORE VILLAVICENCIO
JUANA ROSA
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
ÑAUPARI PINEDA
VICTOR RAUL
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
QUIÑONES JUSTO
ELMER CEFERINO
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
HUANCA PORRAS
SOLEDAD
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
MENDEZ CARLOS
MAXIMO FABIO
PROYECTO: 0021 VES II
IZARRA PEREYRA
MARCOS
PROYECTO: 0015 - LOS
PARQUES DE SAN MARTIN
ORBEGOSO URQUIZO
ANGIE ANDREA
Building O, Apartment Nr: 1101
September 13,
2016
September 2,
2016
Building D, Apartment N °: 1104
June 23, 2016
June 8, 2016
Building M, Apartment N °: 903,
February 18, 2016 February 4, 2016
-
Building D, Apartment N °: 103, Parking N ° 28
November 20,
2016
October 18, 2016
-
PROYECTO: 0021 VES II
APAZA ROJAS ELIDA Building D, Apartment Nr .: 102
September 6,
2016
September 6,
2016
PROYECTO: 0021 VES II
UÑAPILLCO CHAMPI
VLADIMIR
"Building E, Apartment N °: 102"
July 15, 2016
June 15, 2016
-
-
US$
-
-
-
-
-
-
-
-
-
S/
-
-
-
-
-
-
-
-
-
-
-
-
-
14
15
16
17
18
19
20
21
22
23
24
25
26
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureEXHIBIT DVIVA GYM S.A. SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016 149
No.
Project
Customer
Project description
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
27
28
29
30
31
32
33
34
35
36
37
38
39
PROYECTO: 0021 VES II
PROYECTO: 0021 VES II
PROYECTO: 0021 VES II
PROYECTO: 0021 VES II
PROYECTO: 0021 VES II
PROYECTO: 0021 VES II
PROYECTO: 0021 VES II
PROYECTO: 0024 LPDC II
PEÑA VARGAS
FREDDY
SANCHEZ CARITAS
GERARDO
RODRIGUEZ
CONDORI CECILIA
ERIKA
SOSA MENDOZA
ANGEL FELIPE
LUNA TORRES
ANGEL ANTONIO
LLANCARE QUISPE
YENNY YESICA
ROJAS PACHAS
YESSICA YULIANA
DERRAMA DEL
PODER JUDICIAL
Building C, Apartment N °: 202, Parking N ° 23
December 31,
2016
July 22, 2016
Building F, Apartment N °: 101, Parking N ° 87
June 22, 2016
June 22, 2016
Building D, Apartment N °: 103, Parking N ° 83
April 26, 2016
April 26, 2016
US$
-
-
-
Building D, Apartment Nr: 101
January 27, 2016
January 27, 2016
-
Building G, Apartment N °: 202, Parking N ° 72
April 6, 2016
April 23, 2016
Building E, Apartment Nr: 202
May 26, 2016
May 19, 2016
Building G, Apartment N °: 401
March 22, 2016 March 8, 2016
Building 12, Apartment N °: 503.
July 31, 2016
June 27, 2016
-
-
-
-
-
Proyecto: 0028 Los Parques de Villa
el Salvador 3
SUPERMERCADOS
PERUANOS S.A.
Land, Manzana K-1 Lote 8, zona Coop de
Colonización Las Vertientes de la Tablada de Lurín
Tlda 224, District of Villa el Salvador.
July 14, 2016
June 30, 2016
PROYECTO: 0034 - LPD PIURA II MEDINA ZAGAZETA
Building 0A, Apartment N °: 101, Parking N ° 21.
December 7, 2016 November 17,
-
STEVE WILFREDO
2016
PROYECTO: 0034 - LPD PIURA II ERAZO ERAZO
Building 0A, Apartment N °: 104, Parking N ° 4.
August 31, 2016
August 29, 2016
-
PROYECTO: 0036 LPDC II
PROYECTO: 0036 LPDC II
FRANCISCO
GUZMAN
BOHORQUEZ RENZO
CISNEROS CABRERA
SOLEDAD
Building N ° 01, Apartment N ° 1003.
Building N ° 05, Apartment N ° 103.
December 31,
2016
December 31,
2016
December 14,
2016
November 24,
2016
-
-
S/
-
-
-
-
-
-
-
-
-
-
-
-
-
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureEXHIBIT DVIVA GYM S.A. SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016 150
No.
Project
Customer
Project description
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
PROYECTO: 0036 LPDC II
MALLQUI AGUILAR
LUIS JAVIER
Building No. 06, Apartment N ° 101,
Parking N °: 42.
October 31, 2016
September 22,
2016
PROYECTO: 0036 LPDC II
PROYECTO: 0036 LPDC II
PROYECTO: 0036 LPDC II
PROYECTO: 0036 LPDC II
PROYECTO: 0036 LPDC II
PROYECTO: 0036 LPDC II
PROYECTO: 0037 EL RANCHO
48
PROYECTO: 0037 EL RANCHO
40
41
42
43
44
45
46
47
49
50
MATOS ROMERO
VICTOR HUMBERTO
GUERRA MACEDO
DAMARIS ELIZABETH
SAGUMA RUIZ
MARYURI MAYINI
PORTOCARRERO
GRANDEZ YOWER
CASIQUE RENGIFO
KATTY
BENAVENTE OJEDA
MIGUEL ANGEL
FERNANDEZ
CRISTINI DE
VALLEJOS ORIETTA
LUCIA
FERNANDEZ
CRISTINI DE
VALLEJOS ORIETTA
LUCIA
INMOBILIARIA JSA
SAC
Building No. 04, Apartment N ° 305.
July 31, 2016
July 12, 2016
Building No. 04, Apartment N ° 307
July 31, 2016
June 6, 2016
Building N ° 03, Apartment N ° 404
May 26, 2016
May 4, 2016
Building N ° 04, Apartment N ° 805
September 13,
2016
August 23, 2016
-
Building N ° 03, Apartment N ° 602.
February 11, 2016 February 2, 2016
-
Building 02, Apartment N°: 1302
February 11, 2016 February 10, 2016 -
Apartment N ° Q-202, double parking N ° 14-B3 and
Deposit N ° 12-B3.
December 31,
2016
December 30,
2016
Apartment, 1 Double parking.Storage 1.
December 31,
2016
December 30,
2016
PROYECTO: 0037 EL RANCHO
Apartment, Double parking, Storage 1.
December 31,
2016
PROYECTO: 0037 EL RANCHO
EQUIPO PETROLERO
DEL PERU SAC
Apartment, Parking 44 - B6 (DOUBLE), Parking 54 -
B6 (DOUBLE), Storage 28 -B6, Storage CL-04-B6.
December 31,
2016
December 31,
2016
December 22,
2016
US$
-
-
-
-
-
-
-
-
S/
-
-
-
-
-
-
-
-
-
-
-
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureEXHIBIT DVIVA GYM S.A. SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016 151
No.
Project
Customer
Project description
Contractual
delivery date
Date of delivery
to customer
Performance Bonds
51
52
53
54
55
PROYECTO: 0037 EL RANCHO
PROYECTO: 0037 EL RANCHO
AKKERMANS
. JOHANNES
FRANCISCUS
BARRON RAMOS
PLATA JAVIER
EDUARDO
Apartment H-202, second floor, Parking 42 - B5
(DOUBLE), Parking 35 - B5 (DOUBLE).
December 31,
2016
December 28,
2016
Apartment Q202, second floor, Parking 15 - B3
(DOUBLE), Parking 12 - B3 (DOUBLE).
December 31,
2016
December 29,
2016
PROYECTO: 0037 EL RANCHO
PONCE SECADA JOSE
ALONSO
Apartment W102, first floor, Parking 16 - B6
(DOUBLE).
PROYECTO: 0037 EL RANCHO
CORNEJO RAMIREZ
ENRIQUE JAVIER
Apartment C101, first floor, Parking 22 - B6
(DOUBLE), Parking 5 - B6 (DOUBLE), Storage 5 -
B6.
December 31,
2016
December 31,
2016
December 22,
2016
December 29,
2016
PROYECTO: 0037 EL RANCHO
DAMMERT PALACIOS
ALVARO
Apartment O102, first floor, Parking 30 - B3
(DOUBLE), Parking 02 - B4 (DOUBLE), Deposit
18 - B3.
December 31,
2016
December 21,
2016
US$
-
-
-
-
-
S/
-
-
-
-
-
To be read together with the report issued by Gaveglio, Aparicio y Asociados on March 21, 2016.
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureEXHIBIT DVIVA GYM S.A. SCHEDULE OF WORKS PERFORMED, COMPLETED AND DELIVERED FOR THE YEAR ENDED DECEMBER 31, 2016 152
EXHIBIT E
GRAÑA Y MONTERO S.A.A
SUMMARY OF WORKS, PROJECTS AND SERVICES PERFORMED, COMPLETED AND DELIVERED, BY COMPANY FOR THE YEAR ENDED DECEMBER 31, 2016
CONCEPT
GyM S.A.
GMD S.A.
GMI S.A.
Viva GyM S.A.
TOTAL
On the contractual date or before
After contractual date
TOTAL
3
0
3
12
0
12
13
0
13
55
0
55
83
0
83
%
100%
0%
100%
To be read together with the report issued by Gaveglio, Aparicio y Asociados on March 21, 2016.
- Report of projects delivered before the deadlineAPPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future
154
REPORT ON COMPLIANCE WITH THE GOOD CORPORATE
GOVERNANCE CODE FOR PERUVIAN COMPANIES
NAME:
Graña y Montero S.A.A
FISCAL YEAR:
2016
WEB PAGE:
www.granaymontero.com.pe
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 155
METHODOLOGY:
Companies with securities listed on the Public Register of the Securities Market (Registro Público del Mercado de Valores) are required to disclose to the public their good corporate
governance practices. In this connection, such companies report their adhesion contained in the Good Corporate Governance Code for Peruvian Companies.
The information to be submitted refers to the fiscal year ended on December 31 of the calendar year previous to the year of submission, whereby any reference to “the fiscal year” must
be understood as made to the aforementioned period, and is submitted as an annex to the Annual Report of the Company in the electronic forms provided by the Securities Market
Superintendence to facilitate submission of the information in this report through Yesstema MVnet.
Section A includes the letter of introduction of the Company, setting out the major corporate governance advancements made in the period.
Section B presents the level of compliance of the principles that make up the Code. For such purpose, the Report is structured in accordance with the five pillars of the Code:
I. Rights of Shareholders;
II. Regular Shareholders Meeting;
III. Board of Directors and Senior Management ;
IV. Risk and Compliance; and,
V. Information Transparency.
Each principle is evaluated based on the following parameters:
a) “Comply or Explain” Evaluation: compliance by the Company is marked with an “x”, based on the following criteria:
Yes
No
Explanation : In this field, if the Company checked option “No”, it should explain the reasons why it did not adopt the principle or the actions conducted that allow it to consider that progress
: Total compliance with the principle.
: Non-compliance with the principle.
is made towards compliance or partial adoption thereof, as applicable. Also, if deemed necessary, if the option “Yes” was checked, the Company may provide information on
compliance with this principle.
b) Supporting Information: provides information allowing further knowledge on how the Company has implemented the principle.
Section C provides a list of documents of the Company that regulate the policies, procedures and other relevant matters that bear a relationship with the principles under evaluation.
Section D includes additional information not developed in the previous sections or other relevant information that the Company freely decides to mention so the investors and the various
stakeholders may gain further knowledge of the good corporate governance practices that it has implemented.
2 The Good Corporate Governance Code for Peruvian Companies (2013) is available for reference at Orientación – Gobierno Corporativo del Portal del Mercado de Valores www.smv.gob.pe.
(Guidance Section – Corporate Governance of the Securities Market Portal www.smv.gob.pe).
3 The term “Senior Management” includes the general manager and other managers.
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156
SECTION A:
LETTER OF INTRODUCTION4
Graña y Montero S.A.A. is a regional reference in Good Corporate Governance. During the 2016, the annual meeting took place in San
Paulo, Brazil, and the results of the research "Latin American Companies Circle Recommendations on Ethics and Compliance" were
presented, based on the experiences of the companies that are part of the Circle. In addition, as part of this working table, a closed
session was held for the first time between Presidents of the Board of Directors or Independent Directors of the member companies,
in which the Chairman of the Colombian Stock Exchange of Bogotá, Juan Pablo Córdova, presented the current situation and capital
market opportunities in the region. Grupo Graña y Montero was represented in this session by its Independent Director, Pedro Pablo
Errázuriz.
Within this line, during 2016 we received two important awards: For the second consecutive year, the award to the Leading Enterprise in
Corporate Governance, awarded by the institution Agenda Lideres Sustentables 2020 (ALAS 2020) as a recognition of the best company
in Peru committed with the public disclosure of information on sustainable development practices, corporate governance and investor
relations; and, for the ninth consecutive year, we are part of the Good Corporate Governance Index of the Lima Stock Exchange.
Similarly, in 2016, our Board of Directors approved the incorporation of improvements to our Regulations of our Board of Directors
in order to align ourselves with the best practices of the market in corporate governance matters, specifically incorporating the option
that the Board decide to carry out its self-assessment or appoint third parties in order to do so, another improvement was the valuation
criterion to be used for transactions between the company and its subsidiaries and the Human Resources and Human Resources
Committee was renamed to the Human Resources and Sustainability Committee by aligning it with the Sustainability Policy that was
approved in the Directory, in January 2016.
Finally, in March we carried out the self-evaluation process of the Board of Directors, which generated a monthly report on the
relevant facts of the Group companies, which is sent month by month to the Directors as an improvement in our transparency and
communication.
4 Describes the main actions implemented during the fiscal year in terms of good corporate governance practices that the Company deems relevant to highlight in line with the five pillars of the Good Corporate Governance Code for Peruvian Companies
(2013): Rights of the Shareholders, Shareholders Regular Meeting, Board of Directors and Senior Management, Risk and Compliance and Information Transparency.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX SECTION B:
EVALUATION OF COMPLIANCE WITH THE PRINCIPLES OF THE GOOD CORPORATE GOVERNANCE CODE FOR PERUVIAN COMPANIESS
157
PILLAR I:
RIGHTS OF SHAREHOLDERS
Principle 1: Equitable Treatment
Question I.1
Does the Company recognize in its conduct of
business an equitable treatment of shareholders of
the same class and that they are afforded the same
conditions?(*)
Yes
X
No
Explanation:
Article 6 of the Regulations of the Regular
Shareholders Meeting provides that the
relationship of the Company with its shareholders
is to be consistent with the principles of equitable
treatment between shareholders, transparency
and the provision of broad and continued
information so they can accurately know the
Company’s situation in order to exercise their
rights in a reasonable and informed manner.
(*) The same conditions is to be understood as the particularities that distinguish the shareholders, or make them have a common characteristic, in their relationship with the Company (institutional investors, non-controlling investors, etc.). It should
be noted that this shall not imply in any case that the use of privileged information is favored.
Question I.2
Does the Company promote the existence of classes
of shares with voting rights only?
Yes
X
No
Explanation:
Article 8 of the By-Laws provides that the
Company shall have a single class of shares
and all of them shall carry the same rights and
obligations.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 158
a. In connection with the equity of the Company, specify:
Subscribed capital as of closing of the fiscal year Paid-in capital as of closing of the fiscal year
Total number of shares representing
the capital stock
Number of shares of voting stock
S/. 660’053,790.00
S/. 660’053,790.00
660’053,790
660’053,790
b. If the Company has more than one class of shares, specify:
Rights(*)
Number of shares
(*) The specific rights of the class that distinguish it from the others shall be indicated in this field.
Par value
Not Applicable
Rights(*)
Question I.3
If the Company has investment shares, does the
Company promote a policy of redemption or
voluntary swap of investment shares for common
shares?
Yes
No
Explanation:
Not Applicable
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX
Principle 2: Interest of Shareholders
Question I.4
a. Does the Company provide in its corporate
documents the form of representation of the shares
and who is in charge of entry thereof in the share
ledger?
Yes
X
b. Is the share ledger kept permanently up to date?
X
159
No
Explanation:
The Company’s By-Laws and the Regulations
of the Regular Shareholders Meeting provide
that representation by proxy is allowed if it
is communicated to the Company at least 24
hours prior to the Meeting by a non-certified
letter (a certified letter is not required). The
Company provides this representation free of
charge. The only restriction is that if the proxy
letter is for a Director or Executive Officer, this
will seek to indicate expressly the sense that
will vote the representative; in the case they do
not provide precise instructions on the Agenda,
the Director may not exercise the right to vote
when it is prohibited by law or is in a situation
of conflict of interest, as noted by articles 14 of
the Regulations of the Board of Directors and for
the articles 14.5 and 28 of the Regulations of the
Regular Shareholders Meeting. In any case, board
members or executive officers will not accumulate
in their favor votes that represent more than 51%
of the votes, excluding that delegation of votes
from the companies owned by them or from their
relatives by consanguinity or affinity
On the other hand, CAVALI is in charge of entry
in the share ledger.
CAVALI is in charge of keeping and updating the
share ledger.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 160
Provide the timing of updates to the share ledger upon becoming apprised of any change.
Timing:
Within 48 hours
Weekly
Others / Detail (in days)
1 day
Principle 3: No Dilution of Interest in the Capital Stock
Question I.5
a. Is it a policy of the Company that the proposals
of the Board of Directors in connection with
corporate operations that may affect the right
to non-dilution of shareholders (i.e., mergers,
spinoffs, capital increases, among others) be
previously explained by the Board of Directors in a
detailed report with the independent opinion of an
external advisor of professional repute appointed
by the Board of Directors?
b. Is it a policy of the Company to make such
reports available to the shareholders?
Yes
X
X
No
Explanation:
Article 6 of the Regulations of the General
Shareholders Meeting establishes that, in the
specific case of corporate transactions that
may affect shareholders' right to not dilute
shareholders, the Board of Directors shall make
available to shareholders relevant reports dealing
with such matters in particular. It is not stated
that an independent opinion of an external
adviser is necessarily contracted; however,
the Chief Executive Officer hires an external
consultant in charge of the operation.
Article 6 of the Regulations of the General
Shareholders Meeting establishes that the
Board of Directors will make available to the
shareholders the relevant reports that deal with
these particular topics.
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If any corporate operations under the scope of item a) of question 1.5 have occurred during the fiscal year, and if he Company has Independent Directors(*), state if in all cases:
Was the appointment of the external
advisor made with the affirmative vote
of all Independent Directors?
All of the Independent Directors clearly expressed
their acceptance of the aforementioned report and,
if applicable, state the reasons for non-acceptance?
Yes
No
Not Applicable
Not Applicable
(*) Independent Directors are those selected based on their professional experience, honorability, financial sufficiency and independence and non-relationship with the Company, its shareholders or directors.
Principle 4: Information and Communication to Shareholders
Question I.6
Does the Company set who is in charge of or the
means for shareholders to receive and require
timely, reliable and truthful information?
Yes
X
No
Explanation:
Article 10 of the Regulations of the Board
of Directors and Articles 14 and 15 of the
Regulations of the Regular Shareholders Meeting
provide that the Investor Relations Office is
responsible that the shareholders receive and
require timely, reliable and truthful information,
establishing the means for such purpose.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 162
a. Indicate the means through which shareholders receive and/or request information from the Company.
Communication Means
Electronic mail
Telephone
Corporate web page
Postal mail
Information meetings
Others / Detail
Receive Information
Request Information
X
X
X
X
X
X
X
Quarterly telephone conferences.
b. Does the Company have a time limit to respond to information requests of shareholders? If answered in the affirmative, provide the time limit:
Time limit (days)
7 business days
Question I.7
Does the Company have mechanisms in place for
the shareholders to express their opinion on the
development thereof?
Yes
X
No
Explanation:
Section 1 of Article 7 of the Regulations of
the Regular Shareholders Meeting provide
that shareholders may submit, through the
information channels implemented by the
Company, such matters, suggestions and
comments of interest to the Company as they may
deem appropriate at any time.
If answered in the affirmative, detailed the mechanisms in place in the Company for shareholders to express their opinion on the conduct thereof.
Article 7 of the Regulations of the Regular Shareholders Meeting provides that shareholders may
express their opinion through the information channels in place in the Company at any time.
Whenever possible, the company will answer directly to the shareholders in a term that should
no be longer than 7 business days. It also provides that the response of the Company deemed of
general interest shall be placed in the corporate web page.
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No
Explanation:
The Board of Directors is under the obligation
to review and approve the Financial Statements
and, as such, proposes the distribution of profits
in accordance with the dividend policy approved
at the Annual Mandatory Shareholders Meeting.
The Shareholders Meeting approves the dividends
and verifies conformity thereof with its policy.
Yes, our dividend policy is placed in our
corporate web page, specifically in the ‘Corporate
Governance’ section.
Principle 5: Sharing in Dividends of the Company
Question I.8
a. Is compliance with the dividend policy subject
to evaluations to be conducted within a specific
time frame?
b. Is the dividend policy made known to the
shareholders by its corporate web page, among
other means?
Yes
X
X
a. Indicate the dividend policy of the Company applicable to the fiscal year
Approval date
Dividend policy
(profit sharing criteria)
Approved by the Regular Shareholders Meeting
of March 29, 2016
The company will distribute between 30% and
40% of the net profit from the preceding year.
On the basis of the results of the Consolidated
Financial Statements subject to which the
Financial Statements of Grana y Montero S.A.A.
individually, submit sufficient results to cover that
amount; in case the amounts of these financial
statements are not sufficient, the company shall
distribute only up to the limit of the latter. No
dividend advances will be distributed.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 164
b. Indicate the dividends in cash and in shares distributed by the Company in the fiscal year ended and in the previous fiscal year.
Per share
Class
Investment share
Dividends per share
Fiscal Year Reported*
Fiscal year previous to the reported fiscal year**
In cash
S/ 0.046743895
0
In shares
0
0
In cash
S/ 0.158942384
0
In shares
0
0
*The total amount of dividends paid during the year 2016 amounted to S/ 30’853,485.30
**The total amount of dividends paid during the year 2015 amounted to S/ 104’910,522.75
Principle 6: Change of Control or Takeover
Question I.9
Does the Company have policies or agreements of
non-adoption of anti-takeover mechanisms?
Yes
Indicate if any of the following measures has been established in your company:
Yes
Requirement of a minimum number
of shares to be a Director
Minimum number of years as a Director
to be appointed Chairman of the Board
Agreements for indemnification of executives /
officers as a result of changes after a PAO.
Others of a similar nature / Detail
Explanation:
No
X
No
X
X
X
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Principle 7: Arbitration for Settlement of Disputes
Question I.10
a. Do the by-laws of the Company contain
an arbitration agreement providing that any
dispute between shareholders, or between
shareholders and the Board of Directors;
and any objection to resolutions of the Regular
Shareholders Meeting or of the Board Directors
by the shareholders of the Company be submitted
to arbitration according law?
b. Does such clause enable an independent
third party to settle the disputes, except in case
of an express legal reserve to be filed in the
ordinary courts?
Yes
X
X
165
No
Explanation:
Article 76 of the By-Laws contains
the arbitration agreement.
Article 76 of the By-Laws contains
the arbitration agreement
In the event of any objections to resolutions of the Regular Shareholders Meeting or of the Board Directors by the shareholders and others involving the company
during the fiscal period, provide their number.
Number of objections to resolutions
of the Regular Shareholders Meeting
Number of objections to resolutions
of the Board of Directors
0
0
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX PILLAR II:
REGULAR SHAREHOLDERS MEETING
Principle 8: Function and Competence
Question II.1
Is approval of the Board of Directors remuneration
policy an exclusive and non-delegable function of
the Regular Shareholders Meeting?
Yes
X
166
No
Explanation:
The subsection j) of the article 9 of the Regular
Shareholders Regulations and the article 34
of the Regulation of the Board of Directors
establish that the Board of Directors policy is
determined by the Regular Shareholder Meeting
as provided in the By-Laws. In that way, the
article 23 of the By-Laws states that is a function
of the General Shareholders Meeting, when
appropriate, to choose Board Members and set
their remuneration.
Indicate whether the following functions are exclusive of the Regular Shareholders Meeting. If answered in the negative, indicate the body that exercises them.
Provide special investigations and audits
Resolve the amendment of the by-laws
Resolve a capital stock increase
Resolve the distribution of dividends on account
Appoint external auditors
Yes
X
X
X
X
X
No
Body
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 167
No
Explanation:
The Regulations of the Regular Shareholders
Meeting were approved by the Regular
Shareholders Meeting held on March 31,
2005 and its last modification by the Regular
Shareholders Meeting held on march 29, 2016.
No
Principle 9: Regulations of the Regular Shareholders Meeting
Question II.2
Does the Company have binding Regulations
of the Regular Shareholders Meeting,
the non-compliance of which entails liability?
Yes
X
If the company has Regulations of the Regular Shareholders Meeting, state whether they set the procedures to:
Give notice of Meetings
Incorporate items in the agenda
by the shareholders
Provide additional information
to the shareholders for the meetings
Conduct of the meetings
The appointment of members
of the Board of Directors
Relevant others / Details
Yes
X
X
X
X
X
Publicize the resolutions passed at the Regular Shareholders Meeting
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Principle 10: Procedures for Giving Notice of Meetings
Question II.3
In addition to the procedures to give notice of
meetings established by law, does the Company
have notice procedures that allow establishing
contact with shareholders, particularly those
who have no participation in the control or
management of the Company?
Yes
X
No
Explanation:
In addition to the notice procedures established
by law, the article 12 of the Regulations
of the Regular Shareholders Meeting provide
that the meeting is announced through our
corporate web page.
a. Complete the following information for each of the Meetings held during the fiscal year:
Date of Notice
Date of
Meeting
Place of
Meeting
Type of Meeting
Meeting by Unanimous
Consent
Quórum %
Special
Regular
Yes
03 de Marzo de
2016
29 de Marzo
de 2016
Oficina Graña
y Montero
X
(*) Direct exercise includes voting by any means or procedure other than by proxy.
No
X
Nº of
Attending
Shareholders
Interest (%) in the total shares of voting stock
By Proxy
Direct
Exercise (*)
Voting right
not exercised
70.9148%
468,060,222
6.00
64.91
29.09
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX b. What other means, in addition to the one provided in Article 43 of the General Corporations Law and the provisions in the Relevant Facts and Reserved Information Regulations did the
company use to give notice of the meetings during the fiscal year?
169
Electronic mail
Telephone
Corporate web page
Postal mail
Social media
Others / Detail
Question II.4
Does the Company make available to the
shareholders all information relative to the
items in the agenda of the Regular Shareholders
Meeting and the proposed resolutions intended
to be passed (motions)?
In the notices of meeting given by the company during the fiscal year:
Was the place where the information pertaining
to the items in the agenda to be transacted at the
meetings specified?
Were “other business”, “various items” or similar
included as items in the agenda?
X
X
Yes
X
Yes
X
No
Explanation:
The company makes available through its
corporate web page as well as through the
SMV and the e-mail sent to the investors all
information concerning the subjects contained
in the agenda of the Shareholders Meetings
and proposed resolutions arising to adopt.
In addition, paragraph 2 of Article 12 of the
Regular Shareholders Regulations states that
the notice of meeting contains the form and
where the company makes available to the
shareholders the proposed resolutions and
comprehensive documentation that must be given
to shareholders previously.
No
X
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 170
Principle 11: Proposed Agenda Items
Question II.5
Do the Regulations of the Regular Shareholders
Meeting include procedures allowing the
shareholders to exercise the right to submit
proposed agenda items to be discussed at the
meeting and the procedures to accept or reject
such proposals?
Yes
X
No
Explanation:
Article 13 of the Regulations of the Regular
Shareholders Meeting provides that shareholders
may submit suggestions on the matters
included in the agenda through the Investor
Relations Office.
a. Indicate the number of proposals submitted by the shareholders during the fiscal year to include items in the agenda to be discussed at the Regular Shareholders Meeting and the outcome
thereof:
Received
Ninguna
Number of Requests
Accepted
No Aplica
Rejected
No Aplica
b. If any requests to include items in the agenda to be discussed at the Regular Shareholders Meeting were rejected in the fiscal year, state whether the company communicated the reasons for
such rejection to the requesting shareholders.
Not Applicable
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Principle 12: Procedures to Exercise Voting
Question II.6
Does the Company have mechanisms in place that
allow the shareholder to exercise remote voting by
secure means, whether electronic or postal, that
ensure that the person casting the vote is actually
the shareholder?
Yes
No
X
Explanation:
The Company does not limit the right to proxy
and therefore has not set mechanisms to allow
remote exercise of voting.
a. If applicable, indicate the mechanisms or means in place by which the Company may exercise remote voting.
Vote by electronic means
Vote by postal means
Not Applicable
Not Applicable
b. If remote voting was exercised during the fiscal year, provide the following information:
Date of Meeting
% Remote Voting
% Remote Voting / Total
Electronic
Mail
Corporate
Web Page
Postal Mail Others
Not Applicable
Question II.7
Does the Company have corporate documents
that clearly provide that shareholders may vote
separately on substantially independent matters,
so they may exercise their voting preferences
separately?
Yes
X
No
Explanation:
Paragraph 1 of article 13 and article 26 of the
Regulations of the General Shareholders Meeting
establish that the Chairman of the Board of
Directors shall provide shareholders with a
separate vote on matters that are substantially
independent even if they form part of the same
agenda item.
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Indicate whether the Company has corporate documents that clearly provide that shareholders may vote separately on:
The appointment or ratification of Directors by an
individual vote for each of them.
The amendment of the by-laws, for each article or
group of articles that are substantially independent.
Others / Detail
Yes
X
X
No
Paragraph 1 of article 13 and article 26 of the Regulations of the General Shareholders Meeting
establish that the Chairman of the Board of Directors shall provide shareholders with a separate vote
on matters that are substantially independent even if they form part of the same agenda item.
Question II.8
Does the Company allow those acting on behalf
of several shareholders to cast differentiated
votes for each shareholder, so they comply with
the instructions of each shareholder that they
represent?
Yes
X
No
Explanation:
In practice, the Company allows to cast
differentiated votes for each shareholder, for
purposes of complying with the instructions
of each shareholder represented. Article 17 of
the Regulations of the Regular Shareholders
Meeting contain very broad provisions that do
not restrict the possibility to represent more than
one shareholder with different voting intent but,
rather, promote the giving of voting instructions
by proxy letters.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Principle 13: Delegation of Votes
Question II.9
Do the by-laws of the company allow its
shareholders to delegate their vote to any person?
Yes
X
173
No
Explanation:
Article 29 of the company’s By-Laws states
that any shareholder entitled to participate in
regular meetings may be represented by another
person. Likewise, article 17 of the Regulations of
the General Shareholders Meeting establishes
said power; however, paragraph 5 of article 17
accurate that in any case, board members or
executive officers will not accumulate in their
favor votes that represent more than 51% of the
votes, excluding that delegation of votes from the
companies owned by them or from their relatives
by consanguinity or affinity.
If answered in the negative, state whether your by-laws restrict the right to be represented by any of the following persons:
Another shareholder
A Director
A Manager
Yes
No
Not Applicable
Not Applicable
Not Applicable
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 174
No
Explanation:
Article 29 of the By-Laws and Article 17 of
the Regulations of the Regular Shareholders
Meeting require representation by proxy to be
set in writing and especially for each meeting,
unless powers of attorney have been granted by a
public instrument. Proxies must be filed with the
Company at least 24 hours prior to the time set
for the Regular Meeting and the Company shall
not make any charge for such proxy.
Under Section 5 of Article 17 of the Regulations of
the Regular Shareholders Meeting, the Company
makes available to shareholders a proxy form
duly posted in advance in the corporate web page.
However, this is not the only form accepted
by the Company.
Question II.10
a. Does the Company have procedures detailing
the conditions, the means and the formalities to be
performed in situations of voting delegation?
b. Does the Company make available to
shareholders a proxy form setting forth details of
the proxies, the business for which the shareholder
delegates its vote and, if applicable, its voting intent
for each of the proposals?
Yes
X
X
Set forth the requirements and formalities to be met for a shareholder to be represented by proxy at a meeting:
Formality (indicate whether the Company
requires a simple letter, a notarized letter, a public
instrument or other).
Notice period (number of days prior to the meeting
that the proxy form must be submitted)
Cost (indicate whether the Company requires any
payment for this purpose and the amount thereof).
Simple letter
24 hours
Free of charge
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Question II.11
a. Is it a policy of the Company to set limitations
to the percentage of delegation of votes to
members of the Board of Directors or of the Senior
Management?
b. In cases of delegation of votes to members of the
Board of Directors or of the Senior Management, is
it the policy of the Company that shareholders who
delegate their votes clearly state the intent thereof?
Yes
X
X
Principle 14: Follow-up on Resolutions of the Regular Shareholders Meeting
Question II.9
a. Does the Company follow up on the resolutions
passed at the Regular Shareholders Meeting?
b. Does the Company issue periodic reports to the
Board of Directors and are these made available to
the shareholders?
Yes
X
X
175
No
Explanation:
Paragraph 5 of article 17 of the Regulations of the
General Shareholders Meeting accurate that in
any case, board members or executive officers will
not accumulate in their favor votes that represent
more than 51% of the votes, excluding that
delegation of votes from the companies owned
by them or from their relatives by consanguinity
or affinity.
Paragraph 5 of article 17 and article 28 of the
Regulations of the Regular Shareholders Meeting
and article 14 of the Regulations of the Board of
Directors establish that representation by proxy
to a Director will seek to indicate expressly the
sense that will vote the representative; in case
they do not provide precise instructions on the
Agenda, the Director may not exercise the right
to vote when it is prohibited by law or is in a
situation of conflict of interest.
No
Explanation:
Article 9 of the Regulations of the Board of
Directors sets forth the general supervisory
function of the Board of Directors.
Quarterly reports, which are made public through
the SMV and the corporate web page, are issued.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 176
If applicable, indicate the area and/or person in charge of following up on the resolutions passed by the Regular Shareholders Meeting. If a person is in charge, include also the position and
area where he/she works.
Area in Charge
Legal and Corporate Affairs Office
Full Name
Person in Charge
Title
Area
Claudia Drago Morante
Chief Legal and Corporate Affairs Officer
Legal and Corporate Affairs Office
PILLAR III:
BOARD OF DIRECTORS AND SENIOR MANAGEMENT
Principle 15: Board of Directors Conformation
Question III.1
Is the Board of Directors made up of persons
specializing in various areas and with different
competences, with good reputation, ethical,
financial independence and other qualities relevant
to the Company, so that there is a plurality of
approaches and opinions?
Yes
X
No
Explanation:
The Board of Directors for the period 2016 was
composed of 8 people from different professions,
all with prestige, ethics and sufficient availability
and economic independence. Of the 8 directors, 4
were independent.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 177
a. Provide the following information pertaining to the members of the Board of Directors of the Company during the fiscal year.
Full Name
Professional Background (*)
Date
Equity Interest (****)
Start (**)
End (***)
N° of shares
Interest (%)
117,538,203 shares
through GH Holding
Group Corp.
33,785,285 shares
through Bethel
Enterprises Inc.
17.81%
5.12%
Directors (not including Independent Directors)
José Graña Miró Quesada
Carlos Montero Graña
Mario Alvarado Pflucker
Hernando Graña Acuña
Independent Directors
Pedro Pablo Errázuriz Domínguez
Federico Cúneo de la Piedra
Mark Hoffmann Rosas
Hugo Santa María Guzmán
-Architect
-Director in three companies (1 belong to our
economic group)
-Engineer
- Director in three companies (all of them belong
to our economic group)
- Engineer
-Director in three companies (2 of them belong to
our economic group).
- Engineer
-Director in five companies (all of them belong to
our economic group)
- Engineer.
- Director of seven companies (1 of them belong to
our economic group).
-Accountant
- Director in seven companies (1 of them belong to
our economic group).
- Engineer
-Director in three companies (1 of them belong to
our economic group).
- Engineer
-Director in three companies. (1 of them belong to
our economic group).
1996
March 2, 2017
1996
2003
March 2, 2017
1996
March 2, 2017
2014
2014
March 31, 2017
2014
March 31, 2017
March 31, 2017
(*) In addition, detail whether the Director is concurrently a member of other boards of directors, their number and whether these are part of the economic group of the reporting company.
In this connection, the definition of economic group contained in the Regulations on Indirect Ownership, Related Companies and Economic Groups shall be considered.
(**) Pertains to the first appointment in the reporting company.
(***) Complete only if ceased in the position of Director during the fiscal year
(****) Mandatory only for Directors holding an interest of 5% or more in the capital stock of the reporting company.
% of the total shares held by the Directors
28.68%
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 178
Older than 65
3
Between 35 and 55
Between 55 and 65
Provide the number of Directors of the Company within the following age range.
Less than 35
0
b. Indicate whether there are specific
requirments to be appointed Chairman of the
Board in addition to the requirements to be
appointed a Director.
2
Yes
X
If answered in the affirmative, set forth such requirements.
Section 35.2 of the Regulations of the Board of Directors provides that the Chairman of
the Board may not be a Chief Executive of the Group.
c. Does the Chairman of the Board have a
casting vote?
Yes
X
3
No
No
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Question III.2
Does the Company prevent the appointment of
substitute or alternate Directors, especially for
quorum reasons?
Yes
X
179
No
Explanation:
Although the Company's Bylaws allow alternate
or alternate directors, Article 19.4 of Article 19 of
the General Regulations of the Board of Directors
states that the Board of Directors will not
promote the election of these, ensuring that all
elected members are full members. By exception,
the election of alternates or alternates must be
duly motivated.
Such is the case that, for years, the designation
of substitutes or alternate directors has been
avoided because they would not be focused and
connected with the dynamics of the company by
having to attend sporadically.
If the Company has alternate or substitute Directors, provide the following:
Full Name of Substitute or Alternate Director
Start (*)
Not Applicable
Not Applicable
End (**)
(*) Pertains to the first appointment as alternate or substitute Director of the reporting Company.
(**) Complete only if ceased in the position of alternate or substitute Director during the fiscal year.
Question III.3
Does the Company disclose the names of Directors,
their independent status and their resumes?
Yes
X
No
Explanation:
The name, capacity and resumes of our Directors
are provided in our corporate web page, in our
Annual Report and it is made available to the
shareholders prior to the election of every Board
of Directors.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 180
Set forth the means by which the Company discloses the following information on the Directors:
Electronic Mail
Corporate Web Page
Postal Mail
Not Reporting
Others/ Detail
Name of Directors
Independent Status or not
Resumes
Principle 16: Functions of the Board of Directors
Question III.4
The Board of Directors performs the function of:
a. Approving and directing the corporate strategy
of the Company
b. Setting objectives, goals and action plans include
in the annual budgets and the business plans.
c. Controlling and supervising the management
and in charge of governance and administration of
the Company.
d. Supervising the good corporate governance
practices and setting the policies and measures
required for better application thereof.
X
X
X
Yes
X
X
X
X
Adicionalmente se comunica en
la Memoria Anual
Adicionalmente se comunica en
la Memoria Anual
Adicionalmente se comunica en
la Memoria Anual
No
Explanation:
Article 9 of the Regulations of the Board
of Directors states its functions.
Article 9 of the Regulations of the Board
of Directors states its functions.
Article 9 of the Regulations of the Board
of Directors states its functions.
Article 9 of the Regulations of the Board
of Directors states its functions.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 181
a. Detail any other relevant powers of the Board of Directors of the Company
- Supervise strategically important commercial, industrial or financial agreements.
- Approve acquisitions and disposals of substantial assets and equity interests in
companies, and the financial operations of the Company that have a material impact
on the equity situation or that, due to any circumstance, may be especially significant.
- Approve investments that due to their amount or their nature significantly affect the
equity situation or the strategy of the Company.
-Propose and approve within the limits authorized by the Regular Shareholders
Meeting, the issue of bonds, obligations or similar securities.
-Approve the rules and procedures for appointments, control of the management
activity, the identification of the main risks of the Company, the evaluation, removal
and remunerations applicable to the Senior Management, especially of the Corporate
General Manager and the efficiency of the good corporate governance practices.
b. Does the Board of Directors delegate
any of its functions?
Yes
X
No
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 182
Set forth, if applicable, the main functions of the Board of Directors that have been delegated, and the body that performs such delegated functions.
Functions
Hiring and substituting the General Manager
Hiring and substituting the Management Staff
Set the remuneration of chief executives
Evaluate the remuneration of chief executives
Follow up on the social responsibility policy
Ongoing relationing with external auditors
Body / Area to which functions
have been delegated
Human Resources Management
and Sustainability Committee
Human Resources Management
and Sustainability Committee in coordination with the Chief Executive Officer
Human Resources Management
and Sustainability Committee
Human Resources Management
and Sustainability Committee in coordination with the Chief Executive Officer
Human Resources Management
and Sustainability Committee
Audit and Process Committee
Follow-up and supervision of the internal and external audit services
Audit and Process Committee
Review of the internal processes of the Group
Procedures and investigations of claims filed with the Ethical Channel in connection
with accounting and financial matters.
Follow-up and approval of the annual
investment plan
Audit and Process Committee
Audit and Process Committee
Investment and Risk Committee
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Principle 17: Duties and Rights of the Members of the Board of Directors
Question III.5
Are the members of the Board of Directors
entitled to?:
a. Request the Board of Directors support or the
contribution of experts.
b. Participate in induction programs on their
authority and duties and to be timely informed of
the organizational structure of the Company.
c. Receive a remuneration for the work perfumed,
which combines recognition of the professional
experience and dedication to the Company with a
rationality criterion.
Yes
X
X
X
183
No
Explanation:
Article 32 of the Regulations of the Board of
Directors states that Directors may gather the
information and receive the advisory that they
may require on any aspect of the Company.
El numeral 19.3 del Reglamento General del
Directorio establece que el Presidente del
Directorio y/o el Gerente General Corporativo
deberán realizar al nuevo Director una inducción
en la que se le explique la estructura del Grupo
Graña y Montero. Asimismo, como práctica se
lleva de visita a los Directores a obras importantes
del Grupo.
Chapter IX of the Regulations of the Board
of Directors regulating remuneration of the
Director. Remuneration consists of a fixed
amount per meeting and a variable amount per
meeting.
a. If specialized advisors were hired during the fiscal year, indicate whether the list of specialized advisors of the Board of Directors who provided services during the fiscal year for the decision
making of the Company was provided to the shareholders.
Not Applicable
If applicable, state whether any of the specialized advisors was related to any member of the Board of Directors and/or the Senior Management(*).
Not Applicable
(*) In connection with relatedness, the relationship criteria contained in the Regulations on Indirect Ownership, Related Companies and Economic Groups shall be applied.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 184
b. If applicable, indicate whether the Company conducted induction programs with the new members who joined the Company.
Not Applicable
c. Indicate the ratio of the aggregate amount of remunerations and annual bonuses of Directors to gross income, according to the financial statements of the Company (*).
Remuneration
Directors (not including Independent Directors)
Independent Directors
(%) Gross Income
0.00781%
0.01083%
Bonuses
(%) Gross Income
Delivery of Shares
Delivery of Options
Delivery of Cash
Others (detail)
Not Applicable
Not Applicable
Not Applicable
(*) Remuneration ratio set in relation to consolidated gross sales of the Graña y Montero Group.
Principle 18: Regulations of the Board of Directors
Question III.6
Does the Company have binding Regulations of the
Board of Directors the non-compliance of which
entails liability?
Yes
X
No
Explanation:
We have the Regulations of the Board of Directors
approved at the Board of Directors Meeting
held on March 31, 2005 as last amended was
approved by Board of Directors meeting in
October 25, 2016.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Indicate whether the Regulations of the Board of Director contain:
185
Operating policies and procedures
Organizational structure of the Board of Directors
Functions and responsibilities of the Chairman of
the Board
Procedures for identification, evaluation
and nomination of candidates to members
of the Board, who are proposed
to the Regular Shareholders Meeting
Procedures for cases of vacancy, termination and
succession of Directors
Others / Detail
Principle 19: Independent Directors
Question III.7
Is at least one-third of the Board of Directors
made up of Independent Directors?
No
Yes
X
X
X
X
X
Regulates cases of conflict of interest, the functions of the vice chairman and secretary of the Board of
Directors, and of the Chief Executive Officer.
Yes
X
No
Explanation:
During 2016, 4 of our 8 board members
were Independent Directors.
Indicate which of the following conditions is taken into account by the Company to qualify its Directors as Independent Directors.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 186
Not being a Director or employee of a company
of its economic group, unless three (3) or five
(5) years, respectively, since termination of such
relationship have elapsed.
Not being an employee of a shareholder with
an interest of five percent (5%) or more
in the company.
Not having more than eight (8) continued years as
an Independent Director of the Company.
Not having, or having had in the last three (3) years
a business, commercial or contractual relationship,
whether direct or indirect, and significant, (*), with
the Company or any other company of its group.
Not being the spouse of, or have any first
or second degree kinship relationship by blood,
or in the first degree of affinity, with shareholders,
members of the Board of Directors or of the Senior
Management of the Company.
Not being a director or a member of the Senior
Management of another company in which any
Director or member of the Senior Management of
the Company is part of the Board of Directors.
Not having been in the last eight (8) years
a member of the Senior Management or an
employee, whether in the Company, in companies
of its group or in companies who are shareholders
of the Company.
Not having been in the last three (3) years, a
partner or employee of the external auditor or of
the auditor of any company of its group.
Others / Detail
Yes
X
X
X
X
X
No
X
X
X
- *Our regulations consider a period of five (5) years.
- Additionally, to qualify as an Independent Director a professional and personal profile that inspires
a presumption of trust in connection with its independence is required.
*The business relationship shall be presumed significant when any of the parties has issued invoices or payments in an amount higher than 1% of its annual income.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Question III.8
a. The Board of Directors declares that the
proposed candidate is independent based on the
enquiries conducted and the statement of the
candidate?
b. The candidates to Independent Director state
their independent status to the Company, its
shareholders and managers?
Principle 20: Operational Efficiency of the Board of Directors
Question III.9
Does the Board of Directors have a work plan that
contributes to the efficiency of its functions?
Question III.10
Does the Company provide its Directors the
channels and procedures necessary to participate
efficiently in Board of Directors meetings,
even if non-presential?
Yes
X
X
Yes
X
Yes
X
187
No
Explanation:
The Board of Directors proposes to the
Shareholders Meeting the appointment of the
Directors stating whether they are Independent,
External Non-Independent or Internal Directors.
Candidates submit to the Company a Sworn
Affidavit where they state their Independent
status, among others.
No
Explanation:
The Board of Directors
has a pre-established agenda.
No
Explanation:
Section 12.6 of the Regulations of the Board of
Directors and Article 59 of the By-Laws provide
that non-presential meetings may be held.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 188
a. Indicate the following in connection with the Board of Directors meetings held during the fiscal year:
Number of meetings held
Number of meetings held without the giving
of notice (*)
Number of meetings which the Chairman
of the Board did not attend
Number of meetings at which one or more
Directors were represented by substitute
or alternate Directors
Number of regular Directors who
were represented at least once
8
2
0
0
0
(*) The number of meetings held under the provisions in the last paragraph of Article 167 of the General Corporations Law shall be set in this field.
b. Indicate the attendance rate of Directors to Board of Directors meetings during the fiscal year.
Name
José Graña Miró Quesada
Carlos Montero Graña
Mario Alvarado Pflucker
Mark Hoffmann Rosas
Federico Cúneo de la Piedra
Hernando Graña Acuña
Pedro Pablo Errázuriz Domínguez
Hugo Santa María Guzmán
% Attendance
100%
100%
100%
75%
87.5%
100%
100%
87.5%
c. Indicate the time prior to the Board of Directors meeting that all information of the business to be transacted at a meeting is made available to the Directors
Less than 3 days
3 - 5 days
More than 5 days
Non-Confidential Information
Confidential Information
X
X
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Question III.11
a. Does the Board of Directors evaluate at least
once a year, objectively, its performance as
governing body and that of its members?
b. Is the self-evaluation methodology alternated
with the evaluation conducted by external
advisors?
Yes
X
a. Indicate if performance evaluations of the Board of Directors have been conducted during the fiscal year.
As governing body
Of its members
Yes
X
X
189
Explanation:
Directors conduct a self-evaluation within
the first quarter of the year.
The evaluation of the Board of Directors
has been internal; however, clause 12.1 of article
12 of the Regulations of the Board of Directors
establishes that the Board of Directors may
decide to alternate the methodology of said
self-assessment by hiring external auditors
to carry it out.
No
X
No
If any of the fields in the previous question is answered in the affirmative, provide the following information for each evaluation:
Evaluation
Self-evaluation
Board of Directors Meeting
March 29, 2016
No
Date
Communicated (*)
Date
External Evaluation
Entity in Charge
Not Applicable
Communicated (*)
(*) Indicate Yes or No, if the evaluation was communicated to the shareholders.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX b.
¿Se alterna la metodología
de la autoevaluación con la evaluación
realizada por asesores externos?
190
Principle 21: Special Committees
Question III.12
a. Does the Board of Directors of the Company
form special committees focused on the analysis of
the most relevant matters for performance of the
Company?
b. Does the Board of Directors approve the
regulations governing each of the special
committees formed?
c. Are special committees chaired by Independent
Directors?
d. Are Special committees assigned a budget?
Question III.13
Does the Company have an Appointments and
Remuneration Committee in charge of nominating
the candidates to member of the Board, who are
proposed to the Regular Shareholders Meeting
by the Board of Directors, and of approving the
remuneration and incentives system of the Senior
Management?
Yes
X
X
X
X
Yes
X
No
Explanation:
The Regulations of the Board of Directors
govern development of the three Committees
formed in the Company: (i) Investment and Risk
Committee (ii) Human Resources Management
and Sustainability Committee; and; (iii) Audit
and Process Committee.
The Regulations of the Board of Directors, which
govern the conduct of special committees, was
approved by a Board of Directors meeting.
The only one of the three committees not chaired
by an Independent Director is the Investment and
Risk Committee; however, it consists of a majority
of Independent Directors. The other two special
committees are made up of and chaired by
Independent Directors only.
The Investment and Risk Committee
and the Human Resources Management and
Sustainability Committee have an assigned budget.
This is not provided to the Audit and Process
Committee, which in accordance with item o) of
Article 40.6 of the Regulations of the Board of
Directors may determine its own budget to ensure
independence in performance of its duties.
No
Explanation:
The Human Resources Management and
Sustainability Committee approves the
remuneration and incentives system of the Senior
Management, while the Senior Management is in
charge of nominating the candidates to member
of the Board.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 191
Question III.14
Does the Company have an Audit Committee
that oversees the efficiency and suitability of
the internal and external control system of the
Company, the work of the auditing firm or the
independent auditor, and compliance with the legal
and professional independence regulations?
Yes
X
No
Explanation:
The Audit and Process Committee.
a. Indicate whether the Company has the following additional Special Committees:
Risk Committee
Corporate Governance Committee
Yes
X
No
X*
*The functions of the Corporate Governance Committee are performed by our Audit and Process Committee.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX b. If the Company has Special Committees, provide the following information for each committee:
192
Name of the Committee:
Date of Creation:
Main Functions:
Audit and Process Committee
October 28, 2004
Ensure good corporate governance, appropriate internal procedures and the transparency of all acts of the
Company in the economic-financial, external audit and compliance and internal audit areas. Specifically:
• Report at the Shareholders Meeting on matters within the competence of shareholders to be submitted
at such meeting.
• Propose at the Regular Shareholders Meeting the appointment of external auditors for submission there
of to the Regular Shareholders Meeting.
• Oversee the internal auditing services.
• Have knowledge of the financial reporting process and the information and internal control systems of
the company.
• Review the accounts of the company, monitor compliance with legal requirements and the proper
application of generally accepted accounting principles, and report on the proposals for amendment of
accounting principles and criteria proposed by the management.
• Oversee compliance with the auditing contract, ensuring that the opinion of the annual accounts and the
main contents of the audit report are clearly and accurately written.
• Relate with the external auditors to receive information on such matters that may jeopardize the
independence thereof and any others associated with the account audit process.
• Monitor compliance with the Regulations of the Board of Directors and, in general, of the corporate
governance rules, and make such proposals as may be required for improvement and to prepare the
information that the Board of Directors is to approve and include within its annual public documents.
• Oversee functioning of the Corporate web page of the Company.
• Ensure proper compliance with the internal operating processes of the Group associated with the cycles
of origination, structuring, proposal preparation, acceptance of awarded contracts and performance of
contracts and propose any corrective measures deemed appropriate.
• Be directly responsible for the appointment, compensation, retention and oversight of the external
auditors retained by the Company.
• Settle any disputes as may arise between the management and the external auditors.
• Have the sufficient authority and financial resources to hire its own external advisors, whether legal,
accounting or other advisors, as may be necessary for the proper performance of its duties.
• Set its own budget to ensure independence in performance of its duties.
• Set the prior approval policies and procedures for audit and other permitted services.
• Set the procedures for: (i) receipt, retention, and the procedure for complaints received by the Company
in connection with accounting, accounting internal control or auditing matters; and,(iii allow the
anonymous and confidential submission of concerns by Company employees in connection with
debatable accounting or auditing issues.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 193
Members of the Committee (*):
Full Name
Federico Cúneo de la Piedra
Hugo Santa María Guzmán
Mark Hoffmann Rosas
% of Independent Directors in the Committee
Number of meetings held during the fiscal year:
Date
Position in the Committee
Start (**)
29.04.14
29.04.14
29.04.14
End (***)
March 31, 2017
March 31, 2017
March 31, 2017
Chairman
Member
Member
100%
5 meetings
Has been granted powers in accordance with Article 174 of the General Corporations Law.
The committee or its chairman participates in the Regular Shareholders Meeting.
Yes
Yes
X
No
No
X
Name of the Committee:
Date of Creation:
Main Functions:
Human Resources Management and Sustainability Committee
October 28, 2004
• Report to the Board of Directors the appointments and terminations of the Senior Management
of the company, and of the Chief Executive Officers of the subsidiaries.
• Resolve on the adoption of remuneration plans for the Senior Management, especially for the
Corporate Chief Executive Officer, taking into account the performance of the company.
• Propose measures for transparency of the compensation of directors and the Senior Management,
and ensure performance thereof.
• Know and assess the human resources policy.
• Inform the Board of Directors of transactions with related parties of directors, senior executives
or persons related therewith, which involve or may involve conflicts of interest.
• Ensure compliance with the Sustainability Policy, and issue Sustainability policies, directives
and / or complementary procedures that contribute to strengthening the responsible management
of the Group
• Oversee the sustainability management and report in connection therewith to the Board of Directors.
• Review and approve corporate goals and objectives associated with the compensation of the Chief
Executive Officer; evaluate the performance of the Chief Executive Officer in accordance with such
goals and objectives, and set and approve the compensation of the Chief Executive Officer.
• Retain and keep an independent external advisory in compensation matters.
• Responsible for the appointment, compensation and oversight of independent external advisors in
compensation matters.
• Retain independent external advisors for remuneration or other matters as necessary for performance
of its duties.
• Propose measures to strengthen social, environmental and governance risk management of subsidiary
companies, monitor progress and report to the Board of Directors.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 194
Members of the Committee (*):
Full Name
Pedro Pablo Errázuriz
Federico Cúneo de la Piedra
Mark Hoffmann Rosas
% of Independent Directors in the total del Committee.
Number of meetings held during the fiscal year:
Date
Position in the Committee
Start (**)
28.01.16
29.04.14
29.04.14
End (***)
March 31, 2017
March 31, 2017
Chairman
Member
Member
100%
4 meetings
Has been granted powers in accordance with Article 174 of the General Corporations Law.
The committee or its chairman participates in the Regular Shareholders Meeting.
Yes
Yes
X
No
No
X
Denominación del Comité:
Fecha de creación:
Principales funciones:
Investment and Risk Committee
October 28, 2004
• Set the investment policy
• Approve the Annual Investment Plan
• Analyze projects requiring an investment of over US$5,000,000.00 assessing the available funding
sources and the impact on the balance structure of the company and its subsidiaries.
• Assess and control the main risks of the projects in which the companies of the Financial Group
participate.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 195
Members of the Committee (*):
Full Name
José Graña Miró Quesada
Hugo Santa María Guzmán
Pedro Pablo Errázuriz Dominguez
% of Independent Directors in the Committee
Number of meetings held during the fiscal year:
Date
Position in the Committee
Start (**)
28.10.04
29.04.14
29.04.14
End (***)
March 02, 2017
March 02, 2017
Chairman
Member
Member
67%
3 meetings
Has been granted powers in accordance with Article 174 of the General Corporations Law.
The committee or its chairman participates in the Regular Shareholders Meeting.
Yes
Yes
X
X
No
No
(*) Information on persons who are or were members of the Committee during the reporting fiscal year.
(**) Pertains to the first appointment as a member of the Committee in the reporting company.
(***) Complete only if ceased to be part of the Committee during the fiscal year.
Principle 22: Code of Ethics and Conflicts of Interest
Question III.15
Does the Company take measures to prevent,
detect, handle and disclose conflicts of interests
that may arise?
Yes
X
No
Explanation:
The Company has an Ethics Charter and a Code
of Conduct available in our corporate web page.
If applicable, indicate the area and/or person in charge of follow-up and control of possible conflicts of interest. If a person is in charge, include also the position and area where he/she works.
Area in Charge
Human Resources Management
Full Name
Person in Charge
Position
Area
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Question III.16
a. Does the Company have a Code of Ethics(*)
enforceable on its Directors, managers, officers
and other collaborators (**) of the Company, which
sets forth ethical and social responsibility criteria,
including management of potential conflicts of
interest?
b. Does the Board of Directors or the General
Manager approve training programs for
compliance with the Ethics Code?
Yes
X
X
196
No
Explanation:
The Code of Conduct was approved in 2012
and the Ethics Charter in 1995 while the anti-
corruption policy in 2015.
Every company of the group incorporates to
the annual training plan courses on the Code of
Conduct. Also, to conduct such training, we have
on-line courses, incorporating them as induction
for new directors and new collaborators.
(*) The Code of Conduct may be a part of the Internal Conduct Regulations.
(**) The term collaborates covers all persons who have any employment relationship with the Company, regardless of the labor system or procedure.
If the Company has a Code of Ethics, indicate the following:
a. Available to:
Shareholders
Other persons to whom it may apply
The general public
Yes
X
X
X
No
b. Indicate the area and/or person in charge of following up on and compliance with the Code of Ethics.
If a person is in charge, include also the positionand area where he/she works and who he/she reports to.
Area in Charge
Ethics Commission
Person in Charge
Full Name
Position
Area
Reports to
Claudia Drago Morante
Chief Legal and Corporate Affairs
Officer
Legal and Corporate Affairs Office
Mario Alvarado Pflucker*
*After the resignation of Mr. Alvarado on March 02, 2017, the Legal and Corporate Affairs Office reports to Mr. Luis Francisco Díaz Olivero.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 197
c. Is a record of cases of non-compliance with such
Code in place?
Yes
X
No
d. Indicate the number of events of non-compliance with the provisions in such Code, detected or reported during the fiscal year.
Total cases filed 2016
Pending
Inadmissible
Under investigation
Closed
0
5
20
9
• The Ethical Channel record includes reports received, classified as above; however, we cannot say whether the reports classified as ‘closed’
have been an event of non-compliance or were ruled inadmissible, information that the Ethics Commission handles as reserved.
• Likewise, 4 of the 20 investigations were filed in September and belong to Colombia and Chile, while the other 16 are complaints filed between November and December.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Question III.17
a. Does the Company have mechanisms
in place to report any illegal or unethical
behavior, safeguarding the confidentiality
of the reporting party?
b. Reports are filed directly to the Audit Committee
when related to accounting matters or when
the General Management or the Financial
Management are involved?
Question III.18
a. Is the Board of Directors in charge of follow-up
and control of any conflicts of interest arising in the
Board of Directors?
b. If the Company is not a financial entity, has it
established the policy that members of the Board of
Directors are prohibited from borrowing from the
Company or from any company of their economic
group, unless previously consented by the Board of
Directors?
c. If the Company is not a financial entity, has it
established the policy that members of the Senior
Management are prohibited from borrowing
from the Company or from any company of their
economic group, unless previously consented by
the Board of Directors?
Yes
X
X
Yes
X
X
X
198
No
Explanation:
We have an Ethical Channel that allows reporting
illegal or unethical behaviors safeguarding the
confidentiality of the reporting party.
Item Q) of Section 40.6 of the Regulations of the
Board of Directors requires that the Audit and
Process Committee sets procedures for reception,
retention and processing of the reports received
by the Company in connection with accounting,
internal control of accounts or audit matters. The
confidential, anonymous submission of concerns
by employees in society is also allowed regarding
accounting or auditing scope issues.
No
Explanation:
Article 29 of the Regulations of the Board of
Directors provides that Directors communicate
to the Board of Directors any conflict situation,
whether direct or indirect, that they may have
with the interest of the Company.
This policy is in place since we listed in the New
York Stock Exchange in 2013. It should be noted
that no loans whatsoever are granted to members
of the Board of Directors (not even with the
approval thereof ).
This policy is in place since we listed in the New
York Stock Exchange in 2013. It should be noted
that no loans whatsoever are granted to members
of the Senior Management (not even with the
Board of Directors).
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 199
a. Provide the following information on members of the Senior Management who are shareholders with an interest of 5% or more in the Company.
Full Name
Position
Number of Shares
% of Total Shares
Not Applicable
% of the total shares held
by the Senior Management
7.40185%
b. Indicate whether any of the members of the Board of Directors or the Senior Management of the Company is the spouse, is a first or second degree relative by blood,
or first degree relative by affinity of:
Full Name
Vinculación con:
Shareholder(*)
Director
Senior
Management
Not Applicable
Full Name of
Shareholder / Director / Manager
Relation Type (**)
Additional
Information (***)
(*) Shareholders with an interest of 5% or more in the capital stock.
(**) In connection with relatedness, the relationship criteria contained in the Regulations on Indirect Ownership, Related Companies and Economic Groups shall be applied.
(***) If any relationship with a shareholder exists, include the equity interest thereof. If the relation is with any member of the management staff, include its position.
c. If a member of the Board of Directors holds or has held a management position in the Company during the fiscal year reported herein, provide the following information::
Full Name
Management Position that he holds or has held
Management Position Date
Mario Alvarado Pflucker
Hernando Graña Acuña
Corporate General Manager
Executive President of GyM S.A.
Start (*)
12.08.1996
31.03.2011
End (**)
02.03.2017
31.12.2016
(*) Pertains to the first appointment to a management position in the reporting company
(**) Complete only if ceased in the management position during the fiscal year.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 200
d. If any member of the Board of Directors or the Senior Management of the Company has held during the fiscal year any significant business, commercial or contractual relationship with the
Company due to the amount or subject thereof, provide the following information:
Full Name
Relationship Type
Not applicable
Brief Description
Principle 23: Transactions with Related Parties
Question III.19
a. Does the Board of Directors have policies and
procedures in place to assess, approve and disclose
certain transactions between the Company and
related parties, and to know the business or
personal relationships, whether direct or indirect,
that the Directors maintain with each other, with
the Company, its suppliers or clients, and other
stakeholders?
b. For operations of special relevance or complexity,
is the participation of independent external
advisors for assessment thereof considered?
Yes
X
No
Explanation:
The Human Resources Management Committee
has policies and procedures in place to assess,
approve and disclose certain transactions between
the Company and related parties, disclosing
them in form 20F submitted as Relevant Fact
to the SMV.
However, clause 30.5 and 30.6 of Article 30 of
the General Regulations of the Board of Directors
establishes that the Transfer Pricing Study
applicable to Grupo Graña y Montero will be used
as the valuation criterion.
X
a. If item a) of question III.19 is the case, indicate the area(s) of the Company in charge of dealing with transactions with related parties in the following aspects:
Aspects
Assessment
Approval
Disclosure
Area in Charge
Human Resources Management
Chief Executive Officer or Board of Directors
of each company
Chief Executive Officer
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 201
b. Indicate the procedures to approve transactions between related parties:
Article 30 of the Regulations of the Board of Directors provides that Human
Resources Management and Sustainability Committee reserves the knowledge
and authority over any transaction between the Company and any related party
or person related to them, shareholders, Directors, Senior Mangers and Chief
Executives or persons related to them and with other companies of the Graña y
Montero Group.
Furthermore, for ordinary transactions, provided they are conducted at fair value,
the generic authorization of the operations line shall suffice.
c. Detail the transactions material due to their amount or subject performed between the Company and its related parties during the fiscal year.
Name or Corporate Name of Related Party
Nature of the Relationship (*)
Negocios de Gas
Viva GYM
GyM S.A.
Adexus S.A.
Concesionaria Via Expresa Sur
CAM Servicios del Perú
Subordinate
Subordinate
Subordinate
Subordinate
Subordinate
Subordinate
Type of Transaction
Capital Contribution
Credit Capitalization
Loan agreement
Loan agreement
Loan agreement
Loan agreement
Amount (S/.)
427,231,607.37
83,200,000.00
57,405,721.60
25,200,000.00
9,303,240.26
2,949,811.20
(*) In connection with relatedness, the relationship criteria contained in the Regulations on Indirect Ownership, Related Companies and Economic Groups shall be applied.
d. Indicate whether the Company sets limits to
transitions performed with related companies.
Yes
No
X
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Principle 24: Functions of the Senior Management
Question III.20 / Compliance
a. Does the Company have a clear policy
for the delimitation of administrative or governance
functions implemented by the Board
of Directors, the ordinary conduct of business
by the Senior Management and the leadership
of the General Manager?
b. The appointments of General Manager and Chairman
of the Board of the Company are made by various persons?
c. Does the Senior Management have sufficient autonomy
to perform the duties assigned, within the framework of
policies and guidelines defined by the Board of Directors
and under the control thereof?
d. Is the General Manager in charge of complying with and
enforcing compliance with the policy
of information delivery to the Board of Directors and its
members?
e. Does the Board of Directors evaluate on an annual basis
the performance of the General Management under well
defined standards?
f. Does remuneration of the Senior Management have a
fixed and a variable component that take into account the
results of the Company based on a sound and responsible
assumption of risk, and accomplishment of the goals set in
the respective plans?
Yes
X
X
X
X
X
X
202
No
Explanation:
Article 9 of the Regulations of the Board of Directors
defines the overall management strategy and guidelines
of the Company, the furtherance and oversight of
the conduct of the Senior Management setting the
foundations of the corporate organization with a view
to ensuring the highest efficiency thereof, oversight in
connection with transparency and truthfulness of the
information of the Company in its relationships with
shareholders. Additionally, Article 38 of such Regulations
provide that the General Manager is responsible for
the operations and administration of the Company in
accordance with the criteria and guidelines set by the
Board of Directors, who implements such resolutions
and ensures that the Senior Management performs the
resolutions of the Board of Directors, implements the
strategy of the Board and keeps an appropriate planning,
control and information system for the Board of Directors.
Section 35.2 of the Regulations of the Board of Directors
provides that the Chairman of the Board may not be a
Chief Executive of the Group.
Art. 9.5 provides that the Board of Directors respects
the decision making authority of its governing and
management bodies in consistency with the interests of
the Company. Furthermore, the principle of responsible
autonomy set in the Code of Ethics prevails in the
Company.
Article 38 of the Regulations of the Board of Directors
provides that the General Manager shall be in charge
of maintaining and appropriate planning, control
and information system for the Board of Directors.
It is a part of the self-evaluation process of the Board
of Directors which takes place within the first quarter
of each year.
The remuneration of the Companies Board Members is
regulated in Article 34 of the Regulations of the Board of
Directors, consists of the following: Board of Directors
meeting attendance fees, Committee meeting attendance
fees, and profit sharing.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 203
a. Provide the following information on the remuneration of the General Manager and the management staff (including bonuses).
Position
General Manager
Management Staff
Remuneration (*)(**)
Fixed
0.0180 %
0.1172%
Variable
0.0033 %
0.0408 %
(*) Indicate the ratio of the aggregate amount of remunerations and annual bonuses of members of the Senior Management to gross income, according to the financial statements of the Company
(**) The ratio is set in relation to consolidated gross sales of the Graña y Montero Group.
b. If the Company pays the Senior Management bonuses or any compensation other that those required by law, indicate how these are paid.
Delivery of Shares
Delivery of Options
Delivery of Cash
Others / Detail
General Management
Managers
X
No
No
X
No
No
Shares are delivered based on the loyalty program
c. In case of existence of a variable component in the remuneration, specify the main aspects taken into account for determination thereof.
- Compliance with Company budget taken into account
- Rate of compliance with executive objectives
- Pre-established financial index
d. Indicate if the Board of Directors evaluated
performance of the General Management
during the fiscal year.
Yes
X
No
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX PILLAR IV:
RISK AND COMPLIANCE
Principle 25: Environment of Risk Management System
Question IV.1
a. Does the Board of Directors approve a
comprehensive risk management policy in
consistency with its size and complexity, promoting
a risk management culture within the Company,
from the Board of Directors to the Senior
Management and its own collaborators?
b. The comprehensive risk management policy
covers all companies that make up the Group and
allows a comprehensive view of critical risks?
Does the Company have a risk management
delegation policy setting the risk limits that can be
managed for each company level?
Question IV.2
a. The General Management manages the risks to
which the Company is exposed and communicates
them to the Board of Directors?
b. Is the General Management responsible for
the risk management system, if there is no Risk
Committee or Risk Management?
Yes
X
X
Yes
Yes
X
X
204
No
Explanation:
Under item J) of Article 9.3 of the Regulations
of the Board of Directors, this is a function of the
Board of Directors. However, as of this date the
risk matrix of the Group.
Will cover the entire Group.
No
X
No
Explanation:
Through the management report of the business
report and the Relevant Facts submitted
at every meeting.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 205
Does the Company have a Risk Manager?
Yes
No
X
If answered in the affirmative, provide the following information:
Full Name
Date of Position Held
Area / Body to which it reports
Start (*)
End (**)
Not Applicable
(*) Pertains to the first appointment in the reporting Company.
(**) Complete only if ceased in the position during the fiscal year.
Question IV.3
Does the Company have an internal and external
control system the efficiency and suitability of
which is overseen by the Board of Directors of the
Company?
Yes
X
No
Explanation:
Through the Audit and Process Committee
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Principle 26: Internal Audit
Question IV.4
a. The internal auditor performs auditing duties
on an exclusive basis, is autonomous and has the
experience and expertise in the subjects under his
evaluation, and the independence to follow up on
and evaluate efficiency of the risk management
system?
b. Are the ongoing evaluation of the validity and
reliability of all the financial information generated
or entered by the Company, and verifying the
efficiency of regulatory compliance the functions of
the internal auditor?
c. Does the internal auditor report directly to the
Audit Committee its plans, budget, activities,
progress, results obtained and actions taken?
a. Indicate whether the Company has an
independent area in charge of internal audit.
Yes
X
X
X
Yes
X
206
No
Explanation:
The internal auditor is autonomous to objectively
evaluate and regulate the risks of the business,
the internal control system and the operating and
financial performance so that the information of
the Company is accurate and consistent with the
transparency principle.
For the information of the Company
to be accurate and consistent with the
transparency principle.
Likewise, under item c) of Article 40.6 of the
Regulations of the Board of Directors, supervising
the internal audit services is a function of the
Audit and Process Committee.
No
If answered in the affirmative, indicate, by rank, who the audit depends on within the organic structure of the Company.
Depends on:
The Audit And Process Committee
b. Indicate if the Company has an Internal
Corporate Auditor.
Yes
X
No
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 207
Indicate the main responsibilities of the internal auditor and if it performs functions other than the internal audit.
The internal auditor does not perform functions other that the internal audit
and its main functions are:
- Assist the Board of Directors and the Management in performance of its Corporate
Governance-related functions.
- Objectively evaluate and regulate the risks of the business, the internal control
system and operating and financial performance.
- Provide assurance and consulting in the potential capacity of this activity to improve
risk management, add value to the group and improve the operational level.
Question IV.5
Is the Board of Directors in charge of the
appointment and termination of the Internal
Auditor at the proposal of the Audit Committee?
Yes
X
No
Explanation:
The Regulations of the Board of Directors provide
that the Audit and Process Committee shall
ensure that selection of the Internal Auditor is
made under objective criteria; and in general,
that that the information of the Company be
accurate and consistent with the transparency
principle.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX Principle 27: External Auditors
Question IV.6
Does the Regular Shareholders Meeting, at the
proposal of the Board of Directors, appoint the
auditing firm or the independent auditor, who
maintain a clear independence from the Company?
a. Does the Company have a policy for appointment
of the External Auditor?
Yes
X
Yes
X
208
No
Explanation
The external audit firm appointed by the
Regular Shareholders Meeting maintains a clear
independence whereby it is a function of the Audit
and Process Committee to relate with the external
auditors, to receive information on matters that
may jeopardize their independence.
No
If answered in the affirmative, describe the procedure to hire the auditing form in charge of reviewing the annual financial statements (including the identification of the corporate
body in share of electing the auditing firm).
The Corporate Financial Management proposes three candidates, then the
Audit and Process Committee approves the appointment of one of them, who
is presented by the Chairman of the Committee to the Board of Directors for
approval and submission to the Regular Shareholders Meeting who ultimately
approves such appointment.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX
209
b. If the auditing firm has provided services
other than accounts reviewing, indicate
if such hiring was communicated to the
Regular Shareholders Meeting, including the
percentage of the total invoiced by the auditing
firm to the Company that such services
account for.
c. The persons or entities related to the
auditing firm provide to the Company services
other than the reviewing of accounts?
Yes
Yes
X
No
X
No
If answered in the affirmative, provide the following information on the additional services provided by persons or entities related to the auditing firm in the reported fiscal year.
Name or Corporate Name
PwC
Additional Services
Other services
(*) Invoicing of additional services to invoicing of auditing services
d. Indicate whether the auditing firm has used
different equipment, if it has provided services
additional to reviewing of accounts.
Yes
X
% of Remuneration (*)
25%
No
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 210
Question IV.7
a. Does the Company maintain a policy
of renewal of its independent auditor or
auditing firm?
b. If such policy requires longer periods
for renewal of the auditing firm, the work
team of the auditing firm rotates every five (5)
years maximum?
Yes
X
No
Explanation:
The Regulations of the Board of Directors set
forth the independent auditor renewal policy.
The Company keeps the firm, but the team must
be changed at least every three (3) years.
Provide the following information on the auditing firms that have provided services to the Company in the last five (5) years.
Corporate Name of the Auditing Firm
Service (*)
PwC
PwC
PwC
PwC
PwC
Audit before the deadline
Transfer prices study
Oversight advisory
Sworn affidavit assistance
Other services
Period
2011- 2016
2011- 2016
2011- 2016
2011- 2016
2016
(*) Include all service types, such as financial information reviews, accounting appraisals, operational audits, systems audits, tax audits and other services.
(**) Of the aggregate amount paid to the auditing firm on all accounts, indicate the percentage pertaining to remuneration for financial auditing services.
Remuneration (**)
% of the Income of the Auditing Firm
0.9%
19%
63%
18%
25%
Question IV.8
In economic groups, the external auditor
is the same for the entire group, including
off-shore affiliates?
Yes
X
No
Explanation:
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 211
Indicate whether the auditing firm hired to
review the financial statements of the Company
for the reported fiscal year also reviewed the
financial statements for the same fiscal year of
other companies of its economic group.
If answered in the affirmative, provide the following:
Yes
X
No
GyM S.A.
Cam Perú S.A.
GMI S.A. Ingenieros Consultores
CAM Colombia Multiservicios S.A.S.
Name or Corporate Name of Company (Companies) of the Economic Group
GMP S.A.
GMD S.A.
CONCAR S.A.
NORVIAL S.A
SURVIAL S.A.
Concesión Canchaque S.A.C
GyM Ferrovías S.A.
CAM Chile S.A.
Viva GyM S.A
Concesionaria La Chira S.A.
STRACON GyM S.A.
CAM Holding SpA
GyM Chile SPA
Vial y Vives-DSD S.A.
Inmobiliaria Almonte S.A.C.
Ecotec S.A.C.
Compañía Americana de Multiservicios del Perú S.A.
Gestión de Soluciones Digitales S.A.C.
Coasin Instalaciones Ltda
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 212
Yes
X
No
Explanation:
The information policy for shareholders,
investors and other stakeholders is covered by
both our Investor Relations Office and by the
communications made by our Stock Exchange
Representative though the Relevant Facts.
PILLAR V:
INFORMATION TRANSPARENCY
Principle 28: Information Policy
Question V.1
Does the Company have an information policy
for shareholders, investors, other stakeholders
and the market in general, with which it
defines in a formal, orderly and comprehensive
manner the guidelines, standards and
criteria to be applied in handling, gathering,
preparing, classifying, organizing and/or
distributing the information generated or
received by the Company?
a. If applicable, indicate if, according to its information policy, the Company issues the following:
Objectives of the Company
List of members of the Board of Directors and
the Senior Management
Equity structure
Description of the economic group
to which it belongs
Financial statements and annual report
Others / Detail
No
X
Yes
X
X
X
X
Transactions between related parties
Remuneration of the Board of Directors and the Senior Management
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX b. Does the Company have a corporate
web page?
The corporate web page includes:
A special section on corporate governance
or relationships with shareholders and
investors, which includes the Corporate
Governance Report
Relevant facts
Financial information
By-laws
Regulations of the Shareholders Meeting
and information on meetings (attendance,
minutes, others)
Make-up of the Board of Directors and its
Regulations
Code of Ethics
Risk policy
Corporate Social Responsibility (community,
environment, others)
Others / Detail
Question V.2
Does the Company have an investor
relations office?
Yes
X
Yes
X
X
X
X
X
X
X
X
Yes
X
213
No
No
X
No
Explanation:
It is our Investor Relations Office.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 214
If it has an investor relations office, who is the person in charge?
Investor Relations Office Manager
Samantha Ratcliffe Leiva
If no investor relations office is in place, indicate the unit (department/area) or person in charge of receiving and handling the information requests of shareholder of the Company and the
general public. If a person is in charge, include also his/her position and the area where he/she works.
Area in Charge
Not Applicable
Full Name
Person in Charge
Position
Not Applicable
Area
Principle 29: Financial Statements and Annual Report
If the external auditor’s report has been issued with qualifications, these have been explained and/or substantiated to the shareholders?
Not applicable
Principle 30: Information on Equity Structure and Shareholder Resolutions
Question V.3
Does the Company disclose the ownership
structure, considering the various classes of
shares and, if applicable, the joint interest of a
specific economic group?
Yes
X
No
Explanation:
The Company discloses such information
through the SMV, where we report direct
and indirect ownership.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 215
Indicate the make-up of the equity structure of the Company as of the year-end.
Shares of Voting Stock Held
Number of Holders (as of the year-end)
% Interest
Less than 1%
1% - 5%
5% - 10%
More than 10%
Total
1988
9
1
2
2,000
Shares of Non-voting Stock Held (if applicable)
Number of Holders (as of the year-end)
Less than 1%
1% - 5%
5% - 10%
More than 10%
Total
Not Applicable
Not Applicable
Not Applicable
Not Applicable
Not Applicable
Investment Shares Held (if applicable)
Number of Holders (as of the year-end)
Less than 1%
1% - 5%
5% - 10%
More than 10%
Total
Not Applicable
Not Applicable
Not Applicable
Not Applicable
Not Applicable
Treasury stock to capital stock ratio: Not Applicable
15.77%
21.13%
5.12%
57.98%
100%
% Interest
Not Applicable
Not Applicable
Not Applicable
Not Applicable
Not Applicable
% Interest
Not Applicable
Not Applicable
Not Applicable
Not Applicable
Not Applicable
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Question V.4
Does the Company report shareholder
agreements?
a. Does the Company have shareholder
agreements in force?
Yes
X
Yes
No
No
X
Explanation:
However, we do not have a shareholders
agreement.
b. If any shareholders agreement has been reported to the Company during the fiscal year, indicate the subject matter thereof.
Election of members of the Board of Directors
Exercise of voting rights at meetings
Restriction to the free transfer of the shares
Changes in internal or statutory
regulations of the Company
Others / Detail
Not Applicable
Not Applicable
Not Applicable
Not Applicable
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No
Explanation:
These are communicated in the Annual Report
and released to the SMV.
No
Principle 31: Corporate Governance Report
Question V.5
Does the Company disclose the corporate
governance standards adopted in an annual
report, for the contents of which the Board
of Directors is responsible, upon the report
of the Audit Committee, the Corporate
Governance Committee, or of an external
consultant, if applicable?
a. The Company has mechanisms in place for
internal and external disclosure of corporate
governance practices.
Yes
X
Yes
X
If answered in the affirmative, specify the mechanisms used
The Legal and Corporate Affairs Management is in charge of internal and external
disclosure of corporate governance practices and of proposing improvements to
the General Management and the Board of Directors.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 218
SECTION C:
CONTENT OF DOCUMENTS OF THE COMPANY
Indicate in which of the following document(s) of the Company these matters are regulated.
1. Policy for redemption or swap of shares of non-
(**)
voting stock
X
Principle
By-laws
Internal
Regulations (*)
Manual
Others
Not regulated
Not Applicable
2. Share ownership entry method and person in
charge
3. Procedures for selection of external advisor to
issue an independent opinion on the corporate
operations that may affect the right to non-dilution
of shareholders
4. Procedure to receive and handle request for
information and opinion of the shareholders
5. Dividend policy
6. Policies or agreement for non-adoption of anti-
takeover mechanisms
7. Arbitration agreement
8. Policy for selection of Directors of the Company
9. Policy to evaluate remuneration of the Directors
of the Company
10. Mechanisms to make information relative to
items contained in the agenda of the Regular
Shareholders Meeting and resolution proposals
available to shareholders.
11. Means additional to those provided by Law, used
by the Company to give notice of meetings.
12. Additional mechanisms for shareholders to
submit proposals of items in the agenda to be
discussed at a Regular Shareholder Meeting.
2
3
4
5
6
7
8
8
10
10
11
X
X
X
X
X
X
X
X
X
X
X
X
Name of
Document (**)
CAVALI
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Principle
By-laws
Internal
Regulations (*)
Manual
Others
Not regulated
Not Applicable
Name of
Document (**)
X
13. Procedures to accept or reject shareholder
proposals to include agenda items to be discussed
at the Regular Shareholders Meeting
14. Mechanisms allowing non-presential
participation of shareholders
15. Procedures to cast differentiated votes
by the shareholders
16. Procedures to perform in voting delegation
situations
17. Requirements and formalities for a shareholder
to be represented by proxy at the meeting.
18. Procedures for the delegation of votes to
members of the Board of Directors or the Senior
Management.
19. Procedure to follow up on Regular Shareholders
Meeting resolutions
20. Minimum and maximum number of members to
make up the Board of Directors of the Company
21. Duties, rights and functions of the Directors
of the Company
22. Bonus types received by the Board of Directors for
accomplishment of goals of the Company
23. Policy for hiring advisory services for Directors
24. Induction policy for new Directors
25. Special requirements to be an Independent
Director of the Company
26. Criteria for performance evaluation of the Board
of Directors and its members
27. Policy for determining, follow-up and control
of possible conflicts of interest
11
12
12
13
13
13
14
15
17
17
17
17
19
20
22
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
X
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Principle
By-laws
Internal
Regulations (*)
Manual
Others
Not regulated
Not Applicable
Name of
Document (**)
28. Policy defining the procedure for assessment,
approval and disclosure of transactions with
related parties
29. Responsibilities and functions of the Chairman
of the Board, Executive President, General
Manager, and other Senior Management officers.
30. Criteria for performance evaluation of the Senior
Management
31. Policy to set and evaluate remuneration of the
Senior Management
32. Comprehensive risk management policy
33. Responsibilities of person in charge of Internal
Audit.
34. Policy to appoint the External Auditor,
term of the contract and renewal criteria.
35. Policy of disclosure and communication
of information to shareholders
23
24
24
24
25
26
27
28
X
X
X
X
X
X
X
(*) Includes the Regulations of the Regular Shareholders Meeting, Regulations of the Board of Director and others issued by the company
(** Indicate name of the document, unless it is the by-laws
X
X
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trainings were complemented by 10 specialized courses, such as the "prevention of money
laundering", aimed at employees of real estate and construction. In addition, as part of
senior management's commitment to provide a clear message of zero tolerance for bribery
and corruption, we include these issues in the Board's regular agenda and we have a
Compliance Officer who reports to the Audit and Process Committee. At the process level,
we continue to conduct a Due Diligence for mergers and acquisitions, and we disseminated
the "Know Your Partner" initiative, through which 111 preventive evaluations were carried
out of potential strategic partners, 13 suppliers and 9 potential recipients of donations.
Along the same lines, anticorruption clauses were included in contracts and purchase
orders with suppliers, and a specific procedure for donations was implemented. Since
2013, we maintain an Ethical Channel that is the main means of reporting for potential
complaints, and is operated by an independent company to guarantee impartiality,
transparency and confidentiality in the cases presented. In 2016, we received 34 cases,
of which 26% were resolved, 59% are in investigation and 15% were declared unfounded.
Since its creation, we have received a total of 211 complaints, none linked to bribery or
corruption of public officials.
Lastly, we are part of the Companies Circle, an initiative launched in 2005 that brings
together a group of Latin American companies who stand out for their good corporate
governance practices.
SECTION D:
OTHER INFORMATION OF INTEREST5
Besides the special committees mentioned above, we have the following government
bodies, whose operation is regulated in our General Regulations of the Board of Directors:
- Executive Commission.- The governing body made up of the Executive Presidents,
Chief Executives of the Subsidiaries and the Chief Executive Officer of the Company, the
purpose of which is to discuss matters of strategic importance that affect the Company and
Subsidiaries as a part of the Graña y Montero Group and be a coordination body. The main
functions of the Executive Commission include:
a) Discuss the Strategic Plan of the Company and Subsidiaries
b) Discuss the Annual Budget of the Company and Subsidiaries
c) Discuss the Annual Investment Plan of the Company and Subsidiaries
d) Discuss Policies and Strategies applicable to the Company and Subsidiaries
e) Other matters of interest and relevance to the Company and Subsidiaries
- Ethics Commission.- A board in charge of promoting ethical behavior in the Group,
and of evaluating and making decisions on any breach of the Ethics Charter and the
Code of Conduct. The Ethics Commission provides a Manual setting the Ethical Channel
Use Protocol.
In 2015, the Company and its subsidiaries approved the Anti-Corruption Policy applicable
to the Group in accordance with the provisions of the Foreign Corrupt Practices Act (FCPA),
which are applicable to us as a foreign company listed on the New York Stock Exchange.
During 2016, compliance and prevention efforts were focused on the deployment of the
Anti-Corruption Policy in the different companies of the Group and the implementation
of a training plan at all levels of the organization. Thus, a virtual course on the main anti-
corruption guidelines was developed, which enabled 85% of employees to be trained. These
5 Se incluye otra información de interés no tratada en las secciones anteriores, que contribuya a que el inversionista y los diversos grupos de interés puedan tener un mayor alcance sobre otras prácticas de buen gobierno
corporativo implementadas por la Sociedad, así como las prácticas relacionadas con la responsabilidad social corporativa, la relación con inversionistas institucionales, etc.
Asimismo, la Sociedad podrá indicar si se ha adherido voluntariamente a otros códigos de principios éticos o de buenas prácticas, internacionales, sectoriales o de otro ámbito, indicando el código y la fecha de adhesión.
- Compliance of corporate governance principlesINTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the futureAPPENDIX 222
INDEX OF CONTENTS GRI G4
Our Integrated Annual Report 2016 responds to the essential conformity indicators, according to the requirements of the Global Reporting Initiative – GRI G4 guidelines. The following table
indicates where to find information regarding the G4 Guide on our report.
BASIC GENERAL CONTENTS
Description
Strategy and analysis
G4-1
Organizational Profile
Statement by the main decision maker of the organization on the importance
of sustainability to the company.
Page
Page 4
G4-3
G4-4
G4-5
G4-6
G4-7
G4-8
G4-9
G4-10
Name of the organization
Main brands, products and services
Place where the organization’s headquarters are located
Graña y Montero S.A.A
Chapter "What we do"
Graña y Montero’s headquarters are located at:
Av. Paseo de la República 4667- 4675, Surquillo, Lima.
Countries where the organization operates
Page 8
Nature of the property system and its legal structure
Graña y Montero S.A.A., the parent company, was legally
established by Public Deed on August 12th, 1996, as part of a
process of enlargement that started in Gramonvel in 1993.
Its main objective is to engage in investments and commercial
transactions in general, provide engineering services,
management consulting, real state investments and concessions.
The companies who make up the Group are limited societies,
with the exception of the Graña y Montero S.A.A. holding . As
at December 31st 2016 we have 2000 shareholders, among which
99.40% own less than 1% of the equity capital, and 0.45% have
between 1 and 5%.
Markets targeted by the organization
Size of the organization based on its number of employees, transactions, sales or net
income among others
Number of employees by labor contract and sex
Page 8
Page 10
Page 78-79
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G4-12
G4-13
G4-14
G4-15
G4-16
223
Percentage of employees covered by collective agreements
In GyM, there are 2 types of collective agreements: Federation
of Civil Construction Workers and Labors Unions of each project.
In 2016, the number of collective agreements were: GYM 8 works
committees and 4 unions, Stracon GyM 1 work committee, CAM
Chile 8 unions, and GMP 1 union.
Supply chain of the organization
Any significant change in size, structure, share ownership or supply chain of the
organization that has taken place during the analyzed period
The organization’s approach to the principle of precaution
Page 125-127
Page 87
Page 103
Letters, principles or other external economic, environmental and social initiatives the
organization has subscribed to or adopted
We adhere to the United Nations Global Compact since 2004.
National or international promotion associations or organizations to which the
organization belongs
- Since 2010, we have been part of the Companies Circle, a group
of Latin American companies with high corporate governance
standards that belong to the Latin American Corporate
Governance Round table.
- We participate of the Latin American Companies Circle, an
initiative supported by the International Financial Corporation
that supports and shares the implementation of good practices
of corporate governance with the private sector.
- The Graña y Montero group is a member of AFIN, la
Asociación para el Fomento de la Infraestructura Nacional ,
a business guild which gathers the main private companies
of the public service infrastructure sector
- Through GyM we belong to the Peruvian Chamber of
Construction (Capeco).
- Through Vial and Vives we belong to the Chilean Chamber
of Construction.
- Through Viva GyM we are part of the Green Building
Council Peru, a socially committed organization seeking the
implementation of sustainable construction in Peru.
- Through GMI we belong to the Federación Panamericana de
Consultores , which is attached to the Federación Internacional
de Ingenieros Consultores .
- Through GMP, we are part of the American Association of
Petrol Geologists (AAPG), the Sociedad de Ingenieros de
Petróleo (SPE) and the Sociedad Nacional de Minería y
Petróleo (SNMP), whose code of conduct we adhere to and
abide by.
- Through GMD we belong to the Asociación Peruana de
Productores de Software (Apesoft).
- ADEXUS: ACTI Asociacion Chilena de Empresas de Tecnología
de Información 7 A.G., AMCHAM CHILE, Cámara de
Comercio Norteamericana , Cámara de Comercio de Santiago .
- Index of contents GRI G4APPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future 224
Material aspects and coverage
G4-17
G4-18
G4-19
G4-20
G4-21
G4-22
G4-23
Participation of stakeholders
G4-24
G4-25
G4-26
G4-27
Entities that appear in the consolidated financial statements of the organization and
other similar documents
Page 7
Process followed to determine the content of the annual report and coverage of each aspect
Page 67
Material aspects identified during the process of defining the content of the annual report Page 68
Coverage of each material feature within the organization
Limits of each material feature outside the organization
Each material feature has a different coverage, which is
developed in the management approach (DMA) of the addressed
topics, throughout this report.
The limits of each business area can be seen in the materiality
graphs presented in this report, as well as in the development
of the presented topics. This enables us to know every material
feature applied internally or externally to the company.
Consequences of the restatements of the information provided in previous reports and
their causes
The definition of the indicators correspond to those mentioned
in the previous report.
Significant changes in the scope and coverage of each aspect with regard to previous
reports.
In 2016 we increased the coverage of our report to include
Adexus transactions.
Stakeholders linked to the organization
Stakeholders’ selection criteria
Page 113
In order to define stakeholders and the subjects to be reported
and managed, we undertook an aligned materiality process
suggested by the Global Reporting Initiative (GRI) for each
of the companies of the group comprised within this report.
Organizational approach on the participation of stakeholders (frequency, participation
in the report production process, among others)
Page 114
Key issues and problems that have arisen from the participation of stakeholders
As a result of the stakeholders participation during the report
production process, no key problems have arisen. The liaising
with stakeholders can be seen in the chapter “Communication
and dialogue”.
- Index of contents GRI G4APPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future 225
Report Profile
G4-28
G4-29
G4-30
G4-31
G4-32
G4-33
Governance
G4-34
Ethics and Integrity
G4-56
Period under review
Date of the last report
Cycle of report presentation
2016
2015
Annual
Contact to solve any queries that may arise from the contents of the report
Chosen option for the report
Legal and Corporate Affairs Management
responsibilidadcorporativa@gym.com.pe
In agreement- essential
Current policies and practices of the organization regarding the external verification
of the report
Currently, the company has no external verification policy.
Governance structure of the organization
Values, principles, standards and regulations of the organization, such as codes of
conduct or codes of ethics
Page 16-21
Page 70-73
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CONTENIDOS BÁSICOS ESPECÍFICOS
Material Features
of Graña y Montero
GRI G4 Category
GRI G4 Feature
Indicator
Description
Global Compact
ODS associate
Page
Ethical behavior
-
-
Organization's own
indicator
Organization's own
indicator
Training percentage in
the asset laundering
prevention system.
Percentage of complaints
received and assessed
by the Corporate Ethics
Channel
Principle 2
Principle 10
Principle 4
Principle 5
Principle 10
-
-
Persons’ Development
Labor practices and
decent work
Training and education Generic DMA
Management approach
ODS 4
Page 72
Page 72
Page 76
Page 83
Principle 1
G4 - LA9
G4 - LA10
G4 - LA11
Average annual training
hours by employee,
broken down by gender,
and occupational category
Skill management and
continuous training
programs that promote
employability and help
workers manage the
end of their professional
careers
Percentage of employees
who are regularly assessed
on their performance
and their professional
development, broken
down by gender and
occupational category
Principle 1
Page 83-84
Principle 1
ODS4
Page 82
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Material Features
of Graña y Montero
GRI G4 Category
GRI G4 Feature
Indicator
Description
Global Compact
ODS associate
Page
Assessment of the
labor practices of our
suppliers
LA-14
-
-
Organization's own
indicator
Organization's own
indicator
Organization's own
indicator
Percentage of new
suppliers whose
assessment was based on
work-practice criteria
Knowledge management
initiatives, number of
forums and meetings
organized, and number
of visits to the knowledge
website portal
Percentage of employees
coming from the local
community in places
where significant
operations are taking
place
Percentage of re-
categorization of
operating employees
Principle 1
Principle 2
Principle 4
Principle 5
Principle 1
ODS8
Page 126
ODS4
Page 132
Principle 1
ODS4ç ODS1
Page 81
Principle 1
ODS4
Page 82
Organization's own
indicator
Mechanisms to provide
a variable payment
We have a
compensation policy
and procedure that
establishes variable
payment concepts
to our employees,
employees, and
members linked
to their meeting
their objectives.
Among these we
have a yearly bonus
for executives, the
project award (given
to the employees
who manage the
project and have
contributed in an
outstanding manner
to its development),
the retention bonus
for executives, among
others.
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Material Features
of Graña y Montero
Safety
GRI G4 Category
GRI G4 Feature
Indicator
Description
Global Compact
ODS associate
Page
Labor practices and
decent work
Health and Safety at
work
Generic DMA
Management approach
Principle 1
ODS 8
Page 97-98
Page 97-98
100% of the members
of the companies
belonging to the
group are represented
by Health and Safety
Committees.
Specific DMA
Management approach
Principle 3
Principle 1
Principle 3
-
-
G4- LA5
Organization's own
indicator
Organization's own
indicator
Percentage of workers
who are represented
by formal health and
safety committees
for management and
employees, established to
help control and provide
advice on health and
safety at work programs
Accident frequency index
and number of hours
worked with exposure
to risk
Road safety management
initiatives with employees,
users and the society at
large
The environment
The environment
Energy
Generic DMA
Management approach
Specific DMA
Management approach
G4 - EN3
Consumo energético
interno
Emissions
Generic DMA
Management approach
Specific DMA
Management approach
G4 - EN15
Direct emissions of
greenhouse effect gases
(scope 1)
Principle 1
Page 99
Principle 1
ODS3
Page 98
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
ODS7
Page 103
Page 103-104
Page 104
ODS13
Page 104
Page 103-104
Page 105
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of Graña y Montero
GRI G4 Category
GRI G4 Feature
Indicator
Description
Global Compact
ODS associate
Page
229
ODS12
Page 107
Effluents and waste
Generic DMA
Management approach
Suppliers’
Environmental
assessment
G4 - EN23
G4 - EN24
Total waste weight
according to treatment
type and methods
Number and total volume
of significant spillages
Generic DMA
Management approach
Specific DMA
Management approach
G4 - EN32
Percentage of new
suppliers who were
assessed according to
their environmental
criteria
-
-
Organization's own
indicator
Consumo y
reutilización de agua
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Principle 1
Principle 2
Principle 7
Principle 8
Principle 9
Principle 7
Principle 8
Principle 9
Communication
Product responsibility
Product and service
labeling
Generic DMA
Management approach
Principle 1
-
-
G4 - PR5
Customer satisfaction
survey results
Organization's own
indicator
Number of complaints
from our clients
Principle 1
Principle 1
* The economic performance of the company is represented as an important feature of its management, but is not aligned to the strategy of sustainability.
Page 107
Page 108
Page 124-126
Page 124-126
Page 126
Page 106
Page 115
Page 115
Page 115
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SUSTAINABILITY CORPORATE REPORT
SUPERINTENDENCIA DEL MERCADO DE VALORES
(SMV/SUPERINTENDENCE OF THE SECURITIES MARKET)
REGISTERED COMPANY NAME:
Graña y Montero S.A.A
YEAR:
2016
WEBSITE:
www.granaymontero.com.pe
REGISTERED COMPANY NAME OF
THE COMPLIANCE MONITORING FIRM:
- Asociación Peru2021
- Global Reporting Initiative
APPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future- Sustainability corporate report SECCIÓN A:
IMPLEMENTATION OF CORPORATE SUSTAINABILITY ACTIONS
Question A.1
Has the company voluntarily adhered to standards
of good practices in Corporate Sustainability?
Yes
X
231
No
Explicación
We are an Engineering and Infrastructure Group
committed to the sustainable development of
the countries in which we operate. Through our
business, we seek to create value in the long term
for our different stakeholders, and we believe this
will only be possible if we guarantee economically
feasible, socially beneficial, environmentally
safe results.
In January 2016, the Group’s Board of Directors
approved our Corporate Sustainability Policy,
which is an update and consolidation of the
previous Environmental Policy (1998), Risk
Prevention Policy (1999) and Corporate Social
Responsibility Policy (2005). This important
document establishes clear guidelines and
commitments on the seven most important
aspects of our sustainable management, which
were determined based on an assessment
of our risks and impacts on stakeholders.
If the answer is yes, indicate the standard and compliance date:
Standard
United Nations Global Compact
Companies Circle
Principles of Good Corporate Governance of the SMV
Compliance date
2004
2010
2008
APPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future- Sustainability corporate report 232
NO
X
If sustainability reports other than this report are prepared, indicate the following information:
These reports are prepared:
Voluntarily
Due to investor requirements
Due to requirements by public institutions
Other (list):
These reports are available through:
Superintendence of the Securities Market (SMV) portal
Corporate website
Social networks
Other:
YES
X
X
X
X
X
Printed
APPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future- Sustainability corporate report
Question A.2
Does the company have a corporate policy
that covers the impact of its activities on the
environment?
Yes
X
233
No
Explanation:
We have a Sustainability Corporate Policy that
includes the environmental dimension.
It explicitly states, We respect and protect our
environment using a preventive approach.
Hence, we implement the best management
practices to reduce the environmental impact
of our operations and services, promoting a
responsible culture towards our environment and
generating engineering solutions that improve the
environmental performance of our clients and of
our society.
In addition, on an annual basis, we publicly
disclose our environmental performance and
investment in designs, projects and technologies
that produce environmental benefits for society.
a. If your answer to question A.2 is yes, indicate the company document which regulates the policy and the body that approves it.
Document
Sustainability Corporate Policy
Ethics Charter
Code of Conduct
Body
Board of Directors of the Graña y Montero Group and subsidiaries
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
b. Does the company quantify greenhouse gas emissions produced by its activities (carbon footprint)?
APPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future- Sustainability corporate report
234
Yes
X
No
If your answer is yes, indicate the results obtained:
During 2016, the Graña y Montero Group produced 203,907 tons of CO2 eq, calculated
under scopes 1 and 2. For further details, see pages 106 of the 2016 Annual Report.
c. Does the company quantify and document the total amount of energy used in its activities?
Yes
X
No
If your answer is yes, indicate the results obtained:
During 2016, the Graña y Montero Group consumed 115.8 million kWh of electrical
energy and 15.3 million gallons of fuel. See page 105 of the 2016 Annual Report.
d. Does the company quantify and document the total amount of water used (water footprint) in its activities?
Yes
X
No
If your answer is yes, indicate the results obtained:
During 2016, the Graña y Montero Group consumed 1.6 million
cubic meters of water. See page 107 of the 2016 Annual Report.
e. Does the company quantify and document waste produced as a result of its activities?
Yes
X
No
If your answer is yes, indicate the results obtained:
During 2016, the Graña y Montero Group produced 48,827 tons
of solid waste. See page 108 of the 2016 Annual Report.
APPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future- Sustainability corporate report Question A.3
Does the company have a policy to promote and
ensure its workers’ fundamental principles and
rights in the workplace?1
Yes
X
235
No
Explicación
We have a Sustainability Corporate Policy that
includes our position and commitment with
regard to our employees.
It states, “Our employees are the foundation of our
success and our most important asset. Therefore,
we seek their professional and personal growth,
developing the competencies necessary for
achieving their potential, within the framework
of our corporate values, with respect for human
rights and rejecting any form of discrimination.”
a. If your answer to question A.3 is yes, indicate the company document which regulates this policy and the body that approves this document.
Document
Sustainability Corporate Policy
Ethics Charter
Code of Conduct
b. Does the company keep a record of work-related accidents?
Body
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
Yes
X
No
If your answer is yes, indicate the area responsible for keeping the record
and to whom the area reports.
Area responsible
Corporate Operations
Reports to
Corporate General Manager
Risk Prevention area of each subsidiary
General Manager of each subsidiary
1 According to the International Labor Organization (ILO) Declaration on Fundamental Principles and Rights at Work, the principles and rights fall into the following four categories: (i) freedom of association and the effective
right to collective bargaining, (ii) the elimination of forced or compulsory labor, (iii) the abolition of child labor and, (iv) the elimination of discrimination in respect of employment and occupation.
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c. Does the company have a training plan for its workers?
Yes
X
No
If your answer is yes, indicate the company body that approves the plan and the frequency
with which adherence to the plan is evaluated:
Body
Graña y Montero Academy
Corporate Human Resources
Evaluation frequency
Annually
Annually
d. Does the company take surveys or make evaluations regarding the work environment?
Yes
X
No
If your answer is yes, indicate the results obtained:
The average general satisfaction level for the Group was 76%, according to the 2016
Great Place to Work Peru study.
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Question A.4
Does the company have a policy that establishes
basic guidelines for its relations with the
communities with which it interacts?
Yes
X
No
Explanation:
The Sustainability Corporate Policy covers
relations with the communities with which
the company interacts. We are committed to
contributing to their welfare, especially through
skill development building and the promotion
of citizen behavior
a. If your answer to question A.4 is yes, indicate the company document which regulates this policy and the body that approves this document.
Document
Sustainability Corporate Policy
Ethics Charter
Code of Conduct
Body
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
b. Has the company encountered social conflicts (strikes, marches, etc.) in the community where it conducts its main activities as a consequence of its operations?
Yes
No
X
If your answer is yes, explain the impact of these social conflicts on the Company’s activities.
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c. Does the company work in collaboration with the community in the joint creation of value, including the identification and solution of the main problems they have in common?
Yes
X
No
d. Does the company invest in social programs in the community where it conducts its main activities?
Yes
X
No
If your answer is yes, indicate the percentage the investment in such programs represents with
regard to gross revenue according to the Company’s financial statements:
(%) Gross Revenue
0.05%
APPENDIX INTEGRATEDANNUAL REPORT 2016 Financial reportSustainability reportCONTENTCommittedto the future- Sustainability corporate report Question A.5
Does the company have a policy that establishes
basic guidelines for managing supplier relations?
Yes
X
239
No
Explanation:
Our Code of Conduct, Sustainability Corporate
Policy and Anticorruption Policy establish
guidelines for our relations with suppliers.
Some of the main topics covered are adherence
to ethical standards, rejection of any act of
corruption, and compliance with safety, quality
and environmental standards.
a. If your answer to question A.5 is yes, indicate the company document which regulates this policy and the body that approves this document.
Document
Sustainability Corporate Policy
Anticorruption Policy
Code of Conduct
b. Does the company keep an updated list of its suppliers?
Body
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
Yes
X
No
If your answer is yes, indicate the area responsible for keeping it updated
and the body to which the area reports.
Area responsible
Reports to
Logistics area of each subsidiary
General Manager of each company
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c. Does the company have a criterion for supplier selection that covers ethical matters and compliance with labor legislation?
Yes
X
No
d. Does the company have a procurement or hiring policy on selecting suppliers that adhere to sustainable or environmental management standards?
Yes
X
No
Explicación:
Durante el 2016, las empresas subsidiarias del grupo que aplicaron procesos de homologación o
evaluaciones de estándares de sostenibilidad, fueron CONCAR, GMD, GMP, Morelco y CAM Chile.
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Question A.6
Does the company have a policy that establishes
basic guidelines for managing customer relations?
Yes
No
Explanation:
Our Code of Conduct and Sustainability Corporate
Policy establish guidelines on our customer
relations. Some of the main topics covered are
adherence to ethical standards, the confidentiality
of information, compliance with safety and quality
standards, delivery before the due date, and
reliability in business relations, among others.
a. If your answer is yes, indicate the company document which regulates this policy and the body that approves this document.
Document
Sustainability Corporate Policy
Code of Conduct
Ethics Charter
b. Does the company keep an updated log of customer complaints?
Yes
X
Body
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
Board of Directors of the Graña y Montero Group
No
Si, especialmente en nuestras empresas subsidiarias que trabajan con clientes B2C
Area responsible
Customer Service
(Lima Metro Line 1)
Reports to
Gerencia de Relaciones Institucionales
Institutional Relations Manager
Customer Service (Viva GyM)
Social Management Manager
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c. Does the company have regular channels for dealing with the public and for receiving suggestions and complaints related to the products and services it provides?
Yes
X
No
d. Has the company received any recognition for the quality of its customer service?
Yes
No
X
SECTION B:
DETAILS OF ACTIONS IMPLEMENTED BY THE COMPANY
This section details the Company’s stakeholders and the actions implemented during the year in relation to the impact of its operations on social development (labor practices, community and
customer relations, and product liability) and the environment (materials, energy, water, emissions, effluents and waste), complementing the information provided in Section A.
See the “How We Do It” chapter, starting on page 78 of the 2016 Annual Report.
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