Empresas Copec's Corporate Magazine No. 108

empresas copec’s corporate magazine december 2021

No.108

A GLOBAL COMMITMENT

the role of business in combating climate change

new winds for innovation

water: a collaborative challenge

the renewed value of sustainability

a new look at forest heritage

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No.108 for decades, empresas copec has been committed to the development of sustainable businesses where people, communities and the environment are the central focus. and today, in the face of climate change, one of the most important challenges facing humanity, this commitment is renewed, strengthened and translated into concrete actions and goals for the company and its subsidiaries. let us be aware: the future of the planet depends on each one of us. december 2021 / nº.108

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time for convictions

the role of business in combating climate change

multiculturalism: beyond borders

eduardo navarro, empresas copec ceo, talks about the company’s long-term commitment to the challenge of climate change.

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gonzalo muñoz, cop25 champion, analyzes the role of organizations in the search for new solutions to environmental problems.

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in a new virtual discussion, representatives of empresas copec subsidiaries discuss the importance of cultural diversity in organizations.

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water: a collaborative challenge

the future is carved in wood

the renewed value of sustainability

public and private players present priority actions to face the water shortage that chile is experiencing.

arauco subsidiary highlights the attributes of this building material, one of the most sustainable and renewable.

as part of its sustainable management, empresas copec introduced new standards in its financial reporting.

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new winds for innovation

the future of work is thought today

a project in pandemic times

wind connects copec with the global vanguard in innovation and entrepreneurship.

leaders from ec and its subsidiaries reflect on the new way of working brought to organizations by the pandemic.

mina justa is launching a new documentary that recounts, from a human perspective, its construction and start-up process.

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a new look at forest heritage

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the third quarter of 2021 brought good news for empresas copec’s business areas, which continue on the path of recovery.

during this period, empresas copec and its subsidiaries were recognized by the market and achieved important milestones in sustainability and business.

arauco’s bosque abierto encourages projects that promote nature conservation and community entrepreneurship.

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editorial

— TIME FOR CONVICTIONS Beyond our assessment of the outcome of COP26, this year’s Conference of the Parties leaves no room for ambiguity: time is scarce and what is required to achieve the major goal of curbing the rise in global temperature to 2 °C and, hopefully, to 1.5 °C, is huge. A challenge for all countries, requiring the strong commitment of people, institutions, academia, science,

_ in the photo: Eduardo Navarro CEO Empresas Copec.

governments and, of course, the private sector. A task that, as always, requires the decisive action and leadership of large companies.

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approach in which the whole adds up to more than the parts and that conceives new models that enhance the biological infrastructure.

How can we not echo this urgent call?

Empresas Copec has been closely linked to nature, directly relating to ecosystems by creating value from natural resources. A collective history, built on a day-to-day basis and whose chapters we continue to write today, in the face of the urgent climate challenge.

Our future as a species depends on restoring the health of natural systems; on addressing climate change by understanding, in this context, the solutions that nature itself has the capacity to provide. We talk about forests, the power of the wind or the energy of the sun. An

For example, forests’ natural technology, one of the key strategies for reducing carbon in the air, as was pointed out at the opening of COP 26, where world leaders called for planting hundreds of millions of trees to halt and reverse deforestation by 2030. Plantings,

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precisely, such as those that ARAUCO carries out in its reforestation plans, and which contribute decisively to restoring the natural balance.

Today, 29% of this subsidiary’s forestry assets are native forests and conservation areas, duly protected for the benefit of current and future generations. And we know that, in the midst of the drought hitting our country, these forests, as well as the plantations, provide a variety of benefits for the water cycle, the basis for the life of flora and fauna, and crucial for human development. For this reason, a broad strategy has been developed to care for the water resource based on a thorough knowledge of the watersheds and their dynamics, their correct management and the improvement of supply in their neighboring communities, with the appropriate education on these issues.

“EMPRESAS COPEC HAS BEEN CLOSELY LINKED TO NATURE, DIRECTLY RELATING TO ECOSYSTEMS BY CREATING VALUE FROM NATURAL RESOURCES.”

In addition, ARAUCO became the first forestry company in the world to certify its carbon neutrality in 2020, and the first company in Chile and Latin America to sell US$1 billion in sustainable bonds for environmental and social initiatives.

The subsidiary Copec, for its part, has just issued a Declaration on Climate Change, in which it sets out a planned and realistic route to achieve carbon neutrality by 2030, as well as to increase its share of renewable energies at a rate that will take it above that of fossil fuels by 2050. Driven by this goal, Copec Voltex is already today the largest operator of electric charging for public transportation. It was recently awarded the design, construction and operation of 10 of a total of 13 new electroterminals for the Red system.

As such, Copec will sell around 600GWh of renewable energy during 2021, equivalent to a reduction of 243,360 tCO2. The route of

this subsidiary also considers other major milestones. For example, by 2029, to be a zero-waste company in its plants, service stations and convenience stores; and, by 2034, to have forged alliances with other private companies or with the State to conserve 39 ecosystems near its facilities from Arica to Punta Arenas.

And if we think about marine ecosystems, which are crucial to the environmental balance, our fishing subsidiaries are working on the application of predictive models and cutting-edge technologies that seek to preserve the resource.

Orizon, for example, has completed the pilot phase of a project that, through artificial intelligence, allows remote and automatic identification of landed resources. This creates valuable information to improve the traceability and control of catches and, thus, the sustainability of the industry and the conservation of the species.

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evolutions that the environmental cause requires and within the deadlines we are challenged to meet, that Empresas Copec strongly renews its commitment to this planetary goal, and especially to the goals set at COP26, along with others, by the countries in which we are present.

We will speed up the pace, continue to research and update our solutions, build new partnerships for innovation and participate in all those public-private initiatives that represent significant leaps forward to guarantee the future of the next generations.

It is a commitment to young people, to our children’s children and to theirs. They deserve that those of us who make decisions today bequeath them a sustainable future. A civilization that learned from its experience and a planet that was able to regenerate itself and breathe again in balance and peace.

It is time for convictions.

In this climate emergency we can see the value of the long-term vision that characterizes Empresas Copec. It is not today, nor was it yesterday, that we understood the crucial importance of maintaining the balance of the ecosystem. It is precisely our long history, working on the basis of the resources that nature provides us with, that allowed us to recognize it in time as an indispensable ally.

It is from this accumulated knowledge, which incorporates innovation, science and technology as the key tools to generate the

“IN THIS CLIMATE EMERGENCY WE CAN SEE THE VALUE OF THE LONG-TERM VISION THAT CHARACTERIZES EMPRESAS COPEC.”

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“STATES ALONE CANNOT SOLVE THE CLIMATE CRISIS; THE PARTICIPATION OF SOCIETY AS A WHOLE IS NEEDED.”

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THE ROLE OF BUSINESS IN COMBATING CLIMATE CHANGE Within the framework of the recent climate change summit, COP25, Gonzalo Muñoz, High Level Climate Action Champion, discusses the role of the organizations and says: “the most far-reaching, sustainable changes are those that have managed to question and refine business models.”

Gonzalo Muñoz Abogabir is High Level Climate Action Champion of COP25, co-founder of Triciclos, Sistema B and Polkura and board member of The Global FoodBanking Network. He is also the winner of several awards for his work on sustainability issues.

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The climate crisis and its effects are becoming more evident every day, and what was once a potential scenario, we are now living it with notorious temperature changes, droughts and damage to the planet’s biodiversity. Much of what we can do about this is still under discussion at governmental levels and the results of these negotiations will only be seen in the coming years. But there is consensus on one thing in this scenario: states alone cannot solve the climate crisis, since the participation of society as a whole is needed to achieve a real and significant transformation.

Against this backdrop, companies play a very important role. It is they who can make the Sustainable Development Goals adopted by the United Nations General Assembly in 2015

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a reality. It was the UN itself who months later passed a resolution recognizing the importance of the private sector in their realization, granting the mandate to promote them among all types of organizations. Thanks to this, the Race to Zero campaign was created, of which I have the honor of being part and which is aligned with the great objective of achieving zero emissions in 2050, working in the short term to achieve an intermediate goal in 2030. And one of the major milestones recently achieved is the commitment of 80% of global GDP to carbon neutrality so that, from now on, this will be a standard figure worldwide. In practice, this means reducing emissions by 7.4% per year.

But how can this be done concretely?

What actions can companies take?

For example, introducing strategies to reduce polluting emissions in their operations; promoting the use of renewable energies instead of fossil fuels; creating greater investment in Research and Development (R&D) to generate more sustainable technological innovations; promoting

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_ in the photo: Gonzalo Muñoz COP25 High-Level Climate Champion.

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Because, having focused mainly on generating profits, many companies have also had a negative impact on the environment and society. In the globalized world in which we

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In the work we have done in recent months with representatives of the private sector, who intend to join the carbon neutrality commitments and need knowledge and advice to do so, an example worth highlighting is the case of Copec, a Chilean company whose 86 years of life have been dedicated to the marketing, storage and distribution of fossil fuels and lubricants, playing a key role in the development and growth of the Chilean economy.

strategic alliances with startups and ventures that provide disruptive environmental solutions; and coordinating and implementing in practice the agreements established by the international community, including value chains.

But these initiatives are only part of what is happening in the role of entrepreneurship, since the most farreaching, sustainable changes are those that have managed to question and refine business models. Let’s look at it this way: until a few decades ago, the sole purpose of companies was to obtain profitability and outperform the competition. In 1970, economist Milton Friedman postulated that the social role of the company was to maximize its profits. Today, this idea is not enough and can generate a radical difference between one company and another, in the eyes of society and consumers.

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As in previous decades, the company’s purpose was effectively and visibly fulfilled. But it was they themselves who became aware of the climate crisis and its effects.

That same massive use of fossil fuels as a source of energy is one of the causes of the global warming that threatens the planet and that requires us, as a society, to act in a coordinated and conscious manner.

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live today, it is impossible to abstract and have only an intra-corporate view that neglects the communities in which we are inserted. Companies have -of course- economic objectives to fulfill, but the heart of each business must also include a social role that mitigates the consequences of productive activity and hopefully goes a step further in the implementation of new and innovative sustainable policies.

There are currently several initiatives in Chile and around the world that seek to promote this positive impact of the private sector and have shown enormous potential in accelerating the decarbonization of the economy through sustainable regeneration, that is, innovating and multiplying the positive results of the company’s business.

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It is good to be aware of the problem, but what is really important is what comes next, what measures we take to be part of the solution. And this is where it is worth highlighting Copec’s management, which proposed a mutation in its productive matrix through a planned and realistic route, which seeks to increase in the coming years the distribution and use of renewable energies at the necessary pace, together with the development of new capacities based on other energies and strengthening electromobility.

This approach allows the creation of transition plans taking into account the needs of society, always seeking a socio-environmental balance with the economic one. With this plan in place, Copec has today measured and certified its own carbon footprint based on ISO 14.064/2018 standards, with the commitment to achieve carbon neutrality of the Company by 2030,

UN GENERAL ASSEMBLY Sustainable Development Goals

2015

“RACE TO ZERO” PROJECT IS BORN WITH THE FOLLOWING goals:

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considering all emissions of scopes 1 and 2. In relation to scope 3 emissions (indirect emissions under control of third parties), it is awaiting the guidelines of Science Based Target Initiative (SBTI) for the oil and gas industry, in order to define reduction initiatives consistent with global actions.

The path towards sustainability is necessary but at the same time uncertain for those who are just starting out, because it is a different scenario than the one we have known before. Likewise, companies

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that manage to recognize, plan and implement a 2.0 management that incorporates and makes sustainable principles part of the business, have a great task ahead of them, but also a huge social reward. And, as the evidence has shown, a valuable opportunity to achieve better financial performance.

Minimizing the impact of the crisis and seeking a balance between economic benefit and social value is the aspiration of many companies, but each is at different levels of development. At the local level, we should be inspired by the example of those who are already making a difference and have the vision to move from a good idea to action. Those who will be most grateful will be not only the company’s own employees, consumers, society and the planet, but also its shareholders, who will see better and more sustainable returns over time.

80%

7.4%

0 ZERO EMISSIONS

OF GLOBAL GDP COMMITTED TO CARBON NEUTRALITY

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ANNUAL EMISSION REDUCTION

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PARTICIPANTS FELT THAT IN ORDER TO DEVELOP PERSONALLY AND PROFESSIONALLY IT WAS NECESSARY TO LEAVE THEIR HOME COUNTRIES.

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multiculturalism:

BEYOND BORDERS Empresas Copec currently has more than 37 thousand direct employees. Each one of them comes from different parts of the world. However, the Company is not only made up of people who have lived and worked in the same country where they were born, but there are also professionals who, due to various work and personal circumstances, today work in a country completely different from the one in which they grew up.

In this context, we invited a group of professionals who left their countries of origin to embark on a new work adventure to talk about the challenges of starting from scratch and the contribution of multiculturalism in work teams to have more diverse companies adapted to the challenges of the future.

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At Empresas Copec and its subsidiaries, 37 thousand people work directly, all of them with different life perspectives and experiences, which make this organization a diverse place. It is common to meet people on a daily basis who do not come from the country where the subsidiary is located and who came to the Company for various reasons.

To learn about these stories, this new virtual conversation brought together three Chileans who today work outside the country: Andrés Léniz, manager of ARAUCO’s pulp office in China; Rodrigo Abt, Terpel’s Finance Manager in Panama; and Bernardita Sánchez, ARAUCO’s compliance officer in the United States. They were joined by three professionals currently working in Chile: Juan Carlos Valverde, controller at Alxar, who is Bolivian; Sandra Benites, agile coach at Abastible, who was born in Peru; and Jorge de Llano, New Business Manager at Orizon, who came to Chile from his native Spain. The meeting was moderated by Natalia Labbé, head of Communications at Empresas Copec.

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— the reason for a goodbye All six participants have in common that in order to develop personally and professionally it was necessary to leave their countries of origin. A decision that was not taken lightly and that meant big changes for each of them.

Andrés Léniz, who has been in the Asian country for seven years, says he was always eager to expand his horizons: “We were anxious to go out, to get to know other

cultures and people from other places, to develop my career abroad. The first opportunity that came our way, we were going to think about it. My wife had finished her medical degree and was preparing to enter a specialty. She froze her studies to come to China. At first, it was more difficult for her than for me. As a family it was something we had to think about, but we made the right decisión.”

This impetus is shared by Rodrigo Abt, who is about to spend four years in Panama. For him, living a change was an opportunity to get away from what he was used to: “It seemed attractive to me to be away from that comfort, from the network of contacts, from family and friends. To get away from that support network and get to know other cultures, how they think, what their priorities are.” Like Andrés, he shares that at the beginning it was more complex, given that his family left a lot behind: “The hardest decision was for my wife, adapting to a different culture, looking for a different professional path, leaving a good job. That was the most difficult thing.

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From another point of view, for Bernardita Sánchez, emigrating three years ago was a simple option: “This was like a piece of cake. In fact, I looked for it, I made contacts, always interested if there was a position.

You create your own path, it is not something that falls from the sky or by magic. Professional performance is important. But, in short, it was something very sought after.”

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my partner at that time to apply to a telecommunications company that was looking for professionals. I did not hesitate for a minute. Professionally there were many opportunities, and the culture was different because they worked more by objectives. It was a complete professional growth.”

Juan Carlos Valverde arrived in Chile in 2006 through a labor exchange and shares that the family situation can simplify or complicate the process: “The decision when you are single is easier. What weighs a little is leaving the family.

In my case, I’m less than four hours away, I’m not that far away either. On that side it is reassuring. And well, it’s a matter of professional development.”

Jorge de Llano also pursued opportunities on his own once he finished college: “I had always been

THEY ALL AGREE THAT THE MOST DIFFICULT MOMENTS CAME AT THE BEGINNING, BUT NOW THEY HAVE REDEFINED THE EXPERIENCE IN A GOOD WAY.

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very interested in traveling, learning and exploring. I looked for opportunities abroad.

When you look for them you find them. When I was offered to come to Chile I was single, young and it was easy. I didn’t even think about it, it was a natural move, I had nothing to lose.

It was very easy. There is a gene or explorer bug that drives you to know new things, that’s what motivated me to get here.” With almost 20 years in the country, he is the one who has been living outside his place of birth for the longest time among the interviewees.

The case of Sandra Benites is different, since she arrived in Chile pregnant with her daughter, who is now 14 years old. In spite of that, she did not give up and persevered until she found an opportunity in this country: “In 2006 I felt that professionally I had reached my limit, that I had no more to contribute, so I decided with

_ in the photo: Juan Carlos Valverde Controller at Alxar.

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— a road full of challenges and opportunities When talking to the participants about the greatest difficulties and joys of carrying out a project abroad, most of them emphasized the positive aspects more than the negative ones.

They all agree that the most complex moments were at the beginning, but they have now redefined the experience in a good way.

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People work at Empresas Copec, all of them with different life perspectives and experiences, which make this organization a diverse place.

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Sandra Benites says: “When I arrived, leaving my daughter in someone’s care was an issue. In Peru you could take prenatal and postnatal together, but here it is the three months after by law. That is what complicated me the most. I didn’t have my family or my mother here to help me with my daughter. Then we got used to it, we found someone to help us at home, and so, the dynamics took care of itself.” She also asserts that she has made a professional resurgence: “I learned many things here, I was able to develop myself, I studied and my daughter is used to it. She sees Lima as a vacation.”

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Juan Carlos Valverde complements the above: “What is complicated with the pandemic and without the pandemic is when you are a father, since family is fundamental and you miss it more when you are a foreigner, because you don’t have that support network. To solve problems with the children, for example. It is the most complicated part of this process.”

On the other hand, the word “joy” is the one that best defines his current feelings when he remembers his arrival in the country.

For Andrés Léniz, the family issue was key, but also the cultural issue: “The difficulty is being far away, in every sense of the word, it is difficult to find time to talk to my family, since we have 11 hours of time difference. In addition, to go to Chile you have to take two 13-hour flights and it is even more difficult with children. Because of the pandemic we have not been able to go two years ago, so we miss it a lot. Other issues such as internet access, language and culture are very different from any western country, but they are minor and solvable problems. The most difficult thing is the distance and being away from loved ones.”

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Bernardita Sánchez believes that the language variable is important: “Personally, going to the doctor in the United States is the worst experience. In English it is insufferable, but in the end it ends up being fun, more like an anecdote.” Despite this, she values the opportunity to grow and to become a mediator and connector between the country of origin and the country where he works.

_ in the photo: Andrés Léniz Manager of ARAUCO Asia’s pulp office in Asia, with his family.

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HAVING PROFESSIONALS WITH DIFFERENT CULTURAL AND SOCIAL BACKGROUNDS HELPS TO BUILD COMPANIES THAT ARE MORE AWARE OF THEIR ENVIRONMENT. of the process: “Suddenly, starting to build your life, starting to have friends abroad and adapting. I think that was a very positive thing.

It made us very happy when we realized that.

You know you’re not alone anymore.”

For Rodrigo Abt, despite being in a Spanish-speaking country, he says that there are still difficulties: “I am fortunate to be in a country where the same language is spoken, but it is expressed differently and that was a little difficult in the workplace. You don’t make yourself understood well, but it’s not so serious. Among the positive aspects, he highlights the “beautiful” aspect

Jorge de Llano points out: “Coming to Chile from Spain is easy culturally. Although the adaptation was not difficult for me, at the beginning you have to learn many things, for example, how the services work. It takes about six months of adaptation, and from then on everything flows.”

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_ in the photo: Bernardita Sánchez Compliance officer ARAUCO North America.

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— diversity as an opportunity for the new company The interviewees appreciate that a company like Empresas Copec promotes the inclusion of people from different cultures in its work teams. They also agree that having different cultural and social backgrounds contributes to building companies that are more aware of their environment and prepared to face the challenges of the future.

In this regard, Juan Carlos Valverde says: “The contribution of diversity in companies is important, because each professional comes with different experiences and views.

What it can mean for decision making is very relevant. There is a contribution of professionals coming from other countries in the way of working, in decision making and in knowledge above all.”

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For Jorge de Llano, it is important for companies to be a reflection of today’s society: “In general, we see the world differently depending on our age, experience and education. The geographical area gives you a different view of many things, and that sometimes helps to find solutions to problems that, when you are looking at them from the inside, you don’t see them, so it helps to look from the outside to solve them.”

Rodrigo Abt agrees: “Many times we base our decisions on biased visions of reality, such as the niche we are in.

Having cultural diversity is extremely valuable; how a message is received by a person in Ecuador, Peru, Panama

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_ in the photo: Sandra Benites Agile coach at Abastible, with her family.

THE DECISION TO EMIGRATE REQUIRES ADAPTATION TO CHANGE, SELFKNOWLEDGE AND OPENNESS TO NEW IDEAS. and Chile is very different, even with the same language.

That generates a lot of value and has served me well in my team. Definitely, forming a multicultural team in a global company is very necessary.”

Sandra Benites adds: “Multiculturalism generates a lot of empathy. People who come from different countries have

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experienced different realities. I have experienced that empathetic and collaborative side on the part of the work teams. As a learning experience, I think it helps a lot that companies have diversity and open-mindedness, to receive and have a colleague who has a different point of view.”

Bernardita Sánchez emphasizes the importance of how organizations address these issues: “I see in ARAUCO a very important commitment to diversity and inclusion. Also of race, ethnicity and gender. It creates connections, you become a hub, it allows you to have different ideas, because you have certain constraints or different thoughts. It is positive for the organization in general.”

17 _ In conclusion, Andrés Léniz says: “It is fundamental to have a diverse company today. You have your own way of solving problems, of seeing the world. If we only focus on our own vision and experiences, we miss out on an infinite number of ideas and potential solutions. It is key to have broad diversity within the company.

Being in Asia it has been important to manage the cultural differences between China and Chile. You end up acting as an interpreter, modulating and moderating expectations, explaining traditions, etc.”

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do you recommend seeking new horizons outside the country of origin?

“I recommend to everyone that, if you have the opportunity to move to another country, either for study or work, do it, it is very positive. There are many benefits. Let’s hope that the opportunities to be able to physically move to another country continue as now or before and that it is not only through teleworking. The benefits are many more than the costs.” juan carlos valverde Controller at Alxar.

Bolivian in Chile

“It is highly recommended, it is the best job opportunity you can have. It opens a lot of doors, mental spaces, you meet people from everywhere.

The amount of experience you gain as an expat is key and it’s not comparable to anything else, you only get that by living abroad, being alone, working from your own world, that’s key.” andrés léniz Manager of ARAUCO Asia’s pulp office.

Chilean in China.

“The change is very positive from a cultural point of view. The leadership I found here was different. We should not be afraid of change.

Every change is beneficial, there is always a lesson to be learned. You should not be afraid to make mistakes. This is life, learning, meeting people, living new experiences. Totally recommended. I would do it again a thousand times.” sandra benites Agile coach at Abastible.

Peruvian in Chile.

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THE INTERVIEWEES APPRECIATE THE FACT THAT EMPRESAS COPEC PROMOTES THE INCLUSION OF PEOPLE FROM DIFFERENT CULTURES IN THE TEAMS.

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“Traveling is a good way to break down barriers, biases. When you get to know other cultures, you realize that there are different ways of doing things, and it opens your mind to accept other ideas. On the other hand, I have met people who have been in another country and have not been happy. There is a matter of attitude, also of profile.

It is not for everyone, there are people who do not adapt to other cultures. We are different and diverse.” jorge de llano Business Development and New Business Manager at Orizon.

Spaniard in Chile.

“A quote from Charles Darwin: the species that survive are not the strongest and most intelligent, but those that are most adaptable to change. In that sense, adaptation and flexibility for me are synonymous with evolution. The growth and maturity that one achieves living abroad both professionally and personally accelerates exponentially. It is the best decision one can make.” bernardita sánchez Compliance officer at ARAUCO North America.

Chilean in US.

“Not all of us are equally adaptable to change.

You have to have a super adventurous spirit to face change, to cope with it, it is not a minor change. You don’t do it to be uncomfortable.

It is a challenge of self-knowledge, of opening the mind and discovering that there are other things and ways of thinking, which is valuable.

There are people who have a hard time. It is highly recommended, although it is not something for everyone.” rodrigo abt Chief Financial Officer at Terpel Panama.

Chilean in Panama.

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water crisis:

THE WATER CRISIS IS ONE OF THE GLOBAL RISKS THAT IS MOST LIKELY TO OCCUR, WITH THE HIGHEST IMPACT AND THE GREATEST EFFECT ON POPULATIONS AND ECOSYSTEMS.

WATER: A COLLABORATIVE CHALLENGE Due to both its geographical characteristics and its institutional framework, Chile is among the countries most vulnerable to the risks related to climate change.

Different views agree that there is still time to take concrete actions to reverse the most pessimistic scenarios, but we must hurry.

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_ in the photo: Ulrike Broschek Deputy Manager of Sustainability of Fundación Chile.

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What is the reason for this disadvantageous situation? Ulrike Broschek, Deputy Manager of Sustainability at Fundación Chile, says that Chile’s geographical position, with an extensive mountain range and coastal strip throughout the country, makes it particularly vulnerable to extreme weather phenomena. “On the one hand, we are very dependent on rainfall and snow and glacier melting in the mountain range and, to the extent that it rains and snows less there, but more intensely, the availability and storage capacity of water decreases”. She adds that, “on the other hand, having a very extensive coastal strip makes us susceptible to tidal waves and floods related to the increase in temperature and sea level.”

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In the context of the phenomena associated with climate change, water scarcity is no longer just a threat in many parts of the world, but has become a distressing reality; in the rest of the world, concern is growing about the looming scenario.

In fact, the latest reports of the World Economic Forum show that the water crisis is one of the global risks that is most likely to occur, with the highest impact and the greatest effect on populations and ecosystems.

In Chile, which is experiencing the longest and most extensive drought in time and surface area since records have been kept, the outlook is not encouraging. The World Resources Institute places the country among the most affected worldwide, number 18 among the most vulnerable and the only one in Latin America that will suffer extremely high water stress by 2040. It also stands out in the rankings of vulnerable nations due to the speed and depth of the lack of water availability.

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This diagnosis is shared by Giovanni Calderón, executive director of the Sustainability and Climate Change Agency (ASCC), which depends on CORFO. He says that in Chile there are 101 river basins and they are all managed differently, in addition to the fact that the diversity of actors is also present in the demand for the resource: “We have large consumers, such as agriculture, with around 70% of consumptive consumption (in which the water is not returned to the environment from which it was collected) and mining in nonconsumptive consumption (in which once used,

— dispersed institutionality The expert, who leads the Escenarios Hídricos 2030 initiative, warns that another aspect of the issue lies in the way in which the resource is managed. This is confirmed by an analysis conducted by the Foundation in six river basins located between the regions of Atacama and Aysén. “We found that 44% of the water problems in the territories are related to water management and institutions, while 17% are associated with climate change, which brings less rainfall, drought and disasters, and the rest is associated with other factors,” she explains.

Today there are at least 56 state agencies with powers to administer and manage water resources, at national and territorial level. “This great dispersion prevents a coordinated work, there is not an institutional framework with sufficient powers to lead the solution of the problem in an integral way, which translates into barriers to promote solutions”, says Broschek.

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_ in the photo: Giovanni Calderón Executive Director of the Sustainability and Climate Change Agency (ASCC).

the water is returned); and among the smaller consumers are the canal owners and domestic consumers, among others, both from the community and from the productive area.

Calderón regrets that in our country “the debate has focused on ownership, when it should be focused on management”, and compares our institutional framework with that of other countries that have more hierarchical structures focused on water use, which allows integrated basin management. Along the same lines, Ulrike Broschek says that we are the only OECD country that does not have basin organizations within its water institutions.

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_ in the photo: Pamela Harris Director of Corporate Affairs at Empresas Copec.

introducing technology, improving processes and achieving an efficient use of the resource.”

— a strategic approach to conservation of the resource The ASCC promotes collaboration and public-private alliances to materialize policies and strategies aimed at improving a situation that, simply put, is caused by a gap between the decreasing availability of water and an increasing demand. “We are working on these two variables and that is where the greatest need for coordination lies,” says Giovanni Calderón. “It is about making effective public policies that involve

In large-scale consumption, the aim is to bring about changes in the production process of different industries so that, with the same or less water, its use becomes more efficient. Along these lines, the ASCC’s main environmental management instrument is the Clean Production Agreements (APL). The executive director of the Sustainability and Climate Change Agency says that “in agribusiness we are in the fourth APL and we have included the water issue. There is also a commitment with 17 of the 30 largest consumers to implement more cost-efficient systems.

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At Empresas Copec, the water crisis and its effects have not only been closely watched, but have also been addressed comprehensively by each of the subsidiaries, considering that it would have a direct impact on operations and these, in turn, on the environment.

The holding’s Director of Corporate Affairs, Pamela Harris, says that today the water footprint has become a special concern in different industries, especially in those that have intensive operations in its use. “As a parent company, we have been concerned to make known, through indicators, how the water resource is managed, as well as the actions and goals that our subsidiaries have been taking on with the aim of reducing their intensity of use”, she says.

Transparency is a key element. For this reason, we have worked with the sustainability areas of the subsidiaries so that our stakeholders are aware of the actions of each one and can see how they are aligned with the Sustainable Development Goals. Pamela Harris points out that the group’s companies have been operating under an organic and proactive strategy for many years and that this “goes far beyond a story, a corporate image issue or mere legal compliance. It is at the heart of the business, because we understand that we are an important player and that our actions contribute to a global challenge.”

AT EMPRESAS COPEC, THE WATER CRISIS AND ITS EFFECTS HAVE BEEN ADDRESSED COMPREHENSIVELY BY EACH OF THE SUBSIDIARIES

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SOME OF THE COUNTRY CHALLENGES:

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and turn it into a supraministerial, transversal entity, independent of political cycles.

Build a well-structured water institutionality, with non-duplicated competencies, clear policies and measurable and correctable impacts.

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Then there is the constitutional definition of the water resource as a national asset for public use, which today has legal status, “but the regime given to it in the new Constitution will have a relevant impact on the capacity to administer it,” explains Giovanni Calderón.

The third challenge consists of introducing water efficiency actions in specific productive processes, among which he mentions

Constitutional definition of water resources as a national asset for public use.

Introduce water efficiency actions in specific production processes.

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— progress is possible For the executive director of the ASCC, Giovanni Calderón, the great challenges that we as a country must address are the following. The first of these is “to build a well-structured water institutionality, with competencies that are not overlapped, clear policies and measurable and correctable impacts”. From Fundación Chile, Ulrike Broschek adds that “we have to make progress in the establishment of basin organizations, because at this geographic scale different water users intervene and must be coordinated for the implementation of solutions, but with a decentralized and multisectoral approach.” She proposes to dictate a national water resources policy and action plan, developed with the due participation of the regions, and to create a national authority, through the transformation of the current General Water Directorate,

Inclusion of water availability in the corporate risk analysis of companies.

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agriculture and industrial activity. The idea, he says, is “that consumptive consumption is in harmony with human consumption, so that there will no longer be localities that have to be supplied by water trucks.”

To make the Paris agreements a reality, to try to curb the increase in the planet’s temperature; to act taking into account not only the present availability of water, but also the future; to participate in governance, collaboration and territorial organization schemes; to continue with the APLs, which have a proven social benefit of 11 times what is invested.

There are many possible and urgent measures to be taken, but they require political, corporate and individual will to change the most pessimistic future scenarios and give this world a breath of fresh air before it is too late. There is agreement that there is still time, but we must hurry.

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arauco’s challenge Within Empresas Copec, its subsidiary ARAUCO (“chalky water” in Mapudungún) is the company that uses the most water in its production processes. With a clear understanding of its responsibility to protect this resource, it has developed a strategy that not only covers what happens at its facilities, but also involves the communities, addressing both the quality and availability, as well as access to and use of water for human consumption.

Thus, together with the implementation of spill control systems, liquid waste from all its industrial plants is duly treated and monitored in order to protect watercourses. The work with the community is reflected in more than 138 projects framed in the “Water Challenge” initiative,

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ARAUCO HAS DEVELOPED A STRATEGY THAT CONSIDERS THE QUALITY AND AVAILABILITY, ACCESS AND USE OF WATER FOR HUMAN CONSUMPTION.

which includes improvements to drinking water systems in communities and schools, engineering designs, construction of wells and mini-tanks, benefiting 27 thousand people in 44 communities.

In Argentina, various actions are carried out in water basins and other critical or sensitive areas, which in 16 years has allowed the recovery of more than 3,300 hectares. In addition, we mark and monitor springs in operational areas, with the participation of local groups and indigenous communities in the company’s areas of influence.

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xvii international seminar copec uc foundation who lead in these matters. The private sector has a vital role to play in generating solutions.”

“seawater use: is it a solution to water scarcity?”

For his part, the rector of the Pontificia Universidad Católica de Chile and vice-president of the CopecUC Foundation, Ignacio Sánchez, said: “at the University, water security is an issue of great interest to us, and one to which we believe we can contribute from the research and knowledge we develop, from different disciplines, to address it in its multiple dimensions.”

The Minister of the Environment, Carolina Schmidt, the Minister of Public Works, Alfredo Moreno, and the Director of the Center for Water Law and Management of the Pontificia Universidad Católica de Chile, Daniela Rivera, also participated in the activity. Also present were Domingo Zarzo, Innovation Director of Sacyr Agua España, and Nir Becker, author and editor of the book “Water Policy in Israel.”

This year the Copec-UC Foundation focused its traditional international seminar on this topic. During the meeting, which was held on November 11, national and international experts discussed and reflected on whether seawater could be a sustainable solution to the worst drought that has affected Chile in its history.

The inauguration was in charge of the Chairman of Fundación Copec-UC, Roberto Angelini, who said that “our privileged access to the sea and to clean energy sources tells us that there is also a great opportunity. Taking it requires a systemic view, it means more integration and coordination of the different actors involved, and also the ability to learn lessons from those

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ARAUCO SEEKS TO POSITION WOOD AS THE CONSTRUCTION ELEMENT PAR EXCELLENCE OF THE PRESENT AND THE FUTURE.

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arauco y e2e:

THE FUTURE IS CARVED IN WOOD Hopes for a better future are sculpted in this noble material that has accompanied mankind since time immemorial. In addition to its recognized benefits in terms of habitability, its sustainability attributes are now highly valued, given that it is the only renewable building component in existence. Empresas Copec, through its subsidiary ARAUCO and its affiliate E2E, has highlighted the role of this element, taking it to new levels, such as high-rise construction, and investing decisively to achieve better solutions that contribute to shaping a more environmentally friendly world.

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In August this year, the United Nations Intergovernmental Panel on Climate Change (IPCC) delivered a report that perhaps as never before dominated the world’s news agendas.

The message was one of unequivocal urgency: without immediate and large-scale reductions in greenhouse gas emissions, it will be impossible to limit warming to around 1.5°C or even 2°C, the commitment made in the 2015 Paris Agreements. Moreover, the report noted that much of that warming is, in the medium term, irreversible and with palpable effects on human life. 3°C increase? The consequences would be much more serious.

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Against this backdrop, the call is to act. And ARAUCO, the first forestry company in the world to certify its carbon neutrality, has continued to lead this charge by raising wood as the construction element par excellence of the present and the future, given the perfect mix of sustainability and habitability that it offers. “It is an extremely environmentally friendly material,” says Francisco Figueroa, Commercial Manager for Timber and Panels at ARAUCO. In fact, it is a natural product capable of storing one ton of CO2 per cubic meter, while avoiding 1.5 tons of CO2 emissions compared to other materials used to build structures. “According to studies, products other than wood are responsible for approximately 15% of the world’s greenhouse gas or carbon emissions. There is a UN study that indicates that, between now and 2030, we are going to need new housing for three billion more people. Therefore, if we want to have a much better place to live, for our children and grandchildren, it is in the world’s interest and we have to use more wood,” adds the commercial engineer, who has a career of approximately three decades in the subsidiary of Empresas Copec.

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_ in the photo: Casa 165 Architects: PAR Arquitectos Photo: Felipe Cantillana

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— improved quality of life Around the world there are amazing examples of large buildings whose structure is made on the basis of this resource. One of them is located in Vancouver, Canada. It is the Brock Commons, a 53-meter-high, 18-story student residence of the University of British Columbia. The Tokyo 2020 Olympic Village also showed the world the benefits of this technique, which was pointed out by the famous Japanese architect Kengo Kuma as the reflection of a new era in natural design.

Paris, which will host the next Games, is following this line in response to the City of Light’s demand to be carbon neutral by 2055. For Felipe Montes, general manager of E2E, a company in which ARAUCO and Etex have equal interests, and which focuses on industrial construction in

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In addition, manufacturing based on this forest product is less invasive in terms of noise, time and number of trucks, for example, which is a benefit for the communities living around a construction site.

This is an emerging trend in Chile, and even though there is still work to be done, the future looks promising. “As a country and region we have important challenges ahead, such

_ in the photo: E2E Office Architects: 57Studio, Photo: Ronald Halbe

this element, “it is necessary to build in a renewable way, and the main renewable material for this is wood. In addition, everything that one uses in an industrial way is certified as renewable by international entities. Furthermore, it is the material with the lowest carbon emissions, much lower than steel and concrete.” The executive adds that the resource is highly recyclable: “If you want to change or demolish a house, what is left can be used. If you demolish a concrete house, it will probably all go to a landfill.

Wood can be recycled to make furniture and particleboard; in fact, in the United States the input for the latter comes from recycled wood.” There are also indirect costs, such as transportation: because it is lighter than other supplies, it requires less expenditure on this item, which also has an impact on the final environmental balance. In the case of E2E, the company has a dry process, i.e., it does not use liquids, and as for waste, it is practically non-existent, since everything is done in a controlled manner at the plant located in Maipú. Moreover, there are also advantages in terms of habitability. For example, it has a better seismic behavior, and it operates exceptionally well as an acoustic and thermal insulator.

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WOOD CONSTRUCTION REPLACES TRADITIONAL AND LESS ENVIRONMENTALLY FRIENDLY MATERIALS, AS IT HAS A MUCH LOWER CARBON FOOTPRINT THAN STEEL AND CONCRETE. 30 _ as updating the regulations to one that better facilitates the use of this technology in construction, in line with what has been seen in North America and Europe, places where there has also been great success, interest and incentives, including state incentives, to accelerate the penetration of wood construction.

But perhaps the most important barrier is cultural, that people dare to choose the wood alternative, especially when it comes to high-rise construction,” says Francisco Figueroa.

Under the HILAM brand, ARAUCO has been creating engineered wood

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US$ 20

UPCOMING DEBUT

MILLION INVESTMENT

CURVED BEAMS

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— continuous innovation

REFURBISHED ARAUCO MILL:

products for two decades. The executive notes that the new generations are very well disposed towards this subject, both from an environmental and aesthetic perspective, and has seen this through the interest aroused by the upcoming debut - anticipated for the first half of 2022 - of the renovated plant of the same name. This plant, which has an investment of approximately US$ 20 million, will be expanded to include a line of curved and straight beams, capable of producing elements up to 40 meters long, and will also have a line of CLT (cross-laminated timber), one of the most widely used products in the world in construction with this material, especially for walls, floors and mezzanines.

HILAM will be able to create elements up

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STRAIGHT BEAMS

Empresas Copec, through its subsidiary and affiliated company, is already a leading player in this incipient market. E2E, for example, has five four-story buildings in San Pedro de la Paz (Biobío Region), among other projects.

“Although they are located in a rather humid and cold geographical area, one enters and feels that they are apartments with a drier sensation and with a fairly good thermal quality or thermal behavior,” says Felipe Montes. They are also building a three-story dental clinic in Valdivia, which has involved meeting the sanitary requirements of a health facility. In Brazil,

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It will be expanded to include two new lines:

WALLS CLT

to 13.5 meters long, 3.5 meters wide and 300 millimeters thick. All manufacturing, moreover, will be able to be mechanized. “There are already people contacting us, asking us ‘I want to make a six-story building, a five-story building, when can we get together,’” says Francisco Figueroa. This focus also implies a change for the subsidiary, whose business has traditionally led them to deal with large distributors, retailers and industrialists. They will now be joined by real estate agents, architects and designers, among others. “It’s an important, new challenge, and that obviously fascinates us,” says the executive.

FLOORS AND MEZZANINE FLOORS

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central role. It is in this context that the modernization of the HILAM plant is conceived, which will produce elements such as the aforementioned CLT, a relatively recent construction solution in the world and a novelty in Chile. “We created a wood construction unit at ARAUCO that mixes the commercial with the technical, and one of its functions will be to keep completely up to date on all the projects and innovations that exist in the world in these areas. It is part of the job description to be aware of how the world is evolving and changing on a daily basis. This is always a process of continuous improvement,” says Francisco Figueroa.

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Both he and Felipe Montes agree that hopefully new actors will jump on this bandwagon. “We are working to massify wood construction, which is what interests us, and we are also looking for new solutions,” says Montes, while the ARAUCO executive says that “I am very happy that there is a lot of competition and I hope that more will come, for two reasons: one, because obviously competition always makes you better, and the second, and perhaps more important, is that the more players are pushing wood construction or this element to replace traditional and less environmentally friendly materials, the better; it is in our interest for our children, our grandchildren and the new generations. It is the in our interest that there is much more competition, more supply and more services and improvements”. To this, Francisco adds that sustainability is one of the elements that manage to attract Chilean citizens: “In the area of consensus, I have no doubt that wood will be the building material of the future. I have no doubt that this is going to happen in Chile and in the rest of the region as well”.

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_ in the photo: Mariano Latorre School Architects: Macchi – Jeame – Danus & Boza – Labbé – Ruiz Ruiseño Photo: Felipe Contardo

meanwhile, TecVerde -a Brazilian subsidiary of E2E- has also been involved in this area through the construction of modular hospitals to deal with the Covid-19 pandemic, which will continue to operate in the future. In both cases, the speed of industrialization has been a key factor in the clients’ decision to opt for this alternative.

ARAUCO, for its part, has innovation deeply rooted in its culture, and this can also be seen in this aspect, in which engineering plays a

E2E, A COMPANY IN WHICH ARAUCO AND ETEX HAVE EQUAL INTERESTS, FOCUSES ON INDUSTRIAL WOOD CONSTRUCTION.

_ in the photo: Curacautín Food Market Architects: Taller Viga Maestra – Jaime Andrés Gatica Martínez Photo: María Astaburuaga / Luis Morales

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THE WAY IN WHICH COMPANIES RELATE TO THE ENVIRONMENT AND COMMUNITIES IS BECOMING INCREASINGLY IMPORTANT.

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sasb and tcfd standards:

THE RENEWED VALUE OF SUSTAINABILITY In its effort to strengthen its business strategy with the agility that the planet needs, Empresas Copec introduced the SASB and TCFD international standards to its Sustainability Report in 2020. The aim is to provide more information and transparency in the light of rapidly evolving markets.

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As a way of responding to the growing interest in sustainability among different market players, Empresas Copec has included in its Sustainability Report, starting in 2020, new key information for better decision making in a context of climate emergency and progressive importance of the elements of sustainable operation of companies. These are the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and the guidelines of the Value Reporting Foundation.

The TCFD was created in 2015, in the wake of the Paris Agreement, with the aim of providing investors with

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more information and transparency on those companies that are best prepared to address the risks and opportunities posed by climate change.

In turn, the Value Reporting Foundation was created in June 2020, thanks to the merger of SASB and the International Integrated Reporting Council (IIRC). SASB standards were born in 2012, with the aim of creating specific ESG standards (environmental, social and corporate governance criteria) for 77 different industries, particularly reporting to investors, something that was consolidated in 2018. Since then, more than 1,400 companies globally, in all regions of the world, use its standards, which includes more than half of the S&P global 1200 index.

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As the world moves toward an increasingly intangible asset-based economy, the way in which companies relate to the environment and communities, and equip themselves with the governance to manage them properly, is becoming increasingly important in their valuation. Today, investors around the world are reevaluating the basic financial criteria on which they build their portfolios.

_ in the photo: Cristián Palacios Director of Finance and Investor Relations at Empresas Copec.

Cristián Palacios, director of Finance and Investor Relations at Empresas Copec, explains that “ESG concerns (environmental, social and corporate governance) in the financial industry have been gaining a lot of ground and today they are positioned almost at the same level as the business activities of companies. What one sees is that both strategies should be converging, because at the end of the day good ESG performance also has an economic impact. So, they have to go hand in hand,” he says.

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— decisive push In 2020, before the pandemic hit, an open letter to CEOs by Blackrock, the largest global asset manager, warned that the world was “on the verge of a structural shift in finance,” related to the push for a profound rethinking of asset values and major shifts in capital allocation criteria. Signed by the Company’s Chairman and CEO, Larry Fink, the letter was a major shock to the markets.

While noting that climate risk is properly an investment risk, Fink pointed to the need for greater financial transparency, proposing the SASB standard for reporting sustainability information on a wide range of issues, and the TCFD recommendations for assessing and reporting climate-related risks.

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Arturo Rodríguez, the Value Reporting Foundation’s Ibero-American Outreach Lead, explains the importance of that statement: “Black Rock says, on the one hand, that it is important to talk about these issues and, on the other, that there are tools that exist today that are designed with investor needs in mind and that should be used. It was a boom.”

Rodríguez adds that to understand this process, it is key to look at how perceptions of companies, their role in society and their responsibilities to the environment have been transforming. “As the understanding of how business value is generated and preserved evolves, these worlds begin to converge,” he says.

Cristián Palacios, who leads regular dialogues with analysts and investors, both local and foreign, explains that more and more are taking an active role in conveying to companies what is expected of them. “What they are asking today is that companies adopt the best standards in sustainability and climate change issues, that they communicate their strategies in these areas and that they link them directly to their business activities,” he says.

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ESG ISSUES HAVE GAINED GROUND AND ARE NOWADAYS POSITIONED ALMOST AT THE SAME LEVEL AS COMPANIES’ BUSINESS ACTIVITIES.

In this context, adopting metrics such as those contained in the SASB and TCFD standards is becoming increasingly important. “These are standards where companies have to report the associated risks and the mitigation measures they are going to adopt, generating scores and levels, allowing the market to make comparisons.

The truth is that if you don’t adapt to these frameworks, you start to be left out of the spectrum where investors can make their investments or the decision process where they design their portfolios. So it is very important to be present,” explains Palacios.

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— sustainability at the heart

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Empresas Copec included in its Sustainability Report new information for better decision making recommended by:

For Empresas Copec, adopting the SASB and TCFD recommendations is a complement to a strategy that has involved years of effort and commitment by its different teams, as well as those of its subsidiaries, to sustainable management.

Today, the Company is part of the leading sustainability indexes in the world, such as the Dow Jones Sustainability Index (DJSI) Chile and MILA (the latter includes the stock exchanges of Chile, Colombia, Mexico and Peru); the FTSE4Good Index Series, of the London Stock Exchange, and the MSCI Sustainability Index, a US weighting of investment capital funds, debt, stock market indexes, hedge funds and other portfolio analysis tools.

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On this path, SASB and TCFD were two major market trends that needed to be incorporated.

Palacios explains: “But this is a work in progress, there are things that are deepening, new initiatives are coming out. For this reason, we are always investigating and we have an area that is especially dedicated to this. Also at the level of the subsidiaries, they are always attentive and willing to collaborate with Empresas Copec in the collection and standardization of information”, he says.

Although the introduction of reporting standards is an issue in which the developed world leads the way, Chile has been gradually getting involved. In this sense, AFPs (Pension Fund Administrators) and AGFs (General Fund Administrators), when making and monitoring their

This adds to the fact that the company is already part of the world’ leading sustainability indexes: • Dow Jones Sustainability Index (DJSI) • MILA (DJSI MILA Pacific Alliance) • FTSE4Good • MSCI Sustainability Index TCFD Task Force on Climate-Related Financial Disclosures

Empresas Copec’s inclusion in these indexes is a way of ratifying what has been done, for example, by ARAUCO, which in 2020 became the first forestry company in the world to be certified as carbon neutral; or by Copec, whose recent Climate Change Declaration commits to achieving carbon neutrality by 2030, and to continue accelerating the energy transition, marketing a higher proportion of renewable energies than fossil fuels by 2050.

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SASB - Value Reporting Foundation Sustainability Accounting Standards Board

ARAUCO

2020 FIRST CARBON NEUTRAL CERTIFIED FORESTRY COMPANY

COPEC

In its Declaration on Climate Change, it commits itself to achieving carbon neutrality by the year

2030

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investments, are continuously requesting information on ESG initiatives, with special emphasis on climate change. Likewise, the CMF (Financial Market Commission), in its oversight role, also plays an important role, issuing regulations that push organizations to report on these issues. social capital or human capital are becoming increasingly important to understand the value of companies not only today, but also where they are going and their future value,” he says.

Cristián Palacios has a similar view. “Companies that do not adapt could have a significant penalty in their market value, being valued at higher discount rates. There will be a pool of investors who will no longer be there, who will not generate demand for their shares, so they could lose value along the way”, he points out.

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FOR EMPRESAS COPEC, ADOPTING THE SASB AND TCFD RECOMMENDATIONS IS PART OF A STRATEGY TOWARDS SUSTAINABLE MANAGEMENT.

For Empresas Copec, each of its achievements and goals are the result of a permanent effort to place sustainability at the center of its work, with concrete actions to contribute to a reliable future. “All of this demonstrates Empresas Copec’s commitment to link its business strategy with an ESG strategy. This is something that the market perceives, can measure and lets you know,” concludes Palacios.

For Arturo Rodríguez, while a few decades ago it was understood that the focus of business strategies was on generating profits, today non-financial factors and intangible assets have taken on a new importance. “Natural capital,

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_ in the photo: Arturo Rodríguez Ibero-American Outreach Lead at The Value Reporting Foundation.

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wind copec:

NEW WINDS FOR INNOVATION THE SUBSIDIARY HAS AN INNOVATION AND NEW BUSINESS GARAGE IN SANTIAGO, CHILE, AND CORPORATE VENTURE CAPITAL IN SAN FRANCISCO, USA.

Committed to the environment and actions to address climate change, Copec announced a set of initiatives to achieve carbon neutrality, as well as its decision to prioritize the commercialization of renewable energies by 2050.

WIND Copec, a platform that connects the company with the global vanguard in innovation and entrepreneurship, is central to the evolution of First in Service.

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Copec recently introduced its Climate Change Declaration, establishing a series of commitments with which it seeks to achieve carbon neutrality - for Scope 1 and 2 emissions by 2030, and to reconfigure its market proposal to distribute and market a higher proportion of renewable energies than fossil fuels by 2050.

The origin of the above lies in the fact that the subsidiary began to question the linear business models, its forms of production, the consumption paradigms, and has understood that all of these are concepts that must be corrected for sustainable development to become a reality. That is why, according to Arturo Natho, Copec’s CEO, in the Climate Change Declaration: “The company has drawn up a planned and realistic program for the distribution and use of renewable energies, at the necessary pace, hand in hand with the development of new capacities based on other energies and strengthening electromobility. This orientation

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will allow us to create transition plans that take into account the needs of society, always seeking a socio-environmental and economic balance”.

With this declaration, Copec is the first company in the fuels industry to establish a transformation path, where innovation plays a key role in accelerating the energy transition.

— mobilizing innovation Under the name Working on Innovation and New Developments (WIND), in 2019 Copec gave life to an innovation platform that would allow it to link up with cutting-edge technologies, the world of entrepreneurship, startups and global research in the fields of energy, mobility and convenience.

Since then, Copec has had an innovation and new business garage in Santiago, Chile, and a Corporate Venture Capital (CVC) based in San Francisco, United States. Both have a corporate scope and interact with each other and with

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COPEC CREATED AN INNOVATION PLATFORM TO LINK WITH CUTTING-EDGE TECHNOLOGIES, ENTREPRENEURSHIP, STARTUPS AND GLOBAL RESEARCH. 39 _ the different areas of the traditional business, as well as with other entities in the world of innovation in different countries. These include the Mobility Systems Center and the recently created Future Energy Systems Center, both part of the MIT Energy Initiative, a center for the development of low- or zero-emission energy in Boston, Massachusetts.

Leonardo Ljubetic, Copec’s corporate manager of Development and Management, who leads WIND, says:

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Companies ranking, organized by the ESE Business School, El Mercurio and the corporate innovation consultancy MIC Innovation. “I believe this is a recognition of the value that our commitment to innovation is generating and the conviction behind it,” he adds.

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In fact, it is one of the reasons why on October 26 Copec won first place in the Fuel Distribution category in the Most Innovative

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generation, intelligent energy storage, energy efficiency and electromobility, which translates into a comprehensive offer for the residential, commercial and industrial segments. The above under a focus on providing “energy intelligence” and accompanying customers and companies in the transition that is taking place in the world.

“The startups in which we have invested abroad and which are now our partners in Chile have proven to be successful. This is the case of Wallbox, which, like Stem, became a ‘unicorn’. Both are listed on the New York Stock Exchange (NYSE), which is a source of pride for Copec”, says the executive.

To date, Copec has invested in 14 startups based in the United States, Spain, Colombia, Israel and Chile, which have enabled the scaling and development of subsidiary companies and other forms of association that bring, in addition to innovative technologies, a new vision. “The needs of the people, the countries where we operate and the planet are at the core of our business,” says Ljubetic.

“We have a very good evaluation of what we have achieved. We built a unique innovation platform, recognized inside and outside the country, and we have made concrete progress in all the areas on which we decided to focus”.

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Thus, Copec, through new subsidiaries, is currently involved in the commercialization of renewable energies, photovoltaic distributed _ in the photo: Leonardo Ljubetic Corporate Manager of Development and Management at Copec.

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— global connection WIND Copec currently employs around 30 people, both in the garage and in the CVC. These are flexible teams, which grow as projects grow and whose professionals, in most cases, continue with the businesses they conceived. “We have assembled a young, talented team with a culture focused on building new businesses with a startup mentality, that is, adding creativity and methodologies to put good ideas into practice in a short time,” says Ljubetic.

Some of the members are in Silicon Valley, one of the most important innovation hubs in the world and the place chosen by Copec to locate its Corporate Venture Capital, WIND Ventures Copec.

41 _ Led by Brian Walsh, who has extensive experience in venture capital funds, the CVC focuses on disruptive ventures and developments from around the world that contribute to the transformation of Copec in Chile and the rest of the markets in the region in which the Company participates.

_ in the photo: Brian Walsh Head of WIND Ventures.

“Our Latin America-focused strategy is a first in Silicon Valley. No other group offers what we offer: privileged access for global startups to the region’s developing markets. We have made investments and that

THE COMPANY SEEKS TO PROVIDE “ENERGY INTELLIGENCE” AND TO ACCOMPANY CUSTOMERS AND COMPANIES IN THE TRANSITION TAKING PLACE IN THE WORLD.

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has increased WIND Copec’s recognition. We already have entrepreneurs approaching us as investors/partners to help them succeed as well,” explains Walsh.

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WIND COPEC HAS TWO UNITS:

SANTIAGO CHILE

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WORKING ON INNOVATION AND NEW DEVELOPMENTS: Innovation platform that links cutting-edge technology with the world of entrepreneurship and startups, and with global research in the fields of energy, mobility and convenience.

Regarding the collaborative work with WIND Garage, he says, “Collectively, we created a very attractive growth platform, with a distinctive, compelling and, most importantly, ‘real’ value proposition, due to all the passion, dedication and talent of the teams. We are very interested in continuing to improve the way WIND Ventures transfers knowledge to other groups within Copec.”

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WIND GARAGE

SAN FRANCISCO, US

WIND CORPORATE VENTURE CAPITAL (CVC)

Both have a corporate scope, interact with each other and with the different business areas.

For Leonardo Ljubetic, the pandemic and the climate emergency highlight the vulnerability of society and raise questions for companies as to how prepared they are to play an active part in building a safer future.

“Companies need to understand that it is our duty to generate positive impacts on the environment, in social and environmental matters, that we need to decisively address the most urgent problems we have, creating new waves of growth. For this, it is essential to delve deeper into new trends, technology and innovation processes, as well as to expand the list of stakeholders and welcome their views on the different issues and on the role that companies must play,” he concludes.

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electromobility and beyond Copec Voltex is a leader in electric mobility in all segments, most notably public transportation.

In 2020, the company inaugurated the El Conquistador bus terminal in Maipú and in the latest RED tender it was awarded the design, construction and operation of 10 of a total of 13 new terminals, through transportation companies STP and Metropol. Thus, Copec has become the largest operator of electric charging and energy supply for public transport, energizing more than 1,000 electric buses and reaching 60% of the Greater Santiago market.

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Copec also has an electric charging network of 1,400 km on the road and is setting up charging points in urban areas in all the municipalities of the Metropolitan Region. At the end of October, it signed an agreement with Mallplaza to install 38 chargers in 17 of its facilities in the country and will provide the charging infrastructure to the beneficiaries of the “Mi Taxi Eléctrico” program, an initiative of the Ministry of Energy that seeks to massify the use of this type of energy in this segment.

It also offers chargers for the residential segment, through an alliance with the Spanish company Wallbox, and has signed agreements with the leading automotive brands. In the logistics and distribution segment, the area developed the design and construction of an electric charging terminal to supply energy to Transportes Pipau, which, with a fleet of 100 electric vans, provides services to the retail industry and is the largest operator in this segment.

In terms of energy storage, Copec is making progress in the implementation of smart batteries for the residential segment with Ampere. In the industrial

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segment, the installation of the first battery in Latin America, “Behind the meter”, by Stem, with injection to the distribution network, in a pilot implemented together with the Ministry of Energy, stands out.

In the area of distributed generation, Copec was awarded three tenders for photovoltaic installations in more than 800 homes in the municipalities of La Florida, Talca, Quilicura, Rancagua and Maipú, as part of the “Casa Solar” program, also part of the Ministry of Energy.

In energy supply, Copec will end 2021 with around 600 GWh of renewable energy marketed, equivalent to a reduction of 243,360 tCo2 per year.

In line with the corporate role of WIND Copec, similar projects are being promoted in Colombia, through the subsidiary Terpel, and progress is being made in the electromobility strategy in the United States, through the subsidiary Mapco.

COPEC WILL END 2021 WITH AROUND 600 GWH OF RENEWABLE ENERGY MARKETED.

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FLEXIBILITY, INNOVATION AND TRUST HAVE BEEN KEY TO ADOPTING THE NECESSARY CHANGES TO FACE THE NEW WORLD OF WORK.

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empresas copec:

THE FUTURE OF WORK IS THOUGHT TODAY

After almost two years since the beginning of the Covid-19 pandemic, thanks to the loosening of sanitary measures and the positive development of vaccination campaigns, companies have begun to think about what the labor situation will be like in the long term.

Leaders of the People areas of Empresas Copec and its subsidiaries discussed the challenges involved in the change in the way of working, in the case of employees who worked in offices, and the opportunities that arise in this period of transition.

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“the pandemic gave us organizations the opportunity to reset ourselves” been necessary to define new codes of how to relate and interact in these new conditions. We believe that in this mixed modality, in person work helps to reinforce trust and build human ties that promote effectiveness.

alejandra araya People Manager at ARAUCO.

“The context made us completely readjust our way of working. Currently, as a company, we have decided to implement a mixed methodology in all our offices, since more than 90% of the company’s people are in industrial or forestry operations, where the modality is only in person. This measure has been considered good news and is valued as a benefit that we did not have before.

The most complex part of this process has been to give a new use to the spaces and redefine the use of the office. At ARAUCO we are redesigning these places, in order to make them more conducive to co-working, creativity and innovation.

We are currently in a process of transition, in which we are precisely looking for everyone to learn to use the office as a meeting place with the team and with other areas, for which it has

The pandemic gave us organizations the opportunity to reset ourselves and take advantage of this moment to do things differently, bringing into play our capacity for resilience and adaptation. This time allowed us to connect with people from a more human perspective.

The home office format will continue to grow, especially with the new generations joining the workforce, as they have an easier time adapting to this new modality and incorporating new technological tools. The remote or hybrid method will continue to have a direct impact on the design of work methodologies and, therefore, the implementation of digital solutions to facilitate processes and collaboration between teams will be key for this modality to remain sustainable.”

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“empresas copec and its subsidiaries have always said that people are at the center”

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always putting people’s well-being first and maintaining a certain flexibility so that they can better organize their personal, family and work life. Probably, when we feel that it can become more massive, we will study it. What the health authority defines will always be a central parameter for us.

The hybrid system is here to stay, as it will be a way to attract and retain talent. I tend to think

“Today we are in a transition period.

Onlythose who want to come to the office do so, on the day and at the time he or she defines, without any obligation, and it is absolutely voluntary. This has been very well received and people appreciate the company’s willingness, especially employees who take a long time to get to work, those who are caring for the elderly, or simply those who do not want to expose themselves to the virus on public transport.

These measures are evaluated on an ongoing basis: the day we are told that a certain distance or the use of mask is no longer necessary, we will rethink the way we work, but

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47 _ that it will be very difficult that, from now on, someone will want to come to work in-person from Monday to Friday, from 8:30 am to 6:00 pm. Flexibility will be a determining variable when opting for a job position, above economic conditions.

People are very happy to have shareholders like the ones we have. In this company everyone kept their jobs, no one was laid off because of the pandemic, and benefits were maintained.

This was for the employees a demonstration of the coherence between speech and action.

Empresas Copec and its subsidiaries have always said that people are the center, that they are the most important thing, and this was demonstrated in this period of pandemic. We are proud to be part of companies of this type.” jorge garcés Human Resources Manager at Copec.

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“distance brought us closer, despite virtuality”

maría mercedes carrasquilla Vice President, Human and Administrative Management at Terpel.

“We are currently piloting a hybrid return, seeking to maximize the best of both worlds, virtual and in-person. The idea of returning has four basic purposes: to reconnect with the Terpel culture, with our colleagues, always thinking about the welfare of people; to mobilize our team to a culture of cocreation and “agility;” to strengthen a healthy work environment; and to contribute to the economic recovery of the country.

At Terpel, we have been trying to strengthen a culture of innovation within the company for more than three years. In this sense, one of the ideas is to take advantage of the hybrid model to continue to massify and position teamwork dynamics. It is a vector that we want to ingrain more in the teams during the return period. The

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days we are face to face - 3 days a week starting in January - we hope to dedicate to activities that promote more fun and collaborative dynamics.

It sounds a bit counterintuitive, but distance brought us closer together, despite virtuality. I was recently reading about “soft skills”, which we should now call “human skills”, and that in the pandemic they were given more importance. We became more supportive, more empathetic, more generous, more grateful. So, I believe that the pandemic has humanized companies a little more, at least Terpel and all its international operations.

People understood the value of working in a place where shareholders really put people first, where one of the central things was to maintain employability. Fortunately, at Terpel we are blessed and have the advantage of continuing to have jobs, and we can never forget that.”

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“as a company we must take a leading role in delivering a purpose”

“We have the opportunity to build a value proposition that takes the best of this experience. To this end, a strategy has been designed to gradually return to in-person work, incorporating a planned change management that promotes the transition from teleworking to a hybrid workday model in a gradual, safe and efficient manner, and taking into account the experience of the employees in this construction of the future.

The employee’s evaluation of this return has been mostly positive, because the process is being built with them. The positive impacts of teleworking, according to the team itself, have been a greater commitment to work, efficiency in tasks, closer communication with management and the reconciliation of work and personal life from the point of view of the reduction of travel time and the management of their own time.

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osvaldo acuña People Manager at Abastible.

The future looks promising by incorporating a new type of hybrid workday, which allows for greater flexibility and attraction of talent as a company value, promoting the use of agile technologies and methodologies. All of this very much adapted to the functions of each position. On the other hand, the role of the leader is challenged, as he/she needs to incorporate new competencies for the management of diverse teams, in changing and crisis contexts, where the care of people and the environment becomes more relevant.

As a company we must take a leading role in the delivery of a purpose that generates meaning and aligns the talents of each of our employees, along with a concrete delivery of opportunities for constant development in their working life in a comprehensive manner, promoting participatory spaces that consider their experiences and opinions in this transition.

In this, technology will be key.”

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“trust will be even more fundamental than before”

rodrigo huidobro CFO at Empresas Copec.

the family, less commuting time and, therefore, more free time, more flexibility in the schedules that each one defines to fulfill their tasks.

“There is no doubt that the pandemic will have important impacts on the ways and dynamics of work that will be seen in the future.

In the first place, there will clearly be hybrid work models, in which, taking advantage of the benefits of teleworking, employees will be able to better share time between their homes and the office. The gains in quality of life resulting from this are huge: more possibilities to be with

This will undoubtedly have an impact on the physical layout of offices. We will be looking for rotating, unnamed positions; more flexible spaces that can be used to meet, to have a presentation, to connect or to take a break; and, since not everyone will be in the office at the same time, the overall square footage can be reduced.

Trust will be even more critical than before. Teams will need to complete their work on time and in a good manner, with more distant supervision. There will be a continuing challenge in this regard: those who are not capable of self-disciplining and fulfilling their responsibilities without the direct presence of the boss will not qualify well for these new formats.

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On the other hand, unsuspected possibilities open up: instant and efficient meetings with people in different parts of the world; training with the world’s leading experts on a given topic; access to international talent to invite them to work in the organization and, perhaps also the other way around, possibilities to work remotely for organizations in other countries.

All this will also create a challenge for leaders to maintain the spirit and mystique of the team when there will be less direct contact, when coworkers will not see each other every day, when there may be members of the organization working from other latitudes.

In short, these are major transformations. But I am at least very optimistic. It seems that the benefits and possibilities associated with them outweigh the eventual costs or difficulties.”

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worldwide mina justa launches documentary:

“A PROJECT IN PANDEMIC TIMES” The audio-visual record allows us to discover, from a human perspective, the challenges involved in the construction of this iconic project of the new Peruvian mining industry. Internal and external partners give a first-person account of what it meant to make possible a dream that at times was difficult to fulfill, given the pandemic.

The five-part documentary series reflects the spirit and values of a team that did not give up in the face of the adverse world situation and the commitment of a company to the development of Peru and its people.

The creative process lasted about 9 months, during which Marcobre’s Communications team conceptualized the idea for the documentary series, developed the filming plan, interviews and script writing.

With an investment of close to US$ 1,600 million, Mina Justa marks the debut of Empresas Copec in large-scale mining, since our subsidiary Alxar Internacional has a 40% stake in the project, owned by Marcobre, and the Peruvian company Minsur owns the remaining 60%. In 2021, between 80,000 and 85,000 tons of copper are expected to be produced.

The chapters are available at http://minajusta.pe/es/

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5 CHAPTERS

MINA JUSTA PERÚ

DOCUMENTARY SERIES

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ARAUCO SEEKS TO CONNECT PEOPLE WITH THE FOREST, SO THAT THEY FEEL IT IS THEIRS AND LEARN TO LOVE, RESPECT AND CARE FOR IT AS A SOURCE OF LIFE, HISTORY, KNOWLEDGE AND SOCIAL DEVELOPMENT.

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bosque abierto:

A NEW LOOK AT FOREST HERITAGE This pioneering initiative by ARAUCO opens the forest to communities to promote projects that encourage conservation, entrepreneurship and the enjoyment of nature, benefiting different stakeholders.

Bosque Abierto is an invitation to discover and learn about an enormous diversity of landscapes and activities, based on three pillars: tourism and culture, sports and recreation, and environmental research and education.

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Chile is a country proud of its forests, which are both an indisputable scenic beauty and a biological infrastructure that makes an invaluable contribution to the oxygenation of the planet.

ARAUCO feels the same pride and is committed not only to preserving the natural resources it manages, but also to giving this green treasure a value that goes far beyond the productive aspect. It is about connecting people with the forest, helping them to feel it as their own and learn to love, respect and care for it as a source of life, history, knowledge and social development.

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With this purpose, several shared value initiatives have arisen in the areas where the company operates, involving farmers, researchers, athletes, students, tourists, local organizations and indigenous communities, among others. Some examples are Despensa Silvestre, a work with women gatherers who harvest wild herbs and fruits, and the Desafío Agua, which seeks to improve access to the vital element in areas near the company’s operations.

Thus was born Bosque Abierto, an unprecedented venture that seeks to promote projects that encourage conservation, entrepreneurship and the enjoyment of nature. Juan Anzieta, ARAUCO’s People, Health, Occupational Safety and Environment Manager, explains that the challenge was “to value our heritage for the benefit of the communities. Thus, Bosque Abierto is presented as an invitation to discover and learn about an enormous diversity of landscapes and activities, based on three pillars: tourism and culture, sports and recreation, and environmental research and education.”

The idea took shape after a forest recertification process carried out in 2018, an occasion that led to an instance of dialogue and participation with neighbors, called Casa Abierta. In it, communities expressed their intention to access the company’s assets to carry out different types of activities, as they see a very important source of services for their livelihood.

Bosque Abierto invites people to enjoy nature and learn about the benefits that trees provide us, such as the capture of greenhouse gases or the economic sustenance that productive and protected forests can give to hundreds of families. On a more intimate level, we must mention the emotional wellbeing provided by a simple walk feeling the song of a chucao, the sound of an estuary or the crunching of dry leaves underfoot.

“Bosque Abierto is all of these experiences and its spirit is dialogue, participation and collaboration to protect these ecosystems that benefit us all and support life,” emphasizes Juan Anzieta.

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— a virtuous encounter “We have to seek a balance” is the challenge posed by Ricardo Austin, who recently became the head of Forestal Arauco S.A.’s Heritage Department after a long career in the forestry business in Argentina. “For all of the above to exist, it is necessary to once again ratify a basic commitment: to align ourselves with the care of the environment and the protection and conservation of what we at ARAUCO call Protected Production Landscapes.

This new approach to heritage is transversal to the entire Company and, therefore, involves all business areas, reflecting a shared disposition and way of looking at forestry.

For Austin, this approach is very important: “We know how to identify these opportunities for virtuous encounters with the community, which respond to a concept of shared value,” he says.

It was this same perspective that motivated the company to activate the program in the middle of the pandemic, which was a challenge due to logistical issues, mobility permits and sanitary safeguards. What was not lacking was motivation and creativity to adapt to the formats demanded by the new scenario. Technology was a great ally to stimulate the senses, even through a screen.

55 _ “We saw the opportunity to contribute to people’s emotional wellbeing by connecting them, albeit virtually, with nature. So, we developed online and video activities, such as yoga classes next to the Coyanco lagoon, in Ñuble; music in Oncol Park, in Valdivia; forest baths, soundscape clips, we show the diversity of endemic species that we protect in our heritage, etc.,” says Juan Anzieta. “The idea was to transmit a positive sensory experience at a complex time for people due to the confinement and I think we achieved it, we had a very good reception in social networks.”

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BOSQUE ABIERTO is presented as an invitation to discover and get to know an enormous diversity of landscapes and activities, based on three pillars:

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THIS VIEW OF HERITAGE IS TRANSVERSAL TO THE ENTIRE COMPANY, REFLECTING A SHARED WAY OF LOOKING AT FORESTRY ACTIVITIES.

TOURISM AND CULTURE

SPORTS AND RECREATION

For his part, Ricardo Austin tells us that “what comes next is to further encourage the participation of communities, organizations and institutions; develop in-person initiatives in alliance with territorial players; expand the coverage of the environmental education program; deepen this new look in other countries and strengthen the platform www.bosqueabiertoarauco.cl.” There is plenty of enthusiasm, ideas and opportunities for Bosque Abierto to grow and strengthen like the centennial trees that fill the landscape with greenery and the souls of those who enjoy it with peace.

RESEARCH AND ENVIRONMENTAL EDUCATION

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del monte, with quite primitive characteristics. There are also sites that have served as climatic refuges during glaciations and climatic oscillations. This group includes coastal sites such as Oncol or Caramávida, with a very high biodiversity and which, when the ice retreated, allowed the territory to be recolonized.

forests with history Bioforest is a research center that develops and applies the best technologies to maximize the productivity of ARAUCO’s forest and industrial resources. Its expertise is also applied in Bosque Abierto, where the entity has been involved in providing information on the species of flora, fauna and fungi -several of them with conservation problems- present in the Company’s forestry properties.

Since before the activation of the initiative, Bioforest has played a bridging role between the company and academia, facilitating visits by universities, colleges and institutes to ecological restoration projects, conservation programs or areas of shared value in general. Thus, its participation in the project came naturally.

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In addition to their particular history, these forests are next to a great ocean, from which comes the water that allows their existence. “That rain and snow water is very clean, unlike in the Northern Hemisphere, which has facilitated comparative studies on how water and nutrients behave in basins with very little anthropic alteration,” he says.

Pablo Ramírez de Arellano, head of Bioforest’s Ecosystem Management division, says that the professional team is in permanent contact with different academics to collaborate with studies that range “from knowing how water moves in the forests, what happens to the carbon in these ecosystems, what are the greatest threats to their continued existence in the territory, to knowing a series of endemic species that require urgent conservation actions.”

Regarding the areas that are part of Bosque Abierto, the expert says that they are part of much larger forests, which covered an important part of Antarctica, Australia and South America during the Mesozoic. “There are not many, the other examples are in New Zealand, Australia and New Caledonia, areas with which we share quite related species, and are restricted to a few localities,” he explains.

For the same reason, there are species characteristic of the Southern Hemisphere, such as the Nothofagus (southern beech) and marsupials such as the monito

These forests also have very longlived species, such as larch, mountain cypress, Guaitecas cypress and araucaria. Through the analysis of their rings it is possible to know the climate and other characteristics of the environment of the last three thousand years.

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empresas copec FUEL SECTOR EBITDA: US$ 917 million

EARNINGS AS OF SEPTEMBER 2021

FORESTRY SECTOR EBITDA: US$ 1.600 million

FISHING SECTOR EBITDA: US$ 46 million

empresas copec’s consolidated ebitda and profit through september 2021 total us$ 2,551 million and us$ 1,303 million, respectively.

OTHER EBITDA: US$ (12) million

TOTAL PROFIT: US$ 1.303 million EBITDA: US$ 2.551 million

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accounting effect of the increase in international oil prices, which has boosted results.

_ in the photo: Rodrigo Huidobro Alvarado CFO at Empresas Copec.

The third quarter shows very interesting results. Our main product, pulp, has continued to show attractive price levels, although somewhat lower than those achieved up to the second quarter of the year. The strategy of diversification in different fibers -long fiber, short fiber, unbleached, dissolving, fluff- implemented gradually over the years, has allowed for a more robust position that is less exposed to the ups and downs of a particular variety.

The wood and panel market has continued to show an outstanding performance, driven by global trends in home improvement and post-pandemic residential reconfiguration, which have significantly increased the levels of demand for these products. In addition, the Company has achieved important efficiencies, particularly in North America, where ARAUCO’s investment in Grayling has allowed for lower-cost production and distribution.

The energy sector, meanwhile, has continued to show a significant recovery. After last year’s sharp falls, fuel volumes have gradually returned to their normal levels, and have now exceeded pre-pandemic figures in almost all channels. This has been compounded by the temporary

In addition, for the first time this quarter we began to record positive results from the Mina Justa operation in Peru. After completing the project without major delays or cost overruns, in a context of sanitary challenges, and always putting people’s safety first, Mina Justa began production in March and made its first shipments in July, in a very positive scenario for copper prices.

Additionally, this past quarter includes the nonrecurring results of asset sales carried out by Abastible, which completed divestment of its shares in Gasmar, and ARAUCO, which did the same with a group of forestry properties.

As a result, Ebitda through September reached US$ 2,551 million, and the Company’s income reached US$ 1,303 million, well above the comparable figures for the previous year of US$ 1,229 million and US$ 72 million, respectively.

In terms of investments, the MAPA project, which has permanently focused on health safety, has continued to show the complexities of building in a pandemic, forcing the Company to delay its start-up until March 2022. In other latitudes, ARAUCO announced the start of the studies required for an eventual investment in a panel mill in Mexico which, with a Capex of around US$200 million, would begin operations in 2024 and would allow to double MDF capacity in that market.

Thanks to this year’s good results, together with asset sales and the gradual completion of large investment projects, Empresas Copec’s credit indicators have shown substantial improvement, with the most important of these, NFD/Ebitda, at 2.2 at the end of September. We are thus recovering the levels to which we are accustomed, which allow us to be comfortable enough to face the ups and downs of the markets, and also to react in time to the investment opportunities that arise. This has also allowed us to reward the efforts made by our shareholders in recent times, with dividend payouts in October and November totaling more than US$ 700 million, and with the announcement of the return to the traditional dividend policy of 40% of net income.

At the same time, the Company has achieved important milestones in sustainability matters. Copec and ARAUCO’s climate change declarations, ratification in the Dow Jones Sustainability Index Chile and MILA Pacific Alliance, and the award to Copec of a significant number of electric bus terminals are all achievements that continue to reflect the spirit of Empresas Copec: to generate a more reliable and sustainable future for all.

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empresas copec is ratified in the dow jones sustainability index chile and mila pacific alliance 2021

copec and abastible receive “consumer loyalty 2021” award

belén educa foundation and empresas copec close the 2021 mentoring program

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copec wins first place in its category in most innovative companies 2021 read

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empresas copec receives “voice of the market” recognition for the third consecutive year

ec and subsidiary executives give vocational talks to students of belén educa foundation

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copec announces carbon neutrality goal by 2030 read

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empresas copec is ratified in the dow jones sustainability index chile and mila pacific alliance 2021 the company was selected to join both indexes for the sixth and fourth time, respectively.

The Dow Jones Sustainability Index Chile is made up of leading companies in sustainability from the Santiago Stock Exchange’s General Stock Price Index (IGPA); and the DJSI MILA brings together the stock exchanges of Chile, Colombia, Mexico and Peru.

Both indicators use the “Best in Class” methodology, i.e., they select companies that are part of the top 40% of eligible companies, from the IGPA and the Pacific Alliance, in terms of performance in environmental, social and good corporate governance factors.

In a year in which the evaluation requirements in all productive areas were particularly high, Empresas Copec ranked in the top 16%, increasing its relative position

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in the industry in which it participates.

Pamela Harris, director of Corporate Affairs, said that the ratification “is an important recognition of the work we have been doing in recent years together with our subsidiaries and encourages us to continue improving and advancing in the commitment we have made to build a more sustainable future for future generations.”

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copec and abastible receive “consumer loyalty 2021” award the subsidiaries emerged as the companies that have achieved the best levels of closeness and good customer experiences.

The “Consumer Loyalty” award is a recognition carried out

by Alco Consultores together with the Business School of the Universidad de Los Andes (ESE), based on its own Net Promoter Score methodology. Through 13,685 online surveys, conducted between July and September 2021, the degree of loyalty of consumers with respect to 72 Chilean companies, belonging to 16 industries, was evaluated. Copec received the award in the Service Stations category and Abastible in the Liquefied Gas category.

For Gloria Ledermann, Copec’s marketing manager, “the loyalty of our customers is what really moves us and challenges us every day. We want to provide them with the best service, the best experience, to surprise them in each of our interactions, and we achieve this with the commitment of all of us who are part of Copec, all of whom have the firm conviction that the customer is at the center.”

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Meanwhile, Catalina Navarro, Abastible’s assistant manager of Customer Experience, said that it is precisely consumers who “give purpose and meaning to our daily work, guiding the work of the entire company in contributing to their quality of life. This recognition makes us proud and is of utmost importance, as it is the answer to all the effort we make every day to bring energy and heat to homes and industries in our country.”

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belén educa foundation and empresas copec close the 2021 mentoring program the initiative was aimed at guiding fourth-grade students in their professional development through a series of activities in which executives met with the students.

The closing ceremony was attended by the students, who expressed their appreciation for the dedication of the 38 executives of the Company who participated in this edition of mentoring, as well as the comprehensive support they received.

Meanwhile, the different tutors shared their views on the responsibility of having in their hands the guidance of a student who is going through a moment of key decision making.

Eduardo Navarro, Empresas Copec’s CEO, thanked the Belén Educa Foundation for providing this opportunity to young people and executives of the Company. “We had the opportunity to meet and exchange experiences. We are a business group that does great things for the countries in which it is present, but we are also concerned about and very pleased to collaborate in transforming lives, as well as being a contribution to the students of our country,” he said.

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Pedro Larraín, executive director of Belén Educa Foundation, said that the alliance with Empresas Copec represents an important mutual support to continue building a better country, and valued the commitment shown by the executives to their students.

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copec wins first place in its category in most innovative companies 2021 the subsidiary was distinguished in the “fuel distribution” category.

The award recognizes the most innovative companies in their capacity to develop new products, processes and services, and is granted by ESE Business School and the consulting firm MIC Innovation.

At the awards ceremony, the initiatives led by the Company to generate an innovation ecosystem that has an impact both inside and outside the company were highlighted.

Examples of this vision included its transformation process towards electromobility and the creation of WIND, corporate venture capital aimed at accelerating startups and promoting their growth in the United States and Latin America.

This survey has been carried out since 2009 and more than 400 companies have participated in it.

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empresas copec receives “voice of the market” recognition for the third consecutive year the company was considered one of the three best evaluated companies in the country in terms of corporate governance.

Promoted by EY and the Santiago Stock Exchange, “The Voice of the Market” is a survey of directors, investors, intermediaries and analysts, among other opinion leaders, to “take the pulse” of how they perceive the quality and governance practices of organizations traded on the Santiago Stock Exchange.

Eduardo Navarro, CEO of Empresas Copec, thanked the company for the award and reiterated that it will continue to strengthen its governance structures, which are the basis for business development based on transparency and dialogue. He also pointed out that it represents an incentive to always remain “at the forefront” and move towards a “sustainable future that brings well-being to all.”

“The Voice of the Market” evaluates companies under five pillars: business strategy, control environment, transparency,

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fair and equal treatment, and sustainability management.

In addition, it identifies the main focuses to be addressed by boards of directors in the context of the country’s current situation. Along with Empresas Copec, Banco Santander and Viña Concha y Toro also received awards in 2021.

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ec and subsidiary executives give vocational talks to students of belén educa foundation 272 students participated in the activity, which aimed to learn about the experiences of professionals working at the company.

For the fifth consecutive year, EC participated in the event with students from the Arzobispo Crescente Errázuriz school, with whom they talked about their life stories and academic and professional experience. The meeting is part of the commitment of Empresas Copec and its subsidiaries to promote quality education and contribute to the generation of opportunities.

Participating in the talks were Empresas Copec’s CEO, Eduardo Navarro; Alxar’s Corporate Affairs Manager, Silvia Baeza; ARAUCO’s Vice President for International and New Businesses, Gonzalo Zegers; and Abastible’s CEO, Joaquín Cruz.

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copec announces carbon neutrality goal by 2030 in order to add actions to help combat global warming and the emission of greenhouse gases, the subsidiary released its climate change statement.

In this regard, Arturo Natho, Copec’s CEO, said: “Our value proposition is to develop and deliver products, services and solutions that meet the diverse and changing needs, present and future, of life on the move. We are and will continue to be a leading company in mobility, responding to the needs of the digital era, promoting new modes of transportation, renewable energy requirements and consumption. We will use all our accumulated knowledge in fuels, and today in electromobility, to drive and accelerate the energy transition.”

To support this path, since 2019 the company has a platform to accelerate its transformation process, linked to cuttingedge technologies in the world of entrepreneurship, and research in the fields of energy, mobility and retail. Today, it has a broad portfolio of new businesses in these areas.

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This year, Copec’s goal will be to achieve carbon neutrality in its 673 service stations throughout Chile. To date, 64 of them are already supplied with renewable electricity, while the rest will offset their operating emissions through carbon credits. In addition, other initiatives to address climate change are also contemplated, and goals have been set for the biodiversity and circular economy pillars of its sustainability strategy.

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journalistic magazine published by: empresas copec s.a. el golf 150, 17th floor. las condes phone: 2461 7000 legal representative: eduardo navarro beltrán director: rodrigo huidobro alvarado editing and writing: m. francisca riveros novoa journalists: natalia labbé daniela araneda marisol silva proofreading: norinna carapelle photography: empresas copec and subsidiaries photographic archives image bank design and graphic production: porta4, design studio translation: paulina munita if you have any suggestions and opinions, please write to us at comunicaciones@empresascopec.cl follow us:

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The opinions expressed by the different authors and contributors in this magazine are the exclusive responsibility of those who express them and do not necessarily represent the opinion of Empresas Copec S.A.