República del Cacao UN GLOBAL COMPACT Report 2021 by República del Cacao

S U STA I N A B I L I T Y R E P O RT

COP 2021

SUSTAINABILITY REPORT COP 2021

INDEX

• L E T T E R F R OM O U R D IRE C TO R S

• ABOUT REPÚBLICA DEL CACAO

• S U S T A I N A B I L I T Y S T R AT E G Y

- Sustainability Pillars - Our contribution to the Sustainable Development Goals (SDG) and the 2030 Agenda - The certification that guarantees our impact: B Corp

• G L O B A L C O M PA C T P R I N C I P L E S

• HUMAN RIGHTS

• L A B O R S TA N D A R D S

• ENVIRONMENT

• ANTI-CORRUPTION

Mrs. Edelmira Aspiazu Fine Cacao Producer San Jacinto, Vinces - Ecuador

L E T T E R F R OM O U R D IRE C TO R S 2 0 2 1 : U N I T E D W E R E A C T I VAT E After a year in which the world stopped to give priority to people’s health and safety, 2021 began with new goals and objectives that motivated us to work hard for the economic reactivation of our country. Under important biosafety measures, we took back the essence of the Republic of Cocoa through face-to-face events such as the Latin America’s 50 Best, of which we were the official organizers in Ecuador; the launch of the Camino +B project and workshops with different Chefs allied around the world. Innovation & product development did not stop and we were able to launch new products for professional use: My Field to Bar in Mexico and the White Chocolate Ecuador 33% with Roasted Corn, both products with unique concepts that keep us at the forefront in front of our customers. We were proud to support Ecuadorian Chef Nestor Toapanta of Universidad San Francisco de Quito in his participation as Ecuador’s representative in the Bocuse d’Or final in France, a competition to which the country qualified after 19 years. On the other hand, we continued to develop new desserts and chocolate bars with ingredients of origin, quality and excellence. We promoted sensory experiences through fine aroma chocolate in our Chocolate-Boutiques, as well as in digital channels, strengthening the corporate channel under this modality. We piloted an advertising and strategic alliance model through our first franchise, located in the emblematic La Floresta neighborhood of Quito. We protected and strengthened alliances with commercial partners in the Travel Retail sector, recovering sales and building our portfolio with a view to recovering this channel in Duty Frees in Colombia, Peru, the Dominican Republic and Ecuador. We promoted the digital channel through our own e-commerce as well as existing digital platforms such as Rappi, Uber Eats, Tipti and PedidosYa. We developed special seasonal activities and products in Ecuador, such as Pascua, Mother’s Day, Father’s Day, Children’s Day, All Souls’ Day and Christmas, thus creating an important link between the consumer and our brand, and we celebrated the reopening of our store in the Historic Center of Quito with a new design that allows our customers to learn more about the history of cacao in Ecuador. With this summary of projects, we are pleased to present this Annual Progress Report, in which República del Cacao reaffirms its support for the Ten Principles of the United Nations Global Compact in the areas of Human Rights, Labor, Environment and Anti-Corruption. All of our actions to continuously improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations are described in this report. We are committed to sharing this information with our stakeholders through our main communication channels.

Philippe Bongrain CEO B2B

Simón Perez CEO B2C

SUSTAINABILITY REPORT COP 2021

ABOUT REPÚBLICA DEL CACAO República del Cacao was born with a purpose: to create the most authentic Latin American chocolate hand in hand with local communities, developing sustainable fine aroma cacao production at its source. Our actions have allowed us to become a local brand with global impact. We create chocolates with excellence and dedication, hand in hand with expert chocolatiers who are responsible for bringing the flavors and aromas of fine cacao from our region to the world. Our products have an added value thanks to the advanced technologies and professional knowledge we use to produce them. The effort, training and investment we put into the hands of our colleagues is reflected in the creations that chefs and chocolate lovers share daily, highlighting the values that inspire and unite us.

Our commitment to the protection of Fine Aroma Cacao in our region and the farmer goes beyond the purchase at fair prices, it extends to technical support and the application of responsible agricultural practices, promoting the protection of native varieties of fine aroma cacao. Throughout our journey we have met the highest standards of social and environmental performance, transparency and corporate responsibility, seeking to balance profit and purpose. We are proud to receive the B Corp certification in recognition of our efforts to develop a more inclusive, equitable and sustainable economic model for all. Our goal is to build a global community of conscious producers, customers and allies willing to develop their businesses in a more responsible and sustainable way.

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OUR BUSINESS The retail activity (B2C) consists of an extensive portfolio of chocolate products such as gifts, ice cream, desserts, chocolate bars and chocolate confections. It has six Chocolate Boutiques in Ecuador and Duty Free presence in Ecuador, Colombia, Peru and the Dominican Republic. The professional use line (B2B) has a portfolio of 17 products, divided into profiles: Single Origin, Blend and Cigars, present in more than 20 countries around the world.

EUROPE UNITED KINGDOM

SPAIN

UNITED STATES

JAPAN

CHINA

SOUTH KOREA

DOMINICAN REPUBLIC

MEXICO

PANAMA

TAIWAN UNITED ARAB EMIRATES

COLOMBIA ECUADOR BRAZIL

PERU

CHILE

PARAGUAY

AUSTRALIA

URUGUAY ARGENTINA

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S U S TA I N A B I L I T Y S T R AT E G Y LET’S CHANGE THE WORLD ONE CACAO BEAN AT A TIME. In República del Cacao we conceive our strategic vision as a “Sustainable Business” model, which seeks to strengthen impactful relationships through the involvement of different actors in our value chain: from suppliers, customers and collaborators to strategic allies. Our sustainability strategy is based on the triple social, environmental and economic impact, integrated transversally in our business through our strategic framework. This strategy guides the decisions of all our business units in order to achieve profitable growth and shared value in the long term.

COMMUNITY

AUTHENTICITY

FINE CACAO

EXCELLENCE OUR CORE

We create the most authentic Latin American chocolate hand in hand with local communities, developing sustainable fine cacao production at its source.

SUSTAINABILITY LEADERSHIP TEAM (SBLT)

STAKEHOLDERS CLIENTS Enhance costumer experience.

INSTITUTIONAL ALLIES Improve the cacao and chocolate sector.

OUR PEOPLE Empowering our collaborators.

SUSTAINABILITY PILLARS

STRATEGIC FOCUS

SOURCING Creating of shared added value and high trazability.

Our purpose and brand pillars drive our strategic vision. Based on this vision, we involve our entire management team through the Sustainability Leadership Team. In this team, each area manager works annually on objectives framed within the principles of the United Nations Global Compact, the Sustainable Development Goals and the B Corp certification standards. Each of the decisions we make have a direct impact on 4 stakeholders: our suppliers, our employees, our institutional allies and our customers.

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S U S TA I N A B I L I T Y P I L L A R S

We work based on 4 sustainability pillars, which allow us to co-create with our stakeholders projects of social, environmental and economic impact that promote sustainable development throughout our business. These pillars allow us to establish a baseline of action and roadmap with each established project.

ECONOMIC SUSTAINABILITY Guarantee the economic development of our partners, ensuring the purchase of local raw materials.

ENVIRONMENTAL COMMITMENT Promote the implementation of regenerative agricultural projects.

GENDER EQUITY Support the involvement and leadership of women in healthy and productive work environments.

KNOWLEDGE EXCHANGE Develop programs to strengthen the skills of our partners.

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O U R C O N T R I B U T I O N T O T H E S U S TA I N A B L E D E V E LO PM E N T G OA L S ( S D G S ) A N D T H E 2 0 3 0 AGENDA

The 2030 Agenda establishes the need to foster alliances between different public-private entities that help find solutions and best practices to achieve the 17 Sustainable Development Goals (SDGs). These goals include economic growth, social inclusion and environmental protection. The private sector has a transcendental role in this vision, involving the needs and solutions of its value chain for sustainable development. At República del Cacao we contribute indirectly to all the SDGs, but focused on the food sector to which we belong and taking into account our stakeholders, we consider the following SDGs within our priority strategic framework for action:

“ End poverty in all its forms everywhere.”

Contribute to creating solid normative frameworks based on strategies in favor of ending poverty through strategic business management and collaborations with different entities.

“ Achieve gender equality and empower all women and girls.”

Contribute to developing opportunities for women with full and effective participation and equal leadership opportunities at all decision-making levels.

“ Ensure sustainable consumption and production patterns.”

We aspire to promote sustainable practices that incorporates information about production and consumption throughout the value chain introducing economical, social and environmental development, transparently through our communications and strategic management efforts.

“ End hunger, achieve food security

and improved nutrition and promote sustainable agriculture.” Commit to ensure the sustainability of food production systems and implement resilient agricultural practices that increase productivity and production and maintain ecosystems.

“ Promote sustained, inclusive and

sustainable economic growth, full and productive employment and decent work for all.” Contribute to economic and social development by strengthening quality employment, technological modernization, and innovation in our value chain committed to developing cacao and chocolate production and sustainable industries.

“ Protect, restore and promote

sustainable use of terrestrial ecosystems, sustainability manage forest combat desertification, and halt and reverse land degradation and halt biodiversity loss.” Promote sustainable management of all forest types, end deforestation, recuperate degraded forest, and increase forestation and reforestation.

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THE CERTIFICATION THAT ENDORSES OUR IMPACT Throughout our journey we have met the highest standards of social and environmental performance, transparency and corporate responsibility, seeking to balance profit with our purpose. Therefore, we are a certified B Corp company, as a recognition of our efforts in the development of an inclusive, equitable and sustainable economic system for all. Being a B Corp company strengthens our commitment to sustainable development and allows us to position ourselves prominently in the market. We are now part of a global network of companies and organizations that associate economic growth with the promotion of social and environmental well-being. The B Corp certification process has allowed us to reflect the efforts we have been making since the company’s inception through its cross-cutting purpose. This process was achieved through a rigorous B impact assessment covering five categories: Corporate Governance, Employees, Customers, Community, and Environment. This certification is part of the strategic vision of our sustainable business, supporting the management we have developed over the years through our impact pillars. With this certification, República del Cacao’s mission will be expressed in the company’s bylaws, which means ensuring that the growth of the business reflects our purpose of impact. As with any certification, there is a recertification process. In that sense, we know that B Corp will be a stimulus to contribute to the transversal innovation of our value chain through sustainable development, as well as being a constant allied organization that validates our impact processes. Around the world there are more than 4,700 certified B Corp companies from more than 155 industries, from 78 countries with a unifying objective: redefining success in business. We are proud to be part of a global movement of people who use the power of business to create positive impact by working to reduce inequality, lower poverty levels, promote a healthier environment, strengthen communities and create high-quality jobs with dignity and purpose.

4.700

companies around the world

WE ARE PROUD TO BE A

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U N G L O B A L C O M PA C T P R I N C I P L E S

HUMAN RIGHTS

• Organizations should support and respect the protection of internationally recognized fundamental human rights within their sphere of influence. • Ensure that they are not complicit in human rights abuses.

LABOR STANDARDS

• Support freedom of association and the effective recognition of the right to collective bargaining. • Eliminate all forms of forced and/or compulsory labor. • Effectively abolish child labor. • Eliminate discrimination in respect of employment and occupation.

ENVIRONMENT

• Maintain a precautionary approach that favors the environment. • Encourage initiatives that promote greater environmental responsibility. • Encourage the development and diffusion of environmentally friendly technologies.

ANTI-CORRUPTION

• Organizations should work against corruption in all its forms, including extortion and bribery.

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D E V E LO PM E N T I S A H U M A N R I G H T

República del Cacao seeks to manage a value chain in which fundamental human rights are respected and promoted for every human being, without distinction of nationality, place of residence, gender, ethnic origin, color, religion, language, or any other condition.

“Business with vision provides decent work by stimulating sustainable economic growth through increased levels of productivity and technological innovation, as well as by fostering policies that encourage entrepreneurship and effective measures to eradicate forced labor, slavery and human trafficking”

The following is a detail of the projects related to this principle.

CODE OF SUSTAINABLE PRACTICES In a continuous effort to forge strategies that comprehensively watch over the social and environmental conditions of our allied suppliers, every year we work annually with the implementation of our Code of Sustainable Practices. This code is based on a set of principles that guarantee a balanced, fair, and ethical commercial relationship, strengthening the following points:

• Respect fair payment agreements. • Encourage collaborative relationships. • Reduce the risks of mutual dependency. • Involve the buyer in their sectors • Analyze and support environmental issues. • Ensure the company’s responsibility in its territory. • Ensure the overall management of the relationship with suppliers.

100% of our suppliers of raw materials and primary packaging materials have signed this Code.

ANNUAL SUPPLIER EVALUATION Our suppliers are evaluated annually in terms of food safety, product quality, supply, and safety. This evaluation is carried out in accordance with our internal procedure endorsed by ISO22000:2018 certification, in addition to the letter of commitment and code of ethics.

CACAO PROJECTS OUR PRODUCTS WOULD NOT BE THE SAME WITHOUT THE CACAO PROFILES THAT INVOLVE A DIVERSE LATIN AMERICAN REGION. OUR CACAO COMES FROM PLANTATIONS IN ECUADOR, PERU, AND THE DOMINICAN REPUBLIC WHERE WE FOCUS ON CREATING DIRECT AND TRANSPARENT PARTNERSHIPS, FORMING RELATIONSHIPS FREE OF INTERMEDIARIES. THE SOCIAL, ECONOMIC, AND ENVIRONMENTAL DEVELOPMENT OF OUR FARMERS IS PARAMOUNT TO ENSURE THE PROTECTION OF NATIVE VARIETIES OF FINE CACAO.

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CACAO COLLECTION CENTER VINCES, ECUADOR Our collection center is located in the city of Vinces, in the province of Los Rios, Ecuador, considered a national and historical reference in the production of fine aroma cacao. This center is key to guarantee the supply of cacao of origin, traceable and at fair prices, strengthening long-term relationships with our cacao farming allies in the area, thus ensuring their economic, social, and environmental development. Our commitment lies in increasing the volumes of collection and increasing the number of allied farmers, through investment in their farms, and enhancing their skills through ongoing training, thus forging rural micro-entrepreneurs with technical and agricultural skills. We want to promote excellence in the cacao industry in the country, with a high-quality collection center that guarantees economic, social and environmental development, both to our allied farmers and to the community of Vinces. For this reason, during this year we carried out a comprehensive renovation of the facilities and infrastructure of the storage center, with the aim of meeting the requirements of increasingly demanding international markets.

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HUMAN RIGHTS

CACAO COLLECTION CENTER VINCES, ECUADOR For this work, we contracted six Ecuadorian suppliers from: Quito, Vinces, Babahoyo and Guayaquil, encouraging the hiring of local labor. These works included:

• • • • • • •

Renovation of damaged roofs and infrastructure. Maintenance of offices and cabins built in concrete and guadua cane. Renovation of raw material and finished product warehouses. Renovation of a mini-laboratory for artisanal chocolate production. Maintenance of the ecological wastewater treatment system. Restructuring of the fermentation area to take advantage of the 350-ton load capacity, in order to increase production volumes and purchase of cacao. Remodeling of the central cabin, with the objective of developing inspirational gastronomic activities, inviting renowned national and international chefs, who will participate in projects to exchange knowledge and impact with our farmers.

The continuous work and investment in the structure of our Collection Center demonstrates our commitment to a historical legacy of Ecuador as important as fine aroma cacao. In addition, it is key to continue positioning ourselves as a national reference in the promotion of good agricultural practices, maintaining the operational excellence and quality characteristics of our products, while promoting sustainable business development.

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CACAO COLLECTION CENTER VINCES, ECUADOR S U S TA I N A B I L I T Y P I L L A R S

ensure economic income by guaranteeing the purchase of cacao. • We an annual average basis, we pay a differential price between 15% and 20% more per ton of cacao over the • On market price. review of the sectorial census and appraisal assessment of farms through technical visits in the territory. • Annual remodeling of the Collection Center through financial investment, with the objective of increasing the • Integral quantity and quality of cacao.

• Circularity analysis of cacao nibs from Vinces as part of our project to measure our carbon footprint, with the objective of evaluating opportunities that will allow our products to continue to reflect our philosophy of sustainability.

• Visits from República del Cacao’s technical team, in order to verify processes and ensure production quality. • Value-added exchanges through visits from university institutional partners and internationally renowned professional chefs.

• 30% participation of women linked to farm processes.

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SACHA CACAO- ECUADOR Our Amazonia 75% chocolate is produced with a unique variety of cacao from the eastern part of Ecuador. Due to its yield and productivity, this cacao is known as the super tree “Sacha”, which means “jungle” in Quichua. This chocolate, despite having a high percentage of cacao, presents a round profile with very sweet notes of nuts such as almonds and hazelnuts, and it is also common to find soft notes of coconut and earthy flavors. Our focus at Sacha is on guaranteeing the quality and traceability of our origin, developing productivity projects and field improvements in collaboration with our strategic allies.

S U S TA I N A B I L I T Y P I L L A R S

• •

•

We ensure economic income by guaranteeing the purchase of cacao at a price higher than the market price per ton of cacao. Donation of post-harvest infrastructure through cooperation with CORPEI to cacao technician Marisol Choez, located in Sacha, province of Orellana.

3 exchanges between cacao producers of the Shuar-Yamanunka community and managers of República del Cacao, through cooperation with UNHCR.

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PERU CACAO For the past 4 years, we have been working together with the Norandino Cooperative in Peru through a strategic alliance. Located in Piura, northern Peru, the model with which this cooperative works is an excellent example of the collective work of more than 7.000 producers and associations, uniting 3 important sectors of agriculture: cacao, coffee, and panela. Cocoa production represents 20% of the cooperative’s production, making it a successful case study in the region and an essential partner for our company. The small associations that supply our cacao come from the districts of Paimas, Chulucanas and San Jose de Sisa, where we have worked and invested since 2016 in several interdisciplinary projects.

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PERU CACAO

S U S TA I N A B I L I T Y P I L L A R S

• Financial support to improve the infrastructure of the Chipillico Valley Producers Association’s collection center. payment of USD 250.00 per ton of cacao to the Norandino Cooperative to finance projects in specific • Differential supply areas.

• Investment in good organic agriculture practices projects. • Provision of slow combustion ovens for the production of activated carbon (biochar) to reduce cadmium content in cacao.

* Biochar is a natural organic amendment that, through the focused burning of branches and agricultural residues, yields a charcoal that has been shown to have the potential to naturally absorb heavy metals present in some agricultural soils.

• Hiring of a local field technician to support cadmium reduction research projects on organic agricultural practices in the province of Piura.

• Execution of a pilot project of digital cooperatives focused on Financial Education and Bio-gardens for women, led by Producers Direct as a partner organization of Norandino.

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DOMINICAN REPUBLIC The Dominican Republic possesses a treasure: fine aroma cacao, which reflects a millenary Caribbean culture. The climatic conditions of the island endow it with magnificent qualities that make it possible for it to become the great producer that it is. For the past two years we have had an alliance with CONACADO, our strategic ally with whom we work with small and medium cacao producers. Our objective is based on improving the income and quality of life of our allied producers and their families by supporting the sustainable management of their farms, improving their harvests, and strengthening the organization of our allies.

S U S TA I N A B I L I T Y P I L L A R S

• Payment of differential price per ton of cacao above market level.

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PRODUCTS OF ORIGIN PROGRAM A CACAO OF ORIGIN DESERVES INGREDIENTS OF ORIGIN. OUR CHOCOLATE WOULD NOT BE THE SAME WITHOUT THE RAW MATERIALS THAT COMPLEMENT IT, WHICH ARE DISTINGUISHED BY THEIR TRACEABILITY, QUALITY, AND THE COLLECTIVE EFFORTS OF ALL THE PROFESSIONALS THAT MAKE UP OUR VALUE CHAIN. THE RESULT IS THE PRODUCTION OF LOCAL PRODUCTS, WITH UNIQUE FLAVORS AND STORIES WITH NAMES AND SURNAMES, WHICH REVEAL THE SECRETS BEHIND THE PECULIAR ECOSYSTEMS AND AGRICULTURAL PROCESSES THAT SURROUND THEM.

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MILK - TURUCUCHO At República del Cacao we have worked for more than four years in alliance with the Campo Verde Association, located in the community of Turucucho, Cayambe. The objective of our shared value projects in this community is to promote the economic development of our dairy partners by diversifying their income through marketing links with other local companies and the purchase of traceable milk from the community. In addition, during this year we ventured into the implementation of a community kitchen for agrotourism and gastronomic purposes for the area. The milk from these mountains is used for the production of our White Chocolate Ecuador 31%, one of the most requested internationally by our markets, and now it is also one of the ingredients of our new White Chocolate Ecuador 33% with roasted corn. It is a unique milk because of its natural sweetness and special fresh cream flavor.

S U S TA I N A B I L I T Y P I L L A R S

• • •

Guarantee the purchase of milk produced by the Campo Verde Association, through our allied supplier El Ordeño, a B certified company. Diversification of the Association’s income through the link with gastronomic projects of impact through allied companies and chefs such as: Tippy Tea (cultivation and commercialization of Andean medicinal plants). Financing for the construction of a kitchen/dining room project.

• •

Quarterly visits by the Socio-Environmental department for project follow-up. 3 exchanges between experts in the dairy-chocolate chain during 2021.

• •

40 women from 57 families are heads of household and participate in the production processes. Four of these women lead the Steering Committee of the Campoverde Association.

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P A N E L A ( R AW B R O W N S U G A R ) - PA C T O Located in the northwest of Quito, within the bioregion of the Andean Choco, a biosphere reserve, we find Santa Marianita, a small town that houses the collection center “Productos San Jose”, our strategic ally. Being the only production of organic granulated panela in the region, it is a reference for its good agricultural, social and manufacturing practices. The process for the production of panela in “Productos San Jose” is handmade and is developed through the following steps: cultivation of sugar cane, cutting and transportation of cane, cane crushing/juice extraction and finally entering the boiler and production of panela. This center directly employs 25 families, adding up to more than 100 indirect beneficiaries.

S U S TA I N A B I L I T Y P I L L A R S

•

• •

•

Guaranteed purchase of organic panela.

Visits by different clients and external partners of República del Cacao for agrotourism activities. Participation of Productos San Jose in the Camino +B workshops, training in the steps and actions to be taken to become a certified B company.

Purchase of organic-certified panela, produced in the Choco Andino bioregion, a highly biodiverse area, guaranteeing the continuity of good agricultural practices.

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CORN - MACHACHI Considered as “pre-Hispanic gold” due to the relationship that indigenous cultures attribute to it with the “Sun God” himself, we have incorporated this ancient grain to one of our most innovative recipes, a chocolate with unique flavor notes, forged under the sun of the Andes, where the best lands are dedicated to the cultivation of corn. Corn is an ancestral grain with great relevance for the Andean countries since the beginning of its history. Considered a sacred food by the indigenous peoples, their life was largely related to the harvest of this grain, because for them it was a “giver of life”, and cultivating it was synonymous with honoring the “sun god”, that is why its sowing had several ritual aspects and harvesting it was a celebration. The corn we use comes from our allies, Dicorne, a small family-rural agribusiness, specialized in products of origin, developing the local industry and providing support for the development of 10 families in the El Chaupi area and 510 families in Cotopaxi.

S U S TA I N A B I L I T Y P I L L A R S

• •

We guarantee the economic development of our suppliers through the purchase of local ingredients. Our roasted corn supplier is a company with 5 years of operation that seeks to transform and market products with local raw materials.

PA R T N E R S H I P S F O R S U S TA I N A B L E D E V E L O PM E N T AN IMPORTANT ASPECT OF OUR COMPANY’S VISION OF HUMAN RIGHTS IS TO TAKE PART IN THE PUBLIC DEBATE, HAVING THE RESPONSIBILITY TO EXPRESS OUR VIEWS ON THE ISSUES THAT INFLUENCE OUR OPERATIONS, EMPLOYEES, CUSTOMERS, AND THE COMMUNITY OF WHICH WE ARE A PART. IN THIS WAY, WE GENERATE A GREATER IMPACT IN THE MANAGEMENT TOWARDS SUSTAINABLE DEVELOPMENT.

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QU I TO FO O D BA N K

Food Banks arise as a solution to food waste, which worldwide is 1.3 billion tons per year, despite being food in perfect condition for human consumption (Source: FAO). The main objective is to generate alliances with producers and traders in the food sector, to bring food that has been recovered to the people who need it most and thus avoid waste. In the city of Quito, 100 tons of food are wasted every day, even though there are neighborhoods with 85% of their population living in poverty who could consume this food. In response, in 2003 the Quito Food Bank (QFB) was created, with whom we have maintained a prosperous alliance since 2019, based on donations and knowledge exchange workshops.

3,040kg of chocolate donated

Benefiting

3,678 people

5 chocolate workshops

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PROJECT: B R I N G I N G J O Y T H R O U G H C H O C O L AT E

This year we welcomed a new academic alliance with the GQB Culinary Art School in Quito and connected both strategic allies through chocolate. In June we were able to bring joy to several children from QFB’s partner foundations, who received an online class from Chef Romina Rueda from GQB and our Corporate Chef Andrea Lopez, where they learned to make chocolate chip cookies and cupcakes, using the chocolate we donated. Alicia Guevara, founder of the QFB, gave us her opinion about this project, “... Something I really like about República del Cacao is that it is an organization full of life, they don’t stay with just one idea, they are always looking to innovate, they are always looking for different ways to help. Last year there were talks, chocolate handling courses, and now this, an IG LIVE for all the organizations to participate, it is very good for us because it is not just the same thing, you are always reinventing yourselves, looking for ways to help, so I am very grateful again.”

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dimiento empren cial so ómico gastron

GOOD FOOD: GASTRONOMIC SOCIAL ENTREPRENEURSHIP

We believe it is essential to develop spaces where knowledge exchange is encouraged in order to strengthen the cacao and chocolate chain in a transversal and integral way. With the aim of contributing with an inclusive and responsible food, we have created the “Good Food” project, which seeks to promote the development of social enterprises from gastronomy and chocolate workshops taught by allied Chefs. In these workshops, different foundations we work with through the Quito Food Bank received training with knowledge in different gastronomic areas, such as chocolate and pastry making. These trainings allowed social entrepreneurs to learn techniques and recipes, as well as to connect with local people and build relationships. During the first phase of the project, the Chefs who gave the workshops were: Romina Rueda, Pastry Chef at GQB Culinary Art School, Andrea López Corporate Chef at República del Cacao, Chef Pia Salazar, Pastry Chef and Co-owner of Nuema and Serena Larrea Chef at La Serena Bakery. For our allied Chefs this is a unique experience to be part of a social impact movement. For the company, we are proud to have a community of chefs whose goal is to generate a positive impact on society through their knowledge. During the first phase of the project, we worked with the organization “Las Reinas Pepiadas”, who support vulnerable Venezuelan migrant women through the development of entrepreneurships. The project has been carried out thanks to the UNHCR: the United Nations High Commissioner for Refugees and the GQB: School of Culinary Art in Quito with whom we have an alliance. The project is divided into two parts; first, a Design Thinking Workshop, where the participating Chefs got to know in depth the women of the organization “Las Reinas Pepiadas” in order to develop a gastronomic workshop model that adapts to their social and economic context. This workshop allows the contribution of different life stories, through which Venezuelan culture and history are reflected, demonstrating that gastronomy was what kept their family together through the distance. With this valuable co-creation session, the second part of the project unfolded: the basic pastry workshop. The training model of this project went far beyond a space for knowledge exchange, and became a place of female empowerment, experiences, culture, and gastronomy with purpose. The workshops taught by each of the chefs were based on the preparation of: alfajores, cookies, brownies, guargueros, heavy cakes, manjares, Tres leches, frostings, toppings, and chocolates, among others.

4 renown chefs joined in

10 migrant women trained

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HUMAN RIGHTS

CAMINO+B

At República del Cacao we believe that to generate change in the world we must start with ourselves. We know that the concept of sustainability does not have a starting and ending point, but rather is a constant path of learning, challenges, and improvements. The BCORP certification has been a transcendental tool for the strategic development of the company. We have been able to measure each of the areas of our company from governance management, the management of our workers, our suppliers, and our customers to understand with humility, coherence and vision, where we can improve to keep our business in constant evolution. We see República del Cacao as a citizen brand; that can reflect the latent needs of a value chain to reactivate them from a transactional vision towards a transformational vision. In this sense, we aim to build a global community of conscious producers, clients, and allies, willing to develop their businesses in a more responsible and sustainable way. We believe that the best way to create opportunities in the challenging world we live in is through knowledge exchange. For this reason, we have partnered with Sistema B Ecuador (partners in our BCORP certification) to create the CAMINO + B REPÚBLICA DEL CACAO project, a training program focused on evaluating and measuring the performance of organizations regarding sustainability and the Objectives of Sustainable Development, using the most demanding tool on the market: the B Impact Assessment. Through this project we seek to multiply positive impact models at a social, environmental, and economic level together with the allies of our value chain. During 2 weeks we developed 4 successful work modules with 11 of our Chefs and allied ingredient suppliers, who showed us the opportunities we have for our businesses in a changing world. For Pachi Larrea, our Chef Partner in Spain, this workshop has been transcendental for his development, he shared his experience mentioning that “I learnt to measure my impact in order to strengthen my business model, I leave motivated because I have tools that will allow me to position myself strongly and consistently in the market”. In addition, Alejandra Espinoza, Corporate Chef of SOMOS Restaurant, shared her interest in “learning about better sustainable practices, not only for the restaurant but also for the development of our team”. Finally, among other participants, Adrian Escardó, Corporate Chef of Cardó Restaurant, highlighted the importance of these topics in a prosperous business model, mentioning that “if we do not understand these projects we will not get anywhere”. We move forward, confident of the important impact we are generating together, seeking to “change the world, one cacao bean at a time”.

80% average completion rate of the entire B Impact Assessment. 4 guest speakers: 1 international speaker per module and 2 speakers from key B Corp organizations. +90% interest of participants in becoming B Corps. +95% of organizations are focused on 1 specific impact model.

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MY F I E L D T O B A R

The chocolatier and the cacao farmer. Two different people, two different jobs, two different worlds, but with the same passion and daily effort in every step. The fine aroma chocolate that our clients use in their creations would not be the same without raw materials of excellence, without that fine Latin American aroma cacao harvested by our allied farmers with dedication and care. This is why we created a project in which these borders disappear and chefs from all over the world can meet our allied farmers in person and, after living the bean to bar experience for themselves, create unique chocolates in their place of origin, this is My Field to Bar. For our first My Field to Bar we invited Luis Robledo, renowned Mexican Pastry Chef and winner of the Latin America’s 50 Best Pastry Chef in 2019. Luis traveled to Ecuador, to Vinces, in the province of Los Rios, where he met Jaime Alarcón, one of our allied farmers, owner of the Santa Clara farm, where he harvests Cacao Nacional, commonly known as “Cacao Arriba”. Luis toured Jaime’s farm, talking with him, getting to know him, and learning about his work and production process. After this meeting, Luis developed the recipe to create his own small batch of select chocolate, with a specific harvest of the cacao from this high-end plantation. Once the recipe was established, Luis worked together with our R&D and Quality teams in the production of his My Field to Bar chocolate, in a small production center that we built inside our Vinces Collection Center in the middle of cacao plantations. In addition, during his visit, Luis gave a chocolate workshop to women cacao growers in the area, where they learned several of his techniques and developed skills that will allow them to enhance their economic stability. This project becomes a reality in the field thanks to the strong connection between the Chef and the farmer, which is not only based on creating an exclusive chocolate, but also on investing in long-term projects that generate a true triple impact, economic, social, and environmental, which supports our B Corp certification. This is just the beginning of My Field to Bar, a chocolate that transcends borders, full of stories, connections, dreams, and purpose.

LIVE THE MY FIELD TO BAR EXPERIENCE WITH CHEF LUIS ROBLEDO AND MR. JAIME ALARCÓN https://youtu.be/x04L3UiSbSc

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E C O N O M I C R E A C T I VAT I O N T H R O U G H C H O C O L AT E - B O U T I Q U E S

One of the most important steps that the brand takes with the direct consumer, both local and tourist, is the communication of our work in the field and how we transform the cacao bean and fine aroma chocolate into creations that are enjoyed daily in our chocolate-boutiques. This year, we reopened our cacao shop/museum in the heart of the historic center of Quito, which is the main showcase with which we can share this work with the thousands of visitors who discover our country every day, and we also opened our first franchise in partnership with the GQB Culinary Art School, located in the renowned La Floresta neighborhood of Quito. In order to take the right steps to reactivate the local economy and to offer safe and informative spaces to our customers, we decided to change the dynamics of our cacao museum: We opened spaces previously limited to guided tours and made them more accessible, thus allowing a better and more appropriate management of social distancing, while allowing the consumer to have a closer view of our processes, we created changes in furniture, remodeled internal traffic flows and prepared updated communication to tell our story more efficiently and safely. This change allowed us to include new, distanced, and safe spaces for our customers to enjoy the creations of our Corporate Chef Andrea López in a space surrounded by cacao, its history and creation. On the other hand, the opening of our chocolate-boutique in La Floresta was aimed at offering a franchise model that can generate profitability to future investors, and in turn develop new sources of work both directly and indirectly. In addition, this franchise is located within the GQB Culinary Art School, through which we promote the development of future talents in gastronomy and knowledge exchange projects with different allies. During 2021 we also offered the space of our chocolate-boutiques for the sale of products from our customers, such as “Maria La Panaderia”, with whom we collaborated to make bread guaguas filled with our chocolate. Additionally, we donated a percentage of these bread guaguas to the Quito Food Bank (QFB), who distributed them to children from their various foundations to celebrate this local holiday. These investments have also allowed our suppliers and allies, who for months suffered the impact of the pandemic on their businesses, to reactivate their machines and economy. With these new spaces, we hope to bring our customers and partners closer and to develop more “chocolate experiences” in a safe way, with which we hope to inspire new generations of chocolate lovers. Our Chocolate Boutiques are reinventing themselves by providing a space that invites to share, to promote learning spaces, to reactivate ourselves and to take care of the past and its traditions with a vision of the future. Promoting knowledge about fine aroma chocolate We have created experiences open to all our consumers through which they can learn how to work with chocolate and develop creations such as bonbons, desserts, chocolate bars, etc. Our objective with this project is to promote the knowledge of fine aroma chocolate, and to raise awareness about the importance of knowing more about the legacy of fine aroma cacao for Ecuador. Some of these experiences have included: • Chocolate tastings for groups and corporate events. • Chocolate making classes and workshops in our laboratory in the Historic Center.

EVENTS WITH A S U S TA I N A B L E D E V E L O PM E N T V I S I O N

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WE WE RE THE OF F ICIAL O RGA N IZE RS O F LATIN AME RIC A’S 50 BE ST RE STAU RANTS 2 02 1: PAST AN D F U T U RE IN E CUA D O R. As República del Cacao, it is important to promote the economic reactivation of the region through its gastronomy and restaurants. This type of awards enhance Latin American gastronomy by recognizing great references of the industry, thus encouraging gastronomic tourism in the countries with both award-winning and nominated restaurants. Thanks to this incentive, different value chains are reactivated, for example, restaurants continue to operate, purchasing local ingredients from their various suppliers, thus generating a chain of reactivation with a positive impact. The 50 Best Restaurants returned with a special and unique edition. After a year and a half of enormous difficulties for everyone and especially for the restaurant industry, this year a list of 100 restaurants already recognized before was awarded, called Latin America’s 50 Best Restaurants 2013-2021: Past and Future, celebrating the best of Latin American gastronomy of the last 8 years. The contest organizers made this decision because of the COVID19 health emergency, which caused a decrease in travel and forced many restaurants to close for several months. Thus, in November 2021 at the Centro de Arte Contemporáneo (CAC), one of the most iconic places in Quito, the awards ceremony was held in Ecuador, making this the most anticipated event in the gastronomic industry at the national and regional level. At the same time, 6 other cities in the continent were also simultaneously connected digitally to the event, through Facebook and Youtube platforms. The ceremony was held virtually, through the signal generated directly by the official organization of the 50 Best in London. The event also featured a talk called #50BESTTALKS, with the participation of chefs Alejandro Chamorro and Pia Salazar from Nuema restaurant, the first Ecuadorian restaurant to be part of this prestigious list. They talked about the future of gastronomy in Ecuador, and the moderator was the renowned and talented pastry chef Gonzo Jimenez who is part of the Netflix series Bake Squad and is also our chef partner in the US. In November 2019 the 50 Best Discovery list was launched where our country got 3 representatives, in 2021 this list, which reviews the new gastronomic discoveries of the region, was updated extensively and Ecuador had 12 restaurants. República del Cacao has been a strong ally of the organization for more than 4 years, being sponsors of the “Best Pastry Chef” award at the Latin American level, delivering awards to great referents of pastry and chocolate as: Luis Robledo (Best Pastry Chef 2019); Jesús Escalera (Best Pastry Chef 2018); Saiko Izawa (Best Pastry Chef 2017) and Gustavo Saez (Best Pastry Chef 2016). This special 2021 edition provided us with another opportunity to celebrate the essence of Latin American cuisine, but above all to raise the selfesteem of one of the sectors most depressed by this pandemic.

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SIRHA

Sirha is the world’s most important trade fair for Foodservice. It brings together companies of different sizes, manufacturers and distributors related to the hotel and catering industry. This year 2021, the leading international trade fair took place from September 23 to 27 and presented the latest news and innovations in the foodservice and hospitality sector. We were present at the Sirha fair with a stand that represented the fine aroma chocolate of excellence for professional use, proudly produced in Ecuador. The stand featured information about the brand’s products, as well as a tasting of chocolates created by our Corporate Chef: Andrea Lopez. Also present at the stand were the company’s CEO Philippe Bongrain and our R&D & Quality Manager Carla Estévez. Participating in this event represented the opportunity to represent our country, Ecuador, developing a gastronomy of excellence, origin, and impact through the work with fine aroma chocolate.

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E C U A D O R AT B O C U S E D ’ O R Our objective is to strengthen the development of a gastronomy of origin through the work with fine aroma chocolate, that is why we were proud sponsors of the Ecuadorian team that represented us at the Bocuse d’Or. The Bocuse d’Or is the most prestigious cooking competition in the gastronomic world. It is named in honor of its founder and president, Paul Bocuse, an iconic chef of the 20th century French gastronomy and recognized for his restaurant L’Auberge du Pont de Collognes, which has 3 Michelin stars. The competition takes place every two years in Lyon, France, where 24 chefs representing countries from Europe, Asia, Africa, and America meet. The Bocuse d’Or Ecuador 2021 team was formed by Chef Nestor Toapanta, Executive Chef of Marcus Restaurant, Commis Domenica Señalin, student of Gastronomy and Hospitality at USFQ and Chef Erick Dreyer, Executive Chef of Ciré Restaurant, as their Coach. They qualified to this great final after 4 years of demanding preparation and represented Ecuador and Universidad San Francisco de Quito (USFQ) in this prestigious competition. To get here, the team had to go through other qualifying stages. First, the Bocuse d’Or Ecuador, where they competed against other universities and restaurants in the country, then they went on to the Bocuse d’Or Americas, competing against other restaurants in the region, and at the end of September they competed in the grand final in Lyon, France. The Bocuse d’Or is one of the most renowned gastronomic competitions that brings together the best chefs in the world, with the aim of presenting their techniques and the best of the gastronomy of their respective countries. Ecuador returned to be part of this grand finale after 19 years, which has great relevance for the country because this competition is one of the most important gastronomic showcases for chefs and their teams. Beyond becoming the winners, it is an opportunity to make themselves known as professionals, obtain opportunities to work in the best restaurants in the world, establish alliances with international institutions and position themselves as referents of gastronomy of excellence and origin. As República del Cacao we supported all the efforts that the team undertook to obtain funds to cover the materials and needs required for their participation. The name of Ecuador was left on high with the participation of a team that, with its efforts and compromise, made us all proud.

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C H E F T O FA R M

CHEF TO FARM, was born as a project based on an exchange with added value between those who create the raw material for the production of our products, and the Chefs who transform them, both linked through chocolate. The initiative began last year during the pandemic, where eleven allied chefs developed different creations with our chocolate that were then sent to our allied farmers in Vinces and Turucucho, as a thank you for their perseverance and resilience during the pandemic quarantine. In this way, Chef to Farm evolved into an ongoing project, through which we have developed more purposeful and impactful gastronomic exchanges, where chefs and the field connect in a unique way. During December 2020 we held a second Chef to Farm in alliance with the company Haku, origin “cuy”, it took place in the canton of Antonio Ante in the province of Imbabura and counted with the participation of Chef Alejandro Huertas from 3500 restaurant, Chef Sebastian Imbago from Balcon Dos Hemisferios, Chef Carlos Salas from Chulpi restaurant, Chef Michelle Godoy from Nomada restaurant, and our Corporate Chef Andrea Lopez. During this event, attendees were able to learn about the entire production process of Haku, whose objective is the revaluation of the “cuy”, a traditional dish of Ecuadorian cuisine, through gourmet cuisine. Thus, with these products, the participating chefs created high-level recipes using guinea pig meat and other local ingredients, revaluing these products and our countryside.

LEARN MORE ABOUT THIS FANTASTIC COLLABORATION https://youtu.be/x-SebCclY1c

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PA M B A M E S A A Pambamesa is a communal food table held in an act of social solidarity, focused on the exchange of not only gastronomic products of the area but also of ideas and vision of projects. During 2021 we developed 2 Pambamesas in our allied community of Turucucho, Cayambe, with the support of different strategic allies and chefs. The first one took place in January and counted with the participation of two B Corp certified companies with whom we work in alliance: El Ordeño and Tippy Tea, as well as Haku, origin “cuy”, Chef Luis Maldonado from The Meat Republic restaurant and Chef Adrian Escardó from Cardó Restaurant, as well as our Corporate Chef, Andrea López. Thanks to their support, we developed different spaces for knowledge exchange during the event, training in the management of medicinal and aromatic herb gardens, animal nutrition, cow herding, revaluation of dairy cattle and Andean gastronomy. The second Pambamesa was developed with the support of our allied chef, Juan Sebastian Pérez, from Quitu restaurant, with whom we went to Turucucho early in the morning, where Chef Juanse had the opportunity to learn more about the dairy farmers and their daily work. He visited their mountains and orchards, where he collected different ingredients that he later transformed into exquisite creations, which also included products from our strategic allies, Tippy Tea and Haku. As a result of this exchange, Chef Juanse now acquires several local products from Turucucho’s farmers for the menu of his restaurant, thanks to which they have managed to diversify their income and maintain greater economic stability. During 2021, we formed alliances with these organizations through co-creation projects, exchanging responsible practices to strengthen the sustainable development of the Turucucho community in the long term. It is increasingly important for companies not only to inform their impact models to their allies, but also to carry out dynamics where they interact directly with them, listen to them, and respond to their opinions, needs and ideas. For this reason, at República del Cacao we establish rural co-creation processes with our partner farmers and chefs, seeking to create spaces where we can exchange knowledge to strengthen joint projects.

Chef Juan Sebastián Pérez QUITU Restaurant Quito - Ecuador

ACADEMIC ALLIANCES WE PROMOTE A CUISINE OF ORIGIN AND EXCELLENCE THROUGH NATIONAL AND INTERNATIONAL ACADEMIC ALLIANCES, FOCUSED ON THE DEVELOPMENT OF THE GASTRONOMIC FUTURE, THROUGH TRAINING AND SPECIALIZATION OF NEW TALENTS. AMONG THE INSTITUTIONS WITH WHICH WE HAVE DEVELOPED ALLIANCES THIS YEAR ARE ICHE IN THE PROVINCE OF MANABI, LE NOTRE CULINARY ART INSTITUTE IN THE UNITED STATES, UTE, USFQ, AND THE GQB CULINARY ARTS SCHOOL IN ECUADOR.

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ICHE - ECUADOR The Iche school-restaurant is part of the FUEGOS foundation, food for change, whose objective is to convert gastronomic enterprises in Ecuador and Latin America into engines of social transformation that contribute to sustainable development and equity in all its forms. The “Food for Change” initiative arises as a means for the social and economic recovery of the province of Manabi, after the earthquake of April 2016, through the development of the creative force of people and the construction of more inclusive, resilient and innovative communities, with a vision of a sustainable future for all. The Iche school-restaurant considers food as an agent of economic, environmental, and social change. Its pedagogical model focuses on the culinary training of vulnerable people in the province of Manabi, who in another context would not have the possibility of accessing this type of high-level academic training. The training offered at Iche is specialized, and thanks to its school-restaurant model, it is based on learningby-doing, a method through which its students receive both theoretical and practical training, which is paid, and with in the field practices, all with the aim of promoting their economic development and enhancing their skills. Being an organization that is aligned with the pillars of our company, in May 2021, our team visited the FUEGOS Foundation, where we were able to learn more about its academic model and work with the community of Manabi. This is how we signed an agreement through which we will develop projects of: knowledge exchange, workshops by our executive chef and allied chefs, and cooperation in events of both the restaurant and the brand.

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L E N OT RE - U S A At República del Cacao we seek ways through which we can continue to grow and learn from people in our community, while offering the same in reciprocity. In this context, in 2021 we formalized our first partnership with an international academic organization, Le Notre Culinary Institute, located in Houston, Texas. The Le Notre Culinary Institute is a community that seeks to train and welcome tomorrow’s culinary experts into its international family of renowned chefs and hospitality workers. It was founded in 1998 by third generation French Chefs Alain and Marie Lenôtre, a name recognized globally for their French cuisine and pastry art. At this institute, students take classes in both classical and contemporary cooking methods, learn to prepare hundreds of dishes and expand their knowledge in various subjects related to the culinary arts. Our collaboration with the institute has allowed their students to explore and work with our products, while deepening their knowledge in a creative way. We co-designed an educational curriculum for their academic year that fostered a dynamic interaction between students and members of the República del Cacao team. This curriculum covered topics such as the history of cacao and gave students the opportunity to take a virtual tour of our collection center in Vinces, Ecuador, learning firsthand the different stages and processes that cacao goes through, and meeting some of the farmers we proudly work with.

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L E N OT RE - U S A As a first project, we developed an Educational Module for high school students, where they learned about the history and origin of Fine Aroma Cacao through the experience of our team. The module was developed during a full morning, which was full of dynamism and new knowledge. The collaborators of our team who taught the workshops were: • • • • •

Gabriela Lopez-Barry, Brand Manager in the USA. José Merlo, Social-environmental Projects Manager and Carlos Zambrano, Project Coordinator in Vinces. Carla Estévez, INDE & Quality Manager. Maggie Crespo, Communications and Sustainable Business Manager. Estefanía Sánchez, Environmental Technical Consultant.

For the second module, our ally, Chef Juan Sebastián Pérez gave a training session, which was developed from our laboratory located in the Historic Center of Quito and was transmitted live virtually to the students. During this intervention, Chef Juan Sebastián taught the students the various applications that our products can have in both savory and sweet creations, as well as shared his story and the purpose of his business, based on the use of local ingredients and signature cuisine. At the same time, our Chef Partner in the USA, Gonzo Jimenez, was at the institute’s facilities in person, and after Chef Juan Sebastián’s presentation, he gave a tasting of our chocolates to the students. This type of effort creates the synergy that we enthusiastically seek to establish and develop with allies in our environment. Educational institutions are a gateway to establish connections with the best future leaders and decision makers, and if we can promote the importance of sustainable and egalitarian practices to them, then we can be closer to changing the world one cacao bean at a time.

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T R A N S D I S C I PL I N A R Y C A P STO N E W I TH U S FQ USFQ through the Transdisciplinary Capstone seeks to generate spaces where the arts, engineering, science, and design meet to promote innovation and the creation of disruptive solutions to complex problems, through public-private partnerships and civil society. In Ecuador we have seen the need for academia to grow together with business, where alliances allow us to translate problems into tangible proposals applied to the needs of the country. A consolidated alliance allows to generate information and solutions from the academy with a correct application in the companies. República del Cacao and the USFQ have established an alliance that focuses on working together for the innovation of quality products with a social and environmental approach. From the academy, we have seen how by joining the expertise of its researchers and the expertise of our company’s collaborators, we can generate projects that are a model for the sustainable development of Ecuador. Currently, together with the USFQ, we are working on the Circular Innovation and Carbon Footprint project, which seeks to promote and enhance good practices in the cacao sector. The Transdisciplinary Capstone requires the commitment of academy and companies to empower student teams in the execution of a mature proposal with theoretical and practical research bases and with an interdisciplinary approach. For this reason, each project presentation has an Evaluation Committee that provides feedback to the teams. It is of utmost importance for us as República del Cacao to contribute with our experience on the development of the proposed solutions. Generating interdisciplinary spaces between students from different careers promotes the philosophy of liberal arts and we have seen how students have built skills that will help them in the long term such as continuous learning, group management, critical and systemic thinking. In addition, they had the opportunity to gain experience that will prepare them for professional life.

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G L O B A L C O M PA C T E C U A D O R : W O R K S H O P S República del Cacao is part of the Global Compact program: Leaders for the SDGs, seeking to generate impact alliances and exchange of good practices around sustainable development. Due to this, throughout the year we participated in different workshops, together with other companies in the industry with whom we connect and develop ideas for the progress of sustainable business, the tables in which we participated this year were:

“ End hunger”

Commit to ensure the sustainability of food production systems and implement resilient agricultural practices that increase productivity and production and maintain ecosystems.

“ Achieve gender equality and empower all women and girls.”

Contribute to developing opportunities for women with full and effective participation and equal leadership opportunities at all decision-making levels.

“ Ensure sustainable consumption and production patterns.”

L A B O R S TA N D A R D S REPÚBLICA DEL CACAO HAS CREATED A CULTURE BASED ON TEAMWORK, RESPECT, DIALOGUE, AND TRUST. WE CONSIDER OUR EMPLOYEES AN ESSENTIAL PILLAR IN THE DEVELOPMENT OF OUR ENTIRE VALUE CHAIN. THE COMPANY STRIVES TO WORK WITH AN ACTIVE AND TRANSVERSAL HUMAN CAPITAL MANAGEMENT MODEL, IN WHICH EACH EMPLOYEE IS FREE TO CONTRIBUTE IDEAS THAT ADD TO A POSITIVE WORK ENVIRONMENT.

OUR OBJECTIVE IS TO DEVELOP AND EMPOWER OUR COLLABORATORS TO CONTINUE

INCREASING OUR OPERATIONAL EXCELLENCE, AND THAT EACH AREA IS MOTIVATED TO GIVE GREATER ADDED VALUE TO ITS MANAGEMENT.

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OUR REPUBLIC We believe that our people are the center of the company, for this reason we have created a concept of corporate culture that will help reinforce our vision and essence. “Our Republic” is a space where we grow and develop as human beings around a common purpose, fine aroma chocolate.

AT OUR REPUBLIC • We turn challenges into projects. • We share spaces that nurture our knowledge. • We enjoy what we do so much that we do it extremely well. • We build relationships based on trust and mutual respect. • We respect our natural environment and treasure it.

This entire corporate culture is supported by the concept of “Our Republic”, which represents a movement of values, stories and information that keep our links between areas and business units intertwined, representing an integral space for co-creation and development. The seal integrates our raison d’être: a fine aroma cacao pod, from which people emerge who together create experiences for the brand. At República del Cacao, we celebrate the efforts of our employees by integrating them in activities that motivate them to generate collaborative relationships based on trust and respect:

• We do sports together: in 2021, we reactivated the use of our sports facilities to promote group and individual sports once again. • Team Trips to the communities: as an objective of relationship and dispersion, we develop visits to our allied communities, with our different collaborators from both the administrative and production areas.

• In addition, during 2021, members of our management team participated in knowledge sharing trips to internationally renowned gastronomic events such as the SIRHA fair in Lyon, France and the Bocuse d’Or finals.

• We celebrate achievements in different ways with surprises and events that promote team cooperation and interaction.

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C O R P O R AT E B E N E F I T S • • • • •

Induction process and project development and delivery of an institutional welcome kit. Discount on the purchase of our products. Birthday celebrations. 15 working days of vacation. Maternity Leave: We respect and support breastfeeding, ensuring mothers’ time with their babies. We have lactation rooms in our facilities for the comfort of mothers during their breastfeeding hours. Parents are granted the benefits provided by law. • Local and international training for the personal and professional development of our employees. • Supermarket Christmas bonus. • Christmas Event. • Flexibility at work: we give our employees the option to work from home with flexibility. • Annual performance evaluation. • Restructuring of administrative offices, with the aim of reactivating the on-site team and continuing to contribute to the country’s economic reactivation. In addition, this expansion contributed to meeting the distance and biosafety requirements necessary for all our current and future personnel joining the company.

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T E A M B U I L D I N G A N D S T R AT E G I C V I S I O N Our company is composed of two lines of business, our professional line or B2B and our retail line or B2C. However, each and every one of our employees is part of our One República del Cacao. This concept refers to a united community of collaborators, who work for the same purpose and motivation, with the goal of becoming more empowered every day and being excellent and passionate about changing the world one cacao bean at a time. During 2021 we have worked on the first steps to develop and cement this concept between our two lines of business, through the proper integration of new employees, a common internal communication strategy and the implementation of various activities that lead to the achievement of this goal. One of these was a team building among the managers and directors of the company, where each of the leaders of the different departments that make up our two lines of business shared their strategic vision for the One República del Cacao, which was then transmitted to each team. This will be just the beginning of a strong, united team, inspired by fine aroma cacao.

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P O S T - PA N D E M I C R E A C T I VAT I O N During 2020, our main focus was the safety, stability and health of our employees, in order to arrive in 2021 with a strong team ready for the economic recovery that would come after the first months of the pandemic. With this focus, we implemented different strategies that would allow us to continue safeguarding the well-being and health of our employees, but also give us the possibility to continue with our production and projects in the field, thus promoting not only the economic reactivation of the fine aroma chocolate market, but also a good working environment that would keep the team united and motivated.

The strategies implemented were:

• Vaccination: we gave our employees the possibility of accessing the COVID19 vaccine if they so wished, supporting the vaccination plan implemented by the government.

• Reintegration, maintaining high biosafety standards, through team activities such as birthday celebrations, welcomes and team trips to the field where both administrative and plant personnel went to visit the different partner communities in the areas of Turucucho, Pacto and Vinces. • Reincorporation into working life through the implementation of biosafety measures in the offices and plant, and the semi-presential workday. • Development of a return plan for economic reactivation: we are working on the restructuring, remodeling and expansion of our administrative offices, as well as spaces for production processes.

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LABOR STANDARDS

P E R S O N A L A N D P R O F E S S I O N A L D E V E L O PM E N T All our employees have an annual performance evaluation, in which their work is evaluated, based on the objectives established by each area manager. Each manager shares the needs of his or her team, and based on this, situations are analyzed for continuous professional and personal improvement. Additionally, the training that our employees received during the year 2021 were:

Training to Production Plant Personnel The training given to our production plant employees is in accordance with the agenda established by the Ministry of Labor, in order to comply with all labor standards for our employees. • • • • • • • • • • • • • •

COVID19 prevention training Behavioral Safety Visit (BSV) Induction Training Safety Standards Ergonomic Risks Chemical and Mechanical Risks Harassment / Work Stress Intelligence and Emotions Forced Posture Machine Safety HIV AND AIDS Fire Fighting Psychosocial Risk: Alcohol and Drugs Forklift Handling: General Concepts and Practices Violence and Abuse

In addition, as part of our internal safety management system, during 2021 our production plant employees also received the following training: • • • • • • • •

Training and re-training of production processes Reinforcements on behavioral safety visits (BSV) Compliance with safety standards COVID19 and biosafety Evacuation and Communication Sexual Education Social work Socialization of the company’s internal regulations

All these efforts in training our collaborators are carried out with the objective of safeguarding their safety and training them appropriately for the correct fulfillment of their responsibilities within the production plant.

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LABOR STANDARDS

T R A I N I N G O N Q U A L I T Y A N D S A F E T Y S TA N D A R D S Every month, the Quality control department is in charge of following a training program for all personnel and the entire distribution line on quality and safety issues, with the objective of reinforcing knowledge on international standards such as: Good Manufacturing Practices (GMP), pest control, handling and control of chemical products, ISO 22000:2018. “As the Quality team, being the department that leads the commitment to quality and safety of the company, we participate in trainings to strengthen the knowledge and expertise of all our collaborators, with the objective of facing new regulations, certifications, and providing support to the daily issues of the business line.” - Carla Estevez, R&D and Quality Manager B2B • • • • • • • • • • •

FSMA: Food Safety Modernization Act FSSC 22000 V5.1 Personnel hygiene and health status Cleaning and disinfection Pest control Waste management Contamination prevention Safety and Quality Assurance Control of non-conformities and potentially unsafe products. Traceability process and identification of production batches. FSPCA - PCQI Official Course

REPORTE SUSTAINABILITY DE SOSTENIBILIDAD REPORT COP 2021

LABOR STANDARDS

T R A I N I N G AT O U R C H O C O L AT E - B O U T I Q U E S In order to meet the highest standards of quality and excellence in all our operations, each year our retail team receives training focused on different topics of the sales process and store operations. Our goal is to have a strong team with the necessary skills to offer the best experience to our customers, so during 2021 the trainings provided were:

• • • • • • •

GMP training Tippy Tea training Chocolate tasting training for staff, knowledge and product profile as a sales tool. Staff training, launching of new dessert “MACHACHI”. Staff training, launching of milkshake. Operations process training and local check list. Customer service and sales reinforcement training.

T R A I N I N G F O R D U T Y F R E E O P E R AT O R S We have Duty Free presence in Ecuador, Peru, Colombia, and the Dominican Republic. In addition to the quality and security measures that we maintain as a company, it is also important for us to comply with the requirements and processes of the airports where our boutiques are located. Our collaborators at these points of sale were trained in the following areas during 2021:

• • • •

Attenza Training: Brand Presentation, Sales Tools and Chocolate Tasting, Interactive Classes at our chocolate laboratory. During September 28th and 29th During October 19, 20 and 22 Total number of people trained: 49

P R O S P E R O U S O P E R AT I O N S P R O J E C T

SUSTAINABILITY REPORT COP 2021

LABOR STANDARDS

O CCUPATION AL HE ALTH AN D SA F E T Y RE GU L AT IO NS We have had an occupational health and safety regulation since 2017, we seek to be protected under the law, have standards and a framework to comply and safeguard the safety and health of our employees: • This year we had an accident with one of the machines, after which we implemented all the necessary measures to ensure the recovery of our employee and prevent future accidents, hence we currently have 135 accident-free days. • The most important thing for us is to generate a culture of safety and health in all our employees.

B E H AV I O R A L S A F E T Y V I S I T S ( B S V ) The Behavioral Safety Visit (BSV) is a method that focuses on the continuous improvement of the behavior of personnel in the face of risks to their own safety and that of their co-workers. This method incorporates four transcendental points: 1.- The commitment of top management and managers. 2.- The completion of risk analysis to the positions. 3.- Substantive work to improve working conditions 4.- Conformity of the machines. This method is a complement to the global safety management system that features: • • • •

Analysis of accidents or incidents. Discussion of safety during operational meetings. Risk analysis. Inductions

Additionally, extra BSVs are conducted for plant supervisors working in the operational areas, with the aim of reinforcing the company’s safety culture from the process leaders. During 2021 we conducted a total of 18 BSVs, and as a goal for the following years, we have set a minimum of 2 fixed BSVs per month, i.e. 24 per year. During the BSVs, all the distancing and health measures established by law are maintained in order to prevent the spread of COVID19 and to continue with our work in a safe and timely manner.

R E TA I L B U S I N E S S G O O D P R A C T I C E S We have an occupational health and safety regulation for our retail business line, which aims to determine the responsibilities and obligations of all employees with the company, and vice versa in terms of their health and safety. The regulation also stipulates the responsibilities of immediate supervisors and managers to ensure that the working day is adequate and does not generate any type of danger to the integrity and health of our employees. In addition, monthly random internal audits are conducted in our chocolate laboratory to verify compliance with all established Good Manufacturing Practices (GMPs), which are important to determine the conditions and requirements necessary to ensure the hygiene of the food chain and production of all our products, up to their distribution and consumption by our customers.

SUSTAINABILITY REPORT COP 2021

LABOR STANDARDS

S AV E N C I A S A F E T Y C H A L L E N G E 2 0 2 1 During this year 5 of our employees were part of the team that represented us in the “Savencia Safety Challenge 2021”. The Savencia Group is the international company of which our professional product line is a part, and our team competed against 674 other international teams from the Group’s other subsidiaries. The focus this year was on different dynamics that the team had to solve on a weekly basis related to the “10 Essentials of Safety”, which are a crucial part of the group’s safety culture, and health and safety issues related to working from home.

C E R T I F I C AT I O N S As organizations are committed to their customers’ requirements, certifications are a competitive advantage and represent a positive impact in its implementation. In República del Cacao we have learned that being a certified company is something voluntary, we do it with the objective of strengthening our purpose linked to the development of a sustainable and excellent chocolate, in order to generate trust with all our stakeholders. Healthy food is everyone’s right, that is why we comply with the highest quality standards throughout the production process of our chocolates. Confident in the benefit of having alliances with national and international certifications that endorse our management and quality processes, we have the following certifications:

• • • • • •

Kosher ISO 22000:2018 GMP (Good Manufacturing Practices Certificate) Halal Environmental License B Corp

We move forward with our vision, maintaining our commitment to guarantee healthy and safe products. We have one of the noblest tasks, which is to produce healthy, safe food, full of harmonies of flavors that allow us to transmit emotion and creativity in each chocolate that travels around the world.

Certified Chocolate Factory

ENVIRONMENT

SUSTAINABILITY REPORT COP 2021

ENVIRONMENT

U S F Q E N V I R O N M E N TA L C H A P T E R : C A R B O N FO OT P R I NT P R O J E C T As República del Cacao we are committed to climate change mitigation actions, and we also wish to be a carbon neutral company. In this context, during 2021 we initiated a major project that helped us define the necessary strategies to meet the following objective: “República del Cacao Carbon Footprint and Circular Innovation”, in alliance with the Universidad San Francisco de Quito (USFQ) and the CEDIA institute. The project aims to quantify the carbon footprint of our company for the years 2019 and 2020, in order to define a roadmap of strategies for our emissions reduction. In addition, a circularity analysis of cacao nibs from Vinces was conducted, evaluating opportunities that will allow our products to continue reflecting our sustainability philosophy. Currently, all the areas that make up República del Cacao are involved in the carbon footprint quantification process. Information was collected from the following areas through their respective managers: • • • • • • • • • •

B2B and B2C Laboratory Vinces Collection Center Socio-environmental Projects Finance HUMAN RESOURCES Communication R&D & Quality Operations Supply Chain Sustainable Business

We believe that business commitment is essential for the decarbonization of our planet. This is a strategic tool to obtain information that will allow our company to take impact reduction measures based on science, as well as to make decisions with an eco-efficient vision. It will also allow us to use our resources more efficiently.

SUSTAINABILITY REPORT COP 2021

ENVIRONMENT

FIELD PROJECTS, VINCES - ECUADOR Field Strengthening One of our goals at Vinces is to expand the number of cacao partner farmers we work with, thus extending our positive impact and reach through cacao purchases and sustainable projects in the field. By the end of 2021 we purchased 20 tons of cacao from 22 allied farmers, from farms comprising 12,000 trees in total. Our goal for 2022, which will be met thanks to the restructuring and improvement of our collection center, is to expand our purchase to 50 farmers and 100 tons of cacao per year. These new objectives have arisen thanks to the opening of new international markets to which we export our chocolates, development of new projects and product innovations. All our partner farms must meet the following characteristics:

• • • •

Fine Aroma Cacao Farms: our allied farms preserve this type of cacao, considered a historical and cultural legacy for the country, in addition to having unique organoleptic properties that are key to the flavor notes and quality of our chocolates. Maintain agroforestry practices through biodiverse farms, this is an indicator of ecosystem health and nutrition of our farmers and surrounding populations. Be small and medium scale. Be located in the vicinity of the collection center.

SUSTAINABILITY REPORT COP 2021

ENVIRONMENT

REDUCING THE USE OF PLASTIC I N O U R C H O C O L AT E - B O U T I Q U E S In order to reduce our environmental impact throughout our business line, this year we changed the plastic straws and spoons used in our Chocolate Boutiques for biodegradable straws and spoons. As a first step, we began with the search for different suppliers, among which we selected the company Eco Public, since all their supplies meet the standards for food consumption, and being recyclable and biodegradable, they comply with all the characteristics that also meet the rest of the biodegradable supplies, which we already had in our Chocolate Boutiques, besides they are a 100% Ecuadorian company. For the first phase of implementation, we removed all the plastic straws and spoons from all our boutiques in Quito and distributed the new supplies. As a second phase, the objective is to implement processes and training for our Chocolate Boutiques employees so that they know how to complete the recycling and biodegradability cycle of all the supplies in our stores.

SUSTAINABILITY REPORT COP 2021

ENVIRONMENT

E N V I R O N M E N TA L R E S E A R C H P R O J E C T : CADMIUM - CACAO In 2019, the European Union implemented a new regulation that controls the levels of cadmium (a heavy metal that accumulates in cacao beans and has harmful effects on human health in large quantities) that may be present in cacao products imported by Europe. This regulation has a negative impact on the cacao market in the Andean region of Latin America, the countries comprising Ecuador, Colombia, and Peru, as it may cause economic and social repercussions in both the industry and rural areas. In 2021, our Socio-Environmental Projects team at our Vinces Collection Center have identified low cadmium terroirs adjacent to the collection center, these being national fine aroma cacao farms over 50 years old. The priority of focusing on harvesting cacao from these farms benefits 30 small-scale farmers. Additionally, during this year we invested in monitoring and controlling the levels of cadmium in Ecuadorian cacao, and we are currently working with a laboratory in the country that meets the same international standards and methods as our laboratories in the USA and France, thanks to which we ensure the quality of their processes for the protection and health of our customers in the USA and Europe, and we maintain constant control of the levels of cadmium in the cacao we use to produce our chocolates.

SUSTAINABILITY REPORT COP 2021

ENVIRONMENT

EMULSIFIER CHANGE: LECITHIN At República del Cacao we are constantly working to guarantee the food quality and safety of our products, promoting responsible consumption. We have made a change in one of our ingredients, replacing soy lecithin with sunflower lecithin, which brings several benefits to our customers. This change is part of our “Clean Label” project, through which we reaffirm our commitment to the quality and natural origin of our ingredients, thus offering healthier products to our consumers. Sunflower lecithin is a non-GMO ingredient, free of allergens and genetically modified organisms, and has the same nutritional value as soy lecithin, which means that our chocolates maintain the same excellence, quality, and safety as always without any alteration to their nutritional composition.

SUSTAINABILITY REPORT COP 2021

ENVIRONMENT

I N T E R N A L E N V I R O N M E N TA L M A N A G E M E N T P L A N In República del Cacao it is essential to minimize the effect that our different activities may have on the environment and to establish conditions that allow us to harmonize both areas. To fulfill this purpose, each year we follow the internal Environmental Management Plan established by current environmental legislation, which specifies what this environmental management mechanism should be. The objective of the Environmental Management Plan is to prevent, minimize and compensate the impacts of our activities that affect the environment, guaranteeing adequate management of our socio-environmental components and promoting environmental care through compliance with the laws and regulations applicable to the activities carried out by República del Cacao. The following EMP details the plans that we carried out during 2021:

• • • • • • • •

Contingency Plan Communication, Training and Environmental Education Plan Occupational Health and Safety Plan Waste Management Plan Community Relations Plan Rehabilitation Plan for affected areas Closure and Abandonment Plan Monitoring and Follow-up Plan

Quality, R&D, Supply Chain and Industrial areas are in charge of establishing and monitoring the different activities that will be carried out in each of the plans year after year, with the objective of advancing these actions to achieve the renewal of our Environmental License that certifies the correct implementation of the Enviromental Management Plan (EMP).

SUSTAINABILITY REPORT COP 2021

ENVIRONMENT

P R O J E C T : F O R E S TA G R O S U P P L I E R With the objective of incorporating suppliers that connect with our vision and purpose, since December 2020, we started working with a new supplier for our wood pallets, Forestagro. We chose this supplier because they manage self-sustainable practices in their production, as they reuse wood from old or broken pallets for the construction of new “smart-pallets”, thus optimizing the wooden beams that remain in good condition to give a second useful life to their products. Their goal is to promote the circular economy through a concept of total wood utilization that protects nature and improves the environment in which they work. In this way, the pallets we acquire from Forestagro can be considered “cradle to cradle” products, in which the raw material is fully used and reused, thus contributing to the sustainability of this resource. “As the circular economy is an essential part of our business, we understand that this starts from the design of our products. What sets us apart is that we offer a wood pallet service focused on extending the useful life of wood where there is little or no waste. This virtuous circle begins in the field with the planting of plantations, then a responsible use (focused on design, production, and reuse) and finally back to the beginning where forest plantations are renewed. For the design we work together with our customers and help them recycle their pallet waste to give them a second, third and even fourth life. And thus, turning something that was considered garbage back into something useful or indispensable in the operation.”

*Taken from https://forestagro.ec/sostenibilidad/

ANTI-CORRUPTION REPÚBLICA DEL CACAO IS COMMITTED TO CONDUCTING BUSINESS WITH RESPONSIBILITY, HONESTY, INTEGRITY, AND RELIABILITY. WE HAVE THE RESPONSIBILITY TO COMPLY WITH ALL APPLICABLE LAWS OF OUR COUNTRY AND THE COUNTRIES WHERE WE DO BUSINESS. WE HAVE INTERNATIONAL ETHICAL STANDARDS TO BE MET AND REPORTED.

SUSTAINABILITY REPORT COP 2021

ANTI-CORRUPTION CODE OF CONDUCT

Our corporate culture prohibits all forms of corruption. The current Anti-Corruption Code of Conduct specifies which standards and principles apply and provides guidelines for applying them. The strict fundamental requirements of the Code of Conduct apply to the entire group, to all employees and in all circumstances, and must comply with locally applicable regulatory requirements. In case of doubt, the more restrictive requirement must be complied with. Our goal for 2022 is to further strengthen compliance with internal policies and audit standards.

Internal Policies • Management of purchases or investment projects. • As a company policy, when a purchase or investment project needs to be managed, at least three suppliers must be selected, and we analyze the best proposal. • Approval policy for expenses and projects through hierarchies. We have an expense approval table. • Compliance with the country’s tax and corporate regulations. • Cash management policy. • Conflict of interest: employees must avoid situations in which their own interests may conflict with the interests of the company, as well as situations that may influence their judgment or actions or give that impression to third parties. • Procedures for Gifts and Invitations: There is a regulatory document for all collaborators, through which they must report gifts or invitations to the group at the international level.

Audits

Internal Audits: Each year internal audits are conducted, signed, certified, and approved by external international entities. All the process and results are communicated locally to comply with the control entities. Certification audit of expenses abroad: developed by an external firm, which performs an annual review of all our expenses abroad, verifying that they have actually been made according to the form in which they were reported.

WE ARE A

LOCAL BRAND WITH

GLOBAL IMPACT

S U STA I N A B I L I T Y RE P O RT

COP 2021

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® República del Cacao 2022