in the Industrial And

Corporate Works Segment

02
ESG in the Industrial And
Corporate Works Segment

Support

Co-realization Realization

03
E75

ESG in the industrial works segment / Thiago Gomes de Melo ... [et al.]. — Brasilia: CBIC, 2022.

88 p. : il., color.

Document produced by the Brazilian Chamber of the Construction Industry (CBIC).

Co-realization: Senai. Support: Civil Construction Industry Union of the State of Minas Gerais
(Sinduscon/MG) and Dom Cabral Foundation.

1. Environment 2. Industrial works - sustainability 3. Industrial works - practices social 4.

Industrial works – governance I. Melo, Thiago de Melo.

Document produced in association with the following institutions: Brazilian Chamber of the Construction Industry
(CBIC), SENAI, Civil Construction Industry Union of the State of Minas Gerais (Sinduscon/MG) and Foundation
Dom Cabral.
04

CBIC
President
José Carlos Martins
Vice-President of the Area of
Industrial and Corporate Works
Ilso José de Oliveira
Executive Manager - Projects
Patrícia Ribeiro Rêgo
Construction Project Manager
Industrial and Corporate
Alexandre Nícolas Dantas dos Santos
Fact Sheet
SINDUSCON MG
President
Renato Ferreira Machado Michel
Seven Engenharia Ltda
Vice President of Works
Industrial and Corporate Works
Celso Pimentel Fraga Filho
MIP Engenharia Ltda
Technical Team
Coordination and Preparation
Thiago Gomes de Melo
Reta Engenharia
Elaboration
Sérgio Rezende
Engserj Projetos e Engenharia
Marco Túllio Miraglia Neto
Cimcop Engenharia e Construções
Marcelo Eduardo Figueiredo
Progesys INC
José Pedro Barbosa Lins
Fundação Dom Cabral
05
Summary
Fact Sheet 05
Introduction 00
CBIC 08
Sinduscon-MG 10
1. Presentation 11
2. Message from the President 15
Word of the Board 17
3. ESG -Introduction and Timeline 19
4. The Importance of ESG for the World and Industry of 21
Construction
24
5. The benefits of ESG practices in Organizations 24
5.1 The rational and moral question; 27
5.2 Direct economic benefits; 28
5.3 Indirect and immeasurable economic benefits; 29
5.4 Risk mitigation and continuity; 30
5.5 Unavoidable market trend; 30

06
6. Maturity of ESG Practices and Economic Performance 31
6.1 Introduction: 31
6.2 ESG and Financial Performance – NYU & RAM Research; 33
6.3 Studies and Research in Brazil and the 35
Construction Sector
6.4 ARCHIBALD & PRADO Maturity Research 36
6.5 What can be done in the short term; 37
6.6 What to plan for the medium and long term? 42
6.7 Frequent challenges in implementation 45
of ESG Policies and Practices.
The Importance of Transparency in Impact Reports / ESG / 47
Sustainability.
What are the benefits of transparency in companies? 47
7. 7. The stages of ESG evolution: opportunities, challenges, and 49
risks for the perpetuation of business
8. 8. ESG in the construction industry 69
9. 9. Conclusion 77
Publications CBIC 80

07
07
 The Brazilian Chamber of Construction Industry

The Brazilian Chamber of Construction Industry (CBIC) was founded in 1957 in Rio de
Janeiro State. Headquartered in Brasilia, it brings together 98 unions and employers'
associations in the construction sector, coming from the 27 units of the Federation.

A business entity by voluntary adhesion, CBIC represents the sector politically and
promotes the integration of the construction production chain, contributing to the economic
and social development of the country.

Led by a Board of Directors elected by the members, CBIC operates through its
technical committees, four of them focused on the final activities: Infrastructure Commission
(COINFRA), Real Estate Industry Commission (CII), Housing Commission of Social Interest
(CHIS) and Industrial and Corporate Works Commission (COIC).

In addition to these, CBIC also has the Labor Relations Policy Commission (CPRT), the
Materials, Technology, Quality and Productivity Commission (COMAT), the Environment
Commission (CMA), the Social Responsibility Commission (CRS), and the Legal Council
(CONJUR). It also has its own database.

CBIC represents Nationally and Internationally the Brazilian Construction Industry. It is

also part of the Inter-American Federation of the Construction Industry (FIIC), an entity
representing the Latin American construction sector, and is affiliated with the International
Confederation of Construction Associations (CICA).

Aiming to disseminate technical knowledge and good practices in the construction

sector, CBIC holds several events with specialized speakers in a vast network of relationships
and learning opportunities.

CBIC is the maximum representative entity of the real estate market and the
construction industry in Brazil and abroad. It represents 98 entities from the 27 units of the
Federation, corresponding to more than 70,000 companies.

The production chain of the construction sector represents about 6.0% of the Brazilian
GDP. It is responsible for 40.0% of investment in Brazil and employs about 2.5 million workers
with a formal contract.

08
CBIC HIS CORRESPONDS IT IS RESPONSIBLE FOR

70thousand 40%
REPRESENTS TO MORE THAN

98
ENTITIES IN THE COMPANIES
OF THE INVESTMENT
EXECUTED IN BRAZIL

27
THE PRODUCTIVE CHAIN
THE CONSTRUCTION
SECTOR REPRESENTS AND EMPLOYS ABOUT

2,5million
ABOUT

6%
UNITS OF THE
FEDERATION
WORKERS ON THE PAYROLL
OF THE BRAZILIAN GDP

09
 Sinduscon-MG, the partner of Construction.
Founded on December 14, 1936, the Union of the Civil Construction Industry in the
State of Minas Gerais (Sinduscon-MG) represents one of the most important productive
sectors of the Brazilian economy: the Civil Construction Industry.
An entity of extreme importance for strengthening the category offers a structure –
through the Economic, Legal, and Technical Advisories – that strives to defend the interests of
the State's construction sector.
It provides the associate with research on the real estate market, access to information
and sector statistics through the Construction Database (BD/CBIC), agreements and various
discounts, exemption from the Employer's Contribution, and institutionally represents the
construction companies in councils and state forums.
Construction companies have at their disposal several other benefits through the work and
activities of the entity's commissions: Real Estate, Materials and Technology, Environment,
Industrial and Corporate Works, Politics and Labor Relations, Small and Medium Enterprises,
and Allotments.
Associated companies can also participate in the activities of the Legal Council of
Sinduscon-MG (Conjur-MG), the Group for the Exchange of Civil Construction in Human
Resources (GICC-RH), and Sinduscon-MG Jovem, which encourages the participation of young
entrepreneurs in initiatives to strengthen the sector.
Through its Training Center, the union offers updating and professional training at the
technical and managerial levels for associates and non-associates. All this, without forgetting
social responsibility: through Seconci-MG (Social Service of the Civil Construction Industry in
the State of Minas Gerais), free consultations are offered in the medical and dental areas for
workers in the sector and their dependents, in addition to the provision of services in the areas
of occupational safety. Since its foundation in 1992, Seconci-MG has provided more than 2
million services.
Sinduscon-MG effectively participates in the following:
• Labor negotiations, matching the interests of the parties involved.
• Promotes integration with public and private bodies that compose or relate to the Housing
Financial System (SFH).
• Expands the exchange of Civil Construction, seeking more significant business and political
awareness, in addition to increasing the representation of the union.
• Expands the market of works for associates through the constant relationship with
government agencies.
• Defends the interests of associates with bodies of different spheres.
• It is present in the entire production process of construction (from the conception of the
enterprise to the post-work and customer relationship).
• Monthly performs the calculation of the Basic Unit Cost of Construction (CUB/m2), the
primary cost indicator in the construction sector.

Currently, Sinduscon-MG represents more than 12,000 companies (associates, union

members, and partners) in 500 municipalities in Minas Gerais. Affiliated to the Brazilian
Chamber of Construction Industry (CBIC) and the Federation of Industries of the State of
Minas Gerais (FIEMG), it has the necessary credibility to defend the rights of its members.

10
 Presentation

11
1 I n a progressively
dynamic, complex, and
interconnected market,
organizations must have a more
systemic vision to anticipate and
mitigate risks and understand new
opportunities for wealth
generation, value, transformation,
social prosperity, and
competitiveness. In this scenario,
the principles of ESG emerge and
gain strength.
English acronym for Environment,
Social, and Governance, briefly, the
term refers to indicators that
measure the performance of
organizations in the three spheres:
environmental, social, and
governance.
In other words, a company attentive to the
ESG pillars seeks ways to ensure an intended use
of resources, takes good care of the relationship
with its different stakeholders, and maintains the
best leadership and management processes, in
addition to having economic prosperity, develops
social equity, has environmental sustainability
and vitality in its governance and culture — the
four pillars of Sustainable Competitiveness and
ESG.
The importance of this theme for any
sector is urgent, especially for a segment that
consumes most the world's natural resources,
employs a large volume of labor, and recently
went through the largest credibility crisis in its
history in Brazil. In this scenario, no sector should
look more closely at the three pillars of ESG than
the construction industry segment.
Many companies and entrepreneurs still
treat ESG with some suspicion, if the actions
proposed by this logic will entail additional costs
for their businesses without a counterpart of
generating concrete wealth and value and,
therefore, see the adoption of recommended
practices as counterproductive. They see ESG as
an "industry" used by consultancies and certifying
12
bodies to explore the little knowledge of
companies on the subject. It is not too much to
say that throughout the business community,
and not only in the construction industry, many
executives associate ESG only with shallow
actions, which are essential but do not have
relevant impacts throughout the chain. It is
necessary to bring knowledge about ESG in a
clear, efficient, and aligned form with the
demands of the construction industry. Present
clearly that the construction industries already
practice ESG but have no idea that they
practice, and thus do not take advantage of the
opportunities of ESG for their business. They do
not know that ESG was launched 18 years ago
2004.
Actions such as allocating funds to
contribute to reforestation, hiring diverse
professionals (for example, those with
disabilities), and institution of a compliance
system, are essential practices and must be
considered, but cannot, in isolation, change the
business reality of the country concerning
agenda ESG.
The significant impacts come from an
in-depth look at the sector's production chain,
attacking the most relevant (material) aspects
primarily with the potential to generate lasting
impacts/ results for our industry. According to
GBC Brazil, the construction industry consumes
almost 75% of the world's natural resources,
and with relatively simple actions, it is possible
to reduce water and energy consumption by
30-40% and waste generation by 65%.
If implemented disciplined and
effectively, these actions would generate
enormous benefits for companies, the
environment, and society, such as
implementing efficient circular economy
projects. In addition, the construction industry
employs more than 10 million workers, close to
10% of the Federation's economically active
population, and could impact much more with
initiatives such as the circular economy.
Consistent professional qualification programs
can significantly increase the sector's
productivity, with relevant impacts on the
country's wealth generation capacity.
Situations like this need to be evaluated as an
excellent opportunity to reduce project costs,
enabling more business and bringing benefits
to the companies' employees and their supply
chains (and/or value), who undergo training.
Regarding governance aspects, the
gains are also relevant. Nothing is worse for
industry and the companies that militate in it
than a crisis of confidence. Crises such as the
one experienced by the sector in 2014 have
produced reflections for many years. They
provoke strong reactions from control
mechanisms, forcing companies to allocate
substantial volumes of their resources to legal
and controllership areas, which are essential
but do not generate practical value for projects,
thus making their viability more difficult.
Investments in creating a solid culture for
training professionals with strong ethical
values and a robust governance structure
contribute to the resumption of confidence in
the seriousness of the sector in the long term.
We must develop our companies' cultural
vitality and governance based on consistent
principles, values, and beliefs. The consequence
of actions like these will be unequivocally
reflected in the value of projects and
companies.
After all, the greater the confidence in
the segment, the more competitive it will be. In
addition, having a business with a purpose and
positive impact on society drives innovation
and creativity through diversity, improves
leadership, collaboration, and transparency
among teams, improves talent attraction,
retention, and satisfaction, and gives
organizations greater resilience in the face of
13
current socioeconomic and environmental
challenges. However, It must be considered
that no magic formula or requirements lead
to uniformity.

The extent, character, and impact of

actions differ between organizations due to
the size and types of activities. Each
company must adopt measures relevant to
its purpose, culture, values, principles,
beliefs, and strategic direction. However, as
the term gains notoriety worldwide, it
becomes increasingly clear that small,
medium, or large companies in our
industry must advance this agenda,
whether out of interest or conviction.

To raise discussions on the subject,

through gathering knowledge of several
companies and executives in the
construction industry, Sinduscon-MG
proposes, through this Booklet, a more
professional look at ESG, which reveals
more clearly the importance and benefits
of recommended practices.

Subcommittee on Industrial
Works Contracts of Sinduscon-MG

14
2“ Message from

C in s
ar

t
M C BI

the President
s
lo f
Car t o
J o s é e si d e n
Pr

The reality of the construction industry market, constantly changing and

uncertain, imposes the need, increasingly, for companies to raise the level of success
of their projects. The use of the purposes and values of organizations, currently
increasing, as a guide in decision-making has made everyone in the corporate
environment aware of the expectation of providing tangible and reliable evidence on
sustainability and social responsibility data, which contributes not only to reputation
but to business, with a significant increase in the level of maturity of the company.

Faced with this vision, the perspective of ESG (Environmental, Social, and
Governance) became an agenda and one of the critical focuses in discussions on the
generation of value in the purpose of existence of companies, in addition to
increasing interest of investors, public policymakers, and other stakeholders.

With customers or consumers more demanding and concerned with

sustainability, climate change, or equality at work, the interconnection of
environmental, social, and governance issues has become essential for any business.

Implementing actions based on these three pillars can create optimum value
and attract more investments. Ignoring this topic can weaken a company's
competitive position in any segment, significantly affecting confidence in its services
or products and negatively impacting its continuity plan.

Thus, the links between the ESG standards, corporate strategy, and risks have
never been more evident for construction industry institutions. They must adapt
quickly and respond to unprecedented and unpredictable scenarios, emerging more
robust from the pandemic and ensuring their stakeholders recover together.

Another central issue lies behind the "S" of ESG, the social aspect of
investments: how companies can manage their relationships with their workforce, the
society in which they operate, and the political environment. Social factors depend

15
not only on how customers will judge the company's behavior but also on how
institutions, and their entire supply chain, manage to build environments in which
inclusion and equality, together with employee well-being, also provide more
productivity, creativity, and innovation. Thus, investors, customers, and society expect
from companies a clear commitment to this agenda, with processes that can monitor
compliance with these strategic guidelines by all business partners.

As we all begin to think ahead and ask ourselves about the next steps, it
becomes clear that all public or private institutions must acquire a deep appreciation
of purpose- and principled-driven leadership ESG. However, we should consider
focusing on this determination to work together to drive effective change and benefit
all stakeholders in addressing and implementing this issue. Therefore, the CBIC,
through its Commission for Industrial and Corporate Works (COIC), in its projects
"Valuing Engineering" and "Innovation, Productivity, and Competitiveness,"
integrated with the Commission for Social Responsibility (CRS) and the
Commission for the Environment (CMA) and in partnership with the
Sinduscon-MG and the Fundação Dom Cabral, makes this publication available,
intending to bring discussions closer and establish guidelines for the construction of
clear strategies in short to long term.

In addition to the conceptual exposition, it creates a level playing field that

makes it possible to evaluate which actions or interventions make a difference,
uniting and replicating them to positively impact all segments. The initiative is
another step on the firm path of CBIC to seek the strengthening of companies and
solutions aligned with the country's sustainable development.

José Carlos Martins

President of CBIC
Nilson Sarti
President of CMA
CBIC Area VP
Ana Cláudia Gomes
IC ira
President of CRS liv
e

CBIC Area VP d e O f CO
sé e o
o t
Ilso José de Oliveira I ls o J si d e n
Pre
r ti
Presidente of COIC Nilson Saf CMA es
CBIC Area VP Presidente o om
a G RS
u di of C
Ana Cládente
Presi

16
 “
Re reside
P
na nt o
to f Sind
Mic uscon-MG
hel
A Word
from the Board
With more than 85 years of history and a performance based on ethical
principles, the Union of the Civil Construction Industry in the State of Minas
Gerais (Sinduscon-MG) is one of the pioneering entities in the country to work for
the benefit of Brazilian construction and the evolution of the companies it represents.
It is part of its commitment to promote projects and actions in favor of its associates'
productivity, efficiency, and sustainability. It also serves as an instrument for the
interlocution of their interests with municipal, State, and federal governments, public
and private entities, and society in general.

We act in the continuous improvement of the management and governance

tools and processes of companies in the sector to increase the level of
competitiveness and keep them aligned with the needs of the market, in addition to
contributing significantly to the sustainability of their business.

As a result, Sinduscon-MG contributes to gathering and disseminating

knowledge on such a relevant and current topic as agenda ESG, a discussion
conducted here in light of the objectives and challenges concerning the reality of the
Construction Industry in our country.

The entity's initiatives are essential to deepen the debate and provide
guidelines for associated companies to evolve in the environmental, social, and
governance dimensions. We believe that a strong entry into the ESG agenda,
boosting businesses that generate wealth for our country and positive socioeconomic
impacts in the world, is necessary for the sector further to strengthen its credibility
with society and control mechanisms.

Organizations that recognized in advance the importance of adapting to

global demands in these three aspects also obtained superior economic results
compared to the rest of the market, which practically ends with discussions about the
generation or not of wealth and value when implementing measures that contribute
to sustainability, social justice and adoption of vital systems that lead to our
governance and corporate culture; This means that we are confident that an
organization's maturity and potential growth are factors strongly linked to its ability to
17
demonstrate compliance with ESG practices.

Indifference to social, environmental, and corporate responsibility issues can

mean risk of reputational damage, brand erosion, loss of talent, and ultimately
business failure.

This Booklet results from joint work and includes contributions from
contracting companies, contractors, class entities, and business schools. Its main
objective is to expand the knowledge of the sector by the theme to, in the next
moment, guide the implementation of actions in compliance with the principles of
ESG, which will result, consequently, in the improvement of the management and
economic performance of the associates.

On behalf of Sinduscon-MG, we thank the companies and entities for their

willingness to participate in the debates and for the contribution of the professionals
and experts involved in this process. These collaborations were fundamental to this
work's development and the approximation of the Construction Industry of such an
influential agenda. We thank the Fundação Dom Cabral in the person of Professor
Pedro Lins for the lessons transferred during the elaboration phase of the Booklet and
for his essential contribution to the workshop that dealt with the topic.

We hope that this material will serve as a stimulus to arouse the interest of
associated companies for best practices ESG, helping to establish stricter standards of
control and management for all stakeholders, generating value throughout the
construction chain in Minas Gerais and promoting an alignment of the values of the
segment with its professionals and with the whole society.

Ce
Vicelso P
Pre im
Renato Michel sid en
en te
President of t l

Sinduscon-MG

Celso Pimentel
Vice President of Industrial
and Corporate Works
of Sinduscon-MG

18
 3
ESG
Introduction
and Timeline
Starting from the first constructions in Brazil in the era of discovery by the Portuguese, I
am now at the beginning of the remarkable growth of the industrial sector in our country in the
60s and 70s of the last century. We faced the period of the military government that brought a
strategic vision to our country, where the development of our industrial park and infrastructure
with road-rail logistics should be fostered. These were periods of significant industrial work,
leading to the growth of several companies specializing in these enterprise profiles.

The works of industrial constructions have always ensured excellence in their

management, but from this moment of full expansion of the sector, a series of changes and
management concepts have been propagating to the present day. In the early 1980s, the first
concepts of TQC - Total Quality Control - were implemented. The methodology had already
been disseminated worldwide since the Industrial Revolution, and however, it was structured
and standardized in Brazil from this time. Simplistically, a conversion of its applicability was
made. That is, the concepts developed for manufacturing products were adapted for providing
services in construction works.

19
 The excellent market differential
ensured the project's delivery within the
quality standards recommended by the
market with the applicable standards and
management methods incorporated by the
companies.
In a second moment, already in the
years 90 and the first decade of the 21st
century, we radically changed HSE - Safety,
Environment, and Health. It began with
training and applying strategies to prevent
losses: human, financial, material, and
immaterial, both company and of the
community around it, including the location
where the company is inserted, thus creating
a culture and an environment of
sustainability. Several regulatory programs
and standards were created to improve
management in these areas through
customer and construction service providers'
continuous search for operational excellence.
All these procedures and programs are
incorporated into business management and
are non-negotiable values in our construction
environment. Several universal indicators -
KPIs - Key Performance Indicators - were
created to measure and/or compare the
performance of these items in enterprises and
companies.
From the first decade of this
millennium to the present day, one of the
acronyms most used in the dynamics of our
business has been ESG - Environmental,
Social, and Corporate Governance. In
summary, it is about the implementation of
social practices, commitment/concern with
social equity, sustainability of the
environment, and vitality and adequacy of
management's best governance practices.
Linked to these concepts, we have two other
words that have become rhetorical in the
market: Compliance and Accountability.
Sometimes they mix with the concept of
austerity, especially after Operation Car Wash
which took place in our country and involved
many companies after 2014. Compliance is
linked to the adherence and compliance of
companies concerning the legislation and
standards of the respective regulatory bodies,
and accountability is a set of accountability
mechanisms related to accountability,
supervision, and social control. These
precepts are an integral part of corporate
governance, which is much broader. It is the
management model a company establishes
to relate to: internally, with shareholders, and
with the market.
Given the above, the development of
construction businesses, especially in the
industrial segment, has always had several
"waves" of management improvement
processes over time. We have an
extraordinarily current and comprehensive
theme, represented by ESG - Environmental,
Social, and Corporate Governance.
To clarify and transmit more excellent
knowledge on this subject, SINDUSCON-MG,
in partnership with FDC – Fundação Dom
Cabral, brings through this Booklet a very
didactic detail, illustrating this reality within
the business environment of industrial
constructions. I hope you will benefit from
this knowledge in this reading because soon,
entities that do not bother to adhere to these
practices will suffer a natural process of
market selectivity.
20
 The Importance of ESG for
the World and Industry
of Construction
"Who Cares Wins”, with this maxim, Kofi Annan, then Secretary-General of the UN , (en
(together with the World Bank and the IFC), wrote to 50 directors and CEOS of the world's
leading financial institutions in 2004, strategically inviting them to commit to ESG principles
for the financial market. The Who Cares Win paper is the foundation of ESG.

The world heard this term for the first time, and since then, a remarkable
transformation movement has begun, aiming at an evolution of companies in their
environmental, social, and governance pillars. Large global investors are the protagonists
of this movement, and it has become a necessity and competitive advantage to conform to
these standards.

One of the first actions generated by ESG was the creation of the PRI (Principles for
Responsible Investments), that is, the Principles of Responsible Investment. B3, Brazil's stock
exchange, has been a pioneer in this process, being the first emerging country exchange to be
a signatory to the PRI in 2010. According to data released by B3, in July 2016, more than 1,500
institutional investors from 61 countries, representing approximately US$60 trillion in assets,
were signatories to the PRI. Of these, 60 were Brazilian, with assets under management of
R$804 million.

21
 Machado Meyer, one of the
largest law firms in Brazil,
was very assertive on the
subject, saying that responsible
investment can be made from the
allocation of resources available in the
financial market to companies that
implement ESG in their activities and that
follow a series of UN recommendations.
The PRI guides market agents such as
investment fund managers and private
equity firms on portfolio analysis and
capital allocation decision-making.
The financial market figures related
to ESG, and sustainability already
demonstrate their relevance. Bloomberg's
2019/2020 data shows that $347 billion
was injected into ESG-focused investment
funds. In addition, governments,
companies, and other groups raised $490
billion by selling green, social, and
sustainability bonds. Over 700 new funds
were launched globally to capture the
capital flow in the ESG segment during this
period: Around 90% of S&P 500 companies
– the 500 most traded companies on US
exchanges - published sustainability
reports in 2019.
One of the biggest sponsors of the
theme is Larry Flink, CEO of Black Rock, the
world's largest investment manager. He
stresses the importance of companies
evolving in the ESG model and requires
them to demonstrate their responsibilities
through sound environmental, social, and
governance practices and policies.
ESG has become a prominent topic
in the business environment. The
movement is Top Down, from top to
bottom, capital commands. The volume of
signatories of the PRI, of products in the
financial market linked to the theme, and
the importance given by large global
investors demonstrate the current
importance of ESG in the world, among
several other factors. Many multinationals,
for example, already develop this concept
in their supply chains/suppliers, and all are
"obliged" to participate in this movement,
a practice already in force in Brazil. The new
Law on Corporate Due Diligence Duties in
Supply/Value Chains (LkSG) of the German
government will come into force on
January 1, 2023.
This reasoning applies to the world's
industrial construction industry and Brazil.
Companies in the sector are going through
a moment of transition, where they have
already started or should start deploying
the ESG model in their businesses. Most of
the time, this first step is taken by customer
requirements.
The sector now has another quality
standard to be implemented. Hiring a
specialist consultant is essential in this
process. ESG best practices make
companies more humanized, inclusive,
prosperous, and perennial. The
construction industry has a great
opportunity in this model to transform and
positively impact the planet.
There are many consequences of
this process; in the environmental pillar, we
can mention; the reduction of the impact
of economic activities on nature,
respecting its regeneration capacity,
adequate consumption of energy, water,
soil, and wood, reduction of greenhouse
gas emissions, improvement in waste
management, among many others. The
scope at this point is immense, as the
construction industry is one of the great
consumers of natural resources.
22
 In the social pillar, we can mention the improvement of the relations of companies
with society and the communities where they operate, generating value for all stakeholders
through the generation of wealth, employment and income, better working conditions,
reduction of health and safety risks at work, closer and transparent relations with the
communities where they operate, improvement of the quality of life of workers, development
of the supply chain/suppliers and value, customer engagement, more diverse, inclusive work
environments and respect for human rights as a basis. The sector's reach is also enormous
because it is one of the most prominent job creators in the world.

In the governance aspect, we can point out greater transparency of processes, better
efficiency in using capital, tremendous respect for all stakeholders, lower risk of legal and
labor problems, fraud prevention, adherence to the principles for responsible investment, and
implementation of compliance and accountability policy.

Governance appears as a fundamental pillar for companies to structure themselves to

implement the other pillars properly. In addition, it represents an opportunity to align the
organization's purpose with the ESG agenda. Operation Car Wash evidenced the lack of
maturity of the construction industry, with low vitality in its culture and governance.
Compliance and accountability are worked on in this pillar, and it is an opportunity for the
sector to mature and show its credibility.

According to data released by CNI / FSB, 94% of executives see opportunities in

ESG/sustainability actions, but 72% admit that they are minor or not at all familiar with the
acronym ESG, 71% believe that the State should control and encourage companies to follow
environmentally sustainable rules, and 73% will increase investments in ESG/sustainability in
the next two years.

The ESG and faces barriers to its development and implementation, such as
model is transparency, insufficient resources, data veracity, and
greenwashing (when the company says it is sustainable, but the
still young
attitudes and operations are contrary). The important thing is that
the concept evolves rapidly, as does the realization of the generation
of concrete values and awareness of their relevance and urgency.

23
5
The Benefits Of
ESG Practices in the
Organizations
5.1The rational and moral question.
We are in the midst of the 21st century, mid-2022, with the hope that we are
witnessing the end of the great war of the last generations, the Coronavirus pandemic, as we
witness the irrationality of another war breaking out in the cradle of civilization, these and
other factors still catalyzing a global economic crisis, which challenges the models of
production, consumption, and organization of society. In the information age, in which data
is the new oil, the human being tests the limits of his capacity and action on a finite planet,
with the vision and awareness that the consequences of his acts, the lunch bill, have already
arrived and will be paid compulsorily and gradually.

24
 In this scenario, no ideological
position can sustain an action, individual or
corporate, indifferent to the need to
preserve natural resources that are
inexorably scarce. It is rational to
understand that the perpetuity of business
and living standards depends on the
rational and conscious utilization of what
sustains them. Recognizing such truth is
not a political issue, regardless of whether
one believes the apocalyptic or more
optimistic predictions. If placed in an
exempt way, free of positions, it is
understood that any action must be aware
of its damage and responsible for
mitigation or reparation because it is the
best for the good of the author himself, in
addition to being the right and moral for
the other and future generations.
Not very differently, we can see the
Social, Environmental, Economic, and
Governance aspects. It is common
currently, in the desire to justify changes in
behavior and processes to seek the
immediate benefits that will motivate the
transition immediately. They exist and must
be addressed and exalted, but first, it is
necessary to look at the question from the
most fundamental perspective, logic, and
ethics. The inequality of access to teaching
and work opportunities in society is
undeniable, and organizations/ companies
offer the primary vector against this
disparity. How many cases do the reader of
this publication know of winners, achievers
who started from scratch in the companies
that opened their doors and made
successful careers, achieving personal and
professional development that they had
never dreamed of? That should be even
more relevant in the construction market
than average. Moreover, how much have
these people elevated and transformed the
performance of their companies,
generating and distributing wealth? What
would become of organizations without
these people, who, with a simple
opportunity, crossed mountains to build
their legacy?
Therefore, it is not rational to deny
that people's development is the
company's development and growth and
that these movements will be proportional,
hypothetically isolating the influence of
other factors. Nevertheless, a socially
conscious action, which generates
opportunities for those who do not have
and offers a lever of aggrandizement for
those who want and need it, as well as
beneficial to the organization, is also moral
and fair to society. It remains only to say
that this practice is not possible without a
solid, well-structured, and transparent
governance policy as a platform.
Finally, there must be those who can
argue, bound by limiting beliefs, that
nothing has been said so far is possible
25
without increased costs and loss of
competitiveness. That is where disruption
happens, and business models start to
become obsolete. As Porter and Kramer
brilliantly demonstrated for the Harvard
Business Review in 2011, through the
principle of creating shared value,
companies simultaneously create
economic value by creating value for
society. It aligns stakeholders' interests,
which requires a thoughtful look inside,
questioning the company's fundamentals
and positioning, strategic involvement, and
considerable managerial effort. However, it
is the key to the rupture and transition to a
new era, that of Stakeholder Capitalism
(Conscious Capitalism), which brings the
other stakeholders to the center of
decisions, besides only the shareholder.
This path will require a relevant
expenditure of intellectual capital and the
determination to innovate. To think about
ESG is to think beyond sameness, and more
than ever is preponderant for the survival
of organizations in a new economy.

26
 5.2 Direct economic benefits.
Once the fundamental issues of
macro-rational and moral order have been
established, we can analyze what
organizations expect in the short term in the
economic aspect more directly. The focus
now is on what initially draws the most
attention, attracting or driving away the ESG
agenda, depending on the mentality and
understanding of managers. So, in one to
two years, will adopting ESG, sustainability,
social responsibility, and governance
practices bring economic gain to the
business? Given the wide variety of
short-term contexts, it is impossible to state
but the answer is yes. For most cases, we will
understand why.
Initially, it is necessary to recognize
that the simple search for reducing
consumption of resources, fuels, energy, or
raw materials would be the genuine reason
for cost reduction that any company seeks. It
is also a practice of ESG/sustainability. As
simple and obvious as that. Recognizing and
emphasizing this first step, as organic as it
already is, is another incentive in the search
for efficiency, which will bring alignment of
values and feed the clean culture, reducing
the environmental footprint while increasing
competitiveness.
Advancing more on the consumption,
cost reduction, and efficiency aspect, once
the means of production are maintained,
there is an optimal limit between
productivity and consumption once the
possible gains are achieved in the
established structure.
However, technological advances and
innovation on the factory floor, in an
increasingly accelerated way, have been
breaking paradigms and suggesting or even
establishing new methods and production
chains as current while retiring old practices.
An example is how wind and solar energy is
becoming cheaper, to the point that today it
is sold on the free market at a price lower
than that of the regulated market. Another
example is verified in co-processing practices
and/or the correct disposal and recycling of
solid waste, which has benefited industries
by reducing costs and environmental impact.
Therefore, the next evolutionary step of a
given production means may still be
unfeasible, but for how long? Positioning
yourself to take advantage of change at the
right time can be the way to gain a
competitive advantage or even a matter of
survival, depending on how fast the
disruption will happen. To cite one more
situation, despite challenges still to be
overcome in the supply chain and
infrastructure, some electrical equipment,
even with much higher acquisition value
than combustion machines, are already more
efficient due to the lower maintenance and
energy cost. Preparing for this transition is, at
the very least, prudent for the organization
that thinks about competitiveness and
results.
As for the social aspect, the most
relevant benefits are reserved for the long
term and may not be as easily measurable.
However, it is worth noting the role of
diversity in innovation, creativity,
productivity, and team effectiveness. Teams
with a greater diversity of gender, race,
culture, generation, and sexual orientation
report a greater propensity to collaborate
and propose new ideas, are more apt to
27
adopt external ideas to gain performance and
have greater acceptance of feedback for
continuous improvement in addition to attracting
and retaining talent for companies that adopt
Diversity & Inclusion. Among other things, that is
demonstrated by a 2020 study by consultancy
Mckinsey, based on information from more than
700 companies in Latin America.
Finally, we can also mention the cost
reduction effect that solid governance policies
add to the supply/supply and value chains by
ensuring equality in the purchasing and
contracting processes, avoiding deviations and
undue favors, and attracting and retaining
customers for the business.
5.3 Indirect and
immeasurable economic
benefits.
As already observed in this Booklet and
increasingly notoriously, there are several paths to
direct gains through ESG practices in
organizations. However, there is something more
subtle and at the same time impactful, especially
in the long term, behind the change in behavior
and culture that the new times propose. It does
not have a simple and objective answer, difficult
to explain with purely Cartesian and
consequential thinking. That has been touched
and measured, though not to its fullest extent, by
a broad body of research that has found a
correlation between good ESG management,
better operating results, and better stock market
performance; This is the conclusion of Whelan,
Atz, Van Holt and Clark, in the study for Rockefeller
Asset Management and NYU Stern, in which they
analyzed more than 1,000 research articles, from
2015 to 2020, exploring the topic. The reasons for
the correlation, in which we also believe there is
causality, is what will be analyzed next, and
which, more subjectively, has also been reflected
and detailed by several summaries in the subject.
In its vast majority, society has already
become convinced of the imperative need for a
robust agenda on the environment, governance,
and social responsibility by companies. Therefore,
all stakeholders, whether direct employees,
suppliers, investors, or the closest community,
tend to relate more healthily and fruitfully to the
companies that best demonstrate the
commitment to good ESG management. Of
course, given the current context of the very high
flow of information and the concern with its
veracity, the coherence of the action with the
discourse will be checked in detail. It is not
enough to be honest, but also necessary to
appear honest. Nevertheless, then, to put it
simply, leading ESG organizations, compared to
others, should have:
• More accessible to attract and retain talent, in
addition to having employees more engaged with
their vision and purpose, alignment of values that
foster the feeling of ownership, the search for
innovation, and commitment to results.
• A hall of qualified suppliers with a greater
willingness to do business for two rather obvious
reasons: The first is that due to security with high
governance in competitive contracting processes,
they know there will be no favoritism, and the choice
will be purely technical and commercial. Secondly,
anchored in the social pillar is the confidence that
the negotiations will be dignified and that
commitments will be honored.
• Seek innovation and commitment to results.
• Affected communities are more open to dialogue
and cooperation by the certainty that the impacts on
their surroundings will be mitigated or repaired,
combined with the perception that the company
collaborates effectively with local development,
transformation, and social prosperity, representing
28
representing opportunities for growth for people
as well as attracting more investments (wealth
generation).
• Loyal customers with a greater propensity to buy
are confident that the company's products or
services will be obtained through appropriate
labor relations and suppliers contracted pretty and
with a controlled and mitigated environmental
footprint. That is what he says, citing a source.
• A more significant attraction of investors to the
allocation of their resources. Whether by
combining all the factors mentioned above, which
favor the creation of shared value and reinforce the
prospects of better operational results, by the
simple alignment of values, or by the two issues.
That is what EY says, listening to 324 senior
investment leaders across five continents.
5.4 Risk mitigation
and continuity.
As well as the indirect gains addressed
in the previous chapter, also difficult to
perceive and measure is the effect of maturity
in ESG, exposure to risks, and the vocation to
perenniality/perpetuity. After all, is a
company that suffers little from the
misfortunes of the markets or the nature of its
activity just lucky, or is it the result of defenses
and a well-established positioning? These
defenses are directly linked to well-designed
and managed environmental, social
responsibility, economic, and governance
processes.
Starting with governance, the leading
and most effective tool to avoid fiscal, tax,
reputational/ image, and even criminal
liabilities in the various interactions that any
company may have with public or private
entities, regulatory agencies, and
non-governmental entities. However, in
addition to preventing fraud and other
deviations, good compliance, accountability
processes, and results help consolidate an
ethical and responsible culture. Developing
awareness about risk-taking should permeate
all hierarchical levels of the company
/organization, delivering accountability and
decisions better grounded and appropriate to
the function they have been assigned.
On the social pillar, what is observed
over time is that the more integrated the
communities where our operations are
inserted, the more sensitive and attentive
companies will be about local impacts, both
generated by the business and external
factors that may affect operations. The open
and frequent dialogue with people
(stakeholders), inside or outside the company,
offers a critical thermometer, which, well
used, will substantially help the preventive
29
of accidents and any deviation in the interfaces. The capitalism of stakeholders broadens the
organization's vision, delivering more information relevant to management, with the most varied
perspectives among those that relate to the same ecosystem, more significant substance for quality
decisions, risk reduction, and taking advantage of opportunities.

5.5 Unavoidable market trend.

All that has been said throughout the
chapter is that we observe such an expressive
movement of so many companies to evolve in
ESG management, motivated by a society
convinced of the need, which charges and will
charge more and more for a coherent position
and actions. It is a more notorious move in
large companies, where the agenda and
demand are blunter and more urgent. One of
the primary pieces of evidence is the
traditional annual letter to the CEOs of the
companies invested by BlackRock, one of the
most significant investment funds in the
world, signed by the chairman of the Board,
Larry Fink. Since 2012, sustainability and
stakeholder capitalism have been central
themes.
In his letter of the year 2022, Larry Fink
wrote: "Stakeholder capitalism is not about
politics. It is not a social or ideological
agenda. It is not "social justice." Capitalism is
driven by mutually beneficial relationships
between you and the employees, customers,
suppliers, and communities your business
depends on to thrive. That is the power of
capitalism."
Nevertheless, if the reader goes back to
the text of this Booklet and begins to reread
about the benefits of ESG practices, they will
realize that the paths, needs, and fruits are not
exclusive to large companies. Small and
medium-sized businesses benefit in the same
way, or even more, given the greater agility
they can demonstrate in deployment. Finally,
the current movement of large corporations,
investment funds, and the public opinion
itself shows us that thinking and walking the
path of sustainability, in the sense of the three
pillars, is inevitable and essential for growth,
which remains the main lever of social change
of capitalism, now more than ever, sustainable
growth for all stakeholders.
30
6
6.1 Introduction
Maturity of practices ESG
and Economic Performance

In times marked by the global

pandemic and the war in Ukraine, added to
other movements that cause intense
agitation and polarization worldwide,
primarily related to human rights, racial
conflicts, gender equality, environmental
risks, and unemployment rates, among
others, there is a lot of pressure from various
sectors for structural changes in society. It is
not a movement of country A or B; the whole
planet is experiencing analogous situations,
each region obviously within its reality.
impelled to adopt these practices, many are
also confronted with past experiences
arising from "fads" or even "movements" to
which they have adhered and have not
always had the desired effects in terms of
their real sustainability (starting there with
perpetuity/longevity and profitability).
Putting simply (and using explicit and
unambiguous language), questions that
businessmen and entrepreneurs naturally
ask when being introduced to ESG are:

Bringing this debate to the business •"Why, for what reason should
world, more and more entities and I invest in ESG?"
consumers require companies to engage in
these movements. ESG practices have
become the materialization of companies' •"After all, what will my company
commitment to a more just, responsible, gain from this?"
transparent, prosperous, and
sustainable/perennial society. Some sectors
•"Does it make money?"
and individuals formally committed to only
acquiring goods and services consider using
ESG in their practices and products, and this •"Won't it cost too much?"
movement tends to intensify in the coming
years. •"Wouldn't it be more of a "fad"?"
However, when some entrepreneurs
are introduced to these concepts and are
31
 Nevertheless, you really should be concerned about issues like:
• "What are our competitors doing regarding ESG opportunities?"
• "Which ESG issues do investors consider most relevant to the industry?"
• "Are Leaders and the board informed about relevant ESG trends,
opportunities, and risks?"
• "Are Leaders and the board prepared and structured to oversee ESG opportunities and
risks?"
• "Has the Company's Leadership assessed the ESG opportunities
and risks the Company may face in 6, 12, or 30 years?"

These, among others, are legitimate and essential questions that any entrepreneur or
executive needs to address before implementing ESG practices in their companies. This chapter
lends itself to assisting them in this reflection, based on data from research at global, national, and
specific levels of the construction sector in Brazil, as well as suggesting ways for the
implementation of ESG in your company in a safe, structured, and sustainable way, bringing
positive results along with its adoption and implementation.

Professor and Consultant Pedro Lins said, "ESG is a decision-making process. Whether or not
the COMPANY will be ESG?" The big question is, "Who will make this decision in our company?" Our
companies need leaders who assume their roles concerning ESG and are responsible for the
implementation, consolidation, and management of ESG. "What is the role of our company's
leadership in consolidating ESG in Corporate Culture?"

In the face of Inevitable Market Trends, it is necessary to reflect on the repositioning of the
leaders' mindset of our company's present and future. The consolidation of ESG in the Purpose and
Corporate Culture is the role and responsibility of the leader of the present and the future in this
scenario: The New Different; This is a role that our company's leadership cannot delegate to third
parties.

Reflect on this, "Our competitive differential will be in Image / Reputation and Trust."
Based on our past performance, the market will analyze us by our past behavior, to have or not
confidence in our company in the future.

IMAGE/REPUTATION AND TRUST

ARE INTERRELATIONAL, NOT HIERARCHICAL

REPUTATION TRUST
is an aggregate "analysis" is an expectation of future behavior
based on past performance.
of past behavior.

32
6.2 ESG and Financial Performance
NYU &RAM Research.
Studies examining the relationship between ESG, and financial performance have a
decades-long history. According to a survey conducted by NYU (New York University) in
conjunction with the consultancy RAM (Rockefeller Asset Management), almost all articles that
address this correlation were written before 2015. These analyses found positive correlations
between ESG performance and operational efficiency (processes), performance, inventory
performance, and lower cost of capital. However, some still argue that companies and investors
should keep their financial performance management focused on stock price and short-term
indicators and that ESG is, at best, a distraction from the real business of making money.

This same study cited above sought to examine the relationship between ESG and
financial performance in more than 1,000 research articles from 2015 to 2020 to update this
perception, and the results are extraordinarily relevant.

This research found a positive relationship between ESG and financial performance for
58% of studies focused on operational metrics such as ROE (Return on Equity), ROA (Return on
Assets), or stock price, and in 13% of cases showed a neutral impact, 21% mixed results (the
same study finding positive, neutral, or negative results) and only 8% showing a negative
relationship.

Relationship between ESG and Financial Performance - Global (%).

60

50

40

30

20

10

0
POSITIVE NEUTRAL MIXED NEGATIVE

33
 Prof. Robert Eccles' study on the impact of sustainability/corporate ESG on organizational
processes and company performance presents this result clearly, demonstrating that the
difference in share value of two companies of similar size and the same industry, one of them a
company with a high degree of ESG/sustainability in its corporate strategy, versus a low
ESG/sustainability company for 18 years, is 46.75%. (See graph below).

1 https://www.hbs.edu/ris/Publication%20Files/SSRN-id1964011_6791edac-7daa-4603-a220-4a0c6c7a3f7a.pdf

https://www.amcham.com.br/noticias/sustentabilidade/robert-eccles-empresas-de-alta-sustentabilidade
-lucram-mais-e-em-longo-prazo-3071.html

34
6.3 Studies and Research in Brazil and
the Construction Sector.
Although the studies and analyses mentioned above come from data from several
countries and apply on a global scale, in Brazil, more and more companies, entities, and sectors
of the economy are concerned with the subject, and research/studies with various contents are
widely disseminated in the most different media, as well as in business and academic circles,
and in addition to serving as "thermometers" of the inevitable trends for markets and sectors,
they also serve for maturation of the sectors of civil society and business for the practices,
concepts, metrics, and actions in the field of ESG in general.

According to Antonio Emílio Freire in his recent article "Making Explicit the Integration
between Finance, ESG, and Sustainability – Drivers, Elements, and Fundamentals." (LinkedIn,
July 2022),

"Just as we have a uniform set of standards for financial measurement, we are close to
having a set of standards for measuring ESG financial information,"

That is, soon, this association will have global and comparable parameters.

The "framework" below presents a potential financial approach to ESG that will reference
the market obeying standards of reasonableness.

1. Increases customer loyalty MARKETSHARE

lower turnover rate.
2. Brand differen�a�on; REVENUE GROWTH
a�rac�on and new customers.
3. Greater ability to enter new markets. NEW MARKETS
4. Expands poten�al sources of revenue.

PROFIT

PRICING POWER
5. Strengthening the corporate image.
6. Greater efficiency in the use of
resources; greater opera�onal efficiency.
7. Reduces costs and taxes.
8. Improves the ability to a�ract,
COST REDUCTION TOTAL AMOUNT FOR
retain and mo�vate employees. THE SHAREHOLDER
9. Increases the produc�vity of MARGIN INCREASE
collaborators

EMPLOYEE RETENTION
/ ENGAGEMENT FREE CASH FLOW
10. Reduc�on of financial, market
and opera�onal risks.
11. Increased access to capital, finance
and insurance.

COST REDUCTION VALUATION/MULTIPLES

35
 6.4 ARCHIBALD & PRADO Maturity Research
(CBIC 2021)
Specifically for the construction sector in Brazil, recently, CBIC (Brazilian Chamber of
the Construction Industry) commissioned in its regular research of measuring the maturity of
companies in their management and business conduct practices a vision specifically for
theverification of the current maturity and importance that companies in the construction
sector (especially companies involved in the industrial construction sector) give to ESG and its
practices.
The research mentioned above (Archibald & Prado, 2021) demonstrates (see graph
below) that, according to the perception of companies associated with CBIC in the scope of
industrial and corporate works, the ESG dimension has a more significant correlation with
economic variables (72%) than all other dimensions of correlation. In this case, correlation is
understood as the influence (positive or negative) of the ESG dimension on the other areas of
analysis
Correlation of the ESG dimension with the other
Dimensions of Corporate Management - SELF-
From this analysis,
ASSESSMENT OF COIC COMPANIES.
it can be inferred
that for most 74%
72%
entrepreneurs, 72% ESG Economics
70%
there is a direct 70% ESG Marketing
68% 68%
influence between 68%
68%
ESG Operation
the application
66%
of ESG practices in 63%
ESG Management
64% 63%
their business ESG Processes
61%
and the leverage 62%
ESG Technology
of financial results. 60%
ESG Strategy
58%
56% ESG People

Given the results shown above, and an increasingly clear perception of the importance of
adopting ESG practices as a PERPETUITY strategy, we can now move on to a more specific and
practical discussion for our industry and especially the construction sector in the State of Minas
Gerais. Some questions for our debate would be:
• What can be done in the short term?
• What to plan for the medium and long term?
• What are the challenges for implementing ESG in my company?
• How deep is your commitment to ESG? What is your real ambition with ESG?

In addition to answering these questions, it is also necessary to understand the need for
clarity and transparency of our companies' information, data, reports, and statements and their
importance today.

36
6.5 What can be done in the short term?
Working according to ESG principles concerns small and medium-sized companies and
large corporations. It is possible and necessary to work according to ESG principles and
practices in all sizes and types of companies.

According to Ricardo Voltolini, CEO of Ideia Sustentável Consulting, "Good practices are
within reach of any business and do not always mean increased spending." It is also essential to
be clear that applying ESG can (demonstrably) bring numerous benefits to your company,
including:
• Help reduce expenses.
• Attract investors and investments.
• Improve the image and reputation of your business.
• Attract and retain talent.
• Attract and retain new customers.
However, many have doubts about how to get started. Sentences that make sense for
this reflection: "Think big but start small" or "Always start at the beginning."

What can you do to start an ESG

approach in a company?
1) Find out more about ESG and how your company is doing
By reading this Booklet, probably an essential first step is already being taken for
the application of ESG in your company. Here it is intended to inform and give some
essential and practical tips so you can start to "think ESG" within the Company.

As a first step (which we can suggest for any company that aspires to practice and
sell ESG practices), it is crucial to know how we are in the most basic practices of our
company's environmental, social, and governance aspects. For example, how much does
the company spend monthly on water and electricity? Does the company know how
much material is wasted in on-site activities? Do we know what kind of training
employees need or want to have? Do we know what tax and fiscal rules the company
needs to follow?

It may seem distant, but many companies do not even know they make an impact
with their more ordinary attitudes. Sometimes we associate environmental damage with
situations such as pollution and deforestation without considering, for example, how
much the consumption of natural resources can be an impact factor. Furthermore, more
than that, to what extent do we and our companies contribute (positively or negatively) to

37
 to this damage.

Whenever entrepreneurs think only about reducing expenses/costs, they will not be able
to understand where they can act to improve their efficiency.

In this way, an excellent way to take a first step will be to map, record and understand that
the opportunities to invest in ESG contribute to the performance and superior financial results
of your company and, at the same time, create a healthy, sustainable and legally compliant work
environment, versus just focusing on where and how the company can reduce its
expenses/costs.

2) ESG stages in Companies.

We suggest professor and consultant Pedro Lins's article about ESG stages in Companies
as a complementary reading. The idea of evaluating the ESG steps in the company/organization
is to provide a perspective that allows you to determine where your company fits in the current
scenario and provides guidance for you to chart your future course in the evolution of ESG
stages, analyzed in the seven dimensions proposed in the study.

In the article, Lins comments that business leaders worldwide prioritize ESG for their
companies. For example, some update policies and review ESG-related projects, programs,
and/or actions; others form ESG committees, measure their environmental, social,
cultural/governance, spiritual and political performance, and produce impact reports.

Millions of companies/organizations worldwide strive to align ESG dimensions to their

business strategy. Several pioneering companies/organizations orient their products and/or
services to ESG-focused markets, aiming to generate wealth, transformation, and
social/environmental prosperity, perennialize their business, and make even more of a
difference, to have a better world.

However, not all ESG initiatives are suitable for all companies/organizations. Thus, we
have two issues that leaders should consider:

• How to know in which dimension of ESG we should act, assuming that the Company
is already immersed in many initiatives?
•What is the ideal set of ESG initiatives relevant to the company and its stakeholders?

* This article was customized based on the study of the Corporate Citizenship Internship prepared by the Corporate Citizenship Center
of Boston College and on the text Approaches to Sustainability in Organizations Volume 1, from the notebook of ideas prepared by
Cláudio Boechat and Lucas Amaral Lauriano, from the Center for Sustainability Development in Construction, from the Petrobras Sustainability
Center of the Dom Cabral Foundation.

38
 The organization must assess, among other things, its aspirational, appropriate, and
effective ambitions and actions that it must take into account; transparency, compliance,
governance, economic development of the community where it is inserted, work-family
balance, environmental sustainability, social equity: the protection of human rights, the
attraction, and retention of talents, diversity & inclusion, spirituality, ethical relations with
investors, governments and the market, and its gross internal happiness (FIB/GNH).

Every organization should ask if there is a connection between (I) opportunity and risk
management; (II) brand/corporate image and stakeholder engagement; (III) supplier
engagement in your value chain and cause-related marketing; (IV) the impact of your
business operation on the circular economy and equity, diversity and inclusion; (V) between
gross internal happiness and other ESG-related topics.

In the case of the most advanced companies/organizations in ESG, the Shareholder, the
CEO, and/or the C-Level usually lead the organization's position in social, environmental,
cultural/governance, economic, spiritual, and political issues. They are the ones who keep the
organization's Board informed and up to date. It is common for these companies to connect
ESG to their business strategies and to employees through ESG campaigns, projects/programs,
and actions, and establishing ESG objectives and goals for their leaders and employees, to
advance their operations.

So, there are three models of companies/organizations:

1) Companies/organizations that do not want to work with ESG.

2) Companies/organizations that have firmly integrated ESG projects, programs, and/or
actions and are setting new performance standards in the theme; and
3)Companies/organizations in transition stages whose knowledge, attitudes, structures,
and practices represent different degrees of understanding, performance, and
sophistication in ESG.

Discovering and recognizing the ESG stage that the organization is operating at and
understanding the challenges created by advancing ESG will help clarify for leaders the
perspective of where things are, structure strategic choices about where to go, assist in setting
benchmarks, objectives, and goals, and certainly accelerate ESG advancement in the
organization.

The exciting thing about the approach is to identify which Stage the
company/organization is in, evaluating the main challenges, barriers, and characteristics of its
attitude towards ESG.

The article presents the Stages of ESG in Companies and points out the seven
dimensions that make up ESG. By analyzing these dimensions, we can determine which stage
the company is in and present the triggers that help transform its actions regarding ESG stages
in companies. How to get out of the Elementary Stage to reach the Transformative Stage. (See
table below)

39
 3) Take some time (not much) to talk and think about ESG.
Start planning.
Organization, control, and planning are fundamental habits for the success of companies
of all sizes and in all sectors. Always taking time to devote to these topics is an essential practice
for the survival of companies.

Understanding that the company's core processes and costs must be reviewed to apply
ESG principles to your business is essential. Dedicating time (albeit minor in the first few
movements) to consider ESG aspects and plan your everyday tasks is also essential.

Some examples of reflections that may be useful (it is always good to have the help of a
specialized professional to help you in these tasks): How much paper does our company use
each month? What is the fate of this paper after it is discarded? What is the average salary of
employees? Are wages equal for the same functions performed by (diverse) persons of
different sexes, races, and ages? Are there employees earning much higher or much lower
than this average? Does it help or hinder?

With this type of observation and approach and relying on professional support
(SINDUSCON intends to implement a program of systematic support to its associates in this
regard), the company can begin to elaborate a plan to implement some good corporate
sustainability practices in its business, being ideal for formalizing (using for example, a small
materiality matrix).

40
 4) Think about acting on all aspects of ESG

When applying ESG, it is important to consider all aspects involved in this concept,
mainly because it is a systemic and integrated view. It is important to remember that in MANY
cases, companies apply (without, however, registering or even systematizing) ESG concepts and
practices without knowing that they are performing it or capitalizing on it in their favor.

Below are some suggestions for practical actions that can be taken in any company:

Environment:
• Control of water consumption, avoiding waste.
• Control of electricity consumption, avoiding waste.
• Control of the consumption of paper and raw materials, avoiding waste.
• Separation of garbage for collection and selective disposal (development of circular economy).
• Proper disposal of electronic or toxic waste.

Social:
• Hiring local labor (development of wealth, prosperity, and local economy)
• Give preference to local suppliers.
• Stimulate respect for human rights.
• Stimulate diversity and inclusion for all.

Governance
• ESG Opportunity and Risk Management.
• Prevent cases of harassment, discrimination, and prejudice.
• Comply with tax and tax rules/Tax transparency.
• Follow ethical and anti-corruption conduct.
• Ensure fair and rational remuneration to all employees.

41
 5) Motivate Your Team.
Be the ESG Sponsor in Your Company.
Become the Visionary / Admired Leader: you are ahead of your time.
A vital attitude for leaders is to sponsor the implementation of ESG practices in their
companies. In this sense, keeping employees motivated and informed about the progress of the
process is one of the attitudes that help ensure the continuity of these sustainable practices.

There must be some control over the application of planned ESG practices. Monitoring
how these actions are evolving and building reports, informing employees and society helps
ensure the continuity and success of ESG applications in companies.

6.6 What to plan for the medium

and long term?
Once we start applying ESG practices and standards, the big challenge becomes how to
keep the flame burning and, more than that, how and where to evolve. Many questions may
arise from this, such as:

• Should we seek any certification?

• Is hiring professionals or consultants important?
• How and where to seek help to consolidate an ESG approach in my company?

Nowadays, several business certifications and international references help companies

and projects parameterize their practices, establish indicators and formulate ESG policies and
requirements. Examples are environmental certifications and stamps (Leed, Aqua, Edge, Procel,
Well, Fitwel, Cradle to Cradle, Sites, etc.). In the case of evaluating sustainable investment funds,
there are references such as those of GRESB and Sitawi, in addition to many others. All this,
however, applies to more mature moments of companies and projects.

Fundamental and common concept, the ideal is to do right from the beginning (this is a
crucial concept aligned with normal expectations in engineering companies, projects, and
works). Therefore, building a clear policy that permeates the entire organization with the
consent of society is essential. See, it does not have to be complicated; it is just imperative that
it is clear, understandable, and, most importantly, achievable.

Thus, for evolution and thinking in the medium and long term, aspects related to ESG
concepts and practices must be side-by-side with the operational and financial parameters of
the company's daily management.

42
• Objectives should be clear, transparent and data needs to be comparable
•Standardization of indicators for the sector and other business units.
• The status prior to the implementation of the ESG model and indicators in your
company must be established.
• Data needs to be organized, underpinned by clear policies, and broken down into lower
layers.
• Comparisons must be made about the previous status of the region/business prior to
implementation and with other competitors in the same sector.

• ESG Reports are intended for various stakeholders, therefore:

• They can be used as transparency about the company's impacts on customers, civil
society, institutions, authorities, etc.
• They also intend to respond to challenges/problems and pressures from society,
authorities, investors, and other stakeholders.
• They should genuinely reflect the values and quality of management and leadership.

• Need to eliminate communication and understanding noise about ESG

• Policies should be deployed, and their implementation should be measured.
• Objective variables and indicators should be considered.
• Potential controversies and debates of the adversary should be incorporated.
• Value biases should be considered (business impact andconsequence assessments).

• Research industry and risk agencies

• Sectoral and risk analysis.
• Compliance Assessments and Audits.
• Structured and active risk monitoring.

• Research and future approach (opportunities) -

• Discuss topics not covered by the initial approach and evaluate opportunities to
leverage the company's long-term performance.
• Convergences between ESG and financial analysis.
• Identifying ESG opportunities/factors can impact the evaluation of projects and their
feasibility.

43
 • Keep progress information and monitoring tools available

- ESG: Quality Management.

- ESG: Identification of Opportunities.
- ESG: Management of opportunities and risks.

One way to structure a relatively simple ESG program in companies in the

construction sector would be to develop a framework to structure performance
areas and measurement categories (with goals and indicators established and
always measured longitudinally through concise and clear reports).

The diagram below gives a hint of this organization:

Non-financial KPIs

3 Performance E
S G
Areas Environment Social Governance

Emissions Human rights

and Effluents Compliance

11 Measurement Social Performance

Natural resources Sustainability
Categories of Success Factors
Training and
Qualifica�on
Garbage and Rejects
Health and Safety -
People and Products
Environmental
Compa�bility People management

44
6.7 Frequent challenges in implementation
of ESG Policies and Practices.
Each market, each sector of the economy, and each geographical location has its
particularities. Indeed, the challenges and opportunities in any circumstance need to be
analyzed and adapted to these conditions, which are also strongly dependent on seasonal
factors such as macroeconomic situation, social challenges, and the situation of that specific
market or sector

However, some readings and research demonstrate that there are some "commonplaces"
regarding what may be challenges or barriers to implementing an ESG culture within
companies. According to Sheila Conrado of Baker Tilly, some common challenges are evaluating
and measuring results and being up to date on the 2030 sustainable development agenda
composed of the 17 UN SDGs (Sustainable Development Goals). Another major challenge,
according to Sheila, another major challenge is communicating to all levels of the
company/organization the importance and opportunity that ESG provides, improving the
management of the company and its relations with society, and leveraging the business.

In addition, other challenges are pervasive and reported by scholars, observers, and
entrepreneurs, especially in the environments of small and medium-sized enterprises; however,
it is also essential to keep in mind that there is already a broad spectrum of examples
demonstrating that many of these perceptions and fears are, for the most part, exaggerated and
that many of the resistances and fears come from a particular perception of insecurity of
managers and entrepreneurs. Therefore, below we list some of these challenges (seeking to
reproduce what the arguments would be) and try to suggest how they can be addressed and
solved:

1. We cannot invest at this time - ESG initiatives/projects do not always require

financial investments from the company. Although there is some investment in
some situations, the benefits are mostly compensating. In addition, fines or
penalties are potentially costly due to non-conformities, and the cost of compliance
is often less than the cost and consequences of penalties.

2. We are running out of time to implement this here in our Company - There is a
perception by some that using ESG principles can take a long time. That is not true,
perhaps some training, training, and skills development is necessary for our
executives and employees, but ESG should be treated as a routine of processes
within your company/organization that reveal how it treats environmental, social,
and governance issues; often there are already regular and routine practices, which
need only to be adjusted for a speech, and well recorded/reported.

45
 3. We do not have the resources, skills, and knowledge - Most of the time, these
arguments are related to the "potential costs" to develop skills, knowledge, and
resources to implement ESG in the company. Here, hiring a consultant can be a
viable option, or even online training and/or support from class entities (such as
Sinduscon or FIEMG), which often provide free of charge the full range of resources
and knowledge, including internal training and professional monitoring. One can
appoint an internal collaborator to study the subject and be the internal "facilitator."

In any case, working on the improvement of internal processes seeking improvements in

the company's attitude towards environmental and social factors, coupled with attitude
changes (providing effective and transparent governance) can be highly beneficial for the
company and its future, and the greatest of all challenges to reaching the transformative stage
in ESG passes through the ambition and genuine desire of the leadership and the company to
embrace the principles of ESG as an internal priority.

6.8 The Importance of Transparency in Impact

Reports / ESG / Sustainability.
The concept of transparency is widely studied, and there are several ways of
understanding the concept of transparency in various areas. These concepts are developed and
explained in areas such as business management, finance, relationships, etc. Therefore, given
the dispersion of these definitions, transparency contains a certain vagueness as to their
concept.

For an understanding of our purpose concerning ESG practices and

Impact/ESG/Sustainability reports that are essential for demonstrating the positioning of
companies, we will use a definition by Marques et al. l (2019) based on a work published by Albu
and Flyverbom in 2019, which conceptualizes transparency as having two perspectives:
Checkability and performance:

Checkability refers to the ability of disclosed information to be measured in quantity,

frequency, and relevance. On the other hand, performance activity sees transparency as a
complex process full of tensions and negotiations. Hence reports must be considered reliable,
socially accepted, and by the legislation.

In short, doing something with transparency means disclosing your company's

information in a genuine, accepted, and legal way, and this information can be verified,
measured, and comparable.

In many parts of the world, mandatory transparency has been gaining many
repercussions, which means that a government or entities can reduce damages to society and
increase social welfare if it becomes mandatory for companies to disclose risks and failures
transparently.

46
 General Considerations on Transparency in Brazil.
Brazil occupies a poor position in public and private transparency compared to other
countries. The World Economic Forum (WEF) publishes its annual "Global Competitiveness
Report" to support business policies. This report presents the Global Competitiveness Index,
which ranks the performance of 137 countries according to 12 pillars of competitiveness. In
2017-2018, while Switzerland was in 1st place, Brazil was in 80th place.

That is, although Brazil is advancing, it still needs to improve a lot in this regard, and the
business world, together with governments, is the most significant lever for this necessary and
mandatory progress to consolidate a position of competitiveness of the country, and this fully
applies to the construction sector, considered a classic example of Brazilian difficulties with
governance practices and transparent reporting.

What are the benefits of transparency in companies?

For those with a more conservative profile, transparent management can seem quite
daunting since it can (in theory) expose the administration and management of the company.
However, today it is proven that many advantages for the business are extracted from
transparent postures and reports in all sectors, including the company's posture and
commitment to sustainable practices. Some of these advantages and benefits are listed below:

Organizational Culture Consolidation

The relationship between business transparency and organizational culture is a two-way street
in which both are benefited. As information is shared and employees are more involved in
decision-making, culture strengthens, and transparent practices are entrenched

Increased sense of belonging of employees

Information sharing is one of the premises of the sense of belonging in a group, be it of any
nature. When a company shares transparent data, it generates a sense of pride and assimilation
of relevance in employees, customers, and other actors in the chair. Thus, the positive impacts of
transparent reporting are felt throughout the value chain, with more excellent attractiveness
and credibility of that organization for a sector or production chain.

Strengthening positive perceptions in the business environment

The strengthening of the concepts of "good company to work for" and "socially responsible
company," moving from the concept of "best company in the world" to "best company for the
world," has different meanings for companies and sectors of the economy. In an industry that
experiences numerous difficulties in attracting and retaining talent, such as the construction

47
industry in general, developing a positive image/reputation from this perspective can be a
powerful tool for attracting and retaining talent.

Improved motivation and engagement

Motivating and engaging employees is a significant challenge in managing people in any
company. However, this challenge can become more straightforward as people feel
represented by the company/organization in which they work. Knowing how to deal with
differences is essential and motivating.

In this scenario, professionals are more willing to do their best

because they know and trust what is being done.

48
 The stages of
ESG evolution
Opportunities, Challenges,
and Risks to Business
Perennial
Presented by
José Pedro Barbosa Lins

49
José Pedro
Barbosa Lins
pedrolins.associado@fdc.org.br

Consultant, mentor, counselor,

professor, speaker and volunteer,
with vast experience and living
around the planet.

Biology - PUCC
Marketing - ESPM
ADM - FGV
MPA-MC - Harvard (HKS)
Member - FDC
SBS - Harvard (HBS)

50
Construction challenges
of our ESG Strategy.
The “new” positioning of our COMPANY in the face of Inevitable
Market Trends.

Understanding of our COMPANY's Purpose in ESG and our Role

as LEADERS in this scenario: The Different New.

ESG is a decision-making process.

Whether or not our COMPANY will be ESG?”

ESG Timeline

51
The Pillars Of ESG

ESG
Inevitable Market Trends

52
ESG General scenario
Transformations

53
ESG Definition
The term ESG was coined in 2004 in a World Bank publication in
partnership with the UN Global Compact and financial institutions of
9 countries responsible for the administration of more than $20
trillion, called "Who Cares Wins." The proposal was to obtain the
support of financial institutions to seek the best way to integrate ESG
factors into the capital market.
The acronym abbreviates the words Environmental, Social and Corporate Governance; In
Portuguese, the term means good environmental, social and corporate governance

54
Market Reaction
Financial

BlackRock, the world's largest third-party resource manager -

US$ 9 trillion

No sense of purpose, no company, public, private or social life

can reach its full potential. Ultimately, will lose the license to
operate from the main parties interested parties/stakeholders.

Cartas Larry Fink

* 2012-2015: Good Governance
* 2016-2017: Stakeholders
* 2018-2019: Purpose and Leadership
* 2020: Sustainability
* 2021: Carbon neutral economy

55
Market
Reaction

56
 ESG Benefits:
The Performance of
Companies Global

Source: MSCI, 2019

Brazil Vision
The Index of Sustainability ISE |INDEX EVOLUTION Performance Evolution
Business (ISE) has been IBOVESPA X ISE
created in 2005 by B3 as a
tool for measuring and
encouraging sustainable
attitude on the part of
companies, as well as
highlight the companies
aligned with this idea and
make it more attractive the
investment in this field

15th por�olio of the Corporate Sustainability Index- ISE B3 2020

The criteria that evaluate the environmental, social, economic and

governance is divided into four sets:
1 - Policies (indicators of commitment);
2 - Management (program indicators, goals and monitoring);
3 - Performance:
4 - Legal compliance.

57
The challenge ESG literacy throughout the
of literacy organization is a typical goal

in ESG.
leader ESG.

However, the proliferation and lack of alignment among over

2,000 reporting frameworks, requirements, methodologies, and
protocols, with more than 1,424 potential ESG performance
indicators, is an evident frustration.

58
 Management
Opportunities x Risks
OPPORTUNITIES
Increased satisfaction and Attraction andretention
n Quality Gains Development
p Participation in Facilitation of dialogue Brand appreciation
member loyalty of Talent Partnerships for Local Socioeconomic public policy and engagement
growth “Circular Economy”

Society
Clients Employees Suppliers Community Government Media
Civil

Product entry Decrease in Productivity Access restriction Protests Sanctions and Protests and boycotts Loss of reputation
substitutes Increased turnover to inputs, and
Loss of licence. proceedings
Loss ofMarket share Legal co-responsibility
to operate.

RISKS

ESG as a set
of opportunities

-
-
-

-
-
-

59
 OPORTUNIDADES
Aumento da satisfação e Atração e retenção Ganhos de qualidade Desenvolvimento Participação na Facilitação do diálogo Valorização da marca
fidelização de cooperado de talentos Parcerias para o Socioeconômico Local formação de políticas e engajamento
crescimento “Economia Circular” públicas

Sociedade
Clientes Colaboradores Fornecedores Comunidade Governo Mídia
Civil

Entrada de produtos Queda de Produtividade Restrição de acesso a Protestos Sanções e processos Protestos e boicotes Perda de reputação
substitutos Aumento rotatividade insumos, e Perda de licença
Perda de Market share Corresponsabilidade legal para operar

RISCOS

ESG Materiality & Maturity

60
ESG Materiality
& Maturity

A total of 169 topics have been identified and grouped into 19 issues. The tables
on the following pages list the 19 issues that form Our Materiality Matrix and
reflect how we have prioritised them. We have classified these issues into five
Focus Areas. Improving Health & Well-being, Reducing Environmental Impact
and Enhancing Livelihoods encompass the three Big Goals of the Unilever
Sustainable Living Plan; Responsible Business Practices and Wider Sustainability
Issues include issues that are not explicitly part of our Plan, but which are
relevant to our commitments as a responsible business. These issues are listed by
priority which indicates the importance attached to any given issue according to
its impacts on our business and its importance to our stakeholders. Priority does
not equate to the extent of action within Unilever to address an issue.

61
Materiality, ESG Maturity,
and Economic Performance.
"Why, and for what reason should I invest in ESG?"
"After all, what will my company gain from this?
"Does it make money?"
"Won't it cost too much?"
"Wouldn't it be more of a "fad"?"

However, you really should be concerned about issues like:

"What are our competitors doing regarding ESG opportunities?"

"Which ESG issues do investors consider most relevant to the industry?"
"Are Leaders and the board prepared and structured to oversee
ESG opportunities and risks?"
"Has the Company's Leadership assessed theESG opportunities
and risks the Company may face in 6, 12, 30 years?"

What can be done in the short term?

What to plan for the medium and long term?
What are the challenges for implementing ESG
in my company?
How deep is your commitment to ESG?

Help reduce expenses.

Attract investors and investments.
Improve the image and reputation of your business.
Attract and retain talent.
Attract and retain new customers.

62
ESG The Transformation

GROWTH OF THE
ETHICAL GENERATION
Millenials and Generación Z
no longer want:

-WORK FOR
-INVEST IN
-BUY FROM

By 2030, they will be 75%

of the force Global work.

63
ESG The Transformation

Are you ready

for this different new?

64
What is the strategy of ESG
of our Company?

65
ESG Stages.
Mirvis and Googins identified five stages of
ESG, representing distinct patterns of activity
at different points in our COMPANY's development:

1) ELEMENTARY
2) ENGAGED
3) INNOVATIVE
4) INTEGRATED
5) TRANSFORMER

Stages are measured in

seven dimensions:

- Definition of the ESG concept.

- Purpose (strategic intent).
- Leadership support.
- Structure.
- Responsiveness (question management).
- Stakeholder Relations
– Transparency.

Corporations evolve to higher stages

based on four triggers:

-Leadership CREDIBILITY.
-ABILITY to support ESG activities.
-COHERENCE of these activities.
-COMMITMENT to incorporate ESG
into corporate culture.
Customized by:
https://bizfluent.com/about-6684095-france-s-economic-system-.html

66
Leadership
Purpose and Legacy
GNG for ESG
Tshering Tobgay

https://www.youtube.com/
watch?v=HbYXDphNBZk

67
68
 8
in industry of
Construction
69
Works Commission
Industrial and Corporate Works
ESG in the construction industry.
Presented by Marcelo Figueiredo

Civil Engineer

Master (MSC) in Administration

MBA in Business Management (IBMEC)

Extension courses at MIT (USA) and IMD (Switzerland)

VALE - Project Portfolio Director

ArcelorMittal - CTO (Chief Technology & Technical

Officer) at ArcelorMittal Mining Canada Performance
on 6 continents in the implementation of significant
projects in eight countries (Brazil, Oman, Malaysia,
Indonesia, Australia, Mozambique, Malawi and
Canada)

Marcelo Currently a consultant in the Development area

Figueiredo of International Business, Capital Projects,

Governance, and M&A

Chairman of the Board of Directors of Progesys Acttio

70
Industrial and Corporate
Works Comission
ESG in the construction industry
To get started, let's agree on a few things:
ESG IS NOT........
hug a tree NOT kissing little children

ESG IS:
• Concrete and Measurable Goals;
• Internationally comparable parameters (GRI, SDGs, IIRC, SASB)
• Demonstration of the company's responsibility to society
in environmental, social and governance aspects
• Generates value for investors
• Attracts investments
• Decision guider.

Fonte: SSE database

71
 Industrial and Corporate
Works Comission
ESG in the construction industry
After all, why is ESG so crucial to
the construction industry?

DID YOU KNOW?

CIVIL CONSTRUCTION ACCOUNTS FOR

• 75% of Natural Resources Consumption is Produced in Brazil.
• 44% of the Energy Produced in Brazil consumed in the
Value of Civil Construction.
• 40% of all waste generated by human activity comes from the
Civil Construction Value Chair.
• 1/3 of greenhouse gas emissions come from Civil Construction
activities and/or their value chain (intensive use of steel=35%
and cement= 8%).
• The ACTUAL waste in the works reaches an incredible 65%!!!!

Sources: CBCS - Brazilian Council on Sustainable Construction,

SIENGE Platform 09/17/17 and Tribuna do Norte (Article of 08/24/2013)

72
Industrial and Corporate
Works Comission
ESG in the construction industry

SOME MORE DATA

CIVIL CONSTRUCTION ACCOUNTS FOR

• Of the material purchased by the works, only 20 to 50%
is consumed; the rest is wasted or scrapped.
• Only 30% of the waste generated by construction in the
Brazil is recycled.
• The remainder (about 70%) either goes to dumps or
dumpsites (formal and clandestine).
• Potentially up to 95% of construction waste is recyclable.
• Water waste in construction reaches 50%.

Sources: CBCS - Brazilian Council on Sustainable Construction,

SIENGE Platform 09/17/17 and Tribuna do Norte (Article of 08/24/2013)

THERE IS PLENTY OF ROOM FOR

• Only 1% to 2% of civil works in Brazil use sustainability concepts.

• Even so, Brazil is already the fifth country in the world in the
practice of sustainable construction (numbers for the year 2018).

Fuente: Informe LEEDS, 2019

73
Industrial and Corporate
Works Comission
ESG in the construction industry

You must be thinking:

Okay, all right...
Now answer me:
• “Why should I invest in ESG?”
• "After all, what will my company
gain from this?"
• “Does it make money?”
• "Will it cost a lot?"
• "Wouldn't it just be a fad?"

OK, these are good questions, and we will

do our best to answer them, but first,
let us suggest some additional questions:

• What are my competitors doing (ESG)?

• What do investors consider important?
• Do we know the risks, opportunities, and trends?
• Are we ready?

74
Works Comission Industrial
and Corporate Works ESG in
the construcion industry

WHAT CAN I DO IN THE SHORT TERM?

Firstly, it is crucial that you know what you are already doing,
and maybe you do not know...

Just by being here talking about it,

you are already taking a step...

SUGGESTION:
DO A SURVEY ON WHAT IS ALREADY BEING DONE IN
YOUR COMPANY (Ex. Energy consumption, social
actions, savings...)

75
 The journey is long,
but we've already started.

76
Conclusion

77
 This work aimed to bring clear
arguments and motivations for companies
in the construction industry to recognize
the importance of taking ESG seriously and
eventually be encouraged to implement
them. A careful evaluation and reflection on
the industry's environmental, social, and
governance aspects are necessary to
propose an attentive and responsible
management with substantial changes in
the day-to-day of its business.
Studies reveal that most sectors of
the national industry know relatively
superficially the subject, especially our
construction industry, and many executives
remain incredulous about the effects of
adopting the practices of ESG for the
growth and continuity of companies. By
going deeper into this scenario, it is noted
that by adopting the practices of ESG,
companies leverage opportunities and
generate wealth, combining social
prosperity and environmental preservation.
All this is based on an organizational culture
of solid ethical precepts that seeks its
performance through accountability and
compliance. Companies at the forefront of
ESG in Brazil and worldwide have
consistently better-than-average results.
From the discussions arising from
this Booklet, it can be concluded that ESG is
essential not only for environmental, social,
and governance causes but also for the
maturation of management and
sustainability of organizations. Basically, by
giving due attention to this topic, it is
expected that business performance will
improve from the application of the
recommended measures since they
advocate: rational use of resources, which
consequently reduces costs; greater
diversity of professionals, which, in turn,
generates greater creativity and talent
attraction; and a transparent and ethical
78
operation, driving the opening of markets
and reducing the need for control.
This work promoted an essential union of
business organizations, class entities, and
academia around ESG. The debates and
meetings that were part of the elaboration of
this Booklet gave rise to a change of
mentality in the executives and participating
companies, which makes us believe that a
significant step has been taken to make
effective and positive changes in our sector.
These changes will drive the next step:
supporting companies in implementing the
practices and metrics proposed by agenda
ESG.
Finally, we would like to thank
everyone who contributed the best of their
efforts and knowledge to this project: Union
of the Civil Construction Industry in the State
of Minas Gerais (Sinduscon-MG), Brazilian
Chamber of Construction Industry (CBIC),
represented by the Commission of Industrial
and Corporate Works (COIC), Fundação Dom
Cabral (FDC), represented by Professor Pedro
Lins, to the authors of this Booklet and
members of the Subcommittee on Contracts
of the Commission of Industrial and
Corporate Works (COIC) of Sinduscon-MG.
This Booklet also integrates the
project 'Sustainability of Industrial
Construction Companies and Corporatives'
of COIC/CBIC with the National Industrial
Learning Service (Senai Nacional).
Nacional).
79
 9
Publications
CBIC
80
Publications CBIC
INDUSTRIAL AND CORPORATE WORKS

SUSTAINABILITY

81
INNOVATION

INFRASTRUCTURE

82
83
REAL ESTATE INDUSTRY

SOCIAL RESPONSABILITY

84
LABOR POLICIES

LEGAL

85
Support

Co-realization Realization
Support Co-realization Realization