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This is how we lead

Good Corporate Governance is framed in ethical, transparent, trustworthy and respectful relationships, which translate into profitable economic performance and mutual growth with all our Stakeholders.

Integrated Report 2020 / This is how we lead

This chapter covers the topics:

Corporate Governance

Ethics and transparency

Regulation

Economic growth

Sustainable supply chain

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Maintaining high standards of Corporate Governance is a priority to be a transparent company and generate trust in all our Stakeholders. In 2020, we continued to strengthen our Corporate- Governance scheme, which allows mitigating reputational risks and facilitates access to new businesses, markets and clients: we updated the Good Governance Code, the Related-Party Transactions Policy, and that of the relationship with related parties, as well as the guidelines for participation in Boards of Directors.

Being honest, ethical and transparent, we continued to generate the best alliances of mutual trust with our clients, suppliers, communities and other Stakeholders. These principles are embedded in the way we do things through specific guidelines, systems and procedures.

In 2020, we continued with the Committed Campaign, promoted by our Grupo Argos Holding Company, which includes the course of conduct for all our employees, to strengthen the foundations of ethics, transparency and respect.

We defined 100% of the action plans and controls against the most-relevant risks in terms of compliance.

Our financial management allowed us to maintain a long-term vision and align the Organization’s actions to guarantee the creation of value for our Shareholders and other Stakeholders.

In 2020, we achieved consolidated
income for COP

3.5 trillion

The EBITDA was COP

1.23 trillion

Noteworthy is the issuance of bonds in the stock market for COP 200 billion, with a demand that exceeded more than 3.6 times the amount offered.  For the first time, the Colombian Stock Exchange carried out an issuance of this type 100% virtually.

Finally, we seek to grow hand in hand with our suppliers and contractors, who we consider strategic allied.  Supply-chain management allows us to mitigate risks, maximize opportunities and strengthen production chains, thanks to our efforts and proximity to this Stakeholder.

We achieved a positive result of 93.3% in the Supplier Satisfaction Survey.

How did we respond to COVID-19?

In the context of the situation generated by COVID-19, we carried out strong regulatory management together with authorities and guilds, ensuring the continuity of service provision, providing support and flexibility in the payment of the service for our clients and reconnection of service to all of them.  We promoted Government-support mechanism to finance and pay pending subsidies, which would allow financial sustainability for companies and, thus, avoid a chain effect in the activities of the service-provision process.

 

In this emergency, we also had to act decisively to protect our supply chain.  We formulated a financial-aid plan for 350 Colombian companies considered strategic, to preserve their operation and the employment they generate.  Within the framework of the new normal, we virtualized visits, talks and development programs with our suppliers.

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  • Anti-competitive practices
    Business practices that prevent free competition; that is, the possibility for economic agents to effectively participate in a market.
  • Corporate Bylaws
    Internal rules governing the Company’s operation and governance; they are approved by the General Shareholders’ Assembly.
  • Corporate codes and policies
    They are the documents approved by the Celsia Steering Committee or the Board of Directors that determine the framework and guidelines regarding a certain matter, so that the Stakeholders have performance parameters aligned with those of the Organization.
  • Corporate Governance
    The system of principles, policies and guidelines that guides the way the Company and the relationships with the different Stakeholders are guided.
  • Critical providers
    Suppliers whose management is considered a priority because they meet certain predefined criticality characteristics. At Celsia, we consider critical suppliers as those who provide us with high volumes of critical goods or components or non-substitutable goods.
  • Distributed generation
    This consists of the generation of electrical energy through many small sources of generation that are installed near the points of consumption. Distributed generation is based on the cooperation between this microgeneration and the generation of conventional power plants.
  • EBITDA
    The financial indicator of the profitability of our Company. It is calculated as profit before interest, taxes, depreciations and amortizations.
  • Income
    Resources that come from the management of the Company's operation.
  • Local suppliers
    Those suppliers that come from the country of operation.
  • Microgrids
    A group of distributed loads and energy resources with a clearly defined electrical frontier, which has the ability to be self-sufficient and operate in isolation or in parallel with the electrical system to supply local demand.
  • Net Profit
    The result after deducting all the corresponding expenses and taxes from the income obtained by the Organization.
  • Ordinary Bonds
    Securities that represent a debt that an issuing entity has with the natural or legal persons that acquire them. They are a financing option for companies, other than bank credit. In this case, the issuing company acquires the obligation to return the amount of the investment to the bond holder after a period of time has elapsed, plus a sum of money that is equal to the interest it promised to pay.
  • Policy for the Management of the Risk of Fraud, Bribery and Corruption
    The parameters in the development of the Code of Business Conduct to implement a risk-management system, in order to establish control measures aimed at preventing their occurrence.
  • Prosumer
    A user who actively participates in the service-provision chain with different interactions, usually with self-consumption, as well as having the possibility to benefit from its surplus energy.
  • Regulated Clients
    The vast majority are residential clients or small businesses with maximum consumption of 55 MWH/month or 100 kW of power. The rates at which we sell energy to them are regulated by the Energy and Gas Regulatory Commission (CREG, in Spanish).
  • Regulatory Framework
    All the resolutions issued by the Energy and Gas Regulation Commission (CREG, in Spanish). It is part of the general framework, such as the Political Constitution, and is made up, among others, of codes, laws, decrees and resolutions.
  • Reliability Charge
    CREG Resolution 071 of 2006 defines the Reliability Charge as the remuneration paid to a generator for the availability of generation assets with the characteristics to guarantee compliance with the Firm Energy Obligation assigned to it in an auction.
  • Retail market
    A set of residential, commercial or industrial clients to which energy trading companies sell energy directly according to the contractual commitment acquired with them.
  • Self-Generation
    Electric power generation carried out in the home, school or business. As a requirement to inject it into the grid, it must have been generated using non-conventional renewable energy. Self-generated energy will supply part of the total electrical consumption.
  • Smart Meters (AMI)
    Advanced metering infrastructure (AMI). It is the latest technology available that allows the Company not only to have a more-accurate record of client consumption, but also encourages it to develop new products and services to make the most of the information we begin to collect through these new teams.
  • Suppliers with a High Sustainability Risk
    Suppliers that may affect the development and achievement of the Company's strategy objectives. These include Environmental, Social and Economic (ESE) threats, weaknesses and specific situations to which the Company is exposed. If we do not manage it, the lack of risk orientation in the supply chain could limit our ability to obtain sustainable, reliable, long-term benefits for all our Stakeholders.
  • Stakeholders
    Groups of people, internal to the Organization or third parties, with whom we maintain various relationships, depending on the type of relationship. We welcome their suggestions and manage their expectations, which is critical to meeting our strategy.
  • Supply / sourcing chain
    A set of processes that ensure that the company obtains the resources necessary from a series of suppliers and contractors to provide its clients with the goods and services it markets.
  • Tier-1 Suppliers
    Those suppliers who have a direct contractual relationship with Celsia.
  • Unregulated Clients
    They are large consumers of energy. Due to this condition, they are free to contract the provision of the energy service with the company that offers them the best price in generation and commercialization; therefore, the rates are agreed upon through a negotiation process between the client and the company.
  • Wave-1 Supplier
    A supplier of services associated with the business object (high-risk activities within our facilities or assets inherent to the business).
  • Wave-2 Supplier
    A regular high-risk service supplier.
  • Wholesale Market
    A set of information-exchange systems between generators and marketers of large blocks of electrical energy in the Commercial Exchange System, to carry out long-term energy contracts and in the Energy Exchange on defined quantities and prices, subject to the Operating Regulations and other applicable rules.

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