SUSTAINABILITY REPORT
2014
SUSTAINABILITY REPORT 2014
SUMMARY
1. INTRODUCTION
1.1 Letter From The President
1.2 About This Report
1.3 Brazil Steel Institute
Celebration of the 50th Anniversary
Technical Surveys and Papers
Relationship with Strategic Audiences
2. THE STEEL INDUSTRY IN BRAZIL
2.1 Economic Context
2.2 The Brazilian Steel Industry
2.3 The Life Cycle of Steel
2.4 Bottlenecks for Sustainable Development
3. PRACTICES FOR SUSTAINABLE DEVELOPMENT
3.1 Technology Innovation and Corporate
Management Tools
3.2 Initiatives of Certification and Self-regulation
4. PERFORMANCE OF STEEL COMPANIES
4.1 Economic Performance
4.2 Social Performance
4.3 Environmental Performance
CORPORATE INFORMATION
CREDITS
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1. INTRODUCTION
1.1 LETTER FROM THE PRESIDENT
Dear reader, this is the 9th issue of the Brazil Steel
Industry Sustainability Report, where we present
the steel industry activities and indicators for 2013
encompassing the financial, social and environmental
pillars of the sector.
It has been a difficult period the Brazilian economy, especially for the manufacturing industry as
a whole. The annual GDP growth rate was 2.5%,
propelled mainly by the results of the agricultural
sector. The share of the manufacturing industry in
the GDP dropped from 19% in 2004 to 13% last year.
In the specific case of the steel industry, an adverse
global environment still persists due to the excess in
production capacity currently surpassing 600 million
tons. All countries are therefore affected, many of
which have not yet recovered from the economic
crisis that broke out in 2008.
In this context, the Brazilian steel and steel-intensive
goods, such as machinery and equipment, are still
coping with the loss of competitiveness against similar
foreign products due to the country’s structural issues
such as the high, cumulative tax burden, infrastructure and logistics bottlenecks, and a persistingly
appreciated exchange rate. Steel companies only
manage to continue to operate and generate some
results thanks to their state-of-the-art manufacturing
facilities, management practices consistently oriented
towards innovation and quality, and highly skilled staff.
Notwithstanding the difficulties ahead, we strongly
believe that economic sustainability cannot be
achieved unless integrated and balanced with social
and environmental matters. The well-being and quality of life of our collaborators, family members, and
neighboring communities to industrial plants are
a priority reflected in the policies of the associated
companies, ranging from the care for the health and
safety of all workers to the promotion and support of
cultural and educational, health, and sports projects
and entertainment activities to the general public.
In the environmental field, we have invested a total
of BRL $ 763 million in 2013. Nearly all of the water
used in industrial processes has been recirculated
and 88% of what used to be waste is now being used
by the companies or in other activities such as cement
manufacturing, road paving, chemical industry, and
energy production. One of the main goals of all steel
companies lies in maximizing the environmental
efficiency of both processes and products.
The history of the industry has always been closely
connected to the development history of nations.
Steel is constantly innovating and reinventing itself
to fulfill the demands from all sorts of use. It played
an important role during the Industrial Revolution as
a fundamental raw material in the shift from artisanal
to large scale production. It is also an important
part of current societies, present in transportation,
assembly lines, energy production, i.e. our daily lives.
It will continue to play an important role in the future,
providing services and adapting to the needs of generations to come. This is our core belief, which we
have been tirelessly working to turn into reality.
Benjamim M. Baptista Filho,
President of the Board of Directors of Brazil Steel Institute
1.2 ABOUT THIS REPORT
This is the ninth edition of the Brazil Steel Institute
Sustainability Report, in accordance with the principle of transparency and aiming at sharing information
on sustainable actions promoted by the steel sector.
Just as in previous years, this publication is inspired
by the guidelines set forth by the Global Reporting
Initiative (GRI), currently the most complete and
worldwide adopted model. The very process of its
elaboration fosters the engagement of concerned
parties in our organization, an investigation of the
main impacts they produce, the definition of indicators, and communication with target audiences.
The information compiled for this report encompasses the following associated companies and
their respective steel manufacturing plants:
Aperam, ArcelorMittal Brasil, Gerdau, Sinobras,
ThyssenKrupp CSA, Usiminas, Vallourec Tubos do
Brasil, Vallourec & Sumitomo Tubos do Brasil – VSB,
Villares Metals, and Votorantim Siderurgia.
In practical terms, the technical staff of the Brazil
Steel Institute collected all economic, social and environmental data and information about the companies
associated with the Institute. Journalists conducted
interviews with executive directors of associated
companies to better compose an overview of the
steel sector in 2013. They also heard people who
were positively impacted – either direct or indirectly
– by the steel industry.
The Brazil Steel Institute hopes this report will
deliver more information on this primary segment
of Brazil’s economy to the general audience as well
as contribute to expand the dialogue with its different
interlocutors – corporations, clients, consumers,
the Government, and society at large.
The base period for the analysis and data collection
is 2013, and whenever possible the history of the
previous three years is presented for the purpose
of providing a benchmark for the analytical content.
1.3 BRAZIL STEEL INSTITUTE
Celebration of the 50th Anniversary
The Brazil Steel Institute is a non-profit entity that
unites and represents steelmaking companies
accounting for a major share of the Brazilian steel
production. In 2013, 10 companies operating 28 integrated and semi-integrated plants comprised the
Institute. Jointly, their production of a broad range
of steel products was able to fully meet the internal
market’s demand and allowed for exports.
In 2013, the Brazil Steel Institute promoted a number
of activities to celebrate its 50th anniversary.
The scope of the entity’s activities includes surveys
and research on steelmaking processes, equipment,
and technology as well as new uses for steel; developing programs and projects of interest for the sector;
and acting as the industry’s representative before
public and private organizations and institutions in
Brazil and abroad. Its headquarters are located in
Rio de Janeiro and an office is kept in Brasilia.
The Brazil Steel Institute constitutes a reliable source
of statistical data and information on the sector,
meeting the demands and answering questions from
different audiences such as various governmental
spheres, the National Congress, journalists, academia, Third Sector, and the like.
During the 24th edition of the Brazilian Steel
Conference – held in Rio de Janeiro in May – a film
documenting this 50 year history was released. The
book Aço Brasil, uma viagem pela indústria do Aço
(Brazil Steel, a journey through the steel industry)
was also launched, showcasing the transformation
the Brazilian economy went through accompanied
and propelled by the steel industry.
As part of the celebrations, 16 former directors of
Brazil Steel were honored with medals during the
24th Conference, in recognition of their dedication
and effort to developing the steel industry in Brazil.
A celebration logo was launched and used during the
year, in addition to a special session about the date
on the Brazil Steel website. The 50-year logo was
also publicized in several national events such as the
Worldsteel Conference, the ABM Rolling Seminar,
the Brazil Road Show, the 68th ABM Conference,
and the 44th Steelmaking Seminar, among others.
Aço Brasil Sustainability Report 2014
Brazil Steel supports innovation and encourages the
use of steel and its co-products
Year after year, the Brazil Steel Institute – supported
by its associated companies – has been expanding
its technical surveys and presence in specific fora,
proposing innovative solutions in order to advance the
share of steel and steel co-products in the Brazilian
economy and abroad. In this regard, three important
centers are coordinated by Brazil Steel:
Brazil Steel Co-Products Center (CCABrasil)
In 2010, the Brazil Steel Co-Products Center
(CCABrasil) was created within the Brazil Steel
Institute with the collaboration of associated companies and external entities such as academic
institutions, governmental agencies, consumer
sectors and industries that process national and
imported co-products. It aims at advancing development and adding value to co-products – such as
scrap, dust, sludge and scales – that are reused in
steel manufacturing itself or in other sectors, such
as construction and the cement industry, therefore
generating major environmental benefi ts. Learn
more at www.ccabrasil.org.br
Brazilian Center of Steel Construction (CBCA)
The Brazilian Center of Steel Construction (CBCA)
has been working for over 10 years now, together with
associated companies, the academy and entities from
the production chain to promote and enhance steel’s
share in the Brazilian construction market. The CBCA
conducts surveys and research on subject matters
relevant to the steel sector. Steel-intensive industrial
systems such as structures and sheeting are able to
tackle the challenges of construction and allow for
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a significant reduction in environmental and urban
impacts. The Brazil Steel Institute is responsible for
managing the Brazilian Center of Steel Construction.
Learn more at www.cbca-acobrasil.org.br
Brazilian Steel Committee (ABNT/CB-28)
The Brazilian Steel Committee – ABNT/CB-28 was
established in 1996 under the scope of the ABNT
– Brazilian National Standards Organization with
the technical and financial support of the Brazil
Steel Institute. The CB-28 is responsible for creating
technical standards for steel and steel products in
Brazil. Participation is open to those interested in the
matter. Read more on www.cb28-acobrasil.org.br
Relationship with strategic audiences
The Brazil Steel Institute values and seeks to
broaden the dialogue with various interlocutors
from the public and private sector. It takes part in
a number of governmental and corporate Councils
and Committees. It also closely follows up the
activities of the National Congress. Thanks to the
hard work within the Committees of the House of
Representatives and the Senate, Brazil Steel has
advanced proposals to improve bills and therefore
promote welfare and sustainable development in
the country. Brazil Steel has also improved its relations with the academic sector. The exchange of
information has contributed to developing master’s
and Ph.D. theses as well as technical surveys, all of
great importance to the steel sector.
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Aço Brasil Sustainability Report 2014
A significant part of the world’s steel production
comes from government-owned companies, many of
which are highly subsidized by the countries who own
them, making it impossible for private companies
who follow the laws of a free market to compete.
2. THE STEEL INDUSTRY IN BRAZIL
However, in spite of the adverse conditions in the
international market and of the factors that negatively
impact the competitiveness of the Brazilian industry,
steelmaking companies have been investing in their
units to keep them up to date and performing at the
same level of the best companies in the world.
Furthermore, in Brazil there are systemic factors
that undermine the competitiveness of national
products vis-à-vis foreign equivalents: heavy tax
burden, high energy costs, and infrastructure and
logistics problems.
2.1 ECONOMIC CONTEXT
2013 – Outlook
The Brazilian economy, according to IBGE, grew by
2.5% in 2013. A significant improvement if compared
to 2012, when the GDP grew only 1%. According to
the Monthly Industrial Survey of Physical Production,
also by IBGE, industrial production recorded a 2%
increase in 2013. These results impacted the steel
industry: internal sales rose by 5.5% and apparent
consumption grew 4.9% in comparison with 2012.
CRUDE STEEL PRODUCTION
(106t)
1,559.2
1,537.0
1,606.7
Crude steel production in 2013 totaled 34.2 million tons, showing a drop of 1% from the previous
year. On the other hand, rolled products production
reached 26.3 million tons, advancing 2.2% compared
with 2012 levels.
Brazilian plants operated at 70.5% of total production capacity, falling below the 2012 result of 71.3%.
Therefore, idle production capacity remains well
above the industry’s average of 85% of capacity
use due to the slow pace of the country’s economy
in the last few years.
Changes in this scenario represent a great challenge
since there is still an excess in steel production
capacity of around 600 million tons in the world.
67.5
65.7
65.4
35.2
34.5
34.2
2011
2012
2013
WORLD
LATIN AMERICA
BRAZIL
Source: Worldsteel, Alacero and Brazil Steel Institute
Aço Brasil Sustainability Report 2014
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INTERNATIONAL TRADE
Since the global market still presents a production
surplus , the exports by the Brazilian steelmaking
industry in 2013 totaled 8.1 million tons, amounting to US$5.6 billion. It represents a 16.8% drop in
volume and a 20% drop in values when compared to
2012 results. The bottlenecks in logistics and heavy
tax burden still influence the competitiveness of
Brazilian steel. The main buying market of Brazilian
steel products remains the United States.
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Aço Brasil Sustainability Report 2014
Products and markets
2.2 THE BRAZILIAN STEEL INDUSTRY
In 2013 3.7 million tons of steel products were
imported, into Brazil, which represents a 2.1% reduction in comparison to 2012. These products come
mainly from China, who has steadily increasing its
sales in the country. In 13 years, China’s share in
Brazilian imports increased by 36.4%. Furthermore,
Brazil has lost part of its market share to China in
Latin America.
After a poor performance of sales in 2012, some cyclic
factors influenced the market during 2013, such as
the automobile sector growth – 9.6% according to
IBGE – propelled by heavy vehicle manufacturing.
In 2013, the Brazilian steel industry was responsible
for 2.1% of the world production, ranking 9th in world
production. China is the largest manufacturer. In
Latin America, Brazil commanded a 52.2% share
of the continent’s total manufacturing last year.
The 10 corporate groups associated with the Brazil
Steel Institute operated 28 plants in 2013. Most of
these plants are located in the Southeast Region of
Brazil, which accounted for 93.1% of the national
production in 2013. Steelmaking plants located in
the South and North regions have contributed to
increase the geographic dispersion of manufacturing facilities. Main players in the development of
the communities in which they operate and of the
country as a whole, the companies associated with
the Brazil Steel Institute employed 100,924 in-house
and outsourced collaborators and promoted another
2.4 million indirect and induced job positions. (*)
33.1%
STEEL PRODUCTS CONSUMPTION
BY SECTOR
2012
The largest steel consumer segments are civil
construction, followed by the automobile and
machinery/capital goods industries. These three
sectors together represent some 80% of total steel
consumption in Brazil. The associated companies of
the Brazil Steel Institute supply the national market
and export for over 50 countries in all continents.
EVOLUTION OF THE ORIGIN
OF IMPORTS
2013
9.4%
2000
48.1%
19.7%
6.4%
14.1%
1.8%
6.0%
22.1%
1.0%
1.3%
4.7%
3.1%
2.9%
0.7%
5.2%
CIVIL CONSTRUCTION
AUTOMOBILE
8.7%
37.8%
33.3%
2.9%
MACHINERY/EQUIPMENT/CAPITAL GOODS
COMMERCIAL APPLIANCES
PIPING (SMALL-DIAMETER)
OTHERS
37.7%
EUROPE
ASIA
AFRICA
LATIN AMERICA
NORTH AMERICA
CHINA
OCEANIA
PACKAGING
(*) According to a survey carried out by FGV – The Strategic Importance of Steel in the Brazilian Economy, 2011 – each job position in
the steel industry generates additional 23.57 jobs in other economic sectors.
MINING AND STEEL INDUSTRY:
SAILING THE SAME WATERS
Vale, the largest world producer of iron ore and
pellets, has established a close partnership with the
steelmaking segment, not only supplying iron ore but
also assuming direct ownership of steel companies.
Vale’s Executive Director for Ferrous Minerals and
Strategy José Carlos Martins affirms that “iron mining
and steelmaking sail the same waters.”
With over 48 years of experience in the steel and
mining segments, Martins makes use of a metaphor:
iron mining and steelmaking may be on different
boats “but are affected by the same currents”.
Vale’s Executive Director for Ferrous Minerals and
Strategy reminds us that there are many aspects
in common and mentions the final market as main
example. “If it were not for steelmaking, there would
be no need for iron ore, therefore all factors influencing the steelmaking segment directly impact
us. Our destinies are umbilically linked”, he adds.
On his constant trips abroad to visit Vale’s clients
for negotiations, Martins stresses that these buyers
“are always interested in learning not only about
quality and innovation but also about the commitment
to sustainability throughout the whole production
chain.” According to him, this is a global trend, and
major Chinese mining companies and other countries share the same mission. Brazil is a competitive
player and can show best practices, as in emission
control and also several social and environmental
actions”, he says.
In addition to this indirect partnership, Vale holds
shares of steelmaking corporations: ThyssenKrupp
CSA – Companhia Siderúrgica do Atlântico and
Companhia Siderúrgica do Pecém (CSP), in the
state of Ceará. This list used to be longer: Vale is a
former partner of Usiminas, Companhia Siderúrgica
de Tubarão and Açominas. “We gradually sold many
of these shareholdings. We have always made clear
we would enter the companies to generate business,
and then we would leave”, explains Martins.
Vale’s Executive Director for Ferrous Minerals and
Strategy adds that “the participation in steel manufacturing groups aims at promoting the development
of steelmaking in Brazil and simultaneously increasing ore sales. This is what we call investment for
trade. It is part of the history of Vale.” In the case
of CSA and CSP it will not be different, stresses
Martines, adding that many steel manufacturers –
such as CSN, Gerdau and Usiminas – also have stakes
in mining companies. “This is a healthy movement
for Brazil, since it strengthens competition.”
Martins stresses that social and environmental
investments by steel producing companies are very
relevant. “They are absolutely essential to keep our
social equation with a positive and growing balance.
Steel is a crucial good to modern societies. Without
it, it would be impossible to produce energy, social
and transportation infrastructures, to promote the
urbanization of our cities and the goods we have
at our disposal”, he explains. And he concludes
reminding us that modern life style would not exist
without steel
As a result, he highlights, it is of the utmost importance for steel to be manufactured with minimal
impacts to the environment and the most benefits
for all. Martins says it is extremely important to
always keep a positive equation between impacts
and benefits generated for society by steelmaking
activities, as well as its economic benefi ts such
as GDP growth, employment, investment, and tax
revenues. “There is no such thing as an industrial
activity with zero impact.” It is human nature. What
must be done is maintaining a steady flow of investment in the environment, maximizing year after year
the result of our equation, improving each year the
positive contributions from our segment.”
He mentions some successful experiences carried
out by Vale, such as the so called “dry” mining, reducing drastically the water demand; the use of large
vessels, allowing a 35% reduction in emissions; and
the adoption of truckless mining processes, which
cuts carbon emissions in the mines by 70%. “We must
show these results to society in a way that everyone
can clearly understand that we contribute for a more
just and sustainable world. Showcasing the benefits
we produce is not enough, we must make sure it is
crystal clear for everyone”, he concludes.
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2.3 THE LIFE CYCLE OF STEEL
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Aço Brasil Sustainability Report 2014
LIFE CYCLE OF STEEL
An essential material
Steel is the most important and versatile metal
alloy available, and is crucial for the development
of society as we know it. Steel is widely present in
the daily life of every person: in vehicles, buses and
trains; in the construction of bridges, overpasses,
industrial plants and large scale undertakings; in
machinery and equipment; in buildings and houses;
in the manufacturing and conservation of food, in
ovens, refrigerators, and the like. Surveys carried out
by the IPT – Institute for Technological Research and
the Getúlio Vargas Foundation demonstrate that steel
is a major component in cars, major appliances and
construction, and yet represents but a small share
of the final price of these items. Read more on steel
in our daily lives on our page: www.acobrasil.org.
br/site/portugues/aco/aplicacoesintroducao.asp
In steel nothing is lost, everything changes
Being 100% recyclable makes steel a highly sustainable material. In construction for example, steel
shows many advantages when compared to other
inputs since it returns to the beginning of the production chain at the end of its service life. It maintains
its quality even after recycling.
IRON ORE
SCRAP RECOVERY
6 MONTHS
BLAST FURNACE
1 TO 10 YEARS
5 TO 50 YEARS
ELECTRIC ARC FURNACE
15 YEARS
BOF (BASIC OXYGEN FURNACE)
10 TO 20 YEARS
STEEL PRODUCTS
In Brazil, the reuse of steel from demolitions for large
construction sites has been increasing. Besides,
there are other actions in motion such as the National
Program of Truck Fleet Renewal, resulting from a
broad coalition including steelmaking, other industrial segments, workers and the Federal Government.
Its purpose is to, within the next 10 years, withdraw
from circulation all 30+ year-old trucks, gradually
reducing the target fleet age and recycling approximately 30 thousand vehicles per year.
be destroyed and all steel will be reused. There will
also be an incentive to the purchase of 10+ year-old
trucks. That would generate fewer greenhouse gas
emissions and contribute to the compliance with
environmental targets and goals set forth in the
National Policy for Climate Change (Law 12.187/09).
Through the Program, older trucks that are more
prone to accidents, generate more pollution, and
provide less comfort and safety for truck drivers will
Recycling generates revenues and, most of all, savings for the environment, since production processes
under the semi-integrated route consume much less
CONSUMER SECTORS
50 TO 100 YEARS
non-renewable raw materials and therefore reduce
greenhouse gas emissions. It also reduces the need
for new areas to dump products when they reach
the end of their service life. Besides that, new jobs
are created in recovering and processing discarded
materials. The social benefits are evident.
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Process of steel production
There are basically two technological routes for
manufacturing steel, allowing for a few variations
or combinations between them: the integrated route
(preparation of load, reduction, refining, casting
and rolling) and the semi-integrated route (refining,
casting and rolling). The basic difference between
these two lies in the raw material utilized in the
manufacturing of steel. In the integrated route there
is a predominance of iron ore complemented by
small amounts of steel scrap, while semi-integrated
plants (electric arc furnaces – EAF) utilize scrap for
the most part.
In general terms, the steelmaking process encompasses fi ve main stages:
Preparation of iron ore and coal – in this stage, the
portion of iron ore that is in dust form goes through
an agglomeration process by either sinterization or
pelletizing, resulting respectively in sinter and pellets
which are then used, together with high grade iron
ore, in the blast furnace load.
Coal contains undesirable elements (volatile compounds) for the steel production process. In order to
remove these volatile elements, the coal is heated
in ovens (coke-ovens) to be converted into coke.
Reduction of iron ore – this stage corresponds to the
removal of oxygen contained in the oxides present
in the ore, and coke or charcoal is used as a reducing agent. This operation is carried out in the blast
furnaces (fueled by either coke or charcoal). The
resulting product is an iron and carbon alloy named
pig iron, which still contains many impurities such
as phosphorus, sulfur and silica.
Refining – aims at the reduction of carbon content and impurities found in pig iron until desired
amounts, according to the different kinds of steel.
The transformation of pig iron into steel is then
performed in electric arc furnaces (EAF) or basic
oxygen furnaces (BOF).
Casting – the steel produced in the furnaces either
flows into ingot molds, solidifying in the form of
ingots, or is fed into continuous casting machines,
where it is cut off into semi-finished products (slabs,
blooms or billets).
Rolling – the products resulting from conventional or
continuous casting are mechanically transformed by
rolling, forging and other mechanical processes, in
a wide range of products such as coils, bars, plates,
rebars, wire rods, structural shapes, metal sheets, etc
STEELMAKING PLANTS
TYPE
PRODUCT
STEELMAKING
INTEGRATED PLANTS
FLAT ROLLED
PRODUCTS
Aperam South America (MG), ArcelorMittal Tubarão (ES), CSN (RJ),
ThyssenKrupp CSA Siderúrgica do Atlântico (RJ), Usiminas (Ipatinga/
MG and Cubatão/SP)
LONG ROLLED
PRODUCTS
ArcelorMittal Aços Longos (Monlevade/MG,Juiz de Fora/MG), Gerdau
Aços Longos (Barão de Cocais/MG, Divinópolis/MG), Sinobrás (Marabá/
PA), Vallourec (Barreiro/MG), VSB (Jeceaba/MG)
FLAT AND LONG
ROLLED PRODUCTS
Gerdau Açominas (Ouro Branco/MG)
LONG ROLLED
PRODUCTS
Gerdau Aços Especiais (Pindamonhangaba/SP, Mogi das Cruzes/SP,
Piratini/RS), Votorantim Siderurgia (Barra Mansa/RJ, Resende/RJ),
Arce- lorMittal Aços Longos (Piracicaba/SP, Cariacica/ES), Gerdau
Aços Longos (Açonorte/PE, Cearense/CE, Cosigua/RJ, Usiba/BA,
Guaíra/PR, São Paulo/ SP, Riograndense/RS), Villares Metals (SP).
SEMI-INTEGRATED PLANTS
Aço Brasil Sustainability Report 2014
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Further information is available on the Brazil Steel
Institute website: www.acobrasil.org.br/site/portugues/aco/ processo--introducao.asp
The production flow of integrated and semi-integrated plants, including the main manufacturing
stages, are shown in the figure below. In both routes,
scrap steel is necessary to the steelmaking process,
with integrated plants utilizing at most 25% of scrap
steel as input, whereas with electric arc furnaces
almost the entire load is composed of scrap.
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2.4 BOTTLENECKS FOR SUSTAINABLE
DEVELOPMENT
In spite of the permanent investment in technology
and innovation for the production of increasingly
sustainable steel, the Brazilian industry has been
directly hit by external factors that hinder its
competitiveness.
The heavy tax burden, the appreciation of the Real,
high energy costs and issues regarding logistics all constitute bottlenecks for the segment.
Nevertheless, the companies associated with the
Brazil Steel Institute, which focus on strategic management, managed to present reasonable results
after an extremely difficult 2012.
STEEL PRODUCTION PROCESS
SOLID PIG IRON
ELECTRIC ARC FURNACE
SCRAP
ROLLING
SINTER
IRON ORE
STEEL
SINTERIZATION
PIG IRON
COAL
FLAT ROLLED
PRODUCTS
COKE
COKE OVEN
CHARCOAL
BLAST FURNACE
CHARCOAL
FERRO-GUSA
REFORESTATIO CARBONIZATION
PREPARATION OF LOAD
LONG ROLLED
PRODUCTS
ACIARIA LD
REDUCTION
REFINING
CASTING
ROLLING
In this context, Brazil Steel defends the promotion and enlargement of the domestic market, the
expansion of incentive mechanisms comprising the
“Compre Nacional” program, and the elimination
of asymmetries that favor imports as measures to
further develop the industry.
Some governmental actions – such as investment in
infrastructure, unburdening of the payroll for certain
industrial sectors, maintenance of IPI tax reduction
for vehicles – allowed for a more favorable performance of steel– intensive segments and therefore
made this improved scenario possible in 2013.
STEEL IN CIVIL CONSTRUCTION
The new generations of architects are strongly
influenced by an enthusiastic advocate of the use
of metallic structures in civil construction. The
architect Luís Andrade de Mattos Dias, professor
of Design, Metallic Structures and New Technologies
at FAAP – Armando Alvares Penteado Foundation
and at the Centro Universitário Belas Artes of São
Paulo, considers steel as a contemporary material
that has not yet taken off as it should here in Brazil.
“I have always favored industrialization” He worked
for 18 years in the market division of Cosipa, today
Usiminas, where his admiration for the use of steel
in architecture first appeared.
According to Andrade, the great challenge of steel
is to become more competitive, like concrete and
pre-cast concrete. “The use of metallic construction techniques in Brazil still has a lot of room for
growth, as we see now in the rest of the world”, he
says. “Luís Andrade has published his first book –
Edificações de Aço no Brasil (Steel Buildings in Brazi)
(Zigurate Editora) – over 20 years ago. He compiled
the most significant construction works between the
mid-1950s, when the first large metallic structures
appeared in Brazil – such as the Garagem América
and Palácio do Comércio (Palace of Commerce)
buildings in São Paulo – and the beginning of the
1990s, with buildings like the Grande Oriente do
Brasil’s Masonic Palace and the Bank of Brazil’s
Training Center in Brasilia; the Steel Corporate Center
and Itaú Cultural Institute buildings, in São Paulo. “
“There is an economic prejudice against steel: it
carries the stigma of being pricy, an elitist material.
The steelmaking companies themselves are aware
that their strong suit is the automotive industry, but
contractors already begin to realize that steel may be
a good option, even a better one in some regards. We
are seeing a considerable increase in mixed structures in Brazil. This is not a battle with winners and
losers: each one excels in certain aspects. Steel is
as modern as it gets”, he says.” Large steel buildings
abroad are catching the eye of architecture students.
But the universities devote much more time in class
to concrete structures rather than metallic ones. And
it still has to share attention with wood structures.
“If building companies thought of the residual values
of their buildings in 50 years, they would think twice
before opting for concrete.” While the World Trade
Center had most of its metallic structure taken back
to the furnace to be reconverted into steel at plants
and then reused, buildings that do not incorporate
advanced technology into their construction eventually become rubble”, he concludes.
Luís Andrade confesses he does not appreciate the
excessive use of the word “sustainability”, which in
his view has become a fad. However, he does agree
that just by being reusable, steel becomes important
for the conservation of the environment. A pioneer
in the defense of metallic structures in Brazilian
architecture, the architect from São Paulo, who
graduated from the Mackenzie University and has a
Masters degree from FAU – College of Architecture
and Urbanism of São Paulo, Luís Andrade has also
written Aço e Arquitetura – Análise de 12 obras mais
importantes até 2010 (Steel and Architecture – Analysis
of 12 major works until 2010) and Estrutura de Aço
– Conceitos, Técnicas e Linguagem (Steel Structures
– Concepts, Techniques and Language) The latter
was translated into Spanish by request of ILAFA
(Latin American Institute of Iron and Steel) to support Spanish-speaking countries in Latin America.
In the year he reaches the age of 70, he is finishing
his fourth work: Estruturas Mistas e Híbridas (Mixed
and Hybrid Structures), which combine steel with
precast concrete using state of the art techniques,
by demand from the CBCA (Brazilian Center of Steel
Construction).
26
3.
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Aço Brasil Sustainability Report 2014
PRACTICES FOR
SUSTAINABLE
DEVELOPMENT
faced by the oil and gas industry which, in order to
produce in increasingly deeper layers like the presalt, has to develop new technology. The steelmaking
sector is rising to this challenge: it has been actively
participating in the supply of goods, in particular
high resistance pipes and equipment, and has also
invested in new production lines.
Based on the three pillars of sustainability – economic, social and environmental – the steel industry
is concerned not only with keeping its focus on
financial returns, but also on social/environmental
aspects, as seen in its strategic plans. The main challenge has been to perfect the integrated management
of the economic, social and environmental aspects
throughout all processes of associated companies.
3.2 INITIATIVES OF CERTIFICATION
AND SELF-REGULATION
3.1 TECHNOLOGY INNOVATION AND
CORPORATE MANAGEMENT TOOLS
The continuous worldwide search for new technologies in order to bring cutting-edge production
equipment, tools and methods to Brazil has become
a routine for the companies associated with the
Brazil Steel Institute. This way the segment manages to keep in line with major global steelmaking
corporations. According to a global trend, Brazilian
steelmaking companies adopt corporate practices
based on savings of natural resources and reduction
of negative impacts to the environment.
The keyword is eco-efficiency: to manufacture steel
using minimal amounts of raw materials, energy and
water, as well as reducing as much as possible the
generation of waste and greenhouse gases is the
goal of each of the steel plants.
In the field of innovation, the segment has advanced
in research and new technologies to satisfy clients’
needs. It is the case of the challenges of exploration
ISO 50001 contributes to reduce energy consumption
In 2013, some companies associated with the Brazil
Steel Institute obtained the ISO 50001 certification in energy management. The benefits arising
from this certification: energy savings, reduction
in carbon emissions, and enhancement in the performance of production processes. It is a relatively
new certification –it was first awarded in December
2012 – and testifies that it pays off to invest in more
sustainable processes.
Certification is a requirement of the global market,
and companies from the steel sector have manifested their interest in manufacturing high quality
products to attract demanding customers. The ISO
(International Organization for Standardization) is a
global organization network that gathers entities from
148 different countries. In Brazil, it is represented by
the ABNT. The ISO 9000, 14000, 18000, and 50000 are
part of the daily activities of Brazilian steelmaking
plants, alongside forest certifications and ecolabels.
THE MAIN ADVANTAGES OF ISO 50001:
In 2013, some companies associated with the Brazil
Steel Institute obtained quality certifications issued
by international organizations and realized that their
production flow charts became much more agile,
and sustainability aspects were positively impacted.
Identifying areas where energy consumption
may be reduced.
Thanks to the ABNT’s NBR ISO 14001 certification,
positive results can be achieved such as the reuse
of residues from the steel manufacturing process.
Relying in one-stop verification and certification services for energy management.
Ensuring that adequate energy management
controls are properly implemented.
Specific production activities that involve cutting-edge
technology are demanding increasingly specific steel
products. The steelmaking industry has been specializing in meeting the demands of these clients, which
demands major investment in innovation, research
and technology development. This work has always
been conducted jointly, in a partnership between
clients and steelmaking companies.
Recently, a steel manufacturer group in the region
of the Vale do Aço (Steel Valley) in the state of Minas
Gerais has introduced the technology of accelerated
cooling of steel plates (Continuous on-Line Control).
It resulted in the launch of a new steel product family,
providing specific resistance to the so-called sour
service, meant for the use in transportation pipes
for oil and gas containing hydrogen sulfide (H2S).
“These are steel products with high aggregated
value, and they meet the needs of the oil and gas
industry, particularly under severe conditions such
as those found in pre-salt production”, explains
Ricardo Miranda Alé, an expert engineer from the
steelmaking company in question.
Since they are located in very deep waters and have
to cover long distances from the exploration fields
until shore, the pipes used in the Pre-salt require
steels with high strength and toughness, as well as to
sour service. “The development of this new product
family was a great challenge, due to the cumulative
difficulty of simultaneously meeting all those requirements. It was only possible after obtaining steel of
high clarity and by using the CLC technology,” says
the engineer. There was even more caution, in the
case of these products, to prevent damage to the
environment in Pre-salt exploration.
The engineer, who worked directly on the development of these products, highlights the orchestrated
effort of Petrobras and Tenaris to obtain the API
X65 Sour Service steel. The next step, announces
the specialist, will be the development of the X70
grade, providing even higher strength for this sour
service application.
Leonardo Galvani
INNOVATIVE STEEL PRODUCTS
CREATE VALUE FOR MARKETS
DEMANDING HIGH TECHNOLOGY
This company’s new hot strip mill equipment, in a
plant located in the industrial region of São Paulo –
in line with state-of-the-art equipment found in the
global market – also allows the manufacturing of
steel for the line of oil and gas transportation pipes,
reaching up to X80 grade. With this mill, coils of
unprecedented dimensions are being produced in
the country, providing for the manufacturing of 24”
pipes of up to 20mm in thickness.
New, special steels are also being produced for the
automotive sector, based in innovative projects developed in the company. “These are more resistant yet
thinner plates that deliver less weight and smaller
emissions by motorized vehicles. On top of all that,
it also ensures more safety for passengers”, says
engineer Ricardo Alé.
The expert also highlights the investment made in
other special steels – from microalloyed and hot-rolled
dual phase steels to a growing range of cold-rolled
advanced high strength steel (AHSS) – increasing the
offer of hi-tech products for the Brazilian automotive
sector. With a second line of hot dip galvanizing implemented in a plant of the same Vale do Aço company, it
was possible to apply the hot dip galvanizing process
to manufacture AHSS coated coils. “This ensures
corrosion-resistant products, as well as high strength
and formability”, said Ricardo Alé.
Ricardo Miranda Alé, product expert engineer
30
Ecolabel and Product Certification
The constant investment in environmental certification and in the maintenance of good practices
throughout the whole steel production process reassure the market of the sustainability of steel. The
buyer seeks not only quality and fair prices, but also
the commitment to environmental preservation. The
market is demanding more and more the presence
of ecolabels in the products.
Both materials and processes employed in the production of green steel undergo tests and evaluations
every three years.
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Aço Brasil Sustainability Report 2014
In this way, the planted areas used to produce wood
and charcoal, allowed for the preservation of 422
thousand hectares of indigenous forests. In 2013,
the overall consumption of charcoal by associated
OWN CERTIFIED PLANTED FORESTS
2013
In this regard, Brazil Steel associates obtained
important ecological labels for the certification of
products such as the ABNT Ecolabel, issued by the
Brazilian National Standards Organization and the
label issued by IFBQ – Falcão Bauer Quality Institute.
The eco-labeling program is a voluntary methodology
for environmental performance certification of the
product, impartially granted by an independent entity.
33%
Forestry Certification
Brazilian steelmaking plants stand out in the production of steel from charcoal, replacing coke as a
reducing agent for iron ore. In 2013, steel production
from charcoal accounted for about 10% of total crude
steel production.
companies totaled 1.4 million tons. Two main labels
have been adopted by member companies to certify
their forests: the FSC (Forest Stewardship Council),
and Cerflor (Forest Certification, in English).
67%
It is noteworthy that 89% of the charcoal used by
our members come from their own forests. This
share has been steadily increasing in the last three
years. In 2013, member companies held 964 thousand hectares of planted forest, out of which 542
thousand are for economic purposes.
FSC
CEFLOR
THE SUSTAINABLE
LIGHTNESS OF STEEL
Eighth son of a peasant family from the interior of
Ceará, Antonio Spinosa began at age 16 to carve
wooden figurines representing Northeastern culture characters and sell them by the beach. At age
20, he moved to the city of São Paulo and began
experimenting with other materials. In 2004, the
artist discovered steel and fell in love with it: “That
was a major turning point in my career”. Today, at
51 years of age, his steel sculptures are found not
only in the collections of art galleries in Brazil but
also in England, Switzerland and Argentina. He has
a representative in Athens, Greece.
At the same time he searched for the ideal material
with which to express his talent, Spinosa enrolled
in a basic landscaping course where he studied the
movement of trees and the waving patterns of their
leaves. That is when he began carving in steel – a
material that requires application of strong forces
– the soft movement of tree leaves. “In my opinion,
the simpler and more synthetic the form, the better
the result of the work” he says, constantly concerned
with order, balance and extreme simplicity. His art
has everything to do with his philosophy of life.
Being the only artist in the family, Spinosa tells
of the day when, seeing his sculptures, his father
asked him when he would find a real job, since his
brothers were already contributing to the family
income. “I was shocked because for me that is my
job and I do not see myself doing anything else in
life,” he says. His sculptures have no volume and
can lie on the floor or be suspended in the air, or
even be attached to a wall.
Sculptor Antonio Spinosa
In steel nothing is lost, everything changes. Spinosa
uses sheets of carbon steel purchased from the
industry and even incorporates the trimmings before
they are reused by the steelmaker itself. And so he
goes publicizing steel throughout the world.
In London, the Unit 24 gallery that belongs to Polish
Kasia Morawska, currently living in the United States,
surprises by its originality: the space is shared by an
art gallery and a laundromat. “Those who come in
with bags of dirty clothes to be washed are amazed
by the beauty of the sculptures on display, including
those of Spinosa; and whoever attends the cocktails
of new exhibits gets a fright when faced with the
laundry machines.” Soon, the Polish gallerist will
open another space in the United States and will
bring with her the works of this swell Brazilian from
the state of Ceará.
In Brazil, Spinosa has taken part in countless exhibits.
His sculptures are found in various official and private collections such as the Department of Culture,
Business Centre, Caixa Economica Federal, Banco
Crefisul, Rotary Club and the Art Museum of the
Parliament, all in São Paulo. With the Brazil Steel
Institute, he maintains a prolific partnership, since
both pursue a common goal: the dissemination of steel.
Aço Brasil Sustainability Report 2014
Charcoal Sustainability Protocol
1. To act within the principles of sustainable development and in full compliance with the legislation, taking
into consideration, in an integrated and harmonious
manner, environmental, social and economic factors;
2. To act on the production chain in order to end
practices and activities that infringe labor rights or
harm the environment;
3. To only maintain commercial relationships with
companies that meet all social and environmental
requirements provided for by the law;
4. To demand documentation as required by law from
suppliers of charcoal and its by-products;
5. To establish partnerships with the Public Power
in order to develop programs for raising social and
environmental awareness among charcoal suppliers;
6. To meet, in up to four years time, the full demand
for forestry stock by production companies, be it by
own planted forest or outsourced planting, as long
as in full compliance with legal requirements;
7. To act jointly with the Government, permanently
working for the development and implementation of
technology for capturing and burning gases originated during the charcoal production process, aiming
at reducing greenhouse gas emissions;
8. To present in a regular basis the status of the
actions above in the Sustainability Report of the
steel industry.
34
All associated companies signed the Charcoal
Sustainability Protocol, launched in April 2012 with
vast support from the government and participation
from the steel industry. The Protocol establishes
that, in 2016, 100% of the charcoal demand shall
be met by the companies’ own planted forest or
outsourced planting, as long as in compliance with
legal requirements.
As established in commitment 8 of the Protocol,
this report gives an account of accomplishments
to date. Also reported here, in accordance with the
Protocol’s first commitment, are the actions of signatory companies acting in perfect consonance with
the law, considering, in an integrated and harmonious
way, environmental, social and economic aspects.
35
Aço Brasil Sustainability Report 2014
at introducing measures to support the sustainable
production of pig iron from charcoal. A good example
is the support granted to the GEF/MDIC/MMA project
entitled Sustainable Production of Charcoal.
participants. The segment representatives discussed
the challenges and prospects for the Sustainable
production of charcoal, in particular technologies to
capture and burn gases from the charcoal production process, as provided for under commitment 7.
In October 2013, the I Workshop on Sustainable
Production of Charcoal was held in the Federation
of Industry of Minas Gerais (Fiemg), with 139
ORIGIN OF WOOD FOR CHARCOAL PRODUCTION
2013
3.6%
7.7%
In October 2013, the Committee of Special Studies on
the Sustainable Production of Pig Iron by Charcoal
(ABNT/CEE-2013) was established. Shortly thereafter, in November 2, the development of a technical
standard was launched, describing the requirements to achieve a sustainable production of pig
iron, with the participation of representatives of the
Brazil Steel Institute and its members, in the light
of commitments 2, 3 and 4.
Under the concept that the proper use of charcoal
represents an environmental differential for Brazil,
the associated companies have continued to invest
in the creation of their own and third party forests,
meeting item 6 of the Protocol. In 2013, of the total
amount of charcoal used in the making of steel by
Brazil Steel members, 88.7% came from own planted
forests, 7.7% from outsourced planted forests, and
3.6% from certified forest residues.
In parallel, efforts are still in place to enhance productivity and sustainability of charcoal production
through R&D projects.
Another highlight, as established in commitment 5 of
the Protocol, was the strengthening of the partnership with the Brazilian Federal Government aiming
88.7%
CERTIFIED FOREST RESIDUES
OWN PLANTED FOREST
OUTSOURCED PLANTATION
36
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Aço Brasil Sustainability Report 2014
Generating and distributing value
4.1 ECONOMIC PERFORMANCE
In 2013, the added value generated by the steel sector
rose by 38.6%, reaching a total BRL $30 billion.
As for the distribution of added value, 23% was destined to collaborators, 31% to the government – in
the form of taxes, fees and contributions – and 34%
to financial partners. It is worth mentioning that the
share intended for shareholders leaped from 4% in
2012 to 12% in 2013.
Planning and investments
The steel industry has sought to increase productivity
through modernization of equipment and the vertical
integration of production. In 2013, the total investment made by the steel industry reached US$2.13
billion. Furthermore, the companies have invested
in cutting-edge equipment and technology to optimize their operation in mining sites, ports, energy
production and railways.
ADDED VALUE1
BRL$ MILLION
2011
2012
2013
(A) Gross Revenue
74,303
74,264
85,568
(B) Inputs Purchased from Third
Parties
54,509
54,539
56,834
19,794
19,725
28,734
3,443
3,804
4,140
16,352
15,921
24,593
9,033
5,704
5,386
7,795
4,350
4,211
1,238
1,355
1,175
25,385
21,625
29,979
5,766
6,143
6,951
GOVERNMENT*
5,317
6,927
9,326
FINANCERS
7,772
7,688
10,203
6,531
867
3,498
(C) Gross Added Value (A – B)
TOTAL INVESTMENT*
BRL $ BILLION
(D) Withholdings
(E) Net Added Value
Produced by the Sector (C – D)
(F) Transfers
Results by the Equity Method
Financial Revenues
Added Value To Be Distributed
3.09
3.19
2.13
DISTRIBUTION OF ADDED VALUE1
3.71
4.
PERFORMANCE OF COMPANIES
OF THE STEEL SECTOR
The vital role of the steel industry in Brazil’s economy
can be measured by its added value, i.e. the wealth
added by product transformation. This indicator
expresses the significance of this sector to the sustainable economic development of the country, as well
as the social role played by our associated companies.
This outstanding result was due to a large increase
in revenues, reaching BRL $85.6 billion in 2013,
caused mainly by the improvement is sales to the
domestic market.
COLLABORATORS
2010
2011
2012
2013
SHAREHOLDERS
* Taking into consideration total investment per period.
CSN results not included.
(*) Including tax credits.
1. CSN results included. TKCSA and Villaes Metals not included in 2011, 2012, 2013. VSB not included in 2011 and 2012.
Figures for 2012 were reviewed by the companies (in comparison to figures published in 2013).
Aço Brasil Sustainability Report 2014
38
GROSS ADDED VALUE
BRL $ BILLION
19.79
19.73
28.73
25.39
21.63
29.98
2012
2013
2011
2012
2013
DISTRIBUTION OF ADDED VALUE
2013
12%
23%
FINANCERS
GOVERNMENT*
* Including tax credits
34%
4.2 SOCIAL PERFORMANCE
Corporate Governance
Transparency in management and principles and
practices steered towards sustainable growth are
strategic elements for the Brazil Steel Institute associates. They can be found in the companies’ pillars,
present in their mission, values and code of conduct.
This way the rights of all shareholders and a good
relation with the various stakeholders concerned
by their operations are ensured.
Special attention is given to sustainability, overseen
by specific areas within steelmaking companies.
These departments guide employees by the means
of training and capacity building, and encourage
the dissemination of the subject via communication channels. Most of the companies associated to
Brazil Steel publish their own Sustainability Reports.
Environmental performance targets are outlined
and are object of a strict follow-up, and go beyond
the mere observance of the law.
31%
SHAREHOLDERS
Aço Brasil Sustainability Report 2014
ADDED VALUE TO BE DISTRIBUTED
BRL $ BILLION
2011
COLLABORATORS
39
As for the publicly traded companies, they follow
the guidelines imposed by regulatory agencies, disclosing information and results on a regular basis.
According to our survey, 100% of the Brazil Steel
Institute associated companies confirmed that they
consider in their strategic planning the wide range
of matters relating to sustainability as well as all
stakeholders in the production chain.
Over the years, the participation of companies in the
development of neighboring communities has grown,
with relevant environmental, social, educational
and cultural activities. For example, investing in
tutoring, in theater groups, sports teams, libraries,
stimulating voluntary work within the companies,
encouraging local reforestation or supporting
environmental education projects, demonstrating
awareness of their social role in the country.
Investments in infrastructure and services
for the public benefit
The steelmaking sector is a prime agent of development in many areas of the country, fostering regional
growth. Data collected for this report show that the
majority of our associated companies (approximately
73.3%) invests in infrastructure for the public benefit,
and 95.5% carry out assessments of the indirect
economic impacts of their operations. The concern
with the welfare of the population transcends the
limits of the business. Keeping in mind that they
do not intend to replace the legal obligations of the
different spheres of government, the associated
companies report important investments made in
improvements for the regions next to their units.
A COMPANY INVESTING
IN THE REGIONAL CULTURE
The sponsorship from a steel producer located in the
Northern region to a dance company was decisive
for the group to conquer new audiences and work in
training young talent. “Before that, we would spend
90% of our time chasing funds, and only 10% dancing.
We had to devote more time to finding support than
actually doing our core activity. For the past fi ve
years, with the sponsorship of this company in our
region, this situation has fortunately changed dramatically”, tells Cláudio Roberto de Souza, founder
and choreographer of the Yaguara Dance Company.
The group began its activities 17 years ago in the State
of Pará. Not only it disseminates the folklore of the
Amazon region but also works in the development and
training of young people. Typical dances from Pará like
the carimbó and the chula marajoara are performed
by 32 dancers aged 14 to 27. “We rescue our regional
culture and introduce our diversity to other regions of
our vast country”, explains Cláudio Roberto.
The Yaguara Dance Company has performed twice
(2009 and 2010) at the Dance Festival of Joinville in
the state of Santa Catarina before large, cheering
audiences. After much hard work, in 2011 the group
opened its own headquarters, the Cultural Center
Yaguara in Maraba, Southeastern Pará. Before that,
the dancers had to improvise and rehearse in sports
courts of schools, clubs and gyms, available only
for limited time. The founder and choreographer
Yaguara Dance Company
explains that the support from the steel company
– who contributed with 70% of the funds needed
to build the new space – was crucial to make this
dream come true. “Now we have our space, we can
rehearse and develop young talent”, he says.
Classes for youth and adults are held twice a
week. Children start with classical ballet training. No wonder: trained in classical ballet himself,
Claudio is well aware of the importance of this sort
of foundational training, even for folk dancers. The
development of youth is already bearing fruit, with
the creation of Yaguara Kids serving over 40 dancers aged between 6 and 13. In addition to ballet,
the Yaguara Cultural Center also offers classes in
ballroom dancing, capoeira, and street dance.
Aço Brasil Sustainability Report 2014
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Aço Brasil Sustainability Report 2014
OUTSOURCED STAFF BY FIELD OF ACTIVITY
Managing people
Outsourced Personnel
In spite of a persistently adverse economic environment in 2013, the members companies kept
their in-house staff virtually unchanged, totaling
approximately 60,496 people. As for outsourced
personnel, there was a 5.8% drop when compared
to 2012 figures.
In 2013, outsourced personnel represented 40.1%
of the total staff. Most of these workers engaged in
activities of maintenance and support to production,
occupying positions in the departments of security,
transport, food and catering etc.
TOTAL IN-HOUSE STAFF*
OUTSOURCED STAFF*
23%
24%
PRODUCTION AND
MAINTENANCE
SUPPORT TO
PRODUCTION
53%
18%
16%
21%
25%
61%
59%
60,089
60,554
60,496
48,601
42,895
40,428
EXPANSION
2011
2012
2013
2011
2012
2013
SHARE OF OUTSOURCED STAFF IN
TOTAL WORKFORCE
2011
41.5%
Men still occupy most positions, totaling 55.673 male
collaborators in 2013, which corresponds to 92%
of the industry’s workforce. But just like in every
economic field in Brazil, female participation has
been increasing year after year in the steel industry.
40.1%
MEN
* Number of collaborators
2012
2013
WOMEN
Together, the companies associated to the Brazil
Steel Institute had 4,823 women hired as in-house
collaborators – versus 4.656, in 2012 – working for
the most part in management positions.
8%
92%
2011
2013
Gender
IN-HOUSE STAFF
BY GENDER
2013
44.7%
2012
WAY BEYOND
THE CLASSROOM
Portuguese Language Studies teacher Edson Nunes
da Silva, 37, celebrated the arrival of theater group
Cada Um é Um (Each One Is Unique) at state school
Savino Campigli, in Sumaré (state of São Paulo):
“They awake children to art, stories, books, tales
and fables”, says the Educational Coordinator.
profitable: “The theater works as part of our educational strategy and is very important for student
interaction.” The fact that they came to the school
premises made things easier because there was
no need to ask for authorization from parents nor
to purchase tickets: “Many of our students do not
have the opportunity to go see a play.”
With the support of a local steelmaker, the group
first presented a puppet theater show at the school.
Then they started to offer craft workshops, teaching
students how to build puppets. Some of the children,
ranging from 10 to 14 year-olds, had never seen a
play before. “They really enjoyed it because it was
a very different way of learning and they definitely
want to see more”, says Nunes.
The fire prevention crew from the steelmaker often
comes to the classrooms and offers lectures on
security, something also highly appreciated by the
teacher: “When the fi refi ghters arrive, children
show great interest, so we are keen to maintain
these partnerships.”
Eager to offer his students the chance to come across
all kinds of artistic expression, Nunes usually takes
them to watch movies and plays outside of school
as a supplement to Portuguese classes. “When the
class was reading ‘The Book Thief’, we took them to
watch the film and draw comparisons between the
two types of language, as well as analyze the body
language of the characters”, he says.
According to the teacher, the partnerships with
industries and businesses in the community have
been very positive, and the one with the Cada Um
é Um (Each One Is Unique) group was especially
Cada Um é Um Project
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46
Incentive to diversity
Complexion and ethnicity
Valuing diversity, fighting discrimination, and developing policies that encourage gender equality are
all practices common to our members. There are
channels for complaints of discrimination, bullying,
harassment and any other human rights violation,
and the companies maintain a regular dialogue with
their collaborators on related subjects.
Data collected for this Report indicate that in 2013
white professionals made up the majority of in-house
staff (58.8%). Next were black and dark-skinned
workers with a significant participation (38.9%) and
the remainder consisted of yellow complexion and
indigenous workers.
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Aço Brasil Sustainability Report 2014
IN-HOUSE STAFF BY COMPLEXION/ETHNICITY
2013
0.2% 2.0%
38.9%
IN-HOUSE STAFF
BY COMPLEXION/ETHNICITY*
132
264
20,947
127
123
714
1,075
21,006
20,990
58.9%
34,365
2011
32,577
2012
INDIGENOUS
BLACK (BLACK+DARK-SKINNED)
YELLOW
WHITE
* Number of collaborators
31,705
2013
COMPANIES SURVEYED
2013 / 8 Groups / 98% of total in-house staff
2012 / 8 groups / 90% of total in-house staff
2011 / 8 groups / 93% of total in-house staff
WHITE
INDIGENOUS
YELLOW
BLACK (BLACK+DARK-SKINNED)
Several associates encourage their collaborators
to pursue specialized technical courses as well as
higher education, including postgraduate programs.
22.9%
31 TO 40 YEARS
31 TO 40 YEARS
41 TO 50 YEARS
41 TO 50 YEARS
35.5%
50+ YEARS OLD
2013
* Number of collaborators
14,048
5,504
5,586
5,791
21 TO 30 YEARS
13,848
21 TO 30 YEARS
18,140
UP TO 21 YEARS OLD
1,196
2012
UP TO 21 YEARS OLD
50+ YEARS OLD
14,237
30.0%
20,552
9.6%
21,521
2.0%
2011
1,229
IN-HOUSE STAFF
BY AGE GROUP
2013
On the issue of education, the incentives for constant
training and specialization of the professionals of
the industry can be observed in increasing number
of workers with high school education and higher
education in 2013, when compared to 2012. The total
number of collaborators with higher education in
2013 was 10,171 (16.8% of total), larger than in the
previous year – 9,553 workers, 15.8% of total.
IN-HOUSE STAFF
BY AGE GROUP*
18,950
In 2013 most of the in-house staff was within the
range of 31 to 40 years of age, which shows a slight
increase when compared with the previous year.
In second, came the workers between 21 and 30
years-old. It is also worth mentioning the growing
presence of young people joining the associates,
many of them via First Employment programs, as
part of the focus on valuing workers living nearby
industrial plants. This practice not only is a breath
of fresh air for the corporations but also constitutes
a local action of social development.
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19,972
Age groups and education
49
18,063
48
1,127
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51
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COLLABORATORS WITH DISABILITIES*
IN-HOUSE STAFF BY EDUCATIONAL LEVEL
2013
of total in-house staff
1,365
16.8%
2011
2012
2013
COLLABORATORS WITH DISABILITIES
BY DISABILITY
10.6%
2013
6.7%
2.3%
1,460
0%
2.4%
1,290
2.3%
5.7%
0.6%
32.8%
INTELLECTUAL DISABILITY
HEARING IMPAIRMENT
MULTIPLE DISABILITIES
70.8%
0.7%
PHYSICAL DISABILITY
VISUAL IMPAIRMENT
55.3%
ELEMENTARY SCHOOL (INCOMPLETE)
HIGH SCHOOL
GRADUATE SCHOOL
ELEMENTARY SCHOOL (COMPLETE)
Persons with disabilities
Seeking to provide new inclusion opportunities for
persons with disabilities despite all difficulties in
meeting the quotas assigned by the government, the
industry kept as part of in-house staff collaborators
with various types of disabilities in 2013.
UNDERGRADUATE STUDIES
* Number of collaborators
Many of our associates offered training, sometimes
in collaboration with specialized institutions, to
further integrate these workers into their professional activities.
Publicity Photo
VALUING PEOPLE
Leonardo Antonio da Silva, 37, suffered from discrimination. Being albino and afflicted by very strong
myopia, he struggled with many difficulties. “I managed to get a job, but whenever an accident occurred
I was always blamed for it because of my visual
problems”, he recalls. Even taking the bus was a
hard task. He had to rely on the help of passers-by
to know which bus was arriving at the stop.
His life changed dramatically when he heard of
the job interviews for persons with disabilities at a
steelmaking company in Rio de Janeiro. He took the
qualification course offered by Senai in 2013, and in
eight months he was hired by the company. Here I
am not treated as a visually impaired person.” I am a
person, a member of the team. They value my work
and I reciprocate with dedication”, says Leonardo.
The company bus passes right next to his home,
which prevents problems with transportation. He was
assigned to a management position. “I love my job.
I dream of one day going to college and graduating
in Communication or Management”, he reveals.
Leonardo gets emotional when recalling his difficult
childhood in Minas Gerais, before he came to Rio
de Janeiro. His father passed away when he was 7
years-old, and the solution was “trying to make it
in the big city.”
Leonardo took part in the 6th class for the impaired
in the company, one of the large corporations in Rio
de Janeiro that managed to fully comply with the
quotas for inclusion of Persons with Disabilities
(PCDs) in its staff in 2013.
The training is offered in partnership with Senai
(National Service for Industrial Training) and lasts
on average eight months, with four hours of classes
daily. Graduation will take place in May 2014. The
syllabus includes also subjects such as Ethics,
Citizenship, Portuguese Language and Mathematics.
The steelmaker has already invested approximately
BRL $400 thousand in the technical and behavioral
training of other fi ve classes comprising 89 collaborators, which took place from the very beginning
of the partnership with Senai, in 2009. During the
course, the students are already registered employees, receive a monthly pay and those who stand out
in class are hired to work in management positions,
working daily shifts of four hours.
When starting their careers at the plant, each new
collaborator goes through an assessment conducted
by the health and safety areas and takes additional
classes of SAP, Computers, English, Corporate
Writing, and Financial Education. In 2014, the steelmaker will also promote new courses on Corporate
Relations and Budget.
Collaborator Leonardo Antônio da Silva
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54
Working hours and years of service
There has been virtually no change in 2013 in comparison to the two previous years regarding the
proportion between in-house collaborators working
business hours (54%) or by shifts (46%). Neither
there were significant changes in the average time
of service in the steel sector, which was 9.76 years
last year. This figure falls above the average of other
Brazilian companies, which according to the RAIS
(Annual Report on Social Information) gravitates
around fi ve years.
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Aço Brasil Sustainability Report 2014
AVERAGE TIME OF SERVICE AT THE
COMPANY (IN YEARS)*
11.16%
10.19
TOTAL DIRECT STAFF BY TIME OF SERVICE
2013
2.5%
2010
15.5%
2011
9.81
9.76
2012
2013
14.0%
TOTAL DIRECT STAFF BY SHIFT
18.0%
48%
47%
46%
52%
53%
54%
31.8%
18.2%
2011
UP TO 1 YEAR
11 TO 20 YEARS
SHIFT
2 TO 5 YEARS
21 TO 30 YEARS
MANAGEMENT
6 TO 10 YEARS
30+ YEARS OLD
2012
*Estimates based on average weighted by the central point of each range,
2013
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Turnover
Health and Safety
In 2013, the turnover of steel companies was 13.2%,
virtually the same rate assessed in 2012 and 2011.
Health and Safety are object of preventive initiatives
in all Brazil Steel Institute associated companies.
The sector invests heavily in the enhancement of
life quality, health and safety of its workforce. Each
company has specific areas to handle and develop
various actions, ranging from campaigns that stimulate better health and life quality to constant training
to control risks and prevent serious accidents.
IN-HOUSE STAFF
TURNOVER**
TURNOVER RATE
2011
13.2%
13.3%
13.2%
1.90
11.2%
1.77
11.1%
1.60
1.49
1.45
1.35
1.78
1.60
1.51
2011
2012
2013
FREQUENCY OF ACCIDENTS**
2.08
11.4%
2012
933
OUTSOURCED STAFF
775
2013
1,177
6,542
6,877
5,364
2012
Collaborators are offered advice on regular medical examinations, vaccinations, labor exercise,
healthy eating habits and information on drug and
alcohol abuse, all of which accompanied by medical
support and many are extended to collaborators’
families as well.
TOTAL ACCIDENTS*
1,160
2011
8,143
ADMISSIONS
6,571
DISMISSALS
6,634
DISMISSALS AND ADMISSIONS*
These continuous actions of control and prevention
translate into positive indicators: accidents have
dropped in comparison to the two previous years.
1,056
56
825
Aço Brasil Sustainability Report 2014
2011
2013
1.49
2012
2013
GENERAL
AVERAGE OF COMPANIES
* Number of collaborators
**Average of admissions and dismissals, divided by the average of employees in the year.
TOTAL STAFF
IN-HOUSE STAFF
OUTSOURCED STAFF
*Number of collaborators considering all accidents (with or without lost time, and fatal)
**Number of accidents with leave (including fatal) per million man-hours worked.
WORLD AVERAGE
(WORLDSTEEL)
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The concern over safety is not restricted to collaborators. Health and safety of communities surrounding
industrial facilities are also targeted with specific
monitoring and programs. Most companies-accounting for 85.9% of total production-extend their
health and labor safety initiatives to third parties.
Most associates adopt recognized standards of
assessment and certification of health and safety
management systems. These are rules and standards that aim at helping the companies to control
potential risks.
Once threats or issues are identified, measures to
prevent or solve them are undertaken. Collaborators
receive regular training to handle situations of every
nature. Awareness campaigns, lectures and debates
on safety are also regularly organized.
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ACCIDENTS BY SEVERITY
IN-HOUSE STAFF *
2
180
Union agreements are signed covering health and
safety aspects that include individual protection
equipment as well as committees with workers’
representatives to accompany routine inspections
performed at the companies.
2
173
995
FATAL
3
170
881
760
WITH LEAVE
ACCIDENTS BY TYPE
IN-HOUSE STAFF *
2011
2012
858
75
1,003
53
1,123
AT THE
WORKPLACE
2011
54
COMMUTING
WITHOUT LEAVE
2013
5
197
2011
*Includes all accidents (with or without leave, and fatal)
739
36
789
2012
2013
3
132
958
FATAL
36
1,111
3
107
49
AT THE
WORKPLACE
2013
ACCIDENTS BY SEVERITY
OUTSOURCED STAFF*
ACCIDENTS BY TYPE
OUTSOURCED STAFF*
COMMUTING
2012
715
640
WITH LEAVE
WITHOUT LEAVE
2011
*Includes all accidents, both at the workplace and commuting.
2012
2013
ZERO ACCIDENTS IN BLAST
FURNACE EXCHANGE
A world leader in the manufacturing of semi-finished
steel products, a Brazil Steel associated company
located in the state of Espírito Santo achieved a
notable record for its global group. These results
were obtained during the renovation of one of its
blast furnaces, one of the largest in the Americas,
measuring 118 m in height.
In a US$ 180 million operation, involving about four
thousand people, in 138 days, 5.5 million man-hours
worked, resulting in zero accidents with leave (when
the worker has to stay home) and only 20 accidents
without leave (when the worker resumes his work
after being medicated) was something unprecedented. This operation led to the company being
awarded for Safety in the Performance Excellence
Awards, running against other 164 cases.
This was the first time the company staff had ever
renovated a blast furnace. This experience demanded
extreme adherence to processes from all involved
in order to achieve the main goal: ensure simultaneity of operations without endangering the life of
workers-in a operation dealing with parts weighing
up to 750 tons and generating some 13 thousand
tons of scrap steel. The working group used the
PDCA method, which divided all work into a cycle
consisting of planning, doing, checking and acting.
Professionals identified and divided risks into 110
different combinations and created a scale ranging
from 1 to 4, with 4 being the most critical. They conducted a survey within the group to identify safety
practices to prevent chemical, physical, ergonomic
and biological accidents. Whatever was still missing,
they looked for outside the group.
They have also trained their workers in risk perception, transformed operators into Safety Guardians
with visible presence during operations –152 safety
guardians, one for every 25 people – and formed
teams dedicated exclusively to operational safety,
with high frequency of meetings and reporting.
They have also created specific campaigns for each
detected risk and awards for goal achievements.
It is worth highlighting that the profile of workers
was quite varied: mechanical workers, electricians,
welders, masons, helpers, engineers and planning
technicians, most of them outsourced.
Since the company believes that a safety-oriented
work as successful as this one needs to be replicated,
a handbook containing the set of practices adopted
was distributed worldwide to the whole group and
has also been featured in sectoral councils and state
federations of industries. Furthermore, the model
is being adopted with the same degree of success
in the works of service life extension of yet another
blast furnace in the company, which resumed production in July 2014.
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62
Steelmaking companies maintain education and
specialized training programs at all levels of employment. There are also personalized performance
evaluation and career development programs as a
follow-up to each worker.
According to a survey made with associated companies of the Brazil Steel Institute, all of them offered
training and development programs in 2013. Most
companies (totaling 88% of total crude steel production) have also programs of performance assessment
and career development in place.
9.4%
Days/year general and per position
5.53
GENERAL
DIRECTOR
4.14
MANAGER
4.17
12.1%
8.76
SUPERVISOR
MANAGEMENT
TECHNICAL EDUCATION
OPERATIONS
8.4%
0.1%
1.7%
6.0%
AVERAGE TRAINING PER POSITION
2013
COLLEGE EDUCATED
Aço Brasil Sustainability Report 2014
TRAINING OF COLLABORATORS PER POSITION*
2013
Training and development
Investing in collaborators to retain and improve
talent, technical and management competencies,
stimulating personal and professional development
of workers is among the sustainability pillars adopted
by the steel sector.
63
62.3%
3.22
DIRECTOR
6.05
MANAGER
5.46
SUPERVISOR
5.46
8.10
World steel
companies
average
(worldsteel
2012)
*Includes data from 9 associated groups, accounting for 98% of total crude steel production in the period
COLLEGE EDUCATED
MANAGEMENT
TECHNICAL EDUCATION
OPERATIONS
*Includes data from 8 associated groups, accounting for 98% of total crude steel production in the period
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COLLABORATORS PER GENDER TAKING PART IN
PERFORMANCE ASSESSMENTS*
2013
TOTAL COLLABORATORS TAKING PART IN
PERFORMANCE ASSESSMENTS*
28,951
31,821
41,250
91%
2011
2012
2013
HOURS OF TRAINING
2013
66%
MEN
WOMEN
Development of competencies
3,113,240.10
HOURS
Training new leaders and giving workers the
opportunity to achieve, according to their profile,
management positions is part of the culture of companies of the steel sector. This means that each
year the associates create more conditions for their
collaborators to develop in a constantly changing
market, which demands initiative, focus in productivity, timely decision-making and teamwork.
The steel industry values experience and acquired
knowledge, and encourages it to be passed on from
mature professionals to the young, stimulating the
interaction among team members. This way, they are
transmitting corporate values such as transparency
*number of companies varied each year:
* 2013: 7 groups (81.5% ) | 2012: 6 groups (82.83%) | 2011: 6 corporate groups (65.6% of crude steel production)
in management and ethical approach, creating
engagement and achieving identity, strengthening
the feeling of pride and motivation among the internal
audience in companies.
This constitutes a strategic matter for the associates and also something that builds a positive image
before society, attracting new talent and retaining
skilled professionals.
*number of companies varied each year:
* 2013: 7 groups (81.5% ) | 2012: 6 groups (82.83%) | 2011: 6 corporate groups (65.6% of crude steel production)
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Compensation and benefits
Besides the compensation policy and benefits
common to most markets – health care, food vouchers or restaurant, pension, profit sharing, daycare,
commuting to work, life insurance, and the like – 100%
of the Brazil Steel Institute associated companies
are concerned with the day when the employee goes
into retirement. In addition to pension plans, in most
of these companies there are also programs for
in-house collaborators approaching retirement.
BENEFITS
2013
% of crude steel production
by companies offering the
benefit
Health care
100.00%
Profit sharing
100.00%
Pension Plan
98.70%
Daycare
97.29%
Incapacity/
disablement coverage
81.97%
Local development
Companies from the steel sector invest in projects and
programs that prioritize education, sports, culture, and
many other initiatives engaging internal and external
audiences, workers and neighboring communities.
Therefore, they are reducing the impact of their projects, minimizing risks, expanding the relationship
with communities, and leveraging local development.
All associates answered that they have either policies
or written material meant to guide this relationship
with communities.
The associates contribute to programs that ensure
and reinforce citizen rights while responding to social
demands and showcase successful experiences of
actions that were replicated in other businesses and
regions, some of which were eventually converted
into public policy.
Investment is made both in projects based on incentive
laws and in privately funded actions. Priority is given
to initiatives that reflect demands previously identified
in the community. Several associated companies
maintain foundations oriented towards education and
local development. Observing the origin of funding,
it becomes clear that most companies use their own
resources to promote social investment.
The new endeavors and expansions go beyond law
requirements and establish an open channel of
dialogue from the onset of feasibility studies with
all stakeholders.
COMMUNITY AND SOCIETY
RELATIONSHIP WITH NEIGHBORING COMMUNITIES
Aspects taken into consideration in impact assessments in neighboring communities
ASPECTS
2013
% of crude steel production by companies
that adopt each criterion
Local development programs based on community
needs
99.39%
Environmental impact assessment and monitoring
83.93%
Mapping of audiences to define engagement and
participation plans
81.51%
Transparency in the results of social and
environmental impact assessments
80.81%
Sérgio Yago
WRITING CONTEST STIMULATES
STUDENTS AND IMPROVES
STUDENT’S PERFORMANCE
A writing contest – Tempos de Escola (School
Days) – improved the performance in Portuguese
Language studies of students from the Municipal
School Professor Carlinhos, located in Comunidade
Fazenda da Barra 3, in the outskirts of Resende
(RJ). It also fostered cooperation between students,
teachers and management.
In 2014 the sixth contest is being held as one of
the actions of a social project that focuses on
Education, promoted by the social institute of an
industrial group controlling a steelmaking plant in
Resende. The partnership between this Institute
and Local Education Secretariats started in 2008,
aiming to improve public education. The project
reached Resende and Barra Mansa in 2010 and its
goals have always been to contribute to the educational development in the communities touched by
group’s operations. Since 2011, the Institute has also
established partnerships with the local Education
Secretariats to help improve school management.
In 2013, the project was implemented in 21 cities
from 12 Brazilian states, and mobilized more than
5 thousand people during the whole year.
Director of the Professor Carlinhos school, Célia
Maria da Cunha explains that the contest Tempos de
Escola (School Days) is promoted yearly. The main
goal is to “stimulate students from public schools
to reflect upon issues linked to their education.”
Teachers receive kits to guide and improve student’s
performance, starting an actual virtuous cycle that
Tempos de Escola Contest
fosters Education, specially Writing and Portuguese
Language.
At age 57 and after 30 years working as a teacher,
Portuguese Language and Writing teacher Célia
Maria is proud of the outstanding performance of
the School’s young Lara de Jesus Ribeiro, a firstyear student of EJA (Education of Youth and Adults).
In 2013, Lara won the contest in the Elementary
Education 2 category and received a digital camera
during the awards ceremony.
In 2013, 6 thousand students from 21 cities entered
the contest, which is divided in categories. The theme
of the contest was “Reading transforms the world”
and there were sub-themes for different educational
levels. Tempos de Escola (School Days) is the result
of a partnership between the Social Institute of this
industry group, the Ministry of Education – MEC,
and Canal Futura TV channel. The contest aims to
stimulate students to produce texts about school-related subjects and seeks to guide teachers to work
on the Writing plans with students opening the path
to significant learning.
Students love to be part of Tempos de Escola (School
Days).” It is not only about competing. Teachers
receive support materials to prepare the classes
that will help students develop skills for the contest.
It eventually improves educational performance in
Writing and Portuguese Language. It also creates
a pleasant school atmosphere,” says Director Célia
Maria.
There are 380 students at the local school Professor
Carlinhos, comprising the morning, afternoon and
night sessions divided into classes from 4th to
9th grade, as well and the night classes of EJA –
Education of Young and Adults. Most students are
young people from the region, the Fazenda da Barra
3 district. “This is a poor community, but I think this
encourages even more those who really want to study
and get a better life,” adds Juliana Cristina Rabello
de Oliveira, assistant director who also worked coordinating the contest activities in the school.
Results show and stimulate new students to walk
the same road. Some students were successfully
accepted in nearby colleges and distinguished themselves for their good essays. Some former students
already graduated from college. “This is a direct
result of preparatory lessons and of our care for the
subject”, says Célia Maria. Other former students
obtained good jobs in the many industries present in
the region. “We are proud to see our students making
it in the outside world”, she concludes.
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70
Communication with society
Local hiring
To maintain an open dialogue with the external
audience is a priority for the Brazil Steel Institute
Associated companies. A transparent communication, publicizing their corporate practices and
making use of conventional channels – such as
telephone, internet and paper forms – as well as
hosting meetings between executives, collaborators and community. Through these channels,
companies receive suggestions, compliments, and
complaints, answer questions and satisfy a wide
variety of demands, seeking to establish a closer
connection with local communities.
The creation of revenue and employment is key to
achieve sustainable local development. This is why
steel companies have been interviewing and hiring
in the regions they operate whenever possible. When
skilled workforce is lacking in the surroundings,
associates invest in training in collaboration with
educational institutions recognized by their peers.
This investment is extended also to formal education,
in the management of schools and also the training
of educators, which results in better job prospects for
the young. This effort has resulted in a steady growth
in local hiring in the last years. In 2013, local hiring
reached a 77% rate, in comparison to 68% in 2012.
Talks also take place during meetings between
management and community leaders, as well as in
the committees created by the associates, a crucial
tool in the implementation of regional development
plans. In order to expand the forms of collaboration,
visits are organized: community members are able
to see the plants, teachers and students come to
the preservation areas and environmental education center kept by the companies, and so on.
Also, monthly publications inform residents of the
environmental programs and educational projects
held in the communities with the support of member
companies, contributing to raise awareness among
stakeholders.
Broad dialogue
The world demands more dialogue and the steel
industry agrees with the new world order: it is
attentive to all demands, coming from internal and
external groups, and it has been perfecting practices
and contributing to the growth and competitiveness
of the steel sector.
This is the same path chosen by the internal communication strategies of our associates. By mobilization
77%
COLLABORATORS HIRED IN THE LOCAL
COMMUNITY
67%
2011
68%
2012
2013
*Average of local hiring rates in the region informed by the companies Number of surveyed companies varies each year: 2013: 7
corporate groups (62.67% of steel production) | 2012: 9 groups (73.7%) | 2011: 5 groups (17.6%).
71
and engagement actions, collaborators are informedthrough a number of communication channels
including websites, printed and electronic bulletins,
magazines, intranet and internal TV broadcasts –
of the business strategies, so they can assimilate
and share the vision, mission, values, sustainability
values and core beliefs of the companies.
Since a large share of collaborators is engaged in
production processes at the plants, it is also common
to use channels such as pin boards and meetings
at the cafeteria to transmit the messages. In order
to illustrate the strength and relevance of these
channels, an plant newspaper in Minas Gerais and
São Paulo used as benchmarking one of the most
important communication channels in Brazil, adopting a more popular corporate language capable of
showing the effective contribution of collaborators
to business competitiveness.
Marketing programs also contribute to strengthen
the dialogue within the companies, establishing
connections with people management and marketing areas. Some of our members have pursued this
approach, promoting meetings between high management and other professionals, especially young
ones. These meetings are meant for the discussion
of the economic performance and other topics of
internal relevance and stimulate the cooperation
between teams. In some cases, even the CEO meets
on a regular basis with groups of employees.
OUR DAILY TUNE
Dissatisfied with the state of vulnerability of children and teenagers in his home region, Cristiano
Valentim decided to create in 2000, in collaboration
with fellow musicians, the Cais – Casa de Artes e
Inclusão Social (House of Arts and Social Inclusion).
At the time, he worked as the culture coordinator of
the City of Coronel Fabriciano in the state of Minas
Gerais. “In municipal schools, students still take
percussion classes, but then in leaving school at
age 12 they spend their time in the streets, alongside
crime and drugs”, he says.
After struggling to find a suitable space and obtaining the necessary structure to receive children and
teenagers from the populous district of Santa Cruz,
among the most violent in the city, today he maintains
a house on the main square and carries out several
social projects.
“Some of my former students grew up to be excellent
percussionists, thanks to the support of a special
steels plant to the O Som nosso de cada dia project (Our Daily Tune, in English)” he says proudly.
Last year, the Cais enrolled 38 children aged 12
and older, who already can play drums and read
scores, in classes with teacher Natanael Mariano.
One of the most talented percussionists is Rafaeli
Santos Ribeiro, who has even been invited to teach
percussion in local schools.
“In addition to offering percussion lessons, we gather
the students’ families once a month to eat a snack
and hear lectures about drug and alcohol abuse,
aiming at preventing crime and strengthening family
ties”, tells Cristiano.
The support provided by the steelmaker’s foundation
was important because the idea behind their Selection
Program is the democratization of fund raising. “The
most exciting is that, under their guidance, we managed to raise funds from other institutions and to
keep O Som nosso de cada dia (Our Daily Tune)”
functioning everyday in 2014, and we doubled the
number of participants”, he cheers.
This year the steel plant foundation is supporting
seven projects in the Jequitinhonha Valley and four
in the Aço Valley. One of them is Movimento Vida
(Life Movement) that teaches street dance. “In each
project we manage to serve up to 300 children; in
2014 there will be 150,” celebrates Cristiano.
Thiago Fernandes
VOLUNTEERS OF KNOWLEDGE
A neighborhood gone right
The children at the state school José Miguel do
Nascimento, located in a socially vulnerable area of
Belo Horizonte and near a steelmaking plant, give
great cheers twice a week in welcome to the Voluntários
do Saber (Knowledge Volunteers, in English). They are
engineers and technicians employed at the plant that
contribute teaching Math to students from the second
to the ninth grade of elementary school, enrolled at
the Proeti – Full-Time Education Program created
by the state secretariat of Education.
“Our partnership with the plant has been of great
value to our children’s learning”, says headmaster
Natalicia do Consolo, who has been working in the
school for 26 years. She attributes the program’s
success to the teaching methodology that makes
use of educational games. She also remembers that
once the learning gap was really vast between the
students. That is why the school selected 150 out of
453 children and created the full time classes, who
are tutored by the plant’s volunteers.
Through continuous assessments, the school has
recorded a significant improvement in Math learning,
alongside behavior changes and a lift on children’s
self-esteem. From August to December 2013, there
has been a 30% improvement in student performance.
Headmaster of State School José Miguel do Nascimento, Natalícia do Consolo
It is quite interesting to observe their interaction
with the volunteers who not only teach but also tell
them about their professions, raising great interest
and curiosity in the kids”, says Natalicia. She adds
that on their birthdays, volunteers bring cake for all
and celebrate with the children.
76
Value chain
Brazil Steel associates seek to influence the production chain in the sense of getting everyone in line with
77
Aço Brasil Sustainability Report 2014
CRITERIA ADOPTED IN
SUPPLIER ASSESSMENT
2013
sustainable values and practices and committed to
the defense of Human Rights.
Suppliers go through rigorous assessments of their
CRITERIA
compliance with legal obligations (labor, fiscal and
Prevention and fight against forced/analogous to slavery
labor
tax legislation), contractual liabilities and observance
Prevention and fight against child labor
of sustainability matters, which are deemed as a
theme that permeates all business practices in all
areas of the company.
It should be stressed that associates also require
suppliers to sign a code of conduct regarding critical
issues related to Human Rights – including prevention
and fight against slave or analogous to slavery labor,
Respect of labor and union rights
Working conditions of collaborators from hired companies
Environmental aspects (Natural resources; biodiversity;
environmental protection areas / legal reserves; climate
change)
Protection of human rights
and the prevention and fight against child labor.
Valuing and development of local suppliers
Programs meant to prevent and stop corruption are
Prevention and fight against corruption
enforced by the associates, and all companies will not
tolerate forced labor or analogous to slavery, child
Analysis of product origin, avoiding acquiring falsified,
pirate or stolen products
labor, and ensure the same working conditions for
Valuing and development of small and medium suppliers
their collaborators and outsourced staff.
Since several end clients of the steel industries are
global corporate groups, the interest from these
% OF TOTAL CRUDE STEEL PRODUCTION BY
COMPANIES THAT ADOPT EACH CRITERION
100.00%
100.00%
100.00%
100.00%
100.00%
98.64%
98.18%
94.80%
94.80%
91.63%
Prevention and fight against harassment and
discrimination of all sorts.
81.97%
Encouragement to the adoption of social and
environmental certifications
75.56%
buyers has increased: they want to get up close and
testify that indeed the whole production chain strictly
follows legal obligations and respects Human Rights.
Two large client corporations of the steel industry
associates accounting for 98% of production maintain
The goal is to seek operation excellency to improve
have confirmed this is an increasing concern. One
programs of this kind. There also policies in place to
the quality of their products. For instance, product
such company carried out an audit of the whole
stimulate growth of these suppliers, especially small
quality, performance in client/consumer attention and
steelmaking production chain of our associates. It
and medium sized, in 88% of assessed companies.
satisfaction are monitored and regularly assessed by
demonstrated the veracity of information supplied by
steelmakers and resulted in an award to our member
companies in 2013.
associated companies.
Relationship with clients is close and transparent. In
addition to taking part in fairs and events that gather
the main actors of the sector, companies also offer
In order to foster regional development, local
their clients scheduled visits to the plants, or some-
purchases are encouraged by the steel industry:
times pick out leading workers to visit the clients.
MAJOR APPLIANCE
MANUFACTURER CERTIFIES
STEEL PRODUCTION CHAIN
Whirlpool, global leader in major appliance manufac-
In 2013, the audition company reassessed the work
ture such as Brastemp, Consul and KitchenAid, has a
previously done and visited many steel-producing
close partnership with the steel industry. Paulo Miri,
regions to confirm their findings.
Vice-President of Human Resources, Communication,
Sales and New Business at Whirlpool Latin America
“Not only have we confirmed the good results obtained
stresses that steel is a vital feedstock, corresponding to
in the fist audit, but we also assessed the progress
approximately 70% of its products. “When we speak of
made throughout the entire steel production chain.”
refrigerators, ovens, washing machines and the like, we
We never doubted it for a moment. “But now we can
are speaking of steel”, he says. Technology has been a
prove to our clients how serious the commitment is of
critical ally in this partnership, since increased energy
all productive chain to ethical practices in the social
efficiency with lower costs and emissions is required.
and environmental fields”, stresses Miri.
Miri stresses that a refrigerator produced today is
This new audit showed an average increase of 18% in
two times more efficient and uses much thinner steel
the scores registered in the first phase of the program.
than ten years ago. “Best practices ensure great
In a awards ceremony in 2013, Whirlpool certified
technological leaps”, he says.
another 10 input vendors of the main steel plants
that supply the company. The Cadeia do Aço (Steel
The HR Vice-resident of Whirlpool Latin America
Production Chain) program also mapped risks such
explains that, as a global corporation committed to
as forced and child labor, violation of indigenous
sustainability pillars, his group already knew that his
peoples rights, and irregularities in environmental
direct steel suppliers shared those same principles.
and forest management. All sub-suppliers and direct
However, they needed to make sure the same quality
suppliers complied with ethical standards and busi-
and ethical standards were adopted throughout the
ness practices set forth by Whirlpool.
entire production chain. The first audit of the Steel
Production Chain was carried out in 2010, and everything was found to be in compliance with standards.
He reiterates that after the audit room for improvement was found in maintaining environmental
licenses and controlling solid waste. As a result, in
2011 Whirlpool collaborated in the development and
application of action plans to seize these opportunities.
Aço Brasil Sustainability Report 2014
80
4.3 ENVIRONMENTAL PERFORMANCE
Environmental management system
In order to measure the results of a management
committed to environmental preservation, companies
need to establish a set of policies and practices as well
as organizational, technical and administrative procedures, that is to say, an Environmental Management
System (EMS). Only then will they identify opportunities to reduce the impacts of steel production on the
environment, increasing their chances of success and
improving their image before the market.
The ISO 14001 is an effective environmental man-
COMPANIES IN THE
SECTOR MAINTAINED
IN 2013 THEIR
INVESTMENTS IN
ENVIRONMENTAL
PROTECTION PROJECTS
TOTALING
BRL$ 763 MILLION.
2013, 85% of the Brazil Steel Institute associated
companies had ISO 14001 certified environmental
middle of the certification process and only one had
not yet started it.”
Aço Brasil Sustainability Report 2014
CONSUMPTION OF RAW MATERIALS AND ENERGY
agement tool to control environmental impact. “In
management systems; two companies were in the
81
Raw materials
Given the inexorable scarcity of many non-renewable
CONSUMPTION OF RAW
MATERIALS EXTERNAL SOURCES*
(10³ t)
2011
2012
2013
Mineral coal / anthracite
13,687
13,230
13,493
Coke
1,170
1,415
1,369
Petroleum coke
1,023
1,382
1,019
Charcoal
1,342
1,537
1,438
Iron Ore¹
33,589
33,689
34,436
589
484
184
Pig Iron
2,477
2,104
2,147
Iron and Steel Scrap
6,780
6,933
7,291
Crude Dolomite
1,346
1,405
1,373
Crude Limestone
4,108
3,727
2,212
Calcite / Dolomite Lime²
1,791
1,958
2,768
509
471
551
Manganese Ore
natural resources, steel companies have increasingly
Ferroalloys
Environmental certifications, green labels and the
sought eco-efficient processes to prevent waste and
constant investment in technology to promote the
Total
68,411
68,336
68,281
increase the reuse of materials.
CONSUMPTION OF RAW MATERIALS
INTERNAL SOURCES (10³ t)
2011
2012
2013
Coke
8,192
8,097
8,125
Sinter
24,337
25,083
24,464
Pellets
_
_
547
Pig Iron
22,192
22,147
21,226
2,337
2,530
3,054
624
698
486
57,682
58,557
57,902
efficient use of natural resources confirm the commitment of the Brazil Steel Institute associated
The main items from external sources consumed by the
companies to sustainability.
industry are iron ore, coal and scrap. Consumption of
raw materials remained stable in relation to last year.
In 2013, some associates obtained internationally
recognized certifications, were featured in special-
The steel industry has joined the efforts of the entire
ized magazines and awarded important prizes. One
chain to increase the reuse of scrap, both in sector
Brazil Steel Institute associate featured a prominent
programs – for example, the reuse of cars in legal scrap
spot in the Guia Exame de Sustentabilidade 2013
yards – and new programs – such as the replacement
publication for its environmental education project.
of old trucks. In 2013, 10.3 million tons of iron and
Iron and Steel Scrap
It was elected for the fifth time as one of the most
steel scrap were reused, surpassing the indicators
Calcite / Dolomite Lime
sustainable companies of the year in the Biodiversity
from 2012 and 2011.
Management category. Its corporate responsibility
Total
committee, made up of business leaders probably
played a major part in this success. Another highlight of the award was the application of steelmaking
residual sludge as fertilizing agent in the forest unit
of another associated company.
*Including materials purchased by companies. Does not include materials produced in-house.
1 – Includes pellets
2 – Includes fluorite
SCRAP RECOVERY
Based on the development of sustainable practices
In order to further expand the recovering of this input
in its industrial processes, a Brazil Steel associ-
in the regions in which operates, the company is
ated company, leader of long steel products in the
developing projects in collaboration with the public
Americas and a leading supplier of specialty steels
sector to promote appropriate disposal of outdated
in the world, which also operates in flat steel and
cars, trucks and buses. The company is responsible
iron ore, continuously invests in actions to reduce
for the entire process of decontamination, compacting
the impact of its activities on the environment. The
and transport of these vehicles. Not only do these
recycling concept is present in its plants throughout
initiatives contribute to the environment but they also
the different stages of steel production, contributing
play an important social and economic role, since
to the reduction of natural resource consumption.
they cut government expenses with storage, generate revenues from scrap sales, and also increase
In 2013, part of the steel manufactured by this com-
job opportunities throughout the extensive chain of
pany in Brazil was made from metal scrap recovery,
small, medium and large endeavors in the sector.
that is to say, from materials discarded by society. This
means that millions of tons of scrap were removed
from the natural environment, in collaboration with a
vast network of suppliers. The use of scrap reduces
the volume of material disposed in inappropriate sites
and generates savings of energy and other natural
resources used in steel production, in addition to
minimizing emissions of greenhouse gases such as
carbon dioxide (CO2).
Aço Brasil Sustainability Report 2014
84
Energy
85
Aço Brasil Sustainability Report 2014
Greenhouse gas emissions
Steel industry’s energy mix has changed little in 2013
Electricity should also be highlighted. 48% of the
Among the gases that can potentially lead to global
The entire steel industry – including semi-integrated
when compared to the previous two years. Mineral
total consumed by the sector is self generated and
warming, carbon dioxide (CO2) stands out. Its emis-
plants as well as coke and charcoal integrated
coal/coke continues to be the main energy source
52% purchased. It is important to note the sector’s
sions originate mainly from the intensive use of fossil
plants – has made a notable concerted effort aim-
(74%) followed by oil products (14%), charcoal (7%)
effort to increase its own production capacity, which
fuels in various economic sectors.
ing at improving the energy mix efficiency, as can
and electricity (5%).
has been constantly growing in the last three years.
be observed. Throughout the years, more efficient
In the case of the steel industry, carbon plays a vital
technologies in terms of energy use conservation
have been applied.
It is worth mentioning that, because of the charac-
Thanks to the ISO 50001 Certification-energy efficiency
role in the chemical reactions during iron ore reduc-
teristics of steel production processes, mineral coal/
– some steel companies have managed to cut their
tion, in which it acts as the main reducing agent. As
coke and charcoal serve not only as energy input but
energy consumption in a planned manner. As a result,
a result, CO2 is produced both as a by-product gas
As an example of this joint effort, we can mention
also as reducing agents for obtaining pig iron, which
the development of a few projects to improve energy
of the steelmaking process or during their burning.
initiatives for by-product gas recovery, the reuse and
explains the high share of these materials in our mix.
management has enabled production cost savings
recycling of co-products, the optimization of process
and a smaller use of natural resources, which result
The use of charcoal as a substitute reducing agent
control through automation, training and awareness
in the manufacturing of products at more accessible
for coke represents a significant differential for the
raising programs for collaborators – these are all part
steel industry has continuously distinguished itself
prices for the end consumer as well as in cuts in
Brazilian steel manufacturers regarding GHG emis-
of the daily operations of Brazil Steel associates and
as the sole user of a renewable resource, namely
greenhouse gas emissions.
sions, since these gases resulting from the steel
contribute to reduce gas emissions.
Another point worthy of mention is that the Brazilian
biomass (charcoal) , as reducing agent in the man-
production process are compensated by planted for-
ufacturing of steel.
ests used in the production of charcoal. However,
In order to monitor the evolution of emissions from
there are technical restrictions regarding the use of
the steel sector, the Brazil Steel Institute has been
charcoal in large blast furnaces, which limits employ-
working closely with its associates to standardize
ment of this input in high capacity plants.
data collection and calculation of emissions, in accordance with the methodology recommended by the
5%
ENERGY MIX
2013
7%
14%
Since they do not perform the preparation of load and
74%
Worldsteel Association.
reduction stages, semi-integrated plants consume
carbon mostly for energy purposes. As a result, these
As displayed in the chart, in 2013 GHG emissions
plants consume less carbon than the integrated plant,
remained stable, within average values of the last
reducing GHG emissions from the steel sector.
three years.
GREENHOUSE GAS EMISSIONS
MINERAL COAL / COKE
OIL PRODUCTS
CHARCOAL
ELECTRICITY
GREENHOUSE GAS EMISSIONS
Absolute emissions (10³t CO2)
Specific emissions (t CO2/ t crude steel)
2011
2012
2013
49,472
49,779
50,763
1.7
1.7
1.7
Aço Brasil Sustainability Report 2014
86
Water
87
Aço Brasil Sustainability Report 2014
Waste water
The operations of steelmaking plants demand large
During the year, associates implemented in their
Steelmaking plants are permanently concerned with
pH, flocculation and coagulation, cooling, biological
quantities of water, which is used in different stages
units successful solutions for water reuse such as
the control of waste water quality, in constant search
treatment, filtering, sedimentation, among others.
of the industrial process.
the constructions of lakes to collect rain water.
for reduced environmental impacts. All wastewater
Different initiatives have been carried out by the
In addition to internal efforts towards rational water
associates in order to better use water resources.
management, the steel industry takes part in water
The main activity is the water recirculation, which in
management policies. The Brazil Steel Institute and
2013 recorded a 96% index. This means that 4.7 billion
several of its members participate in a number of
cubic meters of water flow yearly inside recirculation
competent fora on this subject, namely the National
circuits, confirming Brazilian companies’ place among
and State Councils for Water Resources, and the
global top performers.
Water Basin Committees.
Both industrial and sanitary waste water are tested
from industrial plants of Brazil Steel associates go
to ensure their parameters fall within legal quality
through rigorous treatment before they are discharged
standards before discharge. In 2013, 85.5 million cubic
into water bodies, a process that includes: separa-
meters of waste water were discharged.
tion of oil from water, neutralizing and adjusting
WASTE WATER DISCHARGE IN FRESHWATER
(106 m3)
This effort towards the reuse of water is particularly
significant in the light of recent shortages of this vital
resource, as seen in 2013.
RECIRCULATED FRESHWATER
2013
FRESHWATER
RECIRCULATION INDEX
96%
97%
96%
2011
2012
2013
85.55
4,749
2012
73.26
4,888
2011
74.72
4,583
(106 m3)
2011
2012
2013
SPECIFIC WASTE WATER DISCHARGE IN
FRESHWATER
2.88
(m³/t crude steel )
2.47
2.47
2011
2012
2013
Aço Brasil Sustainability Report 2014
88
89
Aço Brasil Sustainability Report 2014
Co-Products And Residues
In 2013, reuse of waste and byproducts remained
The generation of blast furnace slag represented 37%
An interesting fact is that almost all of the blast
practically the same. Each ton of manufactured steel
of total residues, and steelmaking slag amounted to
furnace slag (99%) was sold, in particular to cement
generated 594kg of byproducts and residues, totaling
29%. The remaining residues are fines, dust, sludge,
manufacturing units. In the case of steelmaking
17.7 million tons – very close to the amount of 17.8
among others, generated in manufacturing processes
slag, 52% was sold and 26% reused in internal
million tons recorded in 2012.
and treatment systems. Out of this total, 88% were
processes. Its main application (62%) was to serve
reused.
as base for road paving.
SPECIFIC GENERATION OF CO-PRODUCTS AND
RESIDUES
(kg/t crude steel)
DESTINATION OF CO-PRODUCTS
AND RESIDUES
2013
6%
DESTINATION OF BLAST
FURNACE SLAG
2013
6%
1%
DESTINATION OF STEELMAKING SLAG
2013
26%
599
594
REUSE
FINAL DISCHARGE
STORAGE
2012
2013
88%
GENERATION OF CO-PRODUCTS
AND RESIDUES BY TYPE
13%
SELLING
99%
52%
INTERNAL REUSE
INTERNAL
REUSE
DONATION
SELLING
STORAGE
obs.: disposição final 0%
15%
18%
5%
6%
14%
13%
APPLICATION OF BLAST
FURNACE SLAG
2013
APPLICATION OF STEELMAKING SLAG
2013
1% 5%
5%
3%
ROAD BASE
OTHERS
29%
26%
SLUDGE
LAND LEVELING
97%
7%
AGRICULTURAL USE
DUST AND FINES
CEMENT
37%
STEELMAKING SLAG
37%
BLAST FURNACE SLAG
2012
9%
2013
PRODUCTION OF
CEMENT
ROAD BALLATS
CIVIL CONSTRUCTION
OTHERS
20%
62%
Aço Brasil Sustainability Report 2014
90
Occupied area
Out of a total area of 30.5 thousand hectares occupied
by steelmakers associated to the Brazil Steel Institute,
19 thousand hectares are preservation areas: 10.2
thousand hectares comprise voluntary reserves and
8.8 thousand hectares are legal reserves.
USE OF INDUSTRIAL UNIT AREAS
2013
38%
33%
29%
ECONOMIC USE
LEGAL PROTECTION
VOLUNTARY PROTECTION
92
93
CORPORATE INFORMATION
CREDITS
Brazil Steel Institute
Acknowledgements
Av. Rio Branco, 181, 28º andar – Centro
Rio de Janeiro – RJ / CEP: 20.040-007
Tel.: (21) 3445-6300
E-mail: acobrasil@acobrasil.org.br
Further information requests on this report shall be
forwarded to the Image and Communication Dept. of the
Brazil Steel Institute
The Brazil Steel Institute thanks all collaborators from
the associates and other companies who contributed to
the elaboration of this report, be it through interviews or
collection of data, ensuring the quality and reliability of the
information contained herein.
Board of Directors:
President
Benjamin M. Baptista Filho
(ArcelorMittal Tubarão – Aços Planos)
Vice-President
Julián Alberto Eguren
(Usiminas)
Board Members
Alexandre Lyra
(Vallourec Tubos do Brasil)
André Bier Gerdau Johannpeter
(Gerdau)
Carlos Rotella
(Votorantim Siderurgia)
Clayton Labes
(Sinobras)
Clênio Guimarães
(Aperam)
Harry Grandberg
(Villares Metals)
Jefferson de Paula
(ArcelorMittal Aços Longos)
Jorge Gerdau Johannpeter
(Gerdau Aços Especiais)
Manoel Vitor de Mendonça Filho
(Gerdau)
Paulo Perlott Ramos
(Gerdau Aços Longos)
Paulo Valadares
(VSB Tubos)
Sérgio Leite de Andrade
(Usiminas)
Walter de Castro Medeiros
(ThyssenKrupp CSA)
CEO
Marco Polo de Mello Lopes
Executive Directors
Maria Cristina Yuan
Débora Oliveira
Cristiano Buarque
Coordination
Brazil Steel Institute
Content
Technical staff of the Brazil Steel Institute
Graphic Design:
6D
Writing and Review:
Sônia Araripe (Coordinator)
Isabel Capaverde
Nícia Ribas
Cristina Vaz Carvalho