Sustainability Policy

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Review History

 

Version: Date of Review: History: 
1 06/03/2013 Document preparation.
2 06/26/2015 Unification with a Corporate Responsibility policy. Adequacy of Objective (I) and Guidelines (VI).
Inclusion of the items Coverage (II), Complementary Documentation (III), Concepts and Acronyms (IV), Responsibilities (V), Consequence Management (VII) and General Provisions (VIII).
3 05/06/2016 Alteration of VPE responsible for Institutional Relations Policy for Organizational Development;
Update of the items Complementary Documentation (III) and the following items of the Guidelines (VI): 3.1, 3.2, 8.3 and 8.5;
Inclusion of items 3.3, 3.5, 4.3 and 9.2 of the Guidelines (VI).
4 06/07/2018 Update of the items: Objective (I); Scope (II); Guidelines (III): 1.1 and 1.2; 2.3; 3, 3.2, 3.3; 5.2; 6.3, 6.4; 8.1, 8.2, 8.3, 8.4, 8.5, 8.6, 8.7; and 10.1; Responsibilities (VI) and Complementary Documentation (VII).
5 05/22/2020 Amendment to the following items: I. Purpose; II. Scope; III. Guidelines – subitems 1.1, 2.1, 2.2, 3.1, 3.3., 3.4, 3.5, 5.1, 6.1, 6.2, 6.3, 7.1, 8.1, 8.2, 9., 9.1, 9.2, 10.1; V. Responsibilities; VI. Additional Documentation; VII. Concepts and Acronyms.
6 06/25/2022 General Document Update.
7 04/24/2024 Update of items: I. Purpose, II. Scope, III. Guideline sub-items: 1; 1.1; 1.2; 1.3; 1.4; 1.5; 2; 2.1; 2.2; 3; 3.1; 3.2; 4; 4.1; 4.2; 4.3; 5.1; 5.3; 6; 6.1; 6.2; 6.3; 6.4; 7; 7.1; 7.2; 7.3; 7.4; 7.5; 7.6; 7.7; 7.8; 7.9; 8; 8.1 and 8.2, IV. Consequence Management, V. Responsibilities, VI. Supplementary Documentation, VII. Concepts and Acronyms and VIII. General Provisions.

 

I. Purpose

This Sustainability and Impact Policy (“Policy”) sets out the guidelines for Cielo S.A. – Instituição de Pagamento (“Cielo”) regarding the integration of environmental, social, and governance aspects and practices (ASG, in Portuguese, and ESG, in English, a commonly used acronym) into its operations.

II. Scope

All members of the Board of Directors and the Executive Board (“Directors”); members of the Advisory Committees and of the Fiscal Council; employees, including outsourced workers, interns and young apprentices (“Employees”) of the companies Cielo, Servinet Serviços Ltda (“Servinet”), Aliança Pagamentos e Participações Ltda. (“Aliança”) and Stelo S.A. (“Stelo”), hereinafter jointly referred to as the “Company”.

All the Company’s Subsidiaries must define their directions based on the guidelines set forth in this Policy, considering the specific needs and the legal and regulatory aspects to which they are subject.

With respect to the Affiliates, the Company’s representatives who act in managing its Affiliates must make every effort to define their directions based on the guidelines set forth in this Policy, considering the specific needs and the legal and regulatory aspects to which they are subject.

III. Guidelines

1. Principles

1.1. The Company conducts its operations with a focus on social, environmental, and climate responsibility, aligning with strategic frameworks in compliance with relevant legal and regulatory requirements.

1.2. Ethical conduct and integrity form the cornerstone of its operations, guided by the principles outlined in the Code of Ethics, the Anti-Corruption Policy, and the Competition Policy.

1.3. Adopting a corporate governance model tailored to its activities, the Company evaluates sustainability, diversity, and the social, environmental, and climate impact through the oversight of the Executive Board, the Sustainability Committee, and the Board of Directors where applicable. These efforts are aimed at fostering shared value within its business framework.

1.4. Assessment of its operational environment and externalities is conducted in accordance with the guidelines set forth in the Stakeholder Relationship Policy. The Company endeavors to mitigate negative impacts arising from its operations, products, and services while amplifying positive impacts to create value for its stakeholders. It integrates best ESG practices into its culture, structures, and processes, advocating for their adoption throughout its value chain.

1.5. Furthermore, the Company actively promotes awareness and engagement among its employees, suppliers, and service providers on environmental, social, and climate-related issues. It strives to strengthen its positive influence on the broader environmental context in which it operates, serving as a catalyst for social transformation.

2. Risk and opportunity management

2.1. The Company operates with a multidisciplinary approach to risk management, encompassing social, environmental, and climate factors. This process involves the identification, assessment, mitigation, monitoring, and reporting of environmental, social, and climate risks in accordance with the Corporate Risk Management and Internal Controls Policy.

2.2. Reports detailing environmental, social, and climate risks and opportunities are presented to relevant Risk Management Governance bodies for informational or deliberative purposes as deemed appropriate.

3. Value chain

3.1. The Company assesses, monitors, and collaborates with its suppliers and service providers concerning social, environmental, and climate-related practices, adhering to the directives outlined in the Purchasing Policy. It encourages them to align their practices and actions with the principles outlined in this Policy.

3.2. Proactively, the Company verifies the social, environmental, and climate practices disclosed by its suppliers and service providers, conducting audits when necessary. It strives to implement actions for continuous improvement within its value chain, in accordance with the prioritized strategy.

4. Sustainable solutions

4.1. The Company aims to develop products, services, and solutions that create economic value while enhancing positive impacts and minimizing negative ones on society, the environment, and the climate.

4.2. It integrates social, environmental, and climate responsibility criteria into the development and review processes of its products, services and solutions. By identifying and mitigating risks, the Company strives to prevent significant negative impacts from its operations and business activities.

4.3. Additionally, it seeks to discover and develop new business opportunities that benefit society, the environment, and the climate. These considerations are embedded in the development of its products, services, and portfolio solutions to foster positive outcomes for customers, society, and the environment.

5. Eco-efficiency & Climate Change

5.1. The Company adopts environmental management practices to align its business with environmental preservation, focusing on incorporating eco-efficiency into all activities to reduce negative environmental impacts and continuously improve its environmental performance. It aims to optimize the use of natural resources and promotes the adoption of a circular economy strategy, particularly in waste management.

5.2. The Company also implements criteria to address climate change, ensuring its businesses are prepared for various climate change scenarios, with a focus on impact mitigation, climate transition, and adaptation to extreme climate events. This involves:

(a) Managing its Greenhouse Gas (GHG) emissions;
(b) Seeking initiatives to reduce emissions;
(c) Establishing related goals;
(d) Compensating for unavoidable emissions through projects aimed at emission reduction, with a focus on curbing deforestation and promoting social development;
(e) Defining and monitoring risk scenarios and mapping vulnerabilities to extreme climate events; and
(f) Adopting strategies for adaptation, business continuity and increased resilience to extreme climate events, including crisis response mechanisms.

5.3. The Company promotes the identification and implementation of opportunities that support the transition to a low-carbon economy, especially through its business model.

6. Respect for Human Rights

6.1. The Company bases its actions on respect for human rights and firmly opposes forced or compulsory labor, child labor, and the sexual exploitation of children and adolescents.

6.2. It does not condone suppliers or service providers who subject their employees to humiliating or slavery-like working conditions, or who employ children or sexually exploit minors.

6.3. The Company repudiates the use of its products and services by commercial establishments that facilitate or are involved in humiliating working conditions, slavery-like practices, child labor, or the sexual exploitation of minors.

6.4. It adopts criteria and takes measures to monitor and exclude suppliers, service providers, and customers involved in human rights violations.

7. Financial education and social impact

7.1. The Company seeks to increase its positive social impact by focusing on social-productive inclusion through financial, entrepreneurial, and digital education within its value network. This includes essential topics such as financial organization, budget planning, and business management.

7.2. The Company promotes and implements initiatives that develop valuable business management and financial education skills for clients, users, and entrepreneurs, particularly in socially vulnerable contexts. It provides content and formats relevant to their financial lives and the economic growth of their businesses, aiming to amplify the positive social, environmental, and climate impacts of these interventions.

7.3. The Company strives to maximize the reach and effectiveness of these actions for its customers, users, as well as entrepreneurs, and socially vulnerable groups. Emphasis is placed on underrepresented or marginalized social groups, in line with the current priorities of the Company’s Diversity and Inclusion Policy.

7.4. The Company develops actions and programs aimed at financial education to foster a culture of financial resilience among our customers, users, and the audiences served by our social impact initiatives. It provides content and tools tailored to the language, channels, and schedules appropriate to the characteristics and financial education needs of each target audience.

7.5. Financial education measures are implemented in alignment with the Company’s business model, considering the various phases and channels of interaction with each audience, and establishing a strategy compatible with their routines.

7.6. The Company monitors the effectiveness of its financial and entrepreneurial education strategies, as well as the social impact, using appropriate metrics.

7.7. It aims to work towards social development in connection with the growth of its business. To this end, the Company provides information on the suitability of its products and services to customer profiles to prevent default and over-indebtedness.

7.8. The Company voluntarily allocates funds in a planned, monitored, and situational manner to projects and programs that aim to transform the social reality of the served public, contributing to societal development.

7.9. It encourages employee participation in volunteer work to foster an inclusive and humanized culture within the team, thereby enhancing the Company’s social impact.

8. Diversity, Equity & Inclusion

8.1. The Company promotes diversity, equity, and inclusion by developing and refining processes that enhance representation with equity and engage leadership in building an inclusive and humanized culture.

8.2. It values diversity to combat all forms of discrimination and strives to maintain a pluralistic, healthy, safe, and discrimination-free work environment. The Company promotes equity in all its forms, in line with the principles and guidelines established in its Diversity and Inclusion Policy.

IV. Consequence Management

Employees, suppliers or other stakeholders who observe any deviations from the guidelines of this Policy may report the fact to the Ethics Channel through the channels below, with the option of anonymity:

Internally, non-compliance with the guidelines of this Policy gives rise to the application of accountability measures to the agents that fail to comply with it, according to the respective severity of the non-compliance and as per internal regulations, and is applicable to all persons described in the item “Scope” of this Policy, including the leadership and members of the Executive Board.

V. Responsibilities

  • Administrators and Employees: Observe and ensure compliance with this Policy and, when necessary, call the Executive Sustainability, Diversity and Impact Management for consultation on situations involving conflict with this Policy or upon the occurrence of situations described herein.
  • Executive Corporate Governance Superintendency: Liaison with: (i) Controlling Shareholders; (ii) Directors; (iii) members of the Fiscal Council and Advisory Committees, as well as any of the Company’s bodies with technical or advisory functions, created by statutory provision, and those that may acquire this status, in order to clarify and/or direct doubts about the documents mentioned and/or pertinent to this Policy.
  • Sustainability Committee: Propose and monitor the execution of projects that improve the Company’s sustainability practices in the social, environmental and economic dimensions resulting from the Strategic Sustainability Plan, as well as to monitor the social, economic and environmental commitments assumed by the Company.
  • Board of Directors: (i) Analyze, amend, and approve this Policy in accordance with the periodicity outlined in the Company’s internal rules, and whenever deemed necessary; (ii) Ensure the perpetuity of the Company from a long-term and sustainability perspective, incorporating economic, social, environmental, and good corporate governance considerations into the definition of business and operations; and (iii) Promote sustainability topics within the Company’s business processes, addressing social, economic, good corporate governance, and environmental issues, including those related to climate change.
  • Executive Sustainability, Diversity and Impact Management: comply with and enforce the guidelines set forth in this Policy, keep it updated to ensure that any changes to its guidance are incorporated hereto, and clarify doubts regarding its content and application.
  • Executive Vice-Presidency of People, Management, and Performance: responsible for ensuring compliance with the obligations outlined in Joint Resolution No. 8 of the Central Bank of Brazil and the National Monetary Council, as well as those addressed in this Policy. Additionally, it is tasked with adhering to and enforcing the guidelines established within this Policy.
  • Risk and Internal Controls Executive Superintendency: Identify, measure and evaluate, monitor, mitigate and report corporate risks in an integrated and periodic manner, in accordance with the guidelines established in the Corporate Risk Management and Internal Controls Policy.

VI. Supplementary Documentation

VII. Concepts and Acronyms

  • Value Environment: encompasses the setting in which an organization creates, exchanges, and delivers value to its stakeholders.
  • Value Chain: array of activities undertaken by a company, spanning from the acquisition of raw materials to the distribution of the final product.
  • Sustainable Development: a model designed to meet the needs of the present generation without jeopardizing the ability of future generations to fulfill their own needs.
  • Discrimination: Any distinction, exclusion or preference based on race, color, sex, age, marital status, appearance, sexual orientation, disability, disease, religion, political opinion, nationality, social origin or other reason which has the effect of nullifying or reducing equality of opportunity or treatment in employment or occupation; prejudice in action.
  • Human Rights: These are norms that acknowledge and safeguard the dignity of every human being. They are rights granted to individuals solely by virtue of their humanity, grounded in respect for individuality and freedom. Human rights govern the way individual human beings live in society and with each other, as well as their relationship to the State and the obligations the State has toward them.
  • Diversity: In the Koogan/Houaiss encyclopedia and dictionary (1998), diversity is defined as: “character that distinguishes one being from another”.
  • Equity: The principle of equity strives to ensure equal opportunities and impartial treatment, acknowledging that diverse individuals or groups may have varying needs and, consequently, may require different forms of support to attain equitable conditions.
  • Greenhouse Gases (GHG): These are gases known to absorb and trap energy from the sun, resulting in a rise in the planet’s temperature and contributing to the greenhouse effect. Examples of greenhouse gases include Carbon Dioxide (CO2), Methane (CH4), Nitrous Oxide (N2O), and Chlorofluorocarbons (CFCs).
  • Risk Management Governance: This definition is commonly used to refer to governance bodies, including: (i) Executive Board; (ii) Risk Committee; (iii) Sustainability Committee; (iv) Board of Directors. Additionally, it encompasses other Company bodies that may be involved, both for informational and deliberative purposes, in risk and opportunity management, such as the Audit Committee, the Corporate Governance Committee etc.
  • Externalities: These effects encompass the social, economic, and environmental impacts indirectly caused by an activity, affecting third parties who did not directly participate in that action.
  • Social Impact: This pertains to the effect that certain actions, projects, policies, or initiatives have on people and society as a whole. It involves considering both the intentional and unintentional consequences of an organization’s activities on society.
  • Inclusion: The act of including people belonging to minority or minoritized groups, allowing them full participation in all educational, work, leisure, community and domestic activities.
  • Stakeholders: Stakeholders are all relevant audiences, whether internal or external, consisting of people, groups, organizations, associations and other actors who influence or are influenced by the company’s activities, products and services, and who may be impacted by its decisions, actions and performance. Examples of Stakeholders include, but are not limited to: suppliers, investors, employees, local communities, the press and civil society organizations.
  • Climate Change: Array of alterations in the global climate resulting from interference that may have a natural origin, such as variations in solar radiation and the Earth’s orbital movements, as well as human activities, notably the extensive emissions of greenhouse gases.

VIII. General Provisions

The Company’s Board of Directors is responsible for altering this Policy whenever necessary.

This Policy takes effect on the date of its approval by the Board of Directors and revokes any documents to the contrary.