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Message from the Administration
4.2

Indicate whether the Chair of the highest governance body is also an executive officer

+Executive Board
Djalma Bastos de Morais
CEO President
Arlindo Porto Neto
Vice President
Fernando Henrique Schüffner Neto
Chief Business Development Officer
Frederico Pacheco de Medeiros
Chief Corporate Management Officer
José Carlos de Mattos
Chief Natural Gas Officer
Ricardo José Charbel
Chief Distribution and Commercialization Officer
José Raimundo Dias Fonseca
Chief Commercial Officer
Luiz Fernando Rolla
Chief Finance and Investor Relations Officer
Luiz Henrique de Castro Carvalho
Chief Generation and Transmission Officer
Luiz Henrique Michalick
Chief Institutional Relations and Communications Officer
Maria Celeste Morais Guimarães
Chief Legal Officer
+Board of Directors

Effective Members

Dorothea Fonseca Furquim Werneck
Djalma Bastos de Morais
Wando Pereira Borges
Arcângelo Eustáquio Torres Queiroz
Tadeu Barreto Guimarães
João Camilo Penna
Joaquim Francisco de Castro Neto
Fuad Jorge Noman Filho
Guy Maria Villela Paschoal
Eduardo Borges de Andrade
Otávio Marques de Azevedo
Ricardo Coutinho de Sena
Paulo Roberto Reckziegel Guedes
Saulo Alves Pereira Junior

Alternate Members

Paulo Sérgio Machado Ribeiro
Lauro Sérgio Vasconcelos David
Marco Antonio Rodrigues da Cunha
Franklin Moreira Gonçalves
Leonardo Maurício Colombini Lima
Guilherme Horta Gonçalves Júnior
Adriano Magalhães Chaves
Luiz Augusto de Barros
Christiano Miguel Moysés
Tarcísio Augusto Carneiro
Bruno Magalhães Menicucci
Marina Rosenthal Rocha
Newton Brandão Ferraz Ramos
José Augusto Gomes Campos
+Audit Board

Effective Members

Aristóteles Luiz Menezes Vasconcellos Drummond
Luiz Guaritá Neto
Thales de Souza Ramos Filho
Lauro Sander
Helton da Silva Soares

Alternate Members

Marcus Eolo de Lamounier Bicalho
Ari Barcelos da Silva
Aliomar Silva Lima
Salvador José Cardoso de Siqueira
Bruno Gonçalves Siqueira

Message from the Administration

1.1

Statement from the most senior decisionmaker of the organization (e.g., CEO, chair, or equivalent senior position) about the relevance of sustainability to the organization and its strategy.

Once again, we ended the year that the task was completed, adding value to our shareholders, and through our actions, reaffirming our role as a consolidator company in the Brazilian electricity sector.

We knew we would have challenges in 2013 in view of the tariff revision of Cemig Distribuição and the decrease in our transmission revenues due to compensation criteria established in MP 579, as well as the expiration of the 1st concession period of our Jaguara power plant, which we will have to discuss extending for an additional period, as provided for in our concession contract. However, despite these challenges, we made a profit of over R$ 3.1 billion in 2013. Although there was a profit of R$ 4.3 billion in the previous year, which would indicate a decrease in our performance, we should note that the profits of the previous year were the result of an extraordinary event, the early settlement of the CRC contract. Excluding this non-recurring event, our performance has improved over the previous year, which indicates Cemig’s continued growth. These results represent an earnings per share of R$ 2.47, where we paid R$ 4.6 billion in dividends in 2013 resulting in a dividend yield of 9.9%. With lower interest rates expected over the long term, these figures reported by Cemig make our actions an investment with an attractive return for our thousands of shareholders.

Despite the good results, our actions in 2013 were further affected by regulatory uncertainties in the electricity sector due to the effects of MP 579 and the capital outflow from emerging markets including Brazil in pursuit of bonds with a perceived lower risk, especially government bonds from the United States. Even in this unfavorable scenario, our common shares showed a positive variation of 4.0% and preferred shares fell 0.2% in 2013, compared to drops in the Ibovespa and the Electricity Sector Index of 15.50% and 8.83% respectively.

With regard to new investments, a number of significant events occurred for our Company in 2013.  A highlight in the renewable energy area is the acquisition of 51% of Brasil PCH, an investment of R$ 740 million, and an investment agreement that will give Cemig GT, our wholly owned subsidiary, a controlling stake in Renova Energia, which will enable this Company to implement a significant investment program in the coming years and consolidate our position as one of the major participants among Brazilian conglomerates in the renewable energy market.

We would also like to highlight the partnership with Vale S.A. to generate assets through a new company called Aliança Geração de Energia S.A., which was created with combined assets of over R$ 4 billion. With this partnership, we increase the potential to generate new business and maximize results in the energy generation area through the combination of experience in operational, financial, and project management.

In the energy distribution area, Cemig Distribuição reported R$ 884 million in investments in 2013, with investments of R$ 3.7 billion planned for the period between 2013 and 2017.

We also want to emphasize our commitment to society by improving the quality and reliability of service to our customers. The duration of service interruptions of Cemig Distribuição customers as calculated through the DEC Index was 12.49 hours in 2013 compared to 14.74 hours in 2012, an improvement of 15.26%. Moreover, the frequency of interruptions as measured by the FEC, which was already below the minimum levels required by the Regulatory Agency, also improved going from 7.04 interruptions in 2012 to 6.26 in 2013, an improvement of 11.08%.

Growth, consistent financial results, and commitment to providing our customers with quality service represent the materialization of our strategic vision, based on principles of sustainability and social responsibility, which is also evident by Cemig being selected for the 14th consecutive year in the Dow Jones Sustainability Index.

Cemig was also selected in 2013 to be part of the UN Global Compact Index, the Global Compact 100 (GC100), which lists a hundred global companies committed to corporate sustainability linked to better performance in capital markets. This form of action demonstrates Cemig’s commitment to aligning its strategy with the principles of the Global Compact agreement.

In 2014, there will be major challenges once again for our Company and the Brazilian electricity sector. The low reservoir levels of power plants in late 2013 and early 2014 increased energy prices in the wholesale market to above R$ 800.00/Mwh putting pressure on the cash flow of distribution companies because of the significant cost of purchasing energy. This situation makes it essential for the federal government and regulatory bodies to provide support in building solutions to maintain the economic-financial balance of companies in the sector and enable the settlement of transactions between electric distribution and generation companies.

In this scenario, the rainfall in the coming months in comparison with the historical averages will be a factor in determining energy policy and prices for 2014.

Also, the Soccer World Cup will be held in 2014. The electricity sector has an important role to play in this world-level event by supplying reliable power during the period of the games.

Before ending, we would like to thank our employees, whose professional expertise is recognized nationwide. It is the commitment, expertise, and talent of all our collaborators that make Cemig “the best energy company in Brazil”.

Our results were only possible with the support of all company shareholders, who we would like thank for their support and trust throughout the year.

Cemig
Corporate Governance
Strategy
Customers and Consumers
Financial Results
Internal Public
Suppliers and Contractors
Community
Environment
Other Data

Recognitions

2.10

Awards received in the reporting period.

Cemig is chosen as the 3rd most respected brand in Minas Gerais

According to the study carried out by the Grupo Troiano of Branding Cemig was considered as the 3rd most respected brand amongst the companies in the State of Minas Gerais. The survey was carried out with 3 thousand interviewees that evaluated 72 companies in the following criteria: the quality of the products and services, admiration and confidence, social and environmental responsibility, capacity for innovation, history and evolution and work environment.

Cemig receives the Best of the Biggest 2013 award in the Electric Energy category

The fourth edition of the Annual Balance of the Trade Association of Sao Paulo analyzed 10 thousand Brazilian companies, until coming up with 20 companies that achieved recognition in their respective areas, for generation capacity and profit and growth. The integral subsidiary Cemig Geração and Transmissão were defeated in the electric energy category.

Cemig receives the Complain Here Customer Service Quality award

255 companies of 70,000 people registered on the www.reclameaqui.com.br site, divided into 62 categories and the winners were chosen after popular vote. Cemig won the Complain Here Customer Service Quality award in the public services category – electric energy.

Cemig remains in 1st position in the Abrasca award

Cemig remained in 1st place in Abrasca’s evaluation in the category 1, which evaluates the annual reports of the publicly held companies on the BMF&Bovespa. The company obtained a grading of 96.67 points of a total of 100 points.

Award of the best strategic campaign

Elevation of the Rating: In Dec/2013, the risk agency Standard & Poor’s, (“S&P”) increased Cemig’s credit rating on the global scale, from BB to BB+, and on the national scale, and from brAA- to brAA+, with a stable perspective for both. S&P increased, also, the ratings of the subsidiaries Cemig Distribuição SA (Cemig D) and Cemig Geração e Transmissão SA (Cemig GT) from BB+ on the global scale and to brAA+ on the national scale, besides revising the evaluation of Cemig’s risk profile from “regular” to “satisfactory”.

To read the report in full, visit: http://cemig.infoinvest.com.br/ptb/11024/RatingsReviewReport_SP_11142013_por.pdf

Cemig was the winner of the 15th edition of the Abrasca Best Annual Report Award.

This award is granted by the Brazilian Association of Publicly-held Companies - Abrasca and, in 2013, had a participation of 95 companies/entities that competed in five different categories. Cemig was the winner in the Publicly Held Company category – Group 1 (net revenue above R$ 3 billion), together with Souza Cruz S/A.

The award is an important recognition of the effort from Cemig in offering ever more precise and transparent information to the market.

To get to know the list of winners of the Abrasca Best Annual Report 2013 Award, visit: http://www.abrasca.org.br/Eventos/Premio-Abrasca-Relatorio-Anual/2013

Consolidated Social Balance Sheet

Calculation Base 2013 2012
Value (Thousand Real) Value (Thousand Real)
Net Revenue (NR) 14,627,280 14,137,358
Operational Result (OR) 4,362,471 3,474,721
Gross Payroll (GP) 1,038,555 1,030,607
2) Internal Social Indicators Value
(Thousand R$)
% Over FPB % Over RL Value
(Thousand R$)
  % Over FPB % Over RL
Food 75,221 7.24 0.51 73,217   7.10 0.52
Compulsory social charges 282,123 27.16 1.93 276,948   26.87 1.96
Private Pension Plan. 77,058 7.42 0.53 71,554   6.94 0.51
Health 44,546 4.29 0.30 43,185   4.19 0.31
Safety and medicine at work 18,716 1.80 0.13 18,740   1.82 0.13
Education 463 0.04 - 639   0.06 -
CE Culture 78 0.01 - 76   0.01 -
Professional training and development 27,125 2.61 0.19 26,501   2.57 0.19
Nurseries or assistance-nurseries 2,102 0.20 0.01 2,036   0.20 0.01
Share in the profits or results 228,763 22.03 1.56 238,795   23.17 1.69
Others
18,422
1.77
0.13
17,443
 
1.69
0.12
Total – Internal Social Indicators 774,617 74.57 5.29 769,134   74.62 5.44
3) External Social Indicators Value
(Thousand R$)
% Over RO % Over RL Value
(Thousand R$)
  % Over RO % Over RL
Education 1,200 0.03 0.01 1,200   0.03 0.01
Culture 24,831 0.57 0.17 20,275   0.58 0.14
Other Donations/Subsidies/ASIN Project/Sports
51,638
1.18
0.35
57,730
 
1.66
0.41
Total of the Contributions for Society 77,669 1.78 0.53 79,205   2.27 0.56
Taxes (excluding social charges)
5,629,760
129.05
38.49
6,705,564
 
192.98
47.43
Total – External Social Indicators 5,707,429 130.83 39.02 6,784,769   195.25 47.99
4) Environmental Indicators Value
(Thousand R$)
% Over RO % Over RL Value
(Thousand R$)
  %Over RO %Over RL
Related with the operation of the company 181,300 4.16 1.24 163,177   4.70 1.15
In Programs and/or external projects
-
-
-
-
 
-
-
Total of the Investments in the Environment 181,300 4.16 1.24 163,177   4.70 1.15
The establishment of annual goals to minimize residues, the general consumption in the production/operation and to increase the efficiency in the use of natural resources, the company: (x) it doesn’t have goals
( ) complies 0 to 50%
( ) complies 51 to 75%
( ) complies 76 to 100%
(x) it doesn’t have goals
( ) complies 0 to 50%
( ) complies 51 to 75%
( ) complies 76 to 100%
5) Indicators of the Functional Body 2013 2012
No. of employees at the end of the period 7,922 8,368
No. of admissions during the period 776 4
No. of third-party employees ND ND
No. of interns 336 505
No. of employee above the age of 45 3,375 3,928
No. of women employees in the company 1,042 1,089
% of managing positions filled by women 12.76 12.20
No. of black employees in the company 2,542 2,628
% of managing positions filled by black employees 13.17 13.64
No. of bearers of deficiencies or special needs 85 41
6) Information relevant to the exercise of corporate citizenship 2013 ..
Total number of work accidents with employees 61 There isn’t a goal
The social and environmental projects developed by the company were defined by: ( ) directors ( x ) directors and managers ( ) all of the employees ( ) directors ( x ) directors and managers ( ) all of the employees
The security and hygiene standards in the working environment were defined by: ( ) directors and managers ( x) all of the employees ( ) All + CIPA ( ) directors and managers ( x) all of the employees ( ) All + CIPA
The private pension plan contemplates: ( ) directors ( ) directors and managers ( x ) all of the employees ( ) directors ( ) directors and managers ( x ) all of the employees
The share in the profits or results contemplates: ( ) directors ( ) directors and managers ( x ) all of the employees ( ) directors ( ) directors and managers ( x ) all of the employees
In the selection of the suppliers, the same ethical standards and of social and environmental responsibility adopted by the company: ( ) they are not considered ( ) they are suggested ( x ) they are Demanded ( ) they will not be considered ( ) they will be suggested ( x ) they will be demanded
In terms of the participation of employees in voluntary work programs, the company: ( ) it doesn’t develop ( ) it supports ( x ) it organizes and provides incentives ( ) it will not include ( ) it will support ( x ) it will organize and provide incentives
Total number of claims and complaints from consumers: in the company
___ND___
in the Procon
___ND___
in Court
___ND___
in the company ___ND___ in the Procon ___ND___ in the company ___ND___
% of claims and complaints solved: in the company
___ND___
in the Procon
___ND___
in Court
___ND___
in the company ___ND___ in the Procon ___ND___ in the company ___ND___
Total added value to be distributed (in thousand R$) In 2013: 11.568    
Distribution of the Added Value (DAV) 48.36% government 14.70% shareholders 49.26% government 16.30% shareholders
  13.38% collaborators 11.18% third-parties 10.29% collaborators 10.04 % third-parties
  12.38% retained   14.11% retained  
7) Other Information    

I – In 2013, Cemig invested a total of R$181.8 million in resources related to environmental questions: R$128.9 million in assets in the implementation of new ventures and R$52.9 million in environmental management. The resources applied in Consortia in which Cemig participates totaled R$11.7 million.

II – The water quality of Cemig’s reservoirs is monitored regularly, in a network that contemplates the principal hydrographic basins of Minas Gerais (Grande, Paranaíba, Pardo, São Francisco, Doce, Paraíba do Sul, Itabapoana and Jequitinhonha), covering a total of 43 reservoirs and more than 200 stations of the collection of physical, chemical and biological data.

III – In 2013, 32,711 tons of residues and unserviceable materials disposed of, with 32,443 tons being disposed of or recycled, 268 tons were co-processed or incinerated. Of the total presented, 98.4% refer only to the residues disposed by Cemig D, derived from the Plan of the Modernization of the Distributing System. Within these values, 113 tons of unsuitable isolated mineral oil were disposed of for internal consumption, with 252 tons of residues permeated with oil and 10 tons of EPIs co-processed. Of the presented amounts, 1,400 tons represented dangerous residues and 31,310 tons of non-dangerous residues.

GRI Reference List

3.12

Table identifying the location of the Standard Disclosures in the report.

Informações / Relatos / Indicadores GRI Observações Atendimento
1 Strategy and Analysis
1.1

Statement from the most senior decisionmaker of the organization (e.g., CEO, chair, or equivalent senior position) about the relevance of sustainability to the organization and its strategy.

Fully
1.2

Description of key impacts, risks, and opportunities.

There is no specific chapter. The information is dispersed throughout the text.

Partially
2 Organizational Profile
2.1

Name of the organization.

Fully
2.2

Primary brands, products, and/or services.

Fully
2.3

Operational structure of the organization, including main divisions, operating companies, subsidiaries, and joint ventures.

Fully
2.4

Location of organization’s headquarters.

Fully
2.5

Number of countries where the organization operates

Fully
2.6

Nature of ownership and legal form.

Cemig is a mixed capital company controlled by the state of Minas Gerais, which holds 51% of the voting shares.

Fully
2.7

Markets served (including geographic breakdown, sectors served, and types of customers/beneficiaries).

There were no significant changes in the Company regarding size, organizational structure, and ownership control.

Fully
2.8

Scale of the reporting organization

Fully
2.9

Significant changes during the reporting period regarding size, structure, or ownership

There were no significant changes in the company as to the size, structure and ownership control.

Fully
2.10

Awards received in the reporting period.

Fully
EU1

Installed capacity, broken down by primary energy source and by regulatory regime

Fully
EU2

Net energy output broken down by primary energy source and by regulatory regime

Fully
EU3

Number of residential, industrial, institutional and commercial customer accounts

Fully
EU4

Length of above and underground transmission and distribution lines by regulatory regime

Additional Information: Transmission lines are all overhead. There are 16km of underground subtransmission lines and the rest are overhead. With regard to the distribution network, 687km are underground and the rest are overhead.

Fully
EU5

Allocation of CO2e emissions allowances or equivalent, broken down by carbon trading
framework.

No funds were raised through the sale of carbon credits.

Partially
3 Report Parameters
Report Profile
3.1

Reporting period (e.g., fiscal/calendar year) for information provided.

Fully
3.2

Date of most recent previous report (if any).

Fully
3.3

Reporting cycle (annual, biennial, etc.)

Fully
3.4

Contact point for questions regarding the report or its contents.

Fully
Report Scope and Boundary
3.5

Process for defining report content

In 2013, the decision was made to review the materiality test performed in 2012. A new test will be performed in 2014.

Partially
3.6

Boundary of the report

There were no reported decisions taken that do not apply to or significantly diverge from the GRI protocols.

Fully
3.7

State any specific limitations on the scope or boundary of the report.

Fully
3.8

Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations, and other entities that can significantly affect comparability from period to period and/or between organizations.

Fully
3.9

Data measurement techniques and the bases of calculations

No decisions have been reported that do not apply the GRI protocols or to substantially diverge

Fully
3.10

Explanation of the effect of any re-statements of information provided in earlier reports, and the reasons for such re-statement

Fully
3.11

Significant changes from previous reporting periods in the scope, boundary, or measurement methods applied in the report.

Fully
GRI Content Index
3.12

Table identifying the location of the Standard Disclosures in the report.

Fully
Assurance
3.13

Policy and current practice with regard to seeking external assurance for the report.

Fully
4 Governance, Commitments, and Engagement
Governance
4.1

Governance structure of the organization, including committees under the highest governance body responsible for specific tasks, such as setting strategy or organizational oversight.

The Board of Directors consists of 14 members of which 13 are men and 1 is a woman. Among them, 12 are over age 50, and none of them are black, indigenous, Asian, or have a disability.

Fully
4.2

Indicate whether the Chair of the highest governance body is also an executive officer

Does not apply to Cemig’s governance model.

Fully
4.3

For organizations that have a unitary board structure, state the number of members of the highest governance body that are independent and/or non-executive members.

Does not apply to Cemig’s governance model.

Fully
4.4

Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body.

There is no formal representatives for the employees on the Board of Directors at Cemig. The investor Relations area provides a specific channel for contact with minority shareholders, and at the discretion of the area, questions may be forwarded to the Board of Directors.

Partially
4.5

Linkage between compensation for members of the highest governance body, senior managers, and executives (including departure arrangements), and the organization’s performance (including social and environmental performance).

Fully
4.6

Processes in place for the highest governance body to ensure conflicts of interest are avoided.

Fully
4.7

Process for determining the qualifications and expertise of the members of the highest governance body for guiding the organization’s strategy on economic, environmental, and social topics.

Fully
4.8

Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, environmental, and social performance and the status of their implementation.

Fully
4.9

Procedures of the highest governance body for overseeing the organization’s identification and management of economic, environmental, and social performance, including relevant risks and opportunities, and adherence or compliance with internationally agreed standards, codes of conduct, and principles.

Fully
4.10

Processes for evaluating the highest governance body’s own performance, particularly with respect to economic, environmental, and social performance.

None at Cemig.

Fully
Commitments to External Initiatives
4.11

Explanation of whether and how the precautionary approach or principle is addressed by the organization

Cemig always considers the precautionary principle in the processes of risk management, operations planning, and new business development. During planning, all factors are considered that may present risks to the health and safety of employees, suppliers, customers, and the general population.

Fully
4.12

Externally developed economic, environmental, and social charters, principles, or other initiatives to which the organization subscribes or endorses

Cemig has been a signatory of the UN Global Pact since 2009.

Fully
4.13

Memberships in associations (such as industry associations) and/or national/international advocacy organizations

Cemig participates in the following associations: ABRADEE (Brazilian Association of Electricity Distributors), FIEMG (Federation of Industries of the State of Minas Gerais), CEBDS (Brazilian Business Council for Sustainable Development)

Fully
Stakeholder Engagement
4.14

List of stakeholder groups engaged by the organization

Fully
4.15

Basis for identification and selection of stakeholders with whom to engage

Fully
4.16

Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group

Fully
4.17

Key topics and concerns that have been raised through stakeholder engagement, and how the organization has responded to those key topics and concerns, including through its reporting

Fully
5 Management Approach and Performance Indicators
Economic Performance
Economic reports relating to the specific form of management of the Power Sector
Availability and reliablility
EU6

Management approach to ensure short and long-term electricity availability and reliability.

Fully
Aspect: Demand-Side Management
EU7

Demand-side management programs including residential, commercial, institutional and industrial programs.

Fully
Aspect: Research and Development
EU8

Research and development activity and expenditure aimed at providing reliable electricity and promoting sustainable development.

Fully
Aspect: Plant Decommissioning
EU9

Provisions for decommissioning of nuclear power sites.

Does not apply. Cemig does not own or operate any nuclear plants.

Fully
Economic Performance Indicators
Aspect: Economic Performance
EC1

Direct economic value generated and distributed

EVA presented has a different breakdown than the one demanded by GRI

Partially
EC2

Financial implications and other risks and opportunities for the organization’s activities due to climate change

Fully
EC3

Coverage of the organization’s defined benefit plan obligations

Partially
EC4

Significant financial assistance received from government

In 2013, revenues from tariff subsidies were R$ 488 million, of which Cemig is entitled R$ 136 million. Compensation for the cost of energy purchased in the spot market totaling R$ 519 million was also considered. For more information, see Explanatory Note No. 13, in the Financial Statements (DFP).

Fully
Aspect: Market Presence
EC5

Range of ratios of standard entry level wage by gender compared to local minimum wage at significant locations of operation.

Fully
EC6

Policy, practices, and proportion of spending on locally-based suppliers at significant locations of operation.

Fully
EC7

Procedures for local hiring and proportion of senior management hired from the local community at locations of significant
operation.

Cemig has no specific standards for hiring local employees. Since, Cemig is a mixed capital company, hiring can only be done through a public recruitment exam.

Fully
Aspect: Indirect Economic Impacts
EC8

Development and impact of infrastructure investments and services provided primarily for public benefit through commercial, inkind, or pro bono engagement.

Fully
EC9

Understanding and describing significant indirect economic impacts, including the extent of impacts.

Fully
Economic Performance Indicators Specific to the Power Sector
Aspect: Availability and Reliability
EU10

Planned capacity against projected electricity demand over the long term, broken down by energy source and regulatory regime.

Partially
Aspect: System Efficency
EU11

Average generation efficiency of thermal plants by energy source and by regulatory regime.

Fully
EU12

Transmission and distribution losses as a percentage of total energy

Fully
Environmental Performance
Environmental Performance Indicators
Aspect: Materials
EN1

Materials used by weight or volume.

Comments on the indicator: Report in-use inventory of solid and liquid high level and low level PCBs contained in
equipment.

Fully
EN2

Percentage of materials used that are recycled input materials

Fully
Aspect: Energy
EN3

Direct energy consumption by primary energy source

Fully
EN4

Indirect energy consumption by primary source.

Fully
EN5

Energy saved due to conservation and efficiency improvements

Fully
EN6

Initiatives to provide energy-efficient or renewable energy based products and services, and reductions in energy requirements as a result of these initiatives

Fully
EN7

Initiatives to reduce indirect energy consumption and reductions achieved.

Fully
Aspect: Water
EN8

Total water withdrawal by source.

Comments on the indicator: Report overall water usage for processing, cooling and consumption in thermal and nuclear
power plants, including use of water in ash handling.

Fully
EN9

Water sources significantly affected by withdrawal of water.

Fully
EN10

Percentage and total volume of water recycled and reused.

The amount of water that Cemig recycles or reuses is insignificant

Fully
Aspect: Biodiversity
EN11

Location and size of land owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside
protected areas.

Fully
EN12

Description of significant impacts of activities, products, and services on biodiversity in protected areas and areas of high biodiversity value outside protected areas.

Comments on the indicator: Include maintenance of transmission line corridors; fragmentation and isolation (islandization); and impacts of thermal discharge.

Fully
EU13

Biodiversity of offset habitats compared to the biodiversity of the affected areas.

Fully
EN13

Habitats protected or restored.

Fully
EN14

Strategies, current actions, and future plans for managing impacts on biodiversity.

Comments on the indicator: Report the impacts (including fragmentation and isolation), develop mitigation measures and monitor the residual effects of new units and existing units with respect to the following: areas with forest, landscape, ecosystems and freshwater wetland. The assessment and mitigation plans must consider the conservation of native species, changes in migration, or create habitat for animals (like fish transposition) caused by the infrastructure of the organization (such as power lines and dams).

Fully
EN15

Number of IUCN Red List species and national conservation list species with habitats in areas affected by operations, by level of extinction risk.

Fully
Aspect: Emissions, Effluents, and Waste
EN16

Total direct and indirect greenhouse gas emissions by weight.

Comments on the indicator: Report emissions of CO2 per MW/h broken down by country or regulatory system, to:
- the net generation from the total generation capacity
- the net generation from all fossil fuel generation
- estimated liquid delivery to end users.
Include emissions from its own generation, as well as gross energy purchased, including line losses.

Fully
EN17

Other relevant indirect greenhouse gas emissions by weight

Fully
EN18

Initiatives to reduce greenhouse gas emission sand reductions achieved

Fully
EN19

Emissions of ozone-depleting substances by weight.

Information not available.

Not reported
EN20

NO, SO, and other significant air emissions by type and weight.

Comments on the indicator: Report emissions per MWh net generation

Fully
EN21

Total water discharge by quality and destination.

Comments on the indicator:  Include thermal discharges.

Fully
EN22

Total weight of waste by type and disposal method.

Comments on the indicator: Include PCB waste.
Report on nuclear waste using IAEA definitions and protocols.
Report mass and activity of spent nuclear fuel sent for processing and reprocessing per year. In addition, report radioactive waste produced per net MWh nuclear generation per year. Report (in terms of mass and activity) low/intermediate level waste and high level waste separately, based on IAEA radioactive waste classification. This should also include waste produced from reprocessing activities, where data is available.

Fully
EN23

Total number and volume of significant spills.

There were no significant spills in 2013.

Fully
EN24

Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention Annex I, II, III, and VIII, and percentage of transported waste shipped internationally.

Cemig does not transport waste internationally.

Fully
EN25

Identity, size, protected status, and biodiversity value of water bodies and related habitats significantly affected by the reporting organization’s discharges of water and runoff.

Fully
Aspect: Products and Services
EN26

Initiatives to mitigate environmental impacts of products and services, and extent of impact mitigation.

Cemig views the impacts as insignificant. Existing relevant projects are related to biodiversity and have been reported in indicators EN12 and EN14.

Fully
EN27

Percentage of products sold and their packaging materials that are reclaimed by category.

The Company’s main product is electricity, which due to its nature, does not require packaging.

Não aplicável
Aspect : Compliance
EN28

Monetary value of significant fines and total number of non-monetary sanctions for noncompliance with environmental laws and
regulations.

In 2013, Cemig received a notice of an outstanding environmental fee by Cemig D for R$ 450.00.

Fully
Aspect : Transport
EN29

Significant environmental impacts of transporting products and other goods and materials used for the organization’s
operations, and transporting members of the workforce.

Fully
Aspect : Overall
EN30

Total environmental protection expenditures and investments by type.

Fully
Social Performance Indicators
Labor Practices and Decent Work Performance Indicators
Aspect: Employment
EU14

Programs and processes to ensure the availability of a skilled workforce.

Fully
EU15

Percentage of employees eligible to retire in the next 5 and 10 years broken down by job category and by region.

Fully
EU16

Policies and requirements regarding health and safety of employees and employees of contractors and subcontractors.

Fully
LA1

Total workforce by employment type, employment contract, and region, broken down by gender.

Comments on the indicator: Report on total contractor workforce (contractor, subcontractor, independent contractor) by employment type, employment contract and region.

There is no stratified control for outsourced labor.

Partially
LA2

Total number and rate of new employee hires and employee turnover by age group, gender, and region.

Comments on the indicator: For the employees leaving employment during the reporting period, provide the average
length of tenure of employees leaving broken down by gender and age group.

Turnover at Cemig is very low and does not represent a material issue.

Partially
EU17

Days worked by contractor and subcontractor employees involved in construction, operation & maintenance activities.

This control does not exist for outsourced labor.

Not reported
EU18

Percentage of contractor and subcontractor employees that have undergone relevant health and safety training

The absolute figures are reported, but not the percentage. There is no control for 100% of contractors’ information.

Partially
LA3

Benefits provided to full-time employees that are not provided to temporary or part-time employees, by significant locations of operation

Fully
LA15

Return to work and retention rates after parental leave, by gender.

In 2013, maternity leave was granted to 18 women, and 7 of them remained on maternity leave into 2014; the other 11 returned to work after the end of the leave period. In total, 16 women returned from maternity leave in 2013. From these, only one employee requested termination. In reviewing the 12 months subsequent to returning from leave, the retention rate was determined to be 94%. Among men, in 2013, 119 took paternity leave. In addition, one employee was entitled to paternity leave due to adoption. All returned to work after the end of their leave period.

Fully
Aspect: Labor/Management Relations
LA4

Percentage of employees covered by collective bargaining agreements.

Comments on the indicator: Report on percentage of contractor employees (contractor, subcontractor and independent
contractor) working for the reporting organization covered by collective bargaining agreements by country or regulatory regime.

Cemig does not have a control procedure over outsourced labor.

Partially
LA5

Minimum notice period(s) regarding operational changes, including whether it is specified in collective agreements.

Fully
Aspect: Occupational Health and Safety
LA6

Percentage of total workforce represented in formal joint management–worker health and safety committees that help monitor and advise on occupational health and safety programs.

Fully
LA7

Rates of injury, occupational diseases, lost days, and absenteeism, and total number of work-related fatalities, by region and by
gender.

Comments on the indicator: Report on health and safety performance of contractors and subcontractors working onsite or on behalf of the reporting organization off site.

Fully
LA8

Education, training, counseling, prevention, and risk-control programs in place to assist workforce members, their families, or community members regarding serious diseases.

Fully
LA9

Health and safety topics covered in formal agreements with trade unions.

Fully
Aspect: Training and Education
LA10

Average hours of training per year per employee by gender, and by employee category

Fully
LA11

Programs for skills management and lifelong learning that support the continued employability of employees and assist them in managing career endings

Fully
LA12

Percentage of employees receiving regular performance and career development reviews, by gender.

Fully
Aspect: Diversity and Equal Opportunity
LA13

Composition of governance bodies and breakdown of employees per employee category according to gender, age group, minority group membership, and other indicators of diversity

Fully
LA14

Ratio of basic salary and remuneration of women to men by employee category, by significant locations of operation.

Fully
Human Rights Performance Indicators
Aspect: Investment and Procurement Practices
HR1

Percentage and total number of significant investment agreements and contracts that include clauses incorporating human rights concerns, or that have undergone human rights screening..

There were no significant investment agreements in 2013.

Fully
HR2

Percentage of significant suppliers, contractors, and other business partners that have undergone on human rights screening, and actions taken.

Fully
HR3

Total hours of employee training on policies and procedures concerning aspects of human rights that are relevant to operations, including the percentage of employees trained.

Fully
Aspect: Non-discrimination
HR4

Total number of incidents of discrimination and corrective actions taken

Fully
Aspect: Freedom of Ass ociation and Collective Bargaining Core
HR5

Operations and significant suppliers identified in which the right to exercise freedom of association and collective bargaining may be violated or at significant risk, and actions taken to support these rights

Comments on the indicator: Report on management mechanisms to address the right to organize, right to bargain and right to strike or instances of lock out given the context of the industry’s need to ensure continuous provision of essential services. Where the right to strike does not exist or is limited, report on remedial measures such as binding arbitration. Where freedom of association or expression are limited or prevented by regulatory regime, report on mechanisms and processes that exist for getting employee input on conditions of employment

Fully
Aspect: Child Labor
HR6

Operations and significant suppliers identified as having significant risk for incidents of child labor, and measures taken to contribute to the effective abolition of child labor

Fully
Aspect: Forced and Compulsory Labor
HR7

Operations and significant suppliers identified as having significant risk for incidents of forced or compulsory labor, and measures to contribute to the elimination of all forms of forced or compulsory labor

Fully
Aspect: Security Practices
HR8

Percentage of security personnel trained in the organization’s policies or procedures concerning aspects of human rights that are relevant to operations

Fully
Aspect: Indigenous Rights
HR9

Total number of incidents of violations involving rights of indigenous people and actions taken

In 2013, there were no cases of violations against the rights of indigenous peoples

Fully
HR10

Percentage and total number of operations that have been subject to human rights reviews and/or impact assessments

There were no reviews of human rights violations and/or assessments of impacts on operations

Fully
HR11

Number of grievances related to human rights filed, addressed and resolved through formal grievance mechanisms

There were no complaints regarding human rights issues

Fully
Society Performance Indicators
Aspect: Community
EU19

Stakeholder participation in the decision making process related to energy planning and infrastructure development

The participation of stakeholders in decision-making process occurs in accordance with commitments made in large infrastructure projects. In 2013, there were no major projects

Fully
EU20

Approach to managing the impacts of displacement

Fully
Aspect: Prevention and Preparedness for Emergency and Disaster
EU21

Contingency planning measures, disaster/emergency management plan and training programs, and recovery/restoration plans

Partially
Aspect: Local communityies
SO1

Percentage of operations with implemented local community engagement, impact assessments, and development programs

Comments on the indicator: Include discussions of programs related to:

• Ways in which information is exchanged and local population is involved, prior, during and after the event and the provision for intervener funding for the local population; • Influx of workers and impacts on neighboring communities (including changes to local social structures and culture); • Changes to land-use including loss of global commons (e.g. access to land, natural resources, and heritage); • Impacts on infrastructure (e.g. roads, housing), and access to services (e.g. education, utilities, healthcare); and • Changes to the aesthetics and quality of the landscape

Fully
SO9

Operations with significant potential or actual negative impacts on local communities

Fully
SO10

Prevention and mitigation measures implemented in operations with significant potential or actual negative impacts on local communities

Fully
EU22

Number of people physically or economically displaced and compensation, broken down by type of project

Fully
Aspect: Corruption
SO2

Percentage and total number of business units analyzed for risks related to corruption

Fully
SO3

Percentage of employees trained in organization’s anti-corruption policies and procedures

Fully
SO4

Actions taken in response to incidents of corruption

Fully
Aspect: Public Policy
SO5

Public policy positions and participation in public policy development and lobbying

Fully
SO6

Total value of financial and in-kind contributions to political parties, politicians, and related institutions by country

Since Cemig is a mixed capital company, the Company cannot and does not appropriate financial contributions for politicians, political parties, or related institutions

Fully
Aspect: Anti-Competitive Behavior
SO7

Total number of legal actions for anticompetitive behavior, anti-trust, and monopoly practices and their outcomes

The Company was not process administratively or judicially for competition violations, whether for anti-trust practices, monopoly, or unfair competition. All acquisitions, before taking effect, are approved by CADE (Administrative Council for Economic Defense), an autarchy linked to the Brazilian Ministry of Justice

Fully
Aspect: Conformity
SO8

Monetary value of significant fines and total number of non-monetary sanctions for noncompliance with laws and regulations

The amounts accrued for significant fines in 2013 are given in detail in the financial statements. See Explanatory Note No. 23, at the financial Statements 2013

Partially
Product Responsibility Performance Indicators
Aspect: Access
EU23

Programs, including those in partnership with government, to improve or maintain access to electricity and customer support services

Fully
Aspect: Provision of Information
EU24

Practices to address language, cultural, low literacy and disability related barriers to accessing and safely using electricity and customer support services

Fully
Aspect: Customer Health and Safety
PR1

Life cycle stages in which health and safety impacts of products and services are assessed for improvement, and percentage of significant products and services categories subject to such procedures.

Comments on the indicator:  For electric utilities the following categories should also be assessed:

• Resource planning

• Generation

• Transmission

• Distribution

• Use

State the processes for assessing community health risks including monitoring, prevention measures and, if applicable, long term health-related studies.

Identify community health risks that are assessed such as:

• Compliance with exposure limit(s) to electric fields (in kV per m) and magnetic fields (in μT) where available, for members of the public and employees in the areas in which the reporting organization operates.

In compliance with Aneels’ Regulatory Resolution No. 398/2010, Cemig made calculations and/or took measurements of the electric and magnetic field in all facilities with a rated voltage less than 138kV that are part of the Company’s assets. In all cases, the values were verified to be lower than the limits established in the referred resolution for both employees and members of the community

Fully
PR2

Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products and services during their life cycle, by type of outcomes

There are no cases of noncompliance related to the subject

Fully
EU25

Number of injuries and fatalities to the public involving company assets, including legal judgments, settlements and pending legal cases of diseases

Information unavailable

Partially
Aspect: Products and Service Labeling
PR3

Type of product and service information required by procedures, and percentage of significant products and services subject to such information requirements

There is no labeling on energy services

Not reported
PR4

Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcomes

There is no labeling on energy services

Not reported
PR5

Practices related to customer satisfaction, including results of surveys measuring customer satisfaction

Fully
Aspect: Marketing Communication
PR6

Programs for adherence to laws, standards, and voluntary codes related to marketing communications, including advertising, promotion, and sponsorship

Cemig observes the recommendations of the Brazilian Association of Corporate Communication (ABERJE) and follows its own Strategic Communication Plan, which provides specific approaches to communication with each stakeholder. The Company’s advertising campaigns are made by companies that follow the Brazilian Advertising Self-Regulation Code, regulated by the National Council for Self-Regulation (CONAR)

Fully
PR7

Total number of incidents of non-compliance with regulations and voluntary codes concerning marketing communications, including advertising, promotion, and sponsorship by type of outcomes

The Company did not record any nonconformities in 2013 in relation to marketing, advertising, promotion, and sponsorship activities

Fully
Aspect: Customer Privacy
PR8

Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data

In 2013, there were no demands for investigations into privacy violations or loss of customer data at Cemig

Fully
Aspect: Compliance
PR9

Monetary value of significant fines for noncompliance with laws and regulations concerning the provision and use of products and services

Fully
EU26

Percentage of population unserved in licensed distribution or service areas

Fully
EU27

Number of residential disconnections for non-payment, broken down by duration of disconnection and by regulatory regime

Fully
EU28

Power outage frequency

Fully
EU29

Average power outage duration

Fully
EU30

Average plant availability factor by energy source and by regulatory regime

Fully
  Indicadores Setoriais

Princípios do Pacto Global
Human Rights

Principle 1 : Businesses should support and respect the protection of internationally proclaimed human rights

Principle 2: make sure that they are not complicit in human rights abuses.

Labour

Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;

Principle 4: the elimination of all forms of forced and compulsory labour;

Principle 5: the effective abolition of child labour; and 

Principle 6: the elimination of discrimination in respect of employment and occupation.

Environment

Principle 7: Businesses should support a precautionary approach to environmental challenges; 

Principle 8: undertake initiatives to promote greater environmental responsibility; and 

Principle 9: encourage the development and diffusion of environmentally friendly technologies.

Anti-Corruption

Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery. 

Declaration of Independent Verification

Click here to access PDF document

Declaration of Examination of the Level of Application by the GRI

Credits

Edition

Superintendence of Corporate Communication - CE

Coordination

Superintendence of Investor Relations - RI
Superintendence of Corporate Sustainability - SE

Graphics Project

Perfil 252

Consultancy for planning, data collection, analysis of indicators and wording of the report

Keyassociados

Photos

.....

Corporate Information

Companhia Energética de Minas Gerais – Cemig
Avenida Barbacena, 1200
Belo Horizonte – MG
CEP 30190-131
CNPJ: 17.155.730/0001/64
Telephone: 116 or 0800 7210 116
www.cemig.com.br

Cemig Distribuição S/A
Avenida Barbacena, 1200 – 17th Floor – Ala A1
Belo Horizonte – MG
CEP 30190-131
CNPJ 06.981.180/0001-16

Cemig Geração e Transmissão S/A
Avenida Barbacena, 1200 – 12th floor – Ala B1
Belo Horizonte – MG
CEP 30190-131
CNPJ 06.981.176/0001-58

Banco Custodiante
Banco Itaú S/A

Depositary Bank of the ADRs
Citibank Shareholder Services