Environmental Performance

Through our Environmental Policy, we have committed to pursuing sustainable development in our operating model, and applying practices that protect the environment, including preventing from our processes and services. For more than 11 years, we have carried out a series of programs and projects to exercise effective climate governance in our operations while aligning our criteria with all parties with whom we interact. Our environmental management is based on three principles:

These are the vectors that drive strategy to achieve sustainable management and efficient use of natural resources, one of the UN’s goals be met by 2030.

Our operations work with our Environmental Management System to enhance risk control and avoid any environmental liabilities, fines or reputational damage. Also based on our Environmental Management System, we have an annual audit plan measuring the efficacy of operational controls, management of aspects and impacts from our operation and its fulfillment of legal requirements.

We monitor news and updates concerning regulations and laws daily in the municipalities in which we operate, with support from external consultants and an integrated management solutions platform. We engage outside auditors every year and we periodically conduct internal audits covering compliance practices for environmental management, which are reported to senior management.

Our Sustainable Procurement project aims to improve management of critical suppliers in terms of health, safety and the environment by including sustainability criteria in the process of selecting, developing and evaluating these partners. In 2021, we retained our certification under the ISO 14001 international standard for health, safety and environment issues, which reaffirms our transparency and commitment to sustainability for all our processes and services. We are submitted to outside audits annually to retain the ISO seal. In 2021, we invested more than R$1.4 million in environmental management improvements; around 51% of this amount was used for electrical efficiency projects.

Energy

Quality electrical energy is an essential and irreplaceable input to ensure stability and safety for our operations. Due to its relevance and potential environmental impact, we direct our energy management on two fronts: energy efficiency and the transition from electrical to renewable sources - both to lower relative energy consumption and CO2 emissions.

During 2021, we made investments to modernize air conditioning equipment and thus lower our energy consumption. As highlight, we replaced air conditioning units that use a type of gas that is more harmful for the ozone layer. We also have real-time monitoring of electricity consumed by our offices and buildings, which enables us to detect waste hotspots and opportunities to optimize consumption.

Evolving technology has also enabled us to make significant savings on energy use, particularly: optical fiber replacing legacy networks (twisted metallic pair), decommissioning an existing telephone exchange in the plant that was consuming large amounts of energy, migrating databases to the cloud, decommissioning devices and servers. In 2021, our savings were approximately 600 MWh/year due to these measures.

While growing our operation by entering new localities or acquiring networks, our initiatives and investments in electrical efficiency and decommissioning obsolete units resulted in energy consumed being reduced 1.6% from 55,851 MWh (2020) to 54,471MWh (2021).

Over the years, we have been moving to transition our electricity matrix, having been the first operator to locate a telecommunications site in Brazil powered by photovoltaic energy connected to the electric grid.

In the course of year 2021, we raised the percentage of renewable energy consumed and strengthened our commitment to the climate agenda while starting to actually decarbonize our operations.

This evolution was mainly changing our electrical matrix to reach 100% energy from renewable sources:

• Self-generating from photovoltaic plants;
• Purchasing from sources incentivized through Brazil’s ‘Free Market’ electric procurement arrangement;
• Acquiring renewable energy certificates (I-REC). We acquired 21,060 RECs (renewable energy certificates generated from solar plants), which corresponds to 21,060 MWh (1 MWh = 1 REC).

Electric Matrix - Electricity consumed

(1): Solar plants and (as of 2021) solar + biogas.

To manage our vehicle fleet, we are replacing fossil by renewable energy. Most of our vehicles are powered by flex-fuel engines, prioritizing ethanol - which accounts for over 90% of total fuel consumed. Exceptionally, with our acquisition of Vogel Telecom in 2021, we post a one-off increase in non-renewable fuel use, but we held ethanol usage stable, thus showing management’s efficacy in this respect. All vehicles are equipped with telemetry devices; among other aspects, this enables checks to detect any problems causing higher fuel consumption.

We are constantly looking for solutions with partners that may introduce more efficient vehicles. In 2021, we authorized our fleet to switch to more sustainable high-efficiency units. Our operation is an outstanding case in Brazil’s fleet management scenario, thus showing our fleet management’s success in this respect. Evaluated by specialist teams from Instituto PARAR and NAFA (North American Fleet Association), the ‘100 Best Fleets award - Brazil stage’ placed us in the top nine in 2021, so we moved up six places in relation to the previous year.

So we have consolidated our commitment to the environment with initiatives in progress and others planned for implementing in the course of 2022. All of them reflect a collective effort made by our infrastructure and sustainability teams to constantly pursue energy efficiency and decarbonize our operations.

GHG Emissions

We are committed to the fight against climate change. We therefore manage Greenhouse Gas (GHG) emissions, which enables us to identify aspects that require measures to mitigate environmental impacts. Our management is in line with international pacts to which Brazil is a signatory, such as the Paris Agreement, and it is driven by various external initiatives. Chief among them is Agenda 2030 and the Sustainable Development Goals (SDGs) with targets for different aspects, including environmental protection. Our role is guided by taking part in the Global Compact Network Brazil, an initiative led by the United Nations (UN), to which we have been signatories since 2017, and which promotes continuous improvement for sustainable development practices.

Since 2012, we have annually prepared our GHG Emissions Inventory using the GHG Protocol calculation tool, based on internationally recognized methodologies. This document, which details our sources and GHG emission volumes, involves all plants over which we have control, even shared plants.

To monitor emissions, we use Greenhouse Gas Protocol - Corporate Accounting and Reporting Standard (WRI/WBCSD) methodologies; IPCC 2006 Guidelines for National Greenhouse Gas Inventories; IPCC Fourth Assessment Report, Brazilian GHG Protocol Program (GVces/WRI) specifications; and publications of Brazil’s Ministry of Science, Technology, Innovations and Communications.

The inventory is published in the Public Emissions Registry through the platform of the Brazilian GHG Protocol Program, Latin America’s largest corporate inventory database. The audit carried out by an independent third party (Instituto Totum) adds credibility, reliability and transparency to the process of measuring and reporting our GHG emissions. Our practices have also been awarded the GHG Protocol Program’s Gold Seal for five consecutive years.

We reduced all our emissions by 53%, due mainly to investments in electrical efficiency.

In 2021, we emitted 1,472 tons of Greenhouse Gases (CO2e) - 1,090 tons of direct emissions (scope 1), zero indirect (scope 2) emissions and 382 tons of (scope 3) indirect emissions (emissions from activities over which we have no control).

All these results reinforce the claim that planned and monitored climate management provides significant advances that confirm our way of doing business, expressed in the mission statement “Sustainably serve and integrate people and businesses”.

Emissions Compared

(1): Difference was calculated based on 2021 values that do not include Vogel Telecom emissions.
(2) In 2021, we reached 100% consumption of electricity from renewable sources, which is due to: self-generation of energy via solar panels, purchase of renewable energy via the incentivized market and acquisition of I-RECs, which results in zero CO2 emissions in scope 2.

Resilience and climate crisis

By managing and mapping Greenhouse Gas (GHG) emissions, we find opportunities to mitigate environmental impacts and encourage people to use natural resources responsibly.

We are committed to increasingly minimize negative impacts and contribute to the transition to a new model for development based on a low carbon economy. Our management of emissions and related projects reflect enhanced sustainable development practices for our operations and management in line with our voluntary commitment to the Climate Agenda since 2017.

Due to the diverse nature of devices and applications covered by the ICT sector, climate change-related risks are rated very low in terms of the chances of occurring and their impact. Therefore, the latter are not yet covered by our risk matrix. On the environmental axis, our main activity is climate management in order to lower CO2 emissions.

We also identify business growth opportunities by working together with our Innovation Center (Brain) to find solutions capable of contributing to lowering our customers’ carbon emissions. We believe that digitalization will play a crucial role for the transition to a low carbon economy, so we are aligning our commercial and environmental strategies to detect opportunities related to these new types of solutions that have the potential to optimize resource use. In 2022, we will be conducting more in-depth studies of climate risks and opportunities guided by the principles of the Task Force on Climate-related Financial Disclosures (TCFD).

Waste management and reverse logistics

Our operations produce several types of waste when our services are being installed due to the use of materials such as wire, cable, and batteries for our generators, which may harm the environment if they are disposed of incorrectly. Therefore, management of these activities focuses on steering, guiding and ensuring that professionals and internal and external suppliers will dispose of solid waste correctly. Our goal is to increase our percentage of recyclable waste and reuse of devices while encouraging all partners to handle waste correctly, adopting our practices for both recycling and reuse and ensuring quality for separating material, storing and proper disposal processes.

Our main impacts arise from engaging services, so we encourage suppliers and providers - especially large businesses and transnationals - to adopt sustainable practices. In this respect, we undertake initiatives to inspire our stakeholders’ use of these practices.

Another aspect is our critical suppliers project in effect since 2018, which maps suppliers whose activities may impact the environment across five segments: waste, construction work, cleaning and conservation, fleet vehicles and partnerships for installing networks. We also compiled a manual showing requirements for contracting suppliers that may involve environmental impacts to ensure effective contract management.

We follow Brazil’s National Solid Waste Policy (local acronym PNRS) guidelines and arrange reverse logistics for electronic devices. Materials from our operations that are reused included pallets, bobbins and coils, uniforms and Perspex bubbles from payphones, which are converted into dolls, diary covers, toiletry bags, trash cans, kennels, tables, armchairs, masks, etc. Recyclable waste items such as paper, cardboard and plastics are donated to cooperatives. We also have collection bins installed in our buildings, offices and stores for the public to deposit electronic waste such as batteries and cell phones. Our waste management, from initial generation to final treatment, is monitored by an internal team tracking specific indicators to assist efficacious waste management.

In 2021, we arranged reuse for a total of 21 tons of devices (cable modems, CATV, DTH, home gateway, modems, routers, SFP modules, firewalls, commutators, convertors and optical switches) Some 23 tons of recovered materials were sent to landfills: optical drop SIM cards, bathroom waste, organic materials and other non-recyclable waste. In the “Hazardous Waste - Class I” category, 72 tons of batteries, light bulbs and electronics such as post-use cell phones/accessories and batteries were sent for recycling. In the “Non-Hazardous - Class II” category, 271 tons of wire, cable, metal scrap, plastic scrap, electronic scrap, decoders, computer and administrative waste were sent for recycling.

Waste generated by type, by destination

Note: (1) Waste from administrative areas, pruned trees, leftover food and bathrooms