Esval S.A . S u s t ain ab ilit y R ep o r t 2009
ABOUT THIS REPORT This is Esval’s second Sustainability Report, which outlines its economic, social and environmental performance in a balanced way, pursuant to the criteria and requirements laid down by the Global Reporting Initiative (GRI) in its G3/2006 guidelines for drawing up sustainability reports1. The content of this report only refers to Esval’s operations in the Valparaíso Region and the January 1 through December 31, 2009 period, unless expressly indicated otherwise. For better understanding, the figures and data are shown compared to the years 2007 and 2008. In regard to the data reported the previous year, there were no major changes in Esval’s size, structure or ownership, and nor have the bases, preparation criteria or the calculation methods used changed. If there is any modification of any indicator, this will be expressly reported.
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2
www.globalreporting.org
Compliance with the Principles on Reporting Content The content of this report was defined considering the principles of the GRI standard on relevance or materiality, sustainability context and stakeholder inclusiveness. 1. 2.
Benchmark of sustainability reports of national water utilities. This concept identified the main issues and aspects reported by the industry and best reporting practice. Analysis of press articles. The aim was to find out the significant issues for the Company and industry from a public opinion perspective and in a context of sustainable development. 608 press articles in the January 1 through December 31, 2009 period were reviewed and analyzed.
3.
Workshop with representatives of neighbor committees, organized into Communal Associations (UNCOs) in the region, for which the Company invited all the UNCO leaders to a working breakfast meeting. With the help of a consultant team, the attendees were asked about the degree of importance they gave to each of the content items of the report published the previous year. 21 representatives of communal organizations attended this workshop.
All the participants also had the opportunity of raising other issues of interest that were not reported on in the 2008 report or about which they would like to have more information.
ASPECTS RAISED BY STAKEHOLDERS (UNCO LEADERS)
ASPECTS IDENTIFIED BY BENCHMARK
ASPECTS IDENTIFIED IN PRESS ANALYSIS
List of Issues Material to be Included in Esval’s Sustainability Report 2009 The main issues and their priority were established in this workshop, which are reflected in the structure of this report and the depth of the different issues. The various aspects of the GRI standard were associated with the list of major issues identified and related to each of them and its respective indicators, defining that data would be gathered on 54 performance indicators plus all the indicators related to the profile, corporate governance, commitments and stakeholder participation. This gave a total of 96 indicators to be reported on.
CHAPTER/SECTION STRATEGY AND PROFILE ECONOMIC DEVELOPMENT ENVIRONMENTAL DEVELOPMENT
Nº OF INDICATORS 42 3 22
SOCIAL DEVELOPMENT - PRODUCT RESPONSIBILITY
9
SOCIAL DEVELOPMENT - SOCIETY AND HUMAN RIGHTS
8
SOCIAL DEVELOPMENT - LABOR PRACTICES
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TOTAL INDICATORS
96
Es v al S us t ainabilit y Repor t 2009
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Moreover, in this report Esval strived to meet the additional data expectations raised by the leaders of the communal organizations involved in the process of defining the content of Esval’s Sustainability Report 2009.
ISSUES/CONCERNS ODORS AT WASTEWATER TREATMENT PLANTS
ENVIRONMENTAL PERFORMANCE
WATER QUALITY, CHEMICALS USED AND THEIR TREATMENT WASTEWATER DISCHARGES MAIN ENVIRONMENTAL IMPACTS
USER AND LEADER TRAINING
SOCIAL PERFORMANCE PRODUCT RESPONSIBILITY
SUPPORT OF CUSTOMERS IN DEFAULT WITH JUSTIFICATION INFORMATION ON SUBSIDIES WATER CUT (SCHEDULED OR UNSCHEDULED) MANAGEMENT
Attained Partially attained Unattained
SOCIAL PERFORMANCE LABOR PRACTICES
INFORMATION ON CONTRACTORS AND SUBCONTRACTORS (ESVAL’S RELATIONS WITH THEM, HOW IT TRAINS THEM, HOW IT MAKES SURE THEY DO A GOOD JOB WITHOUT IMPACTING THE ENVIRONMENT AND COMMUNITY) INFORMATION ON EMPLOYEE TRAINING AND RELATIONS
DIRECT COMMUNITY SUPPORT AND INFORMATION ACTIVITIES
SOCIAL PERFORMANCE SOCIETY
RESEARCH DEVELOPMENT WITH UNIVERSITIES TRAINING ON WATER CONSUMPTION ISSUES AND OTHERS UNDERSTANDING ESVAL’S RELATIONS WITH THE DIFFERENT PUBLIC BODIES IN THE REGION
COMPANY GROWTH
ECONOMIC PERFORMANCE
HOW THE COMPANY INVESTS IN THE REGION PROJECTS UNDERTAKEN AND THEIR PROGRESS INFORMATION ON WATER TARIFFS
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RESPONSE LEVEL IN THIS REPORT
Compliance with the Principles on Reporting Quality To ensure the quality, accuracy, comparability and verifiability of the information contained in this report, Esval had the support of a specialist external consultant on the GRI-G3 guidelines. This support enabled the necessary precisions to be made and the targets for the next reporting period to be documented. Each indicator concerning the Company’s economic, social and environmental performance was drawn up in accordance with technical data and calculations based on procedures laid down in national regulations and aligned with the standards accepted by the international community. Based on this, the Company qualified this report’s compliance as Level A.
Corporate Contact Esval deems this report is a way of sharing its achievements and challenges with its main stakeholders to promote greater engagement with them. To request further information or make comments on the content of this report, interested people or institutions can contact: Management: General Management Address:
Cochrane 751, Valparaíso
Telephone:
(56 - 32) 2209341
E-Mail:
[email protected]
Report Application Levels
500 copies of this report in Spanish were printed this year. Moreover, to guarantee access and wide distribution, a version was released in PDF format that is available on the corporate website www.esval.cl
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Index 00
FOREWORD BY THE PRESIDENT AND CHIEF EXECUTIVE
01
OUR COMPANY 01.1 01.2 01.3 01.4
02
03
6
34
MANAGING OUR IMPACT WATER AND BIODIVERSITY EMISSIONS WASTE DISCHARGES RAW MATERIALS ENERGY
CUSTOMER RELATIONS 03.1 03.2 03.3 03.4 03.5
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WHO WE ARE AND WHAT WE DO BUSINESS VISION AND SUSTAINABILITY CORPORATE GOVERNANCE AND ETHICS MEMBERSHIPS
CONTROLLING OUR ENVIRONMENTAL IMPACT 02.1 02.2 02.3 02.4 02.5 02.6 02.7
8
OUR CUSTOMERS CUSTOMER SERVICE AND SATISFACTION CUSTOMER INFORMATION AND SUPPORT PRODUCT/SERVICE QUALITY AND SAFETY SUPPLIER RELATIONS
48
04
EMPLOYEE RELATIONS 04.1 04.2 04.3 04.4 04.5 04.6
05
06
OUR EMPLOYEES GENERATING QUALITY EMPLOYMENT TRAINING, DEVELOPMENT AND EMPLOYABILITY OCCUPATIONAL HEALTH AND SAFETY LABOR RELATIONS CONTRACTORS
COMMUNITY RELATIONS IN THE REGION 05.1 05.2
74
COMMUNITY PUBLIC-PRIVATE PROGRAMS TO SUPPORT REGIONAL DEVELOPMENT
CONTRIBUTION TO REGIONAL ECONOMIC DEVELOPMENT 06.1 06.2
64
80
ECONOMIC VALUE GENERATION A REGULATED BUSINESS
07
2009 COMMITMENTS AND 2010 CHALLENGES
88
08
GLOBAL REPORTING INITIATIVE (GRI) INDEX
92
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00 We are very pleased to submit Esval’s second Sustainability Report for 2009, which reflects the efforts started at least five years ago and that culminated in 2008 with the release of the first report.
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Foreword by the President and Chief Executive
We continue to work hard in the Company and also with our related stakeholders. In this second report we can confirm that sustainable development is a core aspect of our business model, which is evident in socially responsible behavior, respect for employees, the environment and the communities with whom we engage. We have therefore taken a new step by considering the opinion of representatives of social organizations in the Valparaíso Region as an essential aspect in drawing up this report, which has enabled us to add a new focus and significant information from the perspective of these groups. We deem the reporting process to be continuous improvement work on the economic, social and environmental aspects of the Company,
presented in a balanced way and pursuant to nationally and internationally-renowned requirements. This is in turn paramount to pursue quality engagement with the community, which has become our main concern due to the impact of a water utility’s operations on life. We are not alone in firmly believing in a policy of direct and transparent relations with our customers and the community as a whole, as two important institutions recognized this work in 2009. Firstly, the Asociación de Industriales de Valparaíso (ASIVA) awarded us the “Corporate Social Responsibility Award” in the large company category for designing the successful Up-To-Date with Esval program together with social organizations and then applying it. This initiative has had such an
impact that it was emulated by the Planning and Development Ministry (MIDEPLAN) in the Chile Solidario program by means of a loan from the Inter-American Development Bank. Then, the Communal Association of Neighbors’ Committees of Viña del Mar gave Esval and its staff an award plaque for “its ongoing disposition to forge relations with social organizations, which reflects the important role it plays as a socially responsible company towards the community.” We cannot omit an event of major importance for the Company and the community in 2009: the private administration completed a decade under the Company management and we can proudly confirm we have achieved
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00
Foreword by the President and Chief Executive
large progress. This is evident in specific actions like an increase in the coverage of our services. Hence, wastewater treatment increased from 59.4% coverage in 1999 to 100% as of 2006. Sewerage coverage rose from 86.9% in 1999 to 91.9% in 2009, and drinking water coverage increased from 95.2% to 99.3% 1999 through 2009. To carry out this growth, we have invested US$463 million in the last ten years, which is one of the highest private investments in the Valparaíso Region in the same period. Such proceeds were allocated equally to drinking water production and distribution and to wastewater collection and treatment. The large works undertaken included the construction of 16 wastewater treatment plants and 59 drinking water storage tanks. We have noted that the growth of sanitary services has contributed to the real estate,
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tourism, agricultural and services development in the region, as without water there is no possibility of any new urban development and growth simply stagnates. This is, for example, what happened with sectors on the northern coastline where there was no drinking water until we built a 57kilometer pipeline from the production plant on the Aconcagua riverbank to the district of Zapallar, which started in 2003 and was completed in 2008. Due to this large investment, every day we can see how communities are reborn and others grow as the service increases in the sector. Wastewater treatment has a large impact on people’s health and on conserving the environment. In fact, several scientific reports claim that discharge of organic matter leads to a loss of oxygen in water, affecting the biodiversity present. We can now proudly say that the rivers and brooks in
the region are 100% clean of wastewater. In comparative terms, a report by the Organization for Economic Co-operation and Development (OECD), to which Chile belongs, and the Asociación Nacional de Empresas de Servicios Sanitarios (ANDESS), ranks Chile in eighth place in the world on wastewater treatment, with 84% coverage, which is the same level as the average of countries that are part of the European Union. Only Holland, Switzerland, the United Kingdom, Germany, Spain, Austria and Sweden are ahead of it. Nevertheless, the Valparaíso Region treats all the wastewater it collects, which puts us in first place of the international ranking up with the most developed countries in the world. In regard to the impact on people’s health, it is important to mention that a study was submitted to the National Congress in the late 1990s claiming that for every US dollar invested in wastewater treatment, the State and people save US2.5 on infecto-contagious
diseases. Without going into details, a report by the doctors Chiang and Henríquez on the impact of the wastewater treatment system on Greater Valparaíso showed a drop in the typhus, paratyphus and hepatitis rates. Therefore, when we see that more housing is being built every day in the region, that the number of tourists is on the increase, that vegetable and fruit exports are increasing to first world countries, we feel great satisfaction for permanently collaborating with the economic and social development of our area and its inhabitants. Lastly, we know that despite the work undertaken we cannot rest. Quite the contrary, we understand that our responsibility requires daily work, and we are aware that there is still room for improvement. That is our commitment to the region, the country and mainly our customers.
Gustavo González Doorman Chief Executive
Pedro Pablo Errázuriz Domínguez President of the Board Es v al S us t ainabilit y Repor t 2009
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01 01.1 WHO WE ARE
AND WHAT WE DO Esval S.A. is a publicly-traded corporation that produces and distributes drinking water, collects, treats and disposes wastewater, and provides services related to such activities in the way and conditions laid down by law and other applicable regulations. Its activity is regulated by the Superintendency of Sanitary Services (SISS)2, which controls the service quality and suitable wastewater treatment.
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2
www.siss.cl
Our Company
Main highlights in the last 10 years The National Congress agrees that water utilities can be privatized, with the State maintaining a capital stock percentage.
The Valparaíso Region has drinking water service coverage of 95.2%, 86.9% for sewerage and 59.4% for collected wastewater treatment.
The Higuerillas marine outfall is extended, thereby opening the Amarilla, Los Lilenes and Playa Negra beaches in the district of Concón in the summer of 2000. The Company resumes direct operation of the province of San Antonio, which has 55,000 customers, thereby ending in advance the investment management contract between Esval and Aguas Quinta signed in 1993. Inauguration of the Higuerillas and Concón Oriente wastewater treatment plants, completing the cleanup of the beaches in Greater Valparaíso.
1998
Esval becomes the first water utility to open up to privatization by means of an international tender process. Aguas Puerto S.A. (Enersis 72% and Anglian Water Chile Ltda. 28%) was awarded 40% of the shareholding.
1999
The Las Vegas aqueduct maintenance works were completed to improve the operation of this system which supplies 70% of the inhabitants of Greater Valparaíso. Anglian Water becomes the main shareholder of the Company with a 49.82% shareholding.
2000
2001
Construction starts on 30 drinking water tanks distributed throughout the concession area to increase the storage capacity and make the growth and development of cities possible.
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01
Our Company
Start-up of the Los Maitenes, La Ligua, Papudo, Zapallar, Cachagua and La Laguna wastewater treatment plants, and the construction of the Chincolco system is completed. Start-up of the San Felipe, Los Andes and Quillota wastewater treatment plants, thereby freeing the Aconcagua river and Limache brook of domestic waste. Construction of the Avenida Argentina collector in Valparaíso.
Construction starts on the first stage of conveying drinking water from the district of Concón to that of Zapallar, covering the stretch to Quintero. Start-up of the El Quisco, El Tabo and Curimón wastewater treatment plants. The Up-To-Date with Esval program was launched to train the poorest sectors in the benefit of responsible drinking water consumption. The program also provides special benefits for regularizing debt. This program was subsequently repeated by the government in the Chile Barrio (Chile Neighborhood) program, led by MIDEPLAN, with a contribution from the IDB.
Start-up of the Quintero and Rinconada wastewater treatment plants.
550 l/s increase in the Las Vegas drinking water production capacity, which supplies the main towns in Greater Valparaíso, at an investment of over CLP2 billion.
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2002
2003
The Healthy Water, Healthy Life campaign is launched, whose aim is to disseminate the need of good use of drinking water and sewerage systems. An increase of 15,000 drinking water subsidies for the poorest families in the region was attained due to the joint work of Esval and the legislative, regional and district authorities.
Consorcio Financiero S.A. acquires 44.78% of the company, becoming the major shareholder. Esval is awarded the operation of the sanitary concessions in the Coquimbo Region through its affiliate Aguas del Valle for a 30-year term. Esval thereby attains a market share of around 17% of customers in this sector in the country. Esval’s laboratory attains certification of complying with Chilean standard 17.025, which regulates the operation of these establishments at national and international level.
2004
The Company starts to participate in the Gobierno Más Cerca (Closer Government) program, an activity of the provincial governors’ offices that gets the community closer to public services.
2005
Esval secures the ISO 14001, 2004 international certification, which includes all the company’s processes, i.e., drinking water abstraction, production and distribution, and wastewater collection, treatment and disposal.
Nogales is connected to the El Molino de Quillota wastewater treatment plant. The San Antonio district clean-up system is launched with the attendance of President Ricardo Lagos Escobar. This completes the 100% domestic waste clean-up of rivers and seawater on the coastline in the Valparaíso Region. Stabilization lagoons are converted to aerated lagoons, thereby complying with the standards laid down in Supreme Decree 90 related to discharges of liquid waste into seawater and continental surface water. Ten towns benefit from this process, which entailed an investment of over CLP6.6 billion.
The Ontario Teachers’ Pension Plan acquires 69.4% of Esval’s shares, becoming the main company shareholder. Start-up of a geo-referenced information system with digital maps with operational infrastructure. It includes customer location and that data is crossreferenced with the results of the 2002 census, location of schools and hospitals, among other establishments, besides telephone databases, making the customer service more efficient.
The Valparaíso Region has a sanitary service coverage which is similar to and even higher than that of developed countries: 99.3% for drinking water, 91.8% for sewerage and 100% for collected wastewater treatment.
2006
2007
2008
2009
By means of an agreement by the Municipality of Viña del Mar, community organizations and Esval, the facilities of the Nuevo Horizonte housing estate in the Glorias Navales sector are improved. This estate had internal operation problems. The company participates in the Manitos Limpias (Clean Hands) program with the Regional Ministerial Secretary of Health, promoting children’s hygiene to prevent infecto-contagious diseases.
The Healthy Water, Healthy Life campaign disseminates the good use of drinking water and sewerage systems to over 205,000 people, attaining one million contacts since the program was launched in 2002. The company secures the ISO 9001, 2000 international service quality certification, and OHSAS 18001, 2007 certification on occupational safety and health of its employees. In addition to ISO 14001, 2004 which includes all the processes, Esval is the first water utility to have an integrated management system.
Inauguration of drinking water conveyance from the Aconcagua river production plant in the district of Concón to Zapallar. It is 57.5 kilometers long, entailed an investment of CLP22.715 billion, and will supply a broad sector on the northern coastline of the region, whose development was hampered by the lack of water.
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01
Our Company
Esval provides a water service to 529,260 drinking water customers and 476,284 sewerage customers, who account for 99.3% and 91.9%, respectively, of the population of the concession areas in the districts where Esval S.A. operates in the Valparaíso Region. To provide its service, the Company has a network of 4,416 kilometers of drinking water mains and 3,246 kilometers of wastewater collectors3.
Esval Operation Data 2009 Urban population supplied
1,480,834
Drinking water customers
529,260
Sewerage customers
476,284
Drinking water coverage (%) Sewerage coverage (%) Wastewater treatment coverage
99.3 % 91.9% 100%
of water collected (%) Drinking water billing (thousands of m3 a year)* 93,456 Sewerage billing (thousands of m3 a year)**
Source: SISS management report 2009 (except the figures marked with an asterisk which are from Esval’s data)
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SISS sanitary sector management report 2009.
3
82,877
Concession Area Article 53 of the General Sanitary Services Law defines a concession area as “the geographical area with an established land and height boundary, where there is a service obligation for drinking water distribution and wastewater collection concessionaires.” Esval’s concession areas are the zones that the previous water utility in the Valparaíso Region served before the General Sanitary Services Law came into force on June 21, 1989, including the expansion areas envisaged in the development plans and new expansions approved by the SISS.
They approximately include the urban zones of all the districts in the Valparaíso Region, with the exception of the towns of Panquehue, Olmué and Santo Domingo and the island territories that depend on this region (Easter Island and Juan Fernández Island). This territorial definition does not consider those sectors that are concessions of private or municipal services. Esval complies with interconnection and service administration contracts outside its concession area to supply drinking water to the Algarrobo Norte, Mirasol and Brisas de Mirasol concessions in the district of Algarrobo and it has an interconnection contract with Inmobiliaria Norte Mar, the concessionaire in the Rodelillo sector of the district of Viña del Mar.
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01
Our Company
Map of the towns where Esval provides a service
01 Petorca: La Ligua, Cabildo, Papudo, Zapallar 02 San Felipe: Putaendo, Santa María, Catemu, Llay Llay 03 Los Andes: San Esteban, Rinconada, Calle Larga 04 Quillota: Nogales, La Cruz, La Calera, Hijuelas 05 Marga Marga: Limache, Villa Alemana, Quilpué 06 Valparaíso: Puchuncaví, Quintero, Concón, Viña del Mar
01
07 San Antonio: Algarrobo, Casablanca, El Quisco, El Tabo, Cartagena, San Antonio
Petorca
02 04
san felipe
03 los andes
quillota
05 MARGA MARGA
06 VALPARAÍSO
07 SAN ANTONIO
Sectors outside the concession area: Sto. Domingo, Olmué, Panquehue.
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Affiliates and Related Companies Esval was awarded a public tender in 2003 giving it the right to the 30-year operation of the public sanitary service concessions, held by ECONSSA CHILE S.A., former ESSCO S.A., in the Coquimbo Region. The affiliate corporation Aguas del Valle S.A. was established to manage such concessions, whose objective is exclusively focused on producing and distributing drinking water, subsequent wastewater collection, treatment and disposal, and the remaining services laid down in current sanitary legislation.
99.00%
ESVAL S.A
99.99%
SERVICIOS
AGUAS DEL
SANITARIOS
VALLE
LAS VEGAS LTDA.
1.00%
The activities and results of this affiliate are not included in this report, apart from exceptions that are expressly indicated.
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01
Our Company
Processes Drinking water production and wastewater treatment Drinking water is that made fit for safe use and human consumption. It is produced from untreated water abstracted from surface or underground sources, which is put through various treatment processes at facilities specially designed for this. The outcome is a product that meets the national standard, NCh 409/1. of 2005, which sets forth the characteristics water must have to be
drinkable. Esval produced 161,484,277 m3 of drinking water in 2009 to supply an urban population of 1,480,834 people. Wastewater treatment has a high social and environmental impact, as it helps to prevent the release of a host of contaminating germs and agents that can be harmful to the health of people and ecosystems. Wastewater
contains the waste from the daily activities of people and related services, which is why it must be removed and treated safely to protect users and the environment from the infinite contaminating agents and germs that build up in drains. In 2009, Esval treated 100% of the wastewater collected.
THE HYDROLOGICAL CYCLE
Water has no beginning or end. The hydrological cycle has enabled it to be constantly recycled since the beginning of the world. Stages of the Hydrological Cycle
1 Seawater evaporates due to heat. 2 Evaporation gives rise to clouds. 3 Water precipitates from the clouds in the form of rain or snow. 4 Snow builds up on high peaks and glaciers are formed. 5 Thawing causes the water to run off down ravines and into rivers and brooks. 6 A part of the water transported accumulates in lakes or dams.
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01
Our Company
Wastewater Treatment Plants
Drinking Water Plants Valparaíso Operations Department
Quillota Operations Department
Aerated Lagoons
Las Vegas (Romeral)
La Cruz Sondaje Alfaro (Quillota) Sondaje Angamos (Quillota) Sondaje Sargento Aldea (Quillota) Parrones (Quillota) El Cristo (Quillota) Sondaje San Isidro (Quillota) San Pedro Oriente (La Calera) San Diego (La Calera) El Melón (La Calera) Lautaro (La Calera) Pachacama (La Calera) Artificio (La Calera) Hijuelas Panamericana (Nogales) Pozo Liceo (Nogales) Pozo Andrés Bello (Limache) Quintero Puchuncaví Aguas Claras (La Ligua) Goenechea (La Ligua) Quínquimo I (La Ligua) Quínquimo II (La Ligua) Papudo La Laguna (Zapallar) Cabildo Petorca Chincolco
Catemu Puchuncaví Placilla de Peñuelas (Valparaíso) Petorca Santa María San Esteban Cabildo Putaendo Llay-Llay Casablanca Chincolco4
Concón Peñuelas (Valparaíso) Poza Azul (Quilpué) San Felipe-Los Andes Operations Department
El Sauce (Los Andes) Bellavista (Los Andes) Sondaje Miraflores (Los Andes) Canal La Compañía (Putaendo) Sondaje 626 and Sondaje Granallas (Putaendo) Dren Putaendo (Putaendo) Llay Llay Catemu Rinconada (Calle Larga) San Esteban El Carmen (San Felipe) El Tambo (San Felipe) Almendral - Chepical (San Felipe) Santa María Southern Coastline Operations Department
San Juan (San Antonio) San Jerónimo (Algarrobo) Casablanca
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To date this is a facultative lagoon operating with 14 customers. PTF: Physical treatment plant
4 5
Marine Outfalls PTF5 _Emisario Dos Norte PTF_Emisario Loma Larga PTF_Emisario Higuerillas PTF_Emisario Concón Oriente PTF_Emisario Quintero PTF_Emisario San Antonio PTF_Emisario Cartagena PTF_Emisario El Tabo PTF_Emisario Algarrobo Activated Sludge Plants El Molino (Quillota) Los Maitenes (La Ligua) Almendral (San Felipe) Cordillera (Los Andes) Rinconada (Calle Larga) Curimón Punta Puyai (Papudo) Zapallar Cachagua La Laguna (Zapallar)
01.2 BUSINESS VISION AND SUSTAINABILITY
Esval aims to be a water utility of excellence, permanently taking care of and contributing to the economic, social and environmental development of the region, being an active agent for the sustainable development of its environment. This is embodied in its business strategy by means of the vision, mission and corporate values that guide its operations.
Mission To provide the best service to all its customers, making a contribution to the community regarding health, quality of life, conservation of the environment and regional development, generating value for its investors. The Company’s success is directly related to the organized effort of all its members and the development of people comprising it. Hence, although achieving good economic results is a necessary condition, it is not the only expression of achievement to assure the Company’s development and the wellbeing of its employees. Service quality, environmental protection and safety in the workplace are priority
objectives for the Company, which aims to be acknowledged as a player that is aware of its social responsibility in the entire region, both on account of respect for the health and life of its own personnel or third parties and for that of its customers.
Vision The company’s service excellence and concern for the environment, along with its active contribution to the development of people and the communities where it operates, will make Esval valued and appreciated by its customers, employees and shareholders.
Corporate Values • Cordiality, kindness, closeness and respect • Technical and service excellence • Proactivity, creativity and innovation • Congruence, veracity and transparency • Unpretentiousness and austerity • Commitment to the community
Management Systems To attain its vision of being a company of service excellence that is concerned about the environment, valued by its customers, employees, shareholders and the communities
where it operates, Esval has an integrated management system (SIG), whose instruments are the international certification of ISO 9001:2000 (quality management system), OHSAS 18001:2007 (occupational health and safety management system), and ISO 14001:2004 (environmental management system). This SIG covers all its processes, from drinking water abstraction, production and distribution to wastewater collection, treatment and disposal. It also includes customer service, administrative procedures, health and safety in the workplace. Moreover, its laboratory has certification pursuant to the NCh 17.025 standard, which regulates its operations pursuant to national and international requirements.
Stakeholders A key objective of Esval’s mission is for its management to be renowned as a player aware of its social responsibility throughout the region and in relations with its main stakeholders. The table below shows Esval’s main stakeholders and the different information channels that allow for engagement with each of them:
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01
24
Our Company
STAKEHOLDER
COMMUNICATION, DIALOGUE AND/OR ENGAGEMENT MECHANISM
Shareholders and financial market
Annual financial report Periodical financial statements Website www.esval.cl
Regulators and controllers
Periodical management reports
Authorities
Annual financial report Periodical publications Active participation with Governors, Mayors, councilors, UNCOs, etc.
Customers
Satisfaction surveys Customer service hotline Commercial offices Website www.esval.cl
Community
Healthy Water, Healthy Life campaign Presentation in schools Educational workshops Activities at centers for children whose mothers are seasonal workers “Door-to-door” activities Public events Health program Website www.esval.cl
Political and trade association area
Active participation in trade and regional organizations Periodical publications Website www.esval.cl
Suppliers
Critical supplier selection and assessment procedure Website www.esval.cl
Workers
Collective bargaining processes (every two years) Performance evaluation Intranet Periodical publications Website www.esval.cl
Student and academic area
Student practice programs, technical visits to facilities, thesis student programs, research projects Website www.esval.cl
01.3 CORPORATE GOVERNANCE AND ETHICS Esval’s Board of Directors comprised the following members for the year ended December 31, 2009:
Corporate Governance President:
Directors’ Committee
Pedro Pablo Errázuriz Domínguez 7.051.188-6, Civil Engineer
The Directors’ Committee of Esval, which operated up to the year ended December 31, 2009, comprised the following members:
Vice president:
President:
Jorge Lesser García Huidobro 6.443.633-3, Civil Industrial Engineer
Directors: Kevin David Kerr 48.120.866-1, Bachelor of Commerce, Chartered Accountant and CFA Charterholder Rodrigo Pérez Mackenna 6.525.287-2, Civil Engineer
Mónica Singer González 7.700.329-0
Directors: Rodrigo Pérez Mackenna 6.525.287-2 Alejandro Reyes Vergara 8.302.295-7
Alejandro Reyes Vergara 8.302.295-7, Attorney Mónica Singer González 7.700.329-0, Business Engineer Olivia Steedman 48.120.868-8, Civil Engineer
The Committee members, Mrs. Mónica Singer González and Mr. Alejandro Reyes Vergara, are directors who are independent of the controller and its related persons.
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01
Our Company
The Directors’ Committee, which operated up to the year ended December 31, 2009, addressed the following issues concerning the 2009 period: • Analysis of the information on operations set forth in articles 44 and 89 of Law N°18.046 and currently regulated by Title XVI of that same law. • Analysis of the external auditors’ report, the balance sheet and other financial statements submitted by the company’s management to shareholders. • Proposal of the external auditors and private risk rating agencies. • Review of the remunerations system and compensation plans for senior managers and executives. In regard to those operations set forth in articles 44 and 89 of Law N°18.046 and now regulated by Title XVI of that same law, the Committee approved the terms of subleasing a non-exclusive office with SAESA in the district of Las Condes, Santiago, to use it for holding board and committee meetings and for other meetings the Company must hold in Santiago, and this operation is subject to the aforementioned legal provisions. Moreover, and pursuant to what is laid down in the mentioned legal provisions,
26
the Committee approved the terms of the addendum or contract that was definitively entered into with the company Ernst & Young. This will enable Esval and other related companies to use the financial protection model developed by such company. Lastly, the Directors’ Committee approved the terms in which Esval will participate with the affiliate Aguas del Valle, and its related company Essbio, jointly with Aguas Nuevo Sur Maule, DICTUC S.A. and USM S.A. in the innovation and development consortium, whose aim is to develop research to address the environmental challenges of the sanitary industry. This operation was regulated by articles 44 and 89 of Law Nº18.046 and now regulated by Title XVI of that same law. The decisions made by the committees entail identifying and managing economic, environmental and social opportunities and risks. Likewise, in regard to budget issues, most of the investments are justified based on the management and/or solution of environmental or social risks. In regard to the board remuneration and fees, the breakdown is shown in the Company’s Annual Report 2009 available on the website www.esval.cl
Executive Committees Esval has an Integrated Management System (SIG) Committee, made up of the CEO, the managers of each area, the internal auditor and representatives of the managements in charge of the environmental, quality, safety and occupational health management systems. This Committee meets twice a year to review the SIG that has been implemented and certified, so as to assure its convenience, suitability and continuous efficiency regarding quality, the environment, and occupational safety and health. There is also an Economic Committee, whose responsibility is to approve, within certain ranges, the disbursements proposed by the different areas for their activities and whether they are in keeping with the budget approved by the Company. This Committee, which meets weekly, is made up of the COO, CFO, human resources and commercial and development managers.
ESVAL S.A. Organization Chart For the year ended December 31, 2009
BOARD
GENERAL MANAGEMENT
PUBLIC RELATIONS
CORPORATE MANAGEMENT
INTERNAL AUDITING
LEGAL ADVICE
ENGINEERING MANAGEMENT
COMMERCIAL & DEVELOPMENT MANAGEMENT
HUMAN RESOURCES MANAGEMENT
FINANCE & ADMINISTRATION MANAGEMENT
PLANNING & STUDY MANAGEMENT
OPERATIONS MANAGEMENT
Es v al S us t ainabilit y Repor t 2009
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01
Our Company
Senior Executives
28
Chief Executive Gustavo González Doorman 7.098.884-4, Civil Electronic Engineer
Legal Advisor Domingo Tapia Navarro 6.645.077-5, Attorney
Engineering Manager Leonel Fuentes Espinoza 4.899.487-3, Civil Engineer
Human Resources Manager Sergio Pinto Fernández 8.018.789-0, Psychologist
Commercial and Development Manager Mauricio Coll Olivares 11.471.960-9, Civil Industrial Engineer
Planning and Studies Manager Francisco Ottone Vigorena 7.523.281-0, Civil Engineer
Chief Financial Officer Agustín Benavente Font de la Vall 7.067.713-k, Business Engineer
Operations Manager George Seal Comte 5.390.299-5, Civil Engineer
Legal System and Ownership As of December 31, 2009, Esval was controlled by the company Inversiones OTPPB Chile Limitada with a 69.77% shareholding. The table below shows the shareholding status of the Company in the period.
NAME OR BUSINESS NAME
A series
B SERIES
C SERIES
TOTAL
SHARES
SHARES
SHARES
SHARES
%
1,122,170,725
-
10,437,782,849,226
10,438,905,019,991
69.77%
16,945,090
1,083,889,342
4,402,236,893,568
4,403,337,728,000
29.43%
INVERSIONES GUALLATIRI LTDA
2,494,988
-
12,132,516,035
12,135,011,023
0.08%
SUC. ZAMORA VILLALBA DAVID
1,734,690
-
6,937,025,310
6,938,760,000
0.05%
BUSTILLOS MUNOZ MANUEL
1,390,000
-
6,598,610,000
6,600,000,000
0.04%
INVERSIONES TACORA LIMITADA
1,192,426
-
5,821,643,775
5,822,836,201
0.04%
VALENCIA UBILLA ARTURO
1,333,029
-
5,330,792,582
5,332,125,611
0.04%
SOTO PIZARRO RENE
1,333,029
-
5,330,792,582
5,332,125,611
0.04%
INVERSIONES LAGOA LTDA.
1,332,491
-
5,328,631,509
5,329,964,000
0.04%
CHILEAN TREASURY
877,294
-
3,508,298,706
3,509,176,000
0.02%
BANCHILE C DE BOLSA S.A.
572,008
7,877
3,472,468,182
3,473,048,067
0.02%
OTHER SHAREHOLDERS
1,505,199,889
96,206
64,055,245,401
65,560,541,496
0.44%
TOTAL
2.656.575.659
1.083.993425
14,958,535,766,916
14,962,276,336,000
INVERSIONES OTPPB CHILE III LIMITADA CORPORACIÓN DE FOMENTO DE LA PRODUCCIÓN
100.00%
The Chilean Economic Development Agency (CORFO) is the only shareholder other than the controllers with over 10% of Esval’s capital stock.
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01
Our Company
The controlling group comprises the following members:
INVERSIONES OTPPB CHILE III LIMITADA
Shareholding of Series of Shares
B SERIES
C SERIES
TOTAL
SHARES
SHARES
SHARES
SHARES
1,122,170,725
-
10,437,782,849,226
10,438,905,019,991
69.77%
42.24%
0.00%
69.78%
1,487,520,566
-
-
1,487,520,566
0.01%
55.99%
0.00%
0.00%
Shareholding of Series with political rights (A & B) MARECO HOLDINGS CORP.
Shareholding of Series of Shares
30.00%
Shareholding of Series with political rights (A & B)
TOTAL SHARES RELATED TO OTPPB CHILE III LIMITADA
Shareholding of Series of Shares Shareholding of series with political rights (A & B)
%
A SERIES
39.77% 2,609,692,291
-
98.24%
0.00%
10,437,782,849,266 10,440,392,540,557
69.78%
69.78%
69.77%
Control by OTPPB and MARECO is based on a 98.24% shareholding of A series shares, with which they hold 69.77% of the Company’s political rights (30% for the former and 39.77% for the latter).
30
Code of Ethical Conduct
Esval S.A.’s code of ethical conduct was published in late December 2008 and was disseminated to all employees in January 2009 by means of different internal communication channels, mainly the intranet and internal newsletter. The aim of the code is to be a guide for the conduct of each of the Company’s employees so this is in line with corporate policies and the value and ethical framework defined by the Company for its operations. The code’s operation considers the presence of various consultation and/or reporting channels, and employees can: • Address the audit head personally • Send an email to
[email protected] • Call the “Integrity Help Line” • Enter the section called Esval - Integro in the intranet. This cannel is also used to provide information on these issues. When an employee files a complaint, he or she will have all the guarantee of confidentiality and privacy and the information provided will be treated in strict confidentiality. In 2009, there were no consultations, and 2 complaints were filed through the different channels available.
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01
Our Company
01.4 ASSOCIATIONS AND MEMBERSHIPS Esval participates as a member in the following social corporations: • Consejo Asesor de un Techo para Chile. • Cámara Regional del Comercio (CRCP). • Cámara Chilena de la Construcción, Regional Valparaíso. • Asociación Nacional de Empresas de Servicios Sanitarios (ANDESS). • Asociación Interamericana de Ingeniería Sanitaria y Ambiental (AIDIS). • Asociación de Empresas y Profesionales para el Medio Ambiente (AEPA). • Asociación Latinoamericana de Hidrología Subterránea para el Desarrollo (ALHSUD). • Asociación de Industriales de la Región de Valparaíso (ASIVA). • Cámara de Comercio y Turismo de Valparaíso. • Cámara de Turismo de la Región de Valparaíso.
Esval also participates in the following committees and entities: • Technical support to the government program of high-risk areas. • Corporate Social Responsibility (CSR) committee of the CRCP. • CSR committee of the ASIVA.
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• Labor study committee (ASIVA). • Tax study committee (ASIVA). • Environmental committee (ASIVA). • Emergency committee (ASIVA). • Business committee Quintero, Concón and Puchuncaví (ASIVA). • Real estate committee of the CCHC. • Communications committee of the ANDESS. • Technical and regulatory committee of the ANDESS.
Awards and Recognition Esval received the following awards and recognition in 2009: • Corporate Social Responsibility Award in the large company category by the Regional Chamber of Commerce for the Up-To-Date with Esval program. • Recognition by the Neighbors’ Committee of Viña del Mar for the way Esval forges permanent relations with social organizations.
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02 02.1 MANAGING OUR IMPACT The operations, engineering, finance and administration, commercial and development, human resources and corporate operation managements are accountable for meeting the Company’s objectives on environmental sustainability. Through their daily work they are directly accountable for the result of the action taken and achieving each of the commitments the company makes in this area. The environmental management system (SGA) made it compulsory for there to be a lead management for each environmental program promoted by the company. According to this scheme, the management responsible must coordinate the specific activities of the
34
Controlling Our
Environmental Impact
program, control its execution and brief the Quality and Environmental Committee on the progress attained, normally twice a year. At the same time, its efforts must be aligned with the work of the management representative of the SGA, who is in charge of the general coordination of all the environmental programs. The environmental management system forms part of the integrated quality, environmental, occupational safety and health management system, implemented in 2008, and its scope includes the production and distribution of drinking water and wastewater collection and treatment, including the marketing and service support processes. Its rationale is embodied in the integrated management system (SIG) policy.
To meet the commitments set forth in the SIG policy, objectives were set that were given a series of indicators, targets and control points. They jointly monitor and assess whether such commitments are met. In the case of environmental objectives and targets, programs were established to be developed, including the assignment of responsibilities, means and timescales to achieve them. In 2009, the SIG objectives for the management of environmental impacts were focused on preventing contamination from discharges of liquid waste, improving the record of solid waste generation and giving priority to using the best environmental practice.
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Controlling Our Environmental Impact
QUALITY, ENVIRONMENTAL, OCCUPATIONAL HEALTH AND SAFETY POLICY
The water utility Esval S.A. develops drinking water production and distribution and wastewater treatment processes in the Valparaíso Region, which entail the quality of processes, environmental protection and conservation, and occupational health and safety, by embracing the following commitments: PROVIDING the best service to all its customers, making a contribution to the community regarding health, quality of life and regional development. ADHERING TO laws, regulations and voluntary commitments signed by the organization. EMBRACING a continuous improvement strategy for the processes developed by the organization. PREVENTING contamination, by reducing waste generation, recycling it or disposing of it suitably. PREVENTING the occurrence of injuries and occupational diseases affecting its employees and interested parties. CONTRIBUTING to the integrated management of watersheds, the coastline and sustainable development of the Valparaíso Region by active participation in the pertinent instances generated, thereby improving the quality of life of its inhabitants. GIVING PRIORITY TO adopting the best environmental and safety practice with the technology available, related to the services provided to the organization. THE SUCCESSFUL COMPLIANCE WITH THIS POLICY ENTAILS THE CONTRIBUTION OF ALL THE AREAS OF THE ORGANIZATION, AND MANAGEMENT IS ACCOUNTABLE FOR ITS DISSEMINATION AND PROMOTION.
Environmental Investment Virtually all the investments made by Esval in infrastructure and maintenance have an environmental component, because they have a direct impact on the operation of the drinking water production and distribution systems; wastewater collection and treatment with the correct disposal in the environment. Esval invested over CLP290 billion in infrastructure and network maintenance 1999 through 2009, which have had a direct effect on the environmental progress in the region. Notwithstanding this, as a result of the operation of the environmental management system some specific investments were made. For example, in 2009 around CLP20 billion were invested in regularizing fuel storage tanks, CLP40 billion in chemical containment works6, CLP19 billion in noise pollution mitigation works, and CLP33 billion in rectification works due to audits of facilities. Most of these investments arose from the objective of complying with the current regulation and maintaining the ISO 14001 certification.
Tanks containing sodium hypochlorite, a sodium fluorosilicate solution, potassium permanganate and ferrous chloride used in the drinking water production and wastewater treatment processes.
6
36
Esval recertified all its processes pursuant to the ISO 14001:2004 standard in July 2008 and will once again undertake recertification in 2011.
02.2 WATER AND BIODIVERSITY Water Esval’s operations management keeps a record of the water production by productive system and source to establish the origin of drinking water. Esval’s operations concern channels, rivers, brooks, springs, groundwater, the Peñuelas and Los Aromos dams, related to the watersheds of the Aconcagua, Maipo, Petorca and La Ligua rivers, and the coastline. Such operations entail water abstraction for potabilization and the discharge of wastewater from its treatment plants. Esval produced 161,484,277 m of drinking water in 2009, which was equivalent to the total annual water consumption, of which 87,825,138 m3 came from surface sources and 73,659,139 m3 from groundwater sources.
Drinking Water Production 2007-2009 (m3) Production m3
Surface Water
Groundwater
Total
2007
84,020,876
74,132,294
158,153,170
2008
83,455,208
75,872,401
159,327,609
2009
87,825,138
73,659,139
161,484,277
Surface Water Abstraction Quantity (N° of Sources)
13
3
To produce drinking water, in 2009 the Company obtained this resource from 13 surface sources and 113 groundwater sources.
Aconcagua river, Serrano channel La Petaca channel Waddington channel La Compañía channel Peñuelas dam
Marga Marga brook Maipo river El Tigre ravine Agua Salada brook Lilén brook
Groundwater Abstraction Quantity (N° of Sources/ Borings)
113
7
Main Locations
Main Locations Las Vegas (Hijuelas) groundwater gallery Concón borings SPAP7 Parrones-Covarrubias-Charravata (Quillota) Pachacama (La Calera) borings SPAP Goenechea (La Ligua) SPAP Artificio SPAP Cabildo San Juan (San Antonio) borings O’Higgins (Casablanca) plant SPAP El Carmen (San Felipe) SPAP El Sauce (Los Andes) SPAP San Esteban SPAP Llay-Llay
SPAP: Drinking Water Production System Es v al S us t ainabilit y Repor t 2009
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02
Controlling Our Environmental Impact
Biodiversity and Water Abstraction
water courses in the region not to be affected by wastewater discharges and the biodiversity conditions of the Valparaíso Region are being maintained. In the case of marine outfalls, whose water has not been treated biologically, the environmental monitoring program (PVA) has proven that their impact is minimal and marginal, as it is only limited to the immediate perimeter of the seabed where the water is discharged.
• Effluents9: Two to four samples are taken a month to verify compliance with Supreme Decree N°90 SEGPRES (Table Nº5: Discharge outside the Coastal Protection Zone).
• Marine sediment: Samples are taken quarterly and half-yearly.
Biodiversity and Wastewater Treatment
In regard to marine outfalls, a monitoring program is undertaken which meets the monitoring and follow-up requirements laid down by the maritime authority (General Directorate of Maritime Territory and Merchant Navy (DIRECTEMAR)), the Superintendency of Sanitary Services, the Directorate of Fisheries (SERNAPESCA), the Regional Ministerial Secretary (SEREMI) of Health of the Valparaíso Region and the respective environmental qualification resolution of the National Environmental Agency (CONAMA).
The wastewater treatment plants currently operating at Esval have enabled the surface
The environmental monitoring programs monitor:
During the process of extracting water for the production of drinking water there are no specific indicators on its impact on the biodiversity, be this biotic environment (human health, flora and fauna) or the physical environment. Nevertheless, Esval also takes care of those places of great significance in terms of diversity, like the Peñuelas Lake and the Poza Azul abstraction plant. Regarding these, the Company has promoted the preservation of their natural conditions free of contamination, for example banning access to people who might damage the ecosystem by using it for recreation or sports. The characteristics of the Peñuelas Lake and Poza Azul were widely presented in the 2008 report8.
www.esval.cl/Inversionistas/ReporteDeSustentabilidad/2008/index.html Water discharge from a treatment plant. 10 These are organisms and species that inhabit the beach and the deep-water seabed. 8 9
38
• Beaches: There is weekly monitoring in the summer and this is monthly in the winter. • Marine environment: Quarterly and half yearly samples are taken from the sea surface and at different depths.
• Tidal and sub-tidal benthic resources10: Monthly samples are taken, especially in the zones around the operation areas. • Oceanographic monitoring: Studies are made of marine currents and the physical properties of the sea in the discharge areas. The environmental monitoring programs are carried out by the Faculty of Marine Sciences and Natural Resources of the University of Valparaíso. Its functions include taking land
and marine surface samples and at different depths, producing and interpreting results and issuing quarterly, half-yearly and annual reports with assessment reports for each outfall. Most of the physical, chemical and bacteriological analyses of the water samples are made at Esval’s laboratory, which is certified by the National Standards Bureau pursuant to
the Chilean NCh-ISO 17.025 standard. The analyses of the marine and benthic fauna are made at specialized laboratories of the University of Valparaíso. A test report is released every month for each outfall with the results of the analyses of the samples taken of effluents, from beaches and the marine environment. These are sent monthly for assessment to the Port
Authorities of Valparaíso and San Antonio, the Directorate of Fisheries (SERNAPESCA)11, the Regional Ministerial Secretary (SEREMI) of Health, the Superintendency of Sanitary Services (SISS)12 and National Environmental Agency (CONAMA)13, who also receive the scientific and technical reports released by the University of Valparaíso.
DUE TO THE WASTEWATER TREATMENT PROCESSES UNDERTAKEN WITH THE HIGHEST STANDARDS AND ADHERING TO THE CHILEAN REGULATION, 100% OF THE WASTEWATER TREATED AND DISPOSED OF IN RIVERS AND BROOKS CAN BE RE-USED FOR IRRIGATION.
WATER THAT CAN BE RE-USED M3/YEAR*
2007
2008
2009
34,362,119
35,946,212
35,883,069
*Meets Supreme Decree N°90 which classifies the irrigation standard.
www.sernapesca.cl Superintendency of Sanitary Services (www.siss.cl) 13 www.conama.cl 11 12
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Controlling Our Environmental Impact
02.3 EMISSIONS
to the operative areas and the corresponding solutions are proposed and implemented.
Odor and Noise Management
Esval’s operations produce a low quantity of airborne emissions, and this mainly arises when it must use diesel-powered generating equipment at drinking water and wastewater treatment plants and stations. The combustion of these generates the following contaminants: CO, NOx, SOx, volatile organic compounds (VOCs), NH3, total suspended particles (TSP) and particulate material (PM-10). The table below shows an estimate of the emissions of these contaminants in 2009.
Odors are a significant emission for the surrounding community and are mainly related to the wastewater treatment process. There is a special environmental program to manage them, which considers the measurement of gases at wastewater pumping stations (EEAS), the installation of an odor treatment system, such as gas scrubbing, essence dosage and an activated carbon filter. The objective is to reduce the number of service requirements because of bad odors at facilities. When these arise, they are logged in the customer service system and are referred
Another emission that has a large impact on surrounding communities is noise pollution. In 2009, Esval invested CLP19 million in works to mitigate this kind of contamination. This investment was made to carry out 8 noise mitigation works at the wastewater pumping stations of: Curauma, Cruz de Lorena in Quilpué, Puerto de Cartagena, Pedro de Valdivia in Concón, Diego Portales and Sótero del Río in San Antonio; and at the drinking water pumping stations (EEAP) of Placilla and Estanque Esperanza in Quilpué.
Total Estimated Emissions14 for Esval’s Generators (t/year) 2009
40
ESTIMATED CONTAMINANT
MP
MP10
MP2,5
CO
NOX
VOCs
SOX
NH3
CO2
EMISSIONS (T/YEAR)
3,42
1,72
0,41
10,52
48,71
3,87
2,58
0,0085
1897,46
14 Values estimated using the formula indicated in the methodological guidelines for estimating airborne emissions of fixed and mobile sources in the Contaminant Transfer and Emissions Record [RETC] (CONAMA- MINSAL).
02.4
WASTE The more than 300 facilities belonging to the Company generated an estimated figure of 12,547 tons of solid waste in 2009, which was a 108.9% increase on the 6,006 tons in 2008. Such increase was mainly due to the greater detail of logging debris waste, which in 2008 accounted for 54.4% of the annual total in tons and in 2009 was 76.7% of the total weight of solid waste generated. The control and logging of solid waste adhered to the guidelines of the SGA, as outlined and reported in the Sustainability Report 2008. The table below shows the type and quantity of solid waste generated in the period.
Solid waste generated by type and disposal (tons) 2007-2009 Type of Solid Waste Generated
Solid Domestic Waste
2007
2008
37.7
39.3
2009 73.8 El Molle in Valparaíso, La Hormiga in San Felipe and Altos de Cartagena waste dumps.
Domestic-assimilable Solid Waste
Recyclable Solid Waste
2,768
8.7
2,683
9.8
2,846
1.57
Paper is sent to SOREPA15 Computer equipment is sent to RECYCLA16
Hazardous Waste
6.6
8.6
7.37
Used oils are sent to the recycling company Bravo Energy17 and Cemento Polpaico. Others (containers contaminated with fluoride, containers with chemicals or reagents, lead washers, fluorescent tubes, small batteries and batteries) are sent to specially implemented facilities that are authorized to destroy them.
Debris
N/D
3,265
9,618
This goes to the waste dumps of each work site.
YEARLY TOTAL
www.sorepa.cl/ www.recycla.cl/ 17 www.bravoenergy.com/htmlPages_Esp/chile.html
Final Disposal
TONs
2,821
6,006
12,547
15 16
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Controlling Our Environmental Impact
Dehydrated Sludge Wastewater treatment using activated sludge technology generates dehydrated sludge with various degrees of humidity ranging from 60% to 85% base humidity (b.h.). The volume generated in 2009 was 27,789 m3, which was a 7.2% increase on the 26,004 m3 generated in 2008. Such higher volume of sludge was due to greater wastewater loads and the increase in the volume of wastewater treated.
The dehydrated sludge is generated at four plants: Los Maitenes (La Ligua), Cordillera (Los Andes), Almendral (San Felipe) and El Molino (Quillota). As of December 2008 and throughout 2009, all the dehydrated sludge generated at the La Ligua, San Felipe, Los Andes and Quillota plants was disposed at the KDM Lomas Los Colorados sanitary landfill in Til-Til, and was disposed with urban solid waste.
Dehydrated Sludge Generation by Plant (m3) PLANT
2007
2008
2009
La Ligua
2,505
3,360
3,045
San Felipe
6,795
7,123
9,402
Los Andes
6,510
7,045
6,417
Quillota
8,625
8,476
8,925
ANNUAL TOTAL
24,435
26,004
27,789
Dehydrated Sludge Generation 2007-2009 29,000 28,000
Cubic Meters
27,000
02.5 DISCHARGES
26,000
There were no environmental emergencies in 2009 related to the operation of wastewater treatment plants and pumping stations.
25,000 24,000
This was the outcome of a series of measures taken to boost the wastewater collection systems consisting of:
23,000 22,000 2007
2008 Years
42
2009
• Increasing or boosting the mobile guard operational coverage, especially during the summer. • Special plan to clean wastewater pumping station (EEAS) wells and screens. • Special plans to review pumps, generators and switchboards. • Co-ordination of the maximum diesel load of generators. • Acquisition of new pumps and generators. • Special plan to clean critical collectors. Despite this, if discharges arise, the following is the procedure for dealing with them: 1. General clean-up of the collector using water jet and combined trucks. 2. Clean-up and sanitization of the backyard of houses located in the sector. 3. Street clean-up and sanitization. 4. Removal of the wastewater-contaminated material and repair of the earth road by filling it with borrowed fill material. 5. A sample shall be taken of the water from the coastline affected to assess the impact of the wastewater spill. 6. The environmental authorities shall be informed, reports be issued and the environmental impact be assessed.
18
Sewer Overflows
Chemical Emergencies
Wastewater can upwell and spill onto roads and inside housing, mainly due to third-party misuse of the sewer system and deficiencies of the public wastewater collection system.
There were three chemical emergencies in 2009, which can be qualified as isolated if one considers that 80 facilities of Esval make intensive use of these raw materials throughout the year.
These operational emergencies are specific cases, but more frequent and less serious, and their hydraulic solution18 is managed through the internal operational service system (SISDA). In addition to this, for these kinds of faults the area where the wastewater spill and/or runoff have occurred is cleaned and disinfected to mitigate the damage caused. Should there be damage to chattels or real estate damage, a special report is issued by a damage inspector to subsequently, through the legal advisor, compensate if applicable, and reach an indemnity agreement with the party affected. In 2009, there were an average of 105 collector obstructions a month with upwelling on the highway and/or customers’ homes affected, which was a 52% drop on the 218 average obstructions a month in 2008. This decrease was due to a special plan to clean up critical collectors and the annual maintenance plan.
The hydraulic solution entails repairing or unblocking piping to restore the sewer to normal operation.
• There was a leakage of chlorine gas in the booster pump room of the chlorine dosage system of the Cordillera de Los Andes wastewater treatment plant, which was contained by closing the container valves. The lines and equipment affected were repaired and cleaned and operators were retrained on handling chlorine gas containers. • The chlorination system vent was activated at the El Llano de Putaendo drinking water plant and chlorine gas was released into the atmosphere, which was quickly rectified and there were no consequences. • There was also an emergency caused by third parties spilling liquid and solid industrial waste (RILES) from the plant of CODELCO’s Andina Division at Saladillo into the river Blanco. This river supplies the El Sauce de Los Andes surface drinking water plant. The surface area of the plant therefore had to be shut down for 7 hours as a preventive measure with operation using borings, and samples were taken from the river to assess the impact of the spill but there was no contamination.
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Controlling Our Environmental Impact
02.6 RAW MATERIALS Chemicals like chlorine gas, sodium hypochlorite, ferrous chloride, aluminum sulfate and fluoride are the main raw materials required in the drinking water production and wastewater treatment processes. Due to the potential risks of some of these elements, Esval has a series of procedures and instructions for the operational handling of these substances during transportation, loading and unloading, storage and dosage stages. These criteria also include action guidelines in emergencies like spills and leakages to protect workers and prevent toxic emissions from being released into the environment. Regarding this, in 2009 Esval invested CLP40 million in building 61 chemical containment systems to prevent the contamination of the soil and groundwater if there is a spill. Such situations are set forth in Supreme Decrees (D.S.) 148 and 46. Another significant raw material is piping of different material and diameter for drinking water distribution and wastewater collection. 95,794 meters of piping were added to Esval’s network in 2009, with the drinking water network accounting for 41,699 meters and the wastewater network for 54,095 meters.
44
Main Raw Materials 2007-2009 DRINKING WATER
WASTEWATER
TOTAL
CHEMICALS
2007
2008
2009
2007
2008
2009
2007
2008
2009
Chlorine Gas (kg)
452,806
489,049
666,452
149,288
168,078
194,893
602,094
657,127
861,345
Fluoride (kg)
151,559
164,597
163,881
151,559
164,597
163,881
Ferrous Chloride (kg)
428,107
423,178
379,261
119,753
547,860
543,886
475,943
Aluminum Sulfate (kg)
985,521
1,319,577
1,112,680
80
985,601
1,319,577
1,112,680
Sodium hypochlorite (l)
103,426
111,359
133,138
455,519
489,463
440,027
558,945
600,822
573,165
Caustic Soda (l)
230,676
216,805
196,326
4,177
64,205
104,889
234,853
281,010
301,215
36,575
59,466
48,122
6,925
8,650
43,500
68,116
48,112
268,987
94,703
268,987
94,703
37,121
5,973
7,945
5,636
46,462
52,097
Activated Carbon (kg) Lime (kg) Potassium Permanganate (kg)
5,973
7,945
120,708
96,682
37,121
5,636
Herbicide (l)
1,000
Saltpeter (kg) Salt (kg)
45,577
46,462
1,000
52,097
45,577 4,370
Sulfuric Acid (l) Cationic Polyelectrolyte (kg) Sodium Carbonate (kg)
14,713
17,319
11,795
1,611
997
4,370 14,713
17,319
11,795
1,611
997
Calcium Hypochlorite (kg) Polymer (kg) Copper Sulfate
40,106
39,302
36,262
40,106
39,302
36,262
1,759
1,524
1,345
1,759
1,524
1,345
Es v al S us t ainabilit y Repor t 2009
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02
Controlling Our Environmental Impact
02.7 ENERGY Direct energy consumption from primary sources The generators at the drinking water and wastewater treatment plants and stations consumed 724 m3 of diesel in 2009 to generate electricity, which was a 19.6% drop in fuel consumption on the 901 m3 consumed in 2008. This was due to the lower use of this backup equipment during peak hours on account of a special contract entered into with electric power generating companies.
Direct energy consumption from secondary sources The table below shows the total use of electric power in each of the drinking water production and distribution and wastewater collection and treatment processes.
46
Direct Electric Energy Consumption (kWh) 2007-2009 2007 kWh
2008 kWh
2009 kWh
Drinking Water Production & Distribution
56,703,019
69,356,024
70,438,689
Wastewater Collection & Treatment
30,677,284
29,601,981
30,039,078
1,141,548
1,035,197
1,147,881
88,521,851
99,993,202
101,652,648
Energy Consumption
Offices & Facilities outside the Processes
Total kWh
Esval launched an energy efficiency plan in 2008 with a target of reducing energy consumption at its commercial and administrative facilities. A 2.45% reduction in electric energy consumption was attained in 2009 due to the optimization of electrical installations and the dissemination of good practice in energy use.
Direct Electric Energy Consumption at Commercial and Administrative Facilities (kWh) 2008-2009 YEAR
TOTAL ANNUAL CONSUMPTION
2008
1,228,886
2009
1,198,850
Total kWh
Es v al S us t ainabilit y Repor t 2009
47
03 03.1
OUR CUSTOMERS The commercial and development management is in charge of establishing and developing Esval’s customer relations. This is done by processes defined in the Company’s integrated management system, which cover all the interrelations that can be established with the customer, categorized into the following areas: • New customers (new services). • Commercial cycle (billing, collection and payment). • Customer service (customer service and service processing). • Contact with the community (continuous improvement of the service, process efficiency). To optimally address each of these areas, the commercial and development management has customer service and new service assistant managements. These units are in ongoing communication with the operations and engineering managements, which allows
48
Customer Relations
for constant coordination to assure product quality, harmlessness and safety.
requirements, Esval’s commercial activities are split into two large groups of users.
Esval’s commitment is to provide the best service to its customers to make a contribution to the community in terms of health, quality of life and regional development.
1. Household or Residential Customer
The work of management in 2009 was focused on: stepping up direct contact with the community and social organizations, the optimization of its customer service Call Center, setting up roundtable meetings with neighbor committee leaders and local authorities, mitigation plans after network renewal works, scheduled water cuts, and assessing customer satisfaction.
Customer Classification Based on the characteristics, location and needs of its customers and to provide them a more satisfactory service according to their
This includes household connections to the drinking water network and/or public sewer network. These are continuous services 24 hours a day, 365 days a year, also including: Customers from High-Risk Sectors These are low-income customers, sometimes below the poverty line, who benefit from a drinking water consumption subsidy, and other programs like Up-To-Date with Esval. 2. Commercial and/or Industrial Customers This category includes all those customers who undertake productive activities or services, such as supermarkets, hotels, restaurants, etc.
Es v al S us t ainabilit y Repor t 2009
49
03
Customer Relations
Customers by real estate purpose and type of service19 CUSTOMERS BY REAL ESTATE PURPOSE COMPANY
TOTAL CUSTOMERS 2009
2009 SHARE
RESIDENTIAL
COMMERCIAL
INDUSTRIAL
OTHER
ESVAL S.A.
529,951
12.07%
502,167
25,037
783
1,964
CUSTOMERS BY TYPE OF SERVICE
03.2
CUSTOMER SERVICE AND SATISFACTION The customer service process enables Esval to maintain permanent contact with customers and thereby meet their needs and address their concerns. This process is made up of three main service channels: 1. Telephone service (Call Center). 2. Personal service (23 commercial offices).
JUST DRINKING WATER
JUST SEWERAGE
475,593
53,667
691
3. Written communication service (letters and website). The commercial service received by any of these three channels is classified as: inquiries20, complaints21 and requirements22. The commercial service is classified and sent to the commercial and development management for analysis, solution and reply. The latter is available in the company’s commercial system.
The operational service is classified and sent to the operations management for verification and solution, if applicable. Site action is also logged in the commercial system for subsequent customer consultation. The main reasons for customer requests are: commercial situations largely related to information on water bills, consumption metering and the feasibility of receiving service, and operational situations related to site works.
SISS management report 2009 Any information request that involves providing data, general information or advice is resolved immediately. 21 Any customer service request or requirement that is a complaint (explicit or implicit) about the service received. 22 Any customer requirement, which is answered by company action to give the customer a new service, expand that currently provided or modify the data in the company database. 19 20
50
DRINKING WATER AND SEWERAGE
Number of Complaints-Inquiries 2008 - 2009 2009
2008 REASON
COMMERCIAL COMPLAINTS In the customer’s favor
No rationale
6,246
5,867
117
71
Meters
1,604
Other commercial reasons
Excessive consumption and reading
Debris & others in the street
TOTAL PER REPLY GENERAL TOTAL
No rationale
No rationale
In the customer’s favor
TOTAL 2009
SISDA In the customer’s favor
No rationale
4,242
6,911
1,466
150
76
265
1,869
2,118
564
2,682
2,222
6,597
8,819
3,707
7,045
10,752
10,189
12,800
24,267
10,217
14,596
22,989
308
308
970
970
1,278
24,267
4.62
The study envisaged a sample of 8,773 customers distributed throughout the country, considering customers living in the regional capitals and also in the main towns.
11,153 450
450
24,813
497,990
It should be highlighted that the Superintendency of Sanitary Services (SISS) released the study “Water Utility Service Quality Insight” in the first half of 2010. This was undertaken late 2009 through early 201023 to assess the impressions and experiences of customers supplied by the 20 largest water utilities operating in Chile.
23
In the customer’s favor
COMMERCIAL COMPLAINTS
12,113
CUSTOMERS B COMMERCIAL RATE [(Complaints/ Customers)* 100]
TOTAL 2008
SISDA
1,137
1,363
687
687
25,950 25,950
510,286
0.26
4.87
4.86
0.22
5.09
The following was the outcome of this insight survey: ATTRIBUTE
AVERAGE SCORE OF THE SECTOR 2008
2009
1. OVERALL SATISFACTION WITH THE SERVICE RECEIVED
5.5
5.6
2. DRINKING WATER SERVICE EVALUATION
5.3
5.3
3. SCHEDULED DRINKING WATER CUTS
4.4
5.5
4. SEWERAGE SERVICE EVALUATION
4.9
5.2
5. TELEPHONE SERVICE
5.0
5.0
6. SITE SERVICE
5.0
5.4
7. STREET WORK
5.4
5.4
8. COMMERCIAL OFFICE SERVICE
5.3
5.4
9. BILLING DOCUMENTS: WATER BILL
5.8
6.0
10. METER AND METER READING
5.7
5.8
11. PAYMENT OF BILLS
5.9
6.0
Period before the earthquake and tsunami of February 27. Es v al S us t ainabilit y Repor t 2009
51
03
Customer Relations
In the particular case of Esval, the Company obtained a score of 5.9, which was an increase on the 5.6 score attained in the 2008 survey. The 2009 score ranks Esval in third place in Chile, after Aguas del Valle (an affiliate of Esval in first place, which provides services in the Coquimbo Region).
Score attained by Esval ATTRIBUTE
SCORE ATTAINED BY THE COMPANY 2008
1. OVERALL SATISFACTION WITH THE SERVICE RECEIVED
5.6
5.9
2. DRINKING WATER SERVICE EVALUATION
5.3
5.6
3. SCHEDULED DRINKING WATER CUTS
4.3
5.8
4. SEWERAGE SERVICE EVALUATION
5.2
5.5
5. TELEPHONE SERVICE
5.1
5.3
6. SITE SERVICE
4.9
5.7
7. STREET WORK
5.1
5.6
8. COMMERCIAL OFFICE SERVICE
5.5
5.8
9. BILLING DOCUMENTS: WATER BILL
5.9
6.1
10. METER AND METER READING
5.8
6.1
11. PAYMENT OF BILLS
6.2
6.2
In the particular assessment of Esval regarding the eleven variables analyzed, it can be seen that for all the customer contact channels (telephone service, site service, commercial office service) the score was higher than in 2008, which reflects the work done last year on policies, targets and community engagement strategies.
52
2009
Customer Satisfaction Survey As part of its service quality continuous improvement policy, Esval undertakes periodic customer satisfaction surveys. The information obtained by the Company results in traceable and measurable action plans, which each management is involved in until better rates are attained. Every year Esval undertakes at least two service quality surveys to appraise the degree of customer satisfaction with the service. The results of these surveys are disseminated to the different areas to strengthen the positive aspects and work on current weaknesses by generating projects and action for improvement.
The survey result reveals an improvement on 2008, with a 4-point increase in customer insight of the service quality provided by Esval.
• Telephone operator’s willingness to solve their problem.
Another important highlight in the area of customer access to the commercial and operations area was the improvement of the customer telephone service (Call Center) in 2009 to boost daily analysis and for online assessment of calls and assignment of responsibilities by work areas.
• Overall telephone service.
• Clarity of the response given.
Customers were surveyed after they had made calls in the April to December 2009 period to assess the service quality received. The following were the questions asked: • Waiting time to be attended. • Friendliness of the telephone operator.
Customer Satisfaction Survey Result 6 & 7 SCORE %
2008
2009
SERVICE QUALITY PROVIDED
61
65
REQUIREMENT RESPONSE TIME
55
51
COMPLAINT RESPONSE SERVICE
51
51
CORDIAL USER SERVICE
66
68
FOCUSED ON MEETING THE CUSTOMER NEEDS
55
51
CLEAR AND ACCURATE WATER BILLS
59
61
SUITABLE SERVICE CHARGES
49
51
Es v al S us t ainabilit y Repor t 2009
53
03
Customer Relations
The graph below shows the overall telephone service level in the result of these surveys. It should be highlighted that the satisfaction level exceeded 80 points throughout the assessment period, considered to be a level of telephone service excellence.
Telephone Service Survey Overall Telephone Service
Scores of 1 to 4
The following are the main customer service and satisfaction challenges in 2010:
Scores of 6 Scores of 7
• Telephone Service: Innovation of the personalized customer contact procedure to inform them of the results of their concerns, requirements and complaints as soon as possible to improve customer insight.
Percentage
90% 80% 70% 60% 54
55
60
63
61
65
62
59
59
50% 40% 30% 20% 30
10% 0%
-6
28
-6
24
23
-7
-5
27
24
26
27
26
-2
-3
-4
-5
-6
-10% Apr-09 May-09 Jun-09
54
Jul-09
Aug-09 Sep-09 Oct-09
Nov-09 Dec-09
• Commercial Offices: Development and implementation of new technologies to enhance the service quality by means of modern self-consultation equipment, which is a technological system that allows for online monitoring. A project will also be launched in 2010 to modernize the look and comfort of the commercial offices. • Integrated customer response system: Implementation of a continuous customer communication improvement process.
03.3
CUSTOMER INFORMATION AND SUPPORT Customer Information Esval’s main concern is its customers and its actions are focused on continuous improvement of the service quality in a context of supporting the region’s social, economic and environmental development. Ongoing customer and general community contact and information are therefore essential. Regarding this, in 2009 the Company started to develop a project, which will be fully implemented in late 2010, to modernize the quality and utility of its website. The changes are focused on changing the image and on providing a quicker service and better quality of information to users. Besides this, it will be boosted as a virtual branch, becoming a new communication channel, enabling water bills to be paid online, requirements and complaints to be entered and followed up, and an agreement to be simulated and generated, among other functions. With all this, the Company aims to increase customer communication through this channel in line with the progress of technology and the facilities provided by the internet. Moreover, and taking advantage of the positive experience of previous years, the
commercial service will be boosted by establishing work roundtables with social organizations, especially with the communal associations of neighbors’ committees and social organizations. It will thereby engage with the leaders, who in turn receive and transmit community concerns. 30 work roundtables were established in 2009. The way Esval informs the community about issues like subsidies, scheduled water cuts, works and others is outlined below. • Subsidies: This information is provided jointly with the social departments of the different Municipalities, based on the subsidies available. All customers with the benefit already granted are also given information on their water bills, at the offices and by means of the telephone service before the expiry date. This is so customers renew the benefit before the expiry date. It is important to mention that this information is also provided in the different workshops the Company holds with the neighbors’ committees. The subsidy coverage percentage in the region was 98% as of December 2009 due to information activities, along with those of supporting the securing and renewal of subsidies. • Scheduled water cuts: Pursuant to the sanitary regulation, all customers affected must be informed of all scheduled water cuts at least 48 hours in advance. Besides this information and depending on the quantity of customers affected, on the
sector and their location, the Company works with a water cut committee, which in practice has the objective of reducing the impact of the supply interruption, either by installing tanks or hydropacks (an automatic water pressurization system that is connected to the water mains). There were 238 scheduled water cuts in 2009.
2008 SCHEDULED WATER CUTS UNSCHEDULED WATER CUTS CUSTOMERS AFFECTED
2009
VARIAtIoN
239
238
2,695
2,237
-16%
618,806
595,181
-4%
Es v al S us t ainabilit y Repor t 2009
55
03
Customer Relations
• Works: There is a systematic customer information delivery procedure for investment works carried out by the Company in different areas.
A large portion of the Company’s activities are therefore focused on supporting its lowincome and/or high-risk customers to facilitate access to drinking water and treatment.
Information is delivered by means of meetings of Esval’s customer assistant management team with neighbors’ committees, communal associations, local health councils, among others, in sectors where the works will be undertaken to give them details of the timescales and stages of the works, the benefits for the sector and the mitigation works implemented.
The following are the main programs undertaken by Esval for this:
Action was stepped up in 2009 to inform the general community and social organizations about providing information on works to be carried out in the year, particularly those concerning network renewal. Site meetings were therefore encouraged, summoned through the neighbors’ committees, which enabled the communities to clearly understand the scope of the works to be undertaken, their benefits and timescales, the amounts involved and the mitigation measures such works would have on the environment.
Customer Support As already mentioned, Esval’s commitment is to provide the best customer service to make a contribution to the community regarding health, quality of life and regional development.
56
Training on the responsible use of sewers and water The “Up-To-Date with Esval” program has 3 execution stages. The first concerns the target sector of this program (high-risk customers with less than 11,000 points on the social protection record), and all these customers are contacted and visited on site
by a team of social workers. The second entails inviting them to an education workshop on water consumption and the responsible use of sewers, which is undertaken at the different commercial offices. After this workshop has been completed, a debt repayment agreement is entered into with each of them, which they must pay in monthly installments with the commitment that for each installment paid Esval will reduce the last installment of the agreement. The third and final part consists of giving these same customers a plumbing workshop to give them the tools needed so they can fix any faucet or toilet wear and tear in their homes.
Up-To-Date with Esval Workshops and Agreements 2007-2009
PROVINCES VALPARAÍSO
Nº OF WORKSHOPS
AGREEMENTS SIGNED
209
2,479
QUILLOTA-PETORCA
34
334
SAN FELIPE-LOS ANDES
43
SAN ANTONIO 2007 total
PROVINCES
AGREEMENTS SIGNED
72
591
285
San Felipe - Los Andes
51
883
54
742
San Antonio
83
304
406
3,638
431
4,051
55
370
482
San Felipe - Los Andes
75
39
177
San Antonio
325
3,472
Regarding this and to collaborate so all the people meet the requirements set forth in the regulation and can get a drinking water subsidy (SAP), in 2009 Esval coordinated a series of meetings with the community development departments (DIDECOS), which cover relations with organizations
like the social programs of municipalities. On this occasion, the Company worked with the DIDECOS of the provinces of Quillota, Petorca, San Felipe, Los Andes and Greater Valparaíso. In the latter case, the head of monetary benefits and social protection record of the Planning Ministry (MIDEPLAN) also attended the meeting held.
Valparaíso
AGREEMENTS SIGNED
Quillota - Petorca
Quillota - Petorca
Every three years there is a mass expiry of drinking water subsidies. At such time, Esval coordinates with the different social departments of the municipalities to offer support for renewing these subsidies.
Nº OF WORKSHOPS
2,273
2,241
2008 total
PROVINCES
225
222
Support for securing and renewing drinking water subsidies
Valparaíso
Nº OF WORKSHOPS
2009 total
Subsidies Assigned 2007-2009 2007
2008
2009
87,117
89,117
91,693
% OF SUBSIDIES ASSIGNED
95.20
95.72
97.91
% OF CUSTOMERS WITH SUBSIDIES
17.76
17.81
17.89
SUBSIDIES ASSIGNED
The results of these proceedings in 2009 enabled 97.91% of a total of 91,693 subsidies to be assigned. 17.89% of Esval’s total customers currently have this important benefit.
Es v al S us t ainabilit y Repor t 2009
57
03
Customer Relations
Support for High-Risk Sectors Areas that have no access to services like drinking water, sewers, electric power and connectivity to towns are classed by the authorities as high-risk sectors. It is deemed that satisfying this deficiency is a priority so families can live with the minimum standards of civilization. In its unwavering commitment and support of the poorest sectors, Esval accepted
the request for support from the regional government to analyze a sanitary solution for high-risk sectors defined by the Planning Ministry (MIDEPLAN). Among other activities, in 2009 Esval participated on various regional working roundtables to analyze the general situation of high-risk sectors. It should be highlighted that with the support of the region’s municipalities, MIDEPLAN drew up and delivered Esval a new list of high-risk
sectors, which increased from 360 to the current 450 sectors. After studying and analyzing this information, Esval reviewed the new sectors defined by the authority, which meet the conditions for undertaking a conceptual study on a technical solution for supplying drinking water and collecting and treating wastewater. The result of this study is shown in the table below:
Table summarizing the classification of sectors on the list of high-risk sectors 2009
SECTORS WITH RURAL DRINKING WATER (APR)
HIGH-RISK SECTORS With APR Design
QUANTITY OF SECTORS PER DISTRICT
With APR Works
SECTORS WITH WORKS EXECUTED OR BEING EXECUTED
SECTORS WITH A CONCEPTUAL STUDY IN 2008
SECTORS THAT WILL NOT BE ADDRESSED WITH A CONCEPTUAL STUDY REQUIRES COMPLEX SOLUTION
LANDS TO BE EXPROPRIATED
SECTORS TO BE ANALYZED FOR THE POSSIBILITY OF UNDERTAKING A CONCEPTUAL STUDY
TOTAL SECTORS ON THE LIST OF HIGH-RISK SECTORS 2009
8
17
27
6
60
159
12
161
450
QUANTITY OF HOUSES WITH A DRINKING WATER BENEFIT
718
2,098
459
350
4,078
5,778
219
4,416
18,116
LENGTH OF DRINKING WATER NETWORKS (m)
41,884
60,560
12,421
5,334
54,402
7,322
181,923
QUANTITY OF HOUSES WITH A SEWERAGE SYSTEM BENEFIT
2,327
4,163
2,437
561
5,325
11,232
39,427
5,406
15,792
9,427
98,691
16,707
146,023
LENGTH OF SEWERAGE NETWORKS (m)
58
SECTORS WITH PROJECTS
12,957
425
In 2010 Esval hopes to carry out 16 conceptual studies of the current list of high-risk sectors. It will also undertake the detailed drinking water and sewerage engineering projects and their related household projects for the high-risk sector called Parcela 15 where 211 families live. Rural Drinking Water (APR) Pursuant to Law N°19.549 of 1998, the urban sanitary service concession companies shall provide technical and administrative assistance to the rural drinking water committees and cooperatives in their respective regions and undertake the activities needed to carry out reimplementation and improvement works and design new rural services, all this upon the request of the Ministry of Public Works. Assistance includes accounting and technical issues and the management of the design and works for rural drinking water systems, training and technical inspection. The rural drinking water program is supervised by the Department of Sanitary Programs (DPS) belonging to the Department of Hydraulic Works (DOH). Esval signed an agreement with the DOH as of May 2009, whose aim is to provide technical assistance to the rural drinking water committees and cooperatives and manage the investment projects that have state financing for this program. The following is a breakdown of the scope of activities:
24
• Technical Advice: entails advising on 150 rural drinking water systems present in the Valparaíso Region regarding administrative, technical, accounting and social issues, and promoting the self-management of the service. Such advice also covers those new systems that arise during the effectiveness of this agreement. • Project Management: consists of developing the pre-investment and investment stages of the studies and works of the rural drinking water program in the region. For this, the studies are tendered, the tender award is proposed, hiring and
technical inspection are made, and the studies are finally approved, or the works are given reception, as the case may be. • Direct Advice to the DOH: advice on the feasibility of providing a drinking water supply, participating in coordination meetings with the DOH and issuing reports. As of December 2009, Esval provided technical advice to a set of 147 APR systems, which benefit an estimated population of 150,534 inhabitants24.
SISS management report 2009. Es v al S us t ainabilit y Repor t 2009
59
03 03.4
Customer Relations
PRODUCT/SERVICE QUALITY AND SAFETY To maintain the current service quality and continuity, there is a quality control system with technology applied to each of the processes.
a. Laboratory Esval has a renowned national laboratory, which makes approximately 150,000 analyses a year, mainly bacteriological, physical and chemical analyses, from samples taken from the whole region. The laboratory has competent personnel and state-of-the-art equipment to control the composition of the drinking water supplied and monitor correct wastewater treatment and disposal and the quality of the natural water bodies that receive it. The laboratory works with a quality assurance system certified by the National Standards Bureau (INN), according to the criteria laid down by the SISS. Moreover, it has been certified by the INN pursuant to the NCh ISO 17.025 standard as of 2004, which regulates the operation of national and international test laboratories. Esval’s laboratory has a total surface area of 915 m2, distributed on two floors containing the biological and chemical areas, with a total of 25 examination and analysis rooms. The large size of this building ranks it as one of the top laboratories in Chile to allow for a better
60
workplace. Two high value instruments, the atomic absorption spectrophotometer and a gas chromatograph, were recently renewed. They detect metal levels and organic products, respectively.
operation and from the final product. In the case of wastewater treatment, for example, this is measured based on the water quality of the receiver medium (rivers, brooks or the sea).
b. Process Control
Samples to measure process efficiency are obtained from:
Processes are controlled by means of samples that are taken at different stages of the
• Drinking water networks, to verify that the quality of the water received in households is compliant with the current regulation. TYPE OF ANALYSIS DRINKING WATER NETWORK BACTERIOLOGY
• Drinking water plants (PTAP), to control and assess the purification process undertaken during the production process.
ANNUAL Nº
TYPE OF ANALYSIS
ANNUAL Nº
53,024
PDAS BACTERIOLOGICAL ANALYSES
1.008 1,488
DRINKING WATER NETWORK TURBIDITY
26,512
PDAS CHEMICAL ANALYSES
DRINKING WATER NETWORK CHEMICAL ANALYSES
16.584 11,328 17.592
33,360
TOTAL PDAS ANALYSES
12,816
TOTAL DRINKING WATER ANALYSES
112,896
• Wastewater treatment plants (PDAS), where checks are made that discharges of waste into surface water courses meet the requirements laid down for these systems.
TYPE OF ANALYSIS PDAS BACTERIOLOGICAL ANALYSES
ANNUAL Nº 1,488
PDAS CHEMICAL ANALYSES
11,328
TOTAL PDAS ANALYSES
12,816
• Marine outfalls and seawater, to verify that these systems do not generate fecal contamination of the coastline, mainly on the beaches of the entire coastline in the region from Llolleo to Papudo.
TYPE OF ANALYSIS
ANNUAL Nº
MARINE OUTFALL & COASTLINE BACTERIOLOGICAL ANALYSES
2,676
MARINE OUTFALL & COASTLINE CHEMICAL ANALYSES
5,526
TOTAL MARINE OUTFALL ANALYSES
8,202
• Liquid industrial waste (RILES) discharged into Esval’s collectors, to assure they comply with Supreme Decree 609 and allow for the suitable operation of collectors and wastewater treatment plants.
TYPE OF ANALYSIS
ANNUAL Nº
CHEMICAL ANALYSIS OF RILES
1,128
TOTAL ANALYSES
1,128
Es v al S us t ainabilit y Repor t 2009
61
03
Customer Relations
All these analyses are part of the following approximately 15 control programs of different periodicity, which are controlled by bodies like the SISS, the Health Ministry and the General Directorate of Maritime Territory and Merchant Navy (DIRECTEMAR), among others. 1. Bacteriological control program and drinking water network disinfection. 2. Bacteriological control program of surface water and groundwater sources (pursuant to the Nch 409 standard and SISS). 3. Chemical control program of drinking water networks. 4. Chemical control program of surface water and groundwater sources. 5. Bacteriological control distribution tanks.
program
of
6. Fluoridation control program of drinking water networks. 7. Fluoridation control program of production subsystems. 8. Bacteriological control program wastewater treatment systems.
of
9. Chemical control program of wastewater treatment systems. 10. Bacteriological control program of seawater - effluents, beaches, marine environment (PVA) - of the areas where collectors that discharge into water bodies operate. 11. Chemical control program of seawater – effluents, beaches, marine environment.
62
12. Direct control program of discharges of liquid and solid industrial waste (RILES) at industries that discharge into our sewer system. 13. Control program of solid waste of wastewater treatment plants. 14. Physical and chemical follow-up programs of production systems.
• Data logger equipment programming and installation on macro meters to measure the flow. • Data logger equipment programming and installation in the drinking water network to measure the pressure.
15. Raw material quality control program.
• Installation of portable electronic equipment and Doppler flow meters in wastewater piping. These are used to contrast fixed pressure main pump flow meters.
c. Technology
• Metal detector to detect metal sewer drain covers and valve rings underground.
The operating work of all the company’s processes is supported by new technologies that have been incorporated to the processes, like:
• Television inspection to review and diagnose the inside condition of collectors and household connections.
• Portable meter to assess the flow of wastewater in sewer drains, and it is also useful for open wastewater channels and unprocessed water courses.
• State-of-the-art atomic absorption spectrophotometer for multi-parameter measurement and automatically-controlled gas chromatograph added to Esval’s laboratory.
• Noise loggers, which indicate what stretches of the drinking water network have leakages.
• Pilot ozone testing at the Peñuelas plant to eliminate the organic parameters.
• Metal piping finder to locate all the underground piping and identify the laying of other services (electricity, telephony, gas, etc.), preventing unnecessary road surface breakage. • Acoustic correlator to detect where there are drinking water network leakages.
03.5
SUPPLIER RELATIONS Esval’s relationship with its suppliers is handled directly by the finance and administration management through the contracts area and procurement department. The Company has not laid down policies or guidelines explicitly establishing Esval’s form of relationship and the way of working with its suppliers. Nevertheless, all critical product suppliers from the environmental standpoint shall be governed by the guidelines in force
for their transport and unloading. Such guidelines control correct product labeling and handling and suitable information on their composition to be able to act efficiently in any emergency. Compliance with these guidelines is controlled by Esval’s personnel by means of a Verification of Environmental Aspects log at the time of transporting and unloading these kinds of products. Suppliers of critical goods are recorded and classified according to whether they have
ISO 9001, ISO 14001 and/or OSHAS 18001 certification. In addition, such suppliers are subject to a monthly assessment process, which considers criteria like meeting deliveries, product quality and after-sales service. For the rest of the goods or services purchased by the Company, suppliers are only selected based on technical and financial assessments, on economic advantage and/or the delivery conditions of the good or service. 90% of the Company’s suppliers were Chilean in 2009, and purchases from foreign suppliers were only made in specific cases. Nevertheless, there is no explicit guideline giving priority to purchases from Chilean companies.
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04 04.1 OUR EMPLOYEES Esval strives so that for its employee relations each person in the organization can attain high professional development in an environment of wellbeing and safety. All the organization’s managements are accountable for achieving this transversal aim of the company and the programs related to this area, including compliance with labor legislation and respect for human rights. This work is led and coordinated by the human resources management. In 2009, this management focused on improving the organizational environment, which included implementing a formal system to measure the internal climate. A qualitative and quantitative assessment methodology was designed for this, and different plans were also drawn up to boost the internal communication of each area. Complementing
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Employee Relations
this, “human resources workshops” were held for all Company staff and they will be outlined below. The highlight of this area’s management was securing certification pursuant to the OHSAS 18001:2007 international standard in February, which distinguishes Esval as a company that is concerned about the safety and health of all the work of its employees. The human resources policy includes a series of commitments to develop good practice in employee and collaborator relations: • Incorporation and Provision: related to the processes of induction, staff selection and encouraging the internal hiring of staff. • Payment and Organization: its focus is to pay salaries and incentives and maintain
a horizontal-type organizational structure. It considers the description, analysis and assessment of job positions, performance evaluations and remunerations.
• Training and Development: related to the competencies of employees and their personal and professional development.
conduct required by Esval. The Company’s main recruitment source is its own staff, enabling the growth and professional development of those who are already part of the organization.
• Health and Wellbeing: focused on improving the quality of life of employees and their families. • Quality: aimed at the job position structure, service quality and supplier relations. Esval undertakes detailed selection processes to hire its employees, as it deems this is the best way of guaranteeing fair opportunities to people and work teams. Formal procedures have been established for the recruitment and selection of new employees and induction processes related to values, regulations and
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04
Employee Relations
04.2 GENERATING QUALITY
Employee Breakdown by Level
EMPLOYMENT
Esval’s workforce amounted to 360 employees for the year ended December 31, 2009, 1.97% down on that in 2008. This decrease was mostly due to employees retiring in the operations area and to the existence of some vacancies at the end of the year. The average age of employees was 45.73 years. Esval generated approximately 1,334 indirect jobs (more than three million manhours) by hiring services, which was a 6.7% increase on 2008. This was mainly due to greater coverage of some services.
Levels
2007
2008
2009
Administrative
27
26
25
Executive
8
8
8
Middle Management
35
33
42
Workers
77
79
71
Professionals
120
125
118
Technicians
111
96
96
Total
378
367
360
Employee Breakdown by Organizational Level Employee Percentage by Organizational Level
66
2007
2008
2009
Senior managers and executives
2%
2%
2%
Professionals and technicians
70%
69%
71%
Administrative and Workers
28%
29%
27%
Job Positions Filled By Men & Women (2007-2009) 100% 90%
15%
17%
16%
Men
Employee Percentage
80%
Women
70% 60% 85%
50%
83%
84%
98% of the Company’s total workforce has an indefinite contract. It should be highlighted that Esval offers formal and attractive working conditions that are in keeping with the labor market, aimed at allowing for the permanence and development of the potential of each person. Employees have payment, compensation and incentive schemes in keeping with the market that generate stability. These incentives contribute towards staff achieving the Company’s objectives and adopting appropriate conduct that improves operations.
40% 30% 20% 10% 0% 2007
2008
2009
Years
Total Company Workforce by Type of Contract TYPE OF CONTRACT
2007
2008
2009
INDEFINITE
376
360
356
FIXED-TERM
2
7
4
378
367
360
Total
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04
Employee Relations
Initial Company versus Minimum Legal Wage Ratio YEAR
ESVAL MINIMUM WAGE
LEGAL MINIMUM WAGE
VARIATION OR RATIO
2007
331,274
144,000
130%
2008
372,319
159,000
134%
2009
410,195
165,000
149%
The average of the total annual taxable amount paid was considered to calculate them.
Benefits for All Employees: • Health: Preventive health checkup and advice on collective health insurance company (ISAPRE) plans. • Social service: Professional service concerning health, housing, the family, education, etc. • Allowances: • Severance payment with no legal limits25.
68
25
• Half-yearly salary readjustment according to the Consumer Price Index (CPI). • Payment of nurseries and day-care centers for children of up to 4 years old. • Salary complement certificate.
due
to
medical
• Leave of absence without pay. • Social security and prevention: Ongoing advice on retirement due to age and disability and choice of voluntary social security saving.
This is a benefit for unionized workers and a percentage of non-unionized workers depending on years of service.
• Sports, recreation and culture: Encouragement to play sports, holding of internal competitions, participation in inter-company tournaments and recreational workshops. • Agreements: Coverage of hospital, medical and dental care, agreements with sports establishments, gymnasiums and opticians.
04.3 TRAINING, DEVELOPMENT AND EMPLOYABILITY
The development of people in the Company is aimed at suitable management of knowledge, performance excellence and the ability to interact. To attain this, organizational environments are created that promote the development of technical, professional, work and personal aspects. Esval thereby seeks to drive teamwork, develop participative systems and above all encourage creativity and participation in the continuous improvement of the entire organization. This is part of the so-called human development project. E-learning was added to the traditional learning methodologies in 2009. Complementing this, it has been made easier for employees to participate in different
classroom training workshops to reduce the levels of stress and improve their health and quality of life. For Esval, further development courses are a significant way of developing people as they drive new abilities and skills that consolidate their employability and promote a service spirit. A major highlight is the holding of the annual day event for all Company personnel called human resources workshops, which this year was focused on two core elements for the Company: a “pleasant environment” and “innovation.” 185 courses and seminars were held in 2009, which covered all the Company’s employees. The 17,272 hours of training given were equivalent to an average of 47.4 hours per employee a year, which means that training accounted for around 2.2% of collaborators’ working day.
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04
Employee Relations
2008 TRAINING AREA
2009
26
Hours
%
1,611
10.09%
SIG Environment
33
0.21%
SIG Quality
443
2.77%
3,781
23.68%
8,983
56.26%
Integrated Management System (SIG)
SIG Occupational Safety & Health Update Professional Development
Hours
%
1,467
8.49%
2,156
12.48%
3,706
21.46%
4,298
24.88%
Personal Development
1,117
7.00%
5,645
32.68%
TOTAL
15,968
100.00%
17,272
100.00%
It should be highlighted that the training leftover from 2008 was used to hold four social scholarship courses sponsored by Esval and given by the Intermediate Technical Training Body (OTIC) of the Chilean Chamber of Construction. Such courses were: plumbing and sanitary installations, laminated flooring, cake-making and pastrymaking. These courses benefitted a total of 100 unemployed people or with incomes equivalent to the minimum wage.
70
The training area categories were changed in late 2008, and the data was adapted to make the best possible comparison of 2008 and 2009.
26
04.4 OCCUPATIONAL HEALTH AND SAFETY
Regarding occupational health and safety, an occupational health and safety management system (SST) was implemented so the organization can control its risks and improve performance. The key objective is to eliminate or minimize risks to employees and other interested parties who might be exposed to work-related hazards. The following are the current programs to achieve this, among others: Implementation of OHSAS 18001 • A hazard identification matrix was made, the risks were assessed and controls set up.
• The occupational health and management system was compiled.
safety
• Procedures, documents and guidelines, among others, were aligned with the ISO 14001 and 9001 standards. • Training of plant personnel and contractors. • Intranet implementation of the daily question form on the standard for all the personnel in the organization. Health Action
• Training on breathing and hearing protection, “safe breathing” campaign. • Pre-occupational exams. Contactors must also adhere to Esval’s safety standards, and guidelines in line with the OHSAS standards are added to service contracts. There is also ongoing training and assessment of compliance with safety standards. A company controls labor, quality and safety issues and is constantly auditing the good execution of contracts in these areas.
• Pause gymnastics. • Comprehensive health workshop on Pilates Yoga. • Sports and recreation for a healthy life.
Exclusive Risk Prevention Training (Man-Hours) ontrato
2007
2008
2009
ESVAL S.A.
2,181
3,719
2,156
CONTRACTORS
15,493
19,263
11,558
TOTAL
17,674
22,982
13,714
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04
Employee Relations
04.5 LABOR RELATIONS
Esval’s Lost-Time Accident and Accident Rate (2007-2009) ontrato LOST-TIME ACCIDENT RATE* ACCIDENT RATE**
2007
2008
2009
26.32%
18.70%
57.00%***
2.9%
2.4%
2.2%
The Company’s union relations are characterized by an environment of cooperation and respect between the parties, and periodic work meetings are held throughout the year as part of the Labor Relations Commission, which reflects the value employees hold of labor conditions at Esval.
*Lost-time accident rate (total): average lost-time accident rate due to temporary disability + lost-time accident rate due to disability and death (pursuant to Supreme Decree 67).
There were two collective bargaining processes in 2009, involving three Company unions. These were completed before the legal deadlines with the signing of two collective contracts that were satisfactory for the parties. They will be effective September 1, 2009 through August 31, 2011, both dates inclusive.
**Accident rate: number of work accidents/average workers divided by 100 in 12 months. ***This is under appeal in the Superintendency of Health Services.
Parity Committees Esval has four parity committees: Southern Coastline Committee, Central Level Committee, Quillota-San Felipe/Los Andes Committee and the Valparaíso Operations Committee. The essential actions of these committees include monthly and extraordinary meetings, and specific work schedule activities like planned inspections, remarks on behavior, investigation of incidents, studies and design of products for prevention campaigns. The activities of the four hygiene and safety parity committees in 2009 were focused on boosting and supporting the risk prevention management in implementing the OHSAS 18001 standard.
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Level of Unionization 2008-2009 2008
2009
UNION Nº1
132
125
UNION Nº2
40
51
PROFESSIONALS & DEPARTMENT HEAD UNION
39
38
UNIONIZED TOTAL
211
214
UNIONIZED %
58%
59%
NON-UNIONIZED
156
146
04.6 CONTRACTORS Esval considers its contractor relations to be part of its ethical and transparency principles. This means providing permanent, clear, and timely information on issues like tender processes, requirements, compliance and performance evaluations. The company’s commitment to contractors is clearly embodied in Esval’s Quality, Environment, Occupational Safety and Health Policy. Among other issues, this sets forth the need of: “Gradually committing its contractors and suppliers so their quality, environmental, occupational health and safety performance is commensurate with the guidelines of this policy in regard to the activities and services they provide to the organization.” Esval deems contractors to be all those companies that provide services related to processes or specialized tasks that are a part of the service chain of this water utility. The Company hires these services provided they contribute to the efficiency of the operation and can be strictly measured according to quality standards. For greater clarity, the terms of the services and requirements between the parties are
27
always expressly governed by a civil contract. For these effects and purposes, Esval has a contract management system, whose aim is to guarantee the good operation of this work system and safeguard compliance with labor and safety laws, among other significant aspects. The following are some elements of this system that should be highlighted: • The contracts assistant management, which reports to the finance and administration management, lays down the regulations, and plans, organizes, executes and controls the drawing up of such contracts in ongoing coordination27 with different areas and managements. • The tender bases have been standardized according to categories or modalities. • There is internal contract control with the presence of the operating coordinator27, who belongs to the management receiving the service. He is in charge of establishing its quality controls and safeguarding suitable compliance with the contractual bases.
• The Company supports different training and updating programs for contractor companies, irrespective of the responsibility of each contractor company for training its own workers. • To comply with Esval’s occupational health and safety standards, contractors shall adhere to the Special Regulation for Contractor and Subcontractor Companies, which commits them to being more self demanding on these issues and to complying with current legislation. Esval had contractual relations with 53 contractor companies in 2009, through which it generated 1,334 indirect jobs.
• A specialized company undertakes systematic audits of contractor compliance with labor legislation and safety regulations, which are independent of other controls Esval undertakes on these issues and regarding quality.
Professional who acts as counterpart representing the principal. Es v al S us t ainabilit y Repor t 2009
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05 05.1
COMMUNITY Community relations are a key factor for Esval because of the vital importance and impact of the sanitary service on the quality of life of people, their health, wellbeing, and therefore on the economic development and environmental sustainability of the Valparaíso Region. Its objective in this relationship is to forge open, fluent and harmonious relations. General management is responsible for meeting this aim, with the collaboration of the corporate management area, commercial management and operations management. Work in 2009 was focused on disseminating the benefits of cleaning up beaches and rivers so the significance of Esval’s contribution to people’s quality of life is valued. The key message of the annual campaign was “Taking care of water depends on you
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Community Relations in the Region
and me,” and the aim was to awareness that taking care of the environment is the shared responsibility of the Company and community as a whole.
• VI CONICYT Explora School Congress of Sciences and Technologies, organized by the Pontifical Catholic University of Valparaíso jointly with the CONICYT Explora program, held in Valparaíso.
The main efforts were focused on school education, and in 2009 extending the healthy life concept pursued in 2008 to transmit the message of taking care of the planet.
• National environmental certification system of schools in Quillota, organized by the Municipality of Quillota jointly with the CONAMA.
Partnerships were also entered into with the public sector with this same objective. Esval signed a collaboration agreement in June with the National Environmental Agency (CONAMA) of the Valparaíso Region, whose aim was to drive favorable habits in preserving the natural environment by means of municipal and community activities, and health shows.
• First regional environmental education meeting of biodiversity experiences on diversification and climate change, organized by the Laguna Verde Corporation and sponsored by the CONAMA of the Valparaíso Region, Environmental Protection Fund, CONICYT Explora, PNUD-VE joint program to fight desertification. It was held in the city of Valparaíso.
The Company also participated in various activities to promote the care of the environment, highlighting the following:
• Inter-school environment tournament in San Antonio, organized by the environmental department of the Municipality of San Antonio. As in previous years, in 2009 Esval supported and participated in various recreation, health and cultural activities throughout the region. The campaign to bolster community awareness about the importance of taking care of the environment, natural water sources and the sea is expected to continue and increase in 2010. This is understood as a shared responsibility which is why we get actively involved in it.
• Seminar on methodologies for environmental education in schools, organized by the department of culture of the Municipality of San Antonio.
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05
Community Relations in the Region
Healthy Water, Healthy Life Campaign The “Healthy Water, Healthy Life” campaign was launched in 2002 to get Esval and its operations closer to the community and act as a bridge of assistance for the neediest. It is currently striving to transmit messages on taking care of the planet, water and its importance in life. As reported in the 2008 report, Esval carried out various activities in 2009 as part of this campaign, including the following:
1. Playful educational presentation in schools, day-care centers and centers for the elderly. 2. Activities in centers for children whose mothers are seasonal workers. 3. Educational workshops. 4. “Door-to-door” activities. 5. Participation in public events related to the community. 6. Health programs.
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1
Playful Educational Presentation
By means of a short play with music and motivating elements for children, Esval made presentations in municipal, subsidized and some private schools, aimed at transmitting a message of taking care of the environment around us, the planet and water. EDUCATION TOTAL YEAR
TOTAL CONTACTS
2009
43,618
2008
79,409
2007
96,296
of this children’s painting competition, organized by the Municipal Corporation of Valparaíso, with an invitation to all municipal schools.
•
Christmas Competition: As is tradition, primary education children at schools that received the Healthy Water, Healthy Life campaign participated in a children’s painting competition organized by Esval. This time the topic of the competition was “Taking Care of the Environment with Esval’s Water Drops.” The winning paintings in the competition were used on Christmas cards that Esval sent out to greet the community.
2 There was a drop in the number of contacts with schools in 2009 for two main reasons. Firstly, the Company made the decision to increase community contact by holding more educational workshops with social organizations, such as mothers’ centers, the elderly and neighbors’ committees. The second reason was due to fewer activities in municipal schools on account of a series of strikes in the year. Esval also promoted activities to further artistic creativity in schools: • Come to Valparaíso Competition: The Company was one of the main sponsors
Activities at day-care centers for children whose mothers are seasonal workers
For the fourth year running, Esval participated in centers, which the National Department for Women (SERNAM) opens every summer to look after the children of mothers who are seasonal workers, by making recreational and educational visits. This educational work, coordinated with the directors of the community development departments of the various municipalities in the region, also helped children learn more about taking care of the environment and the relevance of water in preserving it.
3
Educational Workshops
Esval holds educational workshops, especially aimed at the social organizations in the region. “Use and importance of water for life,” “Care of hydrants,” “100% cleanup of the Valparaíso Region” and “Care of sewerage systems” were the main topics addressed in 2009. 4
Door-To-Door Activities
Door-to-door activities are used to inform customers and the community beforehand about the benefits and impacts of different works the Company undertakes. This personalized contact, which also includes meetings with the respective neighbors’ committees and communal associations, allows neighbors to find out about the main developments being carried in their sector, and to get answers to their queries. In 2009, the campaign teams personally informed of situations like: scheduled drinking water cuts, sanitary network enhancement works, construction of drinking water tanks, renewal of mains, and connection to new services, among others. DOOR-TO-DOOR ACTIVITIES
2007-2009 2007
2008
2009
9,858
9,960
4,752
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05
Community Relations in the Region
A new strategy was implemented in 2009 to boost communication in areas where large mains renewal work needs to be undertaken. Contact was made in such areas before, during and after the construction of works, which involved the same person being visited three times but this was only recorded as one contact, and the number of door-to-door visits therefore dropped in the period.
5
Health Programs
Another activity of the campaign was attending numerous shows, where training was given on health issues, with the education and nutrition departments of the walk-in clinics in the region. The messages transmitted were related to hygiene, healthy eating and information on the clean-up of beaches.
Public Events
Most of the campaign activities require ongoing coordination with the regional and provincial government, municipal authorities and other services, which channel efforts into the most important needs in the region. The various public activities in 2009 with Esval’s participation included: • Support of winter schools, driven by the regional government to train social leaders. • Collaboration with governors’ offices on the “Gobierno Más Cerca” (Closer Government) program. • Coordination with the Regional Ministerial Secretary of Education to bolster the educational emphasis of the campaign
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6
Summary of Site Activities in the Valparaíso Region 2007-2009 YEAR
OFFICES
EDUCATION AREA
COMMUNITY
TOTAL CONTACTS
2009
20,170
43,618
112,653
176,441
2008
22,005
79,409
94,304
195,718
2007
28,101
96,296
68,879
193,276
The drop in site activities in 2009 is mainly explained by fewer door-to-door contacts and activities with schools, as explained above. Nevertheless, there was an increase in the number of activities with the community, which enhanced the information on customer insight, complaints and opinions.
LEVEL
GOVERNMENT BODY
PROGRAM/ PROJECT
TYPE OF SUPPORT/ ESVAL’S PARTICIPATION
INTENDENCY
“HIGH-RISK SECTORS” GOVERNMENT PROGRAM
TECHNICAL SUPPORT
GOVERNOR’S OFFICE
CLOSER GOVERNMENT PROGRAM: ITS OBJECTIVE WAS TO INFORM, DISSEMINATE AND COMMUNICATE THE REGIONAL GOVERNMENT’S PUBLIC OFFERING TO THE COMMUNITY, INCLUDING PROJECTS AND PROGRAMS OF PUBLIC SERVICES AT REGIONAL LEVEL
PARTICIPATION IN VARIOUS ACTIVITIES
REGIONAL MINISTERIAL SECRETARY OF HEALTH
CLEAN HANDS CAMPAIGN: THE OBJECTIVE WAS TO PREVENT AN OUTBREAK OF INFECTO-CONTAGIOUS DISEASES
SUPPORT THROUGH THE HEALTHY WATER, HEALTHY LIFE TEAM AND CAMPAIGN
REGIONAL MINISTERIAL sECRETARY OF EDUCATION
ENVIRONMENTAL ACTIVITIES
SUPPORT OF THE VARIOUS ACTIVITIES UNDERTAKEN
NATIONAL ENVIRONMENTAL AGENCY, VALPARAÍSO REGION
“TAKING CARE OF WATER DEPENDS ON YOU AND ME” CAMPAIGN
COLLABORATION AGREEMENT TO DRIVE GOOD HABITS ON PRESERVING THE NATURAL ENVIRONMENT
WORKING ROUNDTABLES (COMPRISING ESVAL, THE TERRITORIAL DELEGATES OF THE MUNICIPALITIES AND COMMUNITY REPRESENTATIVES)
FOCUS ON EXCHANGING IDEAS AND EXPERIENCES TO IMPROVE COMMUNICATION AND MAKE PROGRESS WITH RESOLVING THE CONCERNS AND/OR PROBLEMS OF COMMUNITY REPRESENTATIVES (MAINLY COMMUNAL ASSOCIATION LEADERS)
Regional
05.2
PUBLIC-PRIVATE PROGRAMS TO SUPPORT REGIONAL DEVELOPMENT As stated in the Company’s mission, the development of its business must make a contribution to the community regarding health, quality of life, conservation of the environment and regional development. Regarding this, Esval participates in and supports the implementation of numerous public projects benefiting the region’s development, as outlined below.
Municipal
TERRITORIAL DELEGATES OF THE MUNICIPALITIES
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06 All the managements are accountable for meeting Esval’s economic performance objectives. The finance and administration management is in charge of appraising the degree of compliance of each area and giving them periodical information about their work. Esval’s net earnings amounted to CLP83.256 billion in 2009, 4.7% up on earnings of CLP79.358 billion in 2008. Net income was CLP22.477 billion, 11.8% up on the CLP19.819 billion of the previous year. Income was driven by a 3.9% increase in operating income from CLP27.921 billion in 2008 to CLP29.054 billion in 2009, largely due to increased operating earnings on account of a higher average tariff compared with 2008. A further contributing factor was the 65.9% drop in income tax from an expense of CLP4.480 billion in 2008 to CLP$2.701 billion in 2009, due to lower deferred tax.
80
Contribution to Regional Economic Development
2009 Investments In 2009, Esval continued to expand the drinking water supply and also to maintain assets and renew networks. Esval’s total investment CLP16.454 billion in 2009.
amounted
INVESTMENTS (expressed in millions of Chilean pesos)
2009
2008
2007
DRINKING WATER PRODUCTION & DISTRIBUTION
9,866
13,269
16,138
WASTEWATER COLLECTION
3,152
3,324
2,201
WASTEWATER TREATMENT
1,337
774
1,334
OTHER INVESTMENTS
2,099
3,181
2,556
TOTAL INVESTMENTS
16,454
20,548
22,229
to
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06
Contribution to Regional Economic Development
PROJECTS
ThCLP$556,241 to provide the community with a top class service.
Conveyance of Drinking Water to the Northern Coastline
Moreover, the towns of Horcón and Chocota solved their water supply quality and regularity problems due to interconnection to these works.
Due to the need of continuing to support the development and growth of the Valparaíso Region, in 2009 new communities on the northern coastline benefited from the investment made 2003 through 2008 with the conveyance of drinking water from the production plant on the Aconcagua river, district of Concón, to the district of Zapallar. The La Laguna-Cachagua conveyance stretch was built in 2009, which boosted the water supply to the towns of Cachagua and Zapallar, adding the real estate subdivisions and projects present in the sector. ThCLP$1,226,984 was invested in these works with the installation of 5,186 meters of piping. Likewise, a 200-cubic meter semi-buried tank was built in the city of Puchuncaví and 6,296 meters of piping at an investment of
82
Tank on the La Isla Housing Estate in Valparaíso Regarding this, a 300-cubic meter semiburied tank was built to resolve the water supply problems of the La Isla housing estate in Valparaíso. These works have already been completed and the project had a cost of ThCLP$238,026, which included a 732meter adduction, the design, construction, inspection and others. It will benefit 3,500 people.
Network Renewal Once the large works had been completed, the Company renewed networks. In accordance with the development plan
committed with the authorities, work was done in virtually all the districts of the concession area in 2009, at an investment of ThCLP$5,307,784, to modernize 50,000 meters of network. Moreover, the construction of 12,000 meters was brought forward, at an investment of ThCLP1,581,560. 40,000 meters were renewed in the districts of Greater Valparaíso, where almost 70% of the population lives. 7,400 meters were renewed in the province of Quillota, 9,600 meters in the provinces of San Felipe and Los Andes, and 5,000 meters in the province of San Antonio.
Treatment Plant Construction and Expansion The Company is ready to assume the increase in demand for its different services and as such in September started to expand the wastewater treatment plant in Cachagua. CLP792 million have been invested in this project to undertake the civil works, provide equipment, hydraulic interconnection and sheds.
06.1 ECONOMIC VALUE GENERATION
The economic value generated by Esval in 2009 amounted to CLP87.350 billion and the economic value distributed was CLP88.665 billion, which was a CLP1.315 billion drop in economic value generation, mainly due to higher operating costs. This was a 66.5% improvement on the -CLP3.923 billion in 2008. This was mainly explained by a lower return to shareholders on account of lower net income in 2008 (the final dividend was decided in 2009). Regarding the economic value distributed, it can be seen that the Company’s operations generated value for its goods and services suppliers, its contractors, employees, shareholders, financial creditors, the community and treasury.
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06
Contribution to Regional Economic Development
Economic Value Generated & Distributed 2007-200928 ECONOMIC VALUE GENERATED (1) EARNINGS (2)
2009
2008
2007
87,350.419
83,636,694
84,316,472
LESS ECONOMIC VALUE DISTRIBUTED OPERATING COSTS
45,899,226
43,488,008
39,434,143
PURCHASE OF GOODS
11,149,645
10,921,062
7,524,101
PAYMENT OF SERVICES HIRED
19,561,456
18,171,830
17,429,338
OTHER OPERATING COSTS
15,188,125
14,395,115
14,480,705
EMPLOYEE SALARIES
7,557,204
7,277,752
7,232,246
PAYMENT TO CAPITAL SUPPLIERS
33,553,240
35,978,987
30,021,410
DIVIDENDS
20,153,306
23,192,046
17,281,278
DEBT INTEREST
13,399,934
12,786,942
12,740,132
PAYMENTS TO THE TREASURY (3)
1,443,592
660,421
1,292,866
211,844
154,035
110,971
-1,314,687
-3,922,509
6,224,836
INVESTMENT IN THE COMMUNITY (4) ECONOMIC VALUE WITHHELD
(1) Drawn up on an accrued basis. (2) Include operating earnings, financial income and other non-operating earnings. (3) Include 1st category income tax, tax on rejected expenses, commercial licenses, land tax, stamp duties and others. Exclude deferred taxes (4) Include donations and the Healthy Water campaign expenses, stated in the item Corporate Image.
84
All the values are stated in millions of Chilean pesos as of December 2009, and the economic value generated figures were drawn up according to generally accepted accounting principles.
28
Economic Value Withheld Community Investment Operating Costs Employee Salaries
Economic Value Distributed 2007-2009
Dividends Debt Interest
110%
Payments to the Treasury
100% 90% 80%
06.2
52.0% 46.8%
52.5%
70%
Chilean legislation lays down that water utilities “that act in a natural monopoly” shall be subject to the supervision and regulation of the Superintendency of Sanitary Services (SISS). This is a functionally decentralized legal entity with its own equity, which is subject to the supervision of the President of the Republic through the Ministry of Public Works. Its function is to guarantee that these services are provided to the population in the quantity, quality and at the price offered, with continuity in the long term. It must also verify that wastewater is treated and disposed of in keeping with sustainable development.
60% 50% 40% 30%
1.5%
0.8%
20.5%
27.7%
1.7% 23.1%
0.1% 15.1%
20% 10%
0.2%
0.2%
15.3%
15.3%
8.7%
8.7%
-4.7%
-1.5%
8.6% 7.4%
0%
Esval and other water utilities are also subject to the provisions of various laws and regulations, and the main ones are as follows:
-10% 2007
2008
A REGULATED BUSINESS
2009
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06
Contribution to Regional Economic Development
Tariff system in the water utility sector
30
86
DOCUMENT
D.F.L.29 MOP30 Nº382
General Sanitary Services Law (updated at July 2005)
1988
D.S31 MOP Nº1199
Regulation of the General Sanitary Services Law
2004
D.F.L. MOP Nº70
Law on Sanitary Service Tariffs
1988
D.S. MOP Nº214
Regulation of article 67 of D.F.L. MOP Nº382/88
2005
D.S. MINECON32 Nº453
Regulation of the Law on Sanitary Service Tariffs
1989
D.S. MINECON Nº385
Regulation on the Designation and Operation of Expert Commissions
2000
D.S. MOP Nº1305
Regulation on Share Expropriation
2001
Law Nº18.902
Law Establishing the Superintendency of Sanitary Services
1989
Law Nº19.821
Modifies Law Nº18.902 and repeals Law Nº3.133
2002
Law Nº18.778
Subsidy Law on the payment of drinking water consumption and sewerage services
1989
D.S. Nº195 Treasury
Regulation of the Subsidy Law
1998
D.S. MOP Nº50
RIDAA – Approves the Regulation on Domestic Drinking Water and Sewers
2002
Statutory Decree Ministry of Public Works 31 Supreme Decree 32 Ministry of Economy 29
ENACTMENT DATE
DECREE/LAW
The most economical solution a community can have for the provision of its sanitary service is for this to be provided exclusively by one company, as it would not be efficient for there to be piping networks of various companies installed in the streets, as is the case for other public services like telephony. Hence, an efficient sanitary service for a community is a monopolistic service. To ensure that water utilities, due to their monopolistic nature, do not establish their prices unilaterally and thereby avoid undue tariffs and charges to customers, the State has laid down a series of laws and regulations defining how such tariffs should be calculated and established, and core legislation is the Law on Sanitary Service Tariffs (Statutory Decree Nº70, Ministry of Public Works of 1998) and its Regulation (Supreme Decree Nº453, Ministry of Economy of 1990). Pursuant to these laws, tariffs are calculated every five years by means of a process undertaken by the SISS and in which the water utility participates. These tariffs are calculated based on a “model” water utility,
which provides sanitary services according to the real conditions of the locality but whose infrastructure is designed optimally. The optimal operating and maintenance expenses based on this infrastructure model are also considered. It similarly considers the other expenses of this model company, like the commercial and administrative costs needed for its operation. This means that any possible inefficiency of the real company is eliminated so that the costs and expenses included in a tariff are only the minimal and efficiently necessary to provide the service and not transfer higher costs to customers due to the inefficiencies of the real company. In accordance with law, the tariff process starts one year before the tariff term expires. The process commences when the SISS publishes the preliminary bases of the study, which set forth the methodologies, criteria and standards for calculating tariffs. It also defines the information it will require from the company to make its calculations. After a process of the water utility reviewing and making remarks about the preliminary bases, the SISS publishes the final bases and one month later the water utility must provide all the data for tariff calculation. With this information, the SISS makes its tariff
calculation. At the same time, the water utility makes its own tariff calculation study. Five months before the end of the tariff period, the SISS and water utility exchange their studies. If the water utility does not agree with the results of the SISS study, it can raise discrepancies of each point it disagrees with in a detailed and accurate way. The SISS shall have a legal 15-day term to review the discrepancies with the water utility and reach a tariff agreement. If this occurs, this leads to the end of the process and the publication of the new tariffs. Should no agreement be reached, the discrepancies shall be resolved by a commission of three experts, with one designated by the SISS, another by the water utility and a third party, designated by the SISS based on a list agreed on beforehand with the water utility. The verdicts of this commission shall determine the final tariffs and there shall be no appeal.
series of “other charges” related to providing the sanitary service, including the following: service suspension and reconnection charge for not paying the bill, meter verification charge, hydrant maintenance charge, charge for the direct control of liquid industrial waste, and a project review charge. The tariff decree also includes the formulae for updating the tariffs according to the Consumer Price Index (CPI) variation and two other price indexes to compensate for the higher costs of the water utility in providing the service. The tariff review processes were completed for 23 concessionaires in 2009, including Esval. The agreement reached led to maintaining the tariffs for the 2010-2015 period in the Valparaíso Region.
Lastly, the final tariffs are published in the Official Gazette by means of a Decree of the Ministry of Economy, Production and Tourism, containing the following tariff charges: variable charges for drinking water consumed, variables charges for wastewater collected and treated, and the standing charge per customer. It also establishes a
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88
2009 Commitments and 2010 Challenges
AREA
2009 TARGET
2009 PERFORMANCE
2010 TARGET
ENVIRONMENT WASTEWATER DISCHARGES INTO WATER BODIES DUE TO FAULTS OF WASTEWATER TREATMENT PLANTS (PDAS) AND PUMPING STATIONS (EEAS)
NO WASTEWATER DISCHARGES INTO WATER BODIES.
TARGET ATTAINED
NO WASTEWATER DISCHARGES INTO WATER BODIES.
TARGET NOT ATTAINED ENERGY SAVING IN ADMINISTRATIVE AND COMMERCIAL BUILDINGS
HANDLING OF HAZARDOUS WASTE
REDUCE ENERGY CONSUMPTION (KW) IN THE COMPANY’S ADMINISTRATIVE AND COMMERCIAL BUILDINGS BY 5%.
SECURE SANITARY AUTHORIZATION FOR 8 FLUORIDE CONTAINER STORAGE PLANTS.
ENERGY CONSUMPTION WAS REDUCED BY 3%. THE RESULT WAS BECAUSE IT WAS IMPOSSIBLE TO CARRY OUT ALL THE PLANNED ACTIVITIES.
TARGET PARTIALLY ATTAINED AUTHORIZATION OF 5 FLUORIDE CONTAINER STORAGE PLANTS WAS SECURED.
REDUCE ENERGY CONSUMPTION (KW) IN THE COMPANY’S ADMINISTRATIVE AND COMMERCIAL BUILDINGS BY 5%.
SECURE SANITARY AUTHORIZATION FOR THE 3 REMAINING FLUORIDE CONTAINER STORAGE PLANTS.
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07
2009 Commitments and 2010 Challenges
AREA
2009 TARGET
2009 PERFORMANCE
2010 TARGET
CUSTOMERS (PRODUCTS & SERVICES)
TARGET ATTAINED COVERAGE OF DRINKING WATER
DRIVE DRINKING WATER AND SEWERAGE SERVICE COVERAGE FOR NEW CUSTOMERS INCORPORATED DUE TO THE INSTALLATION OF ESSENTIAL PUBLIC SERVICES AND SERVICE CONNECTIONS TO THE NETWORK.
25 DRINKING WATER PRELIMINARY PROJECTS AND PROJECTS. 26 PRELIMINARY SEWAGE PROJECTS WHICH RESPECTIVELY ENABLE 563 AND 550 POTENTIAL CUSTOMERS NOT CONNECTED TO SUCH NETWORKS TO BE ADDED.
18 DRINKING WATER PRELIMINARY PROJECTS AND PROJECTS WERE DRIVEN, WHICH ADDED 287 POTENTIAL CUSTOMERS.
ADD 500 NEW CUSTOMERS TO THE SEWERAGE SYSTEM BY DEVELOPING THE MASS CUSTOMER INCORPORATION PROGRAM.
COVERAGE OF SEWERAGE SERVICE
UNDERTAKE 15 CONCEPTUAL STUDIES RELATED TO HIGH-RISK SECTORS.
27 PRELIMINARY SEWAGE SERVICE PROJECTS WERE DRIVEN, WHICH ADDED 724 POTENTIAL CUSTOMERS.
UNDERTAKE 6 CONCEPTUAL STUDIES RELATED TO SEIZED SECTORS.
*THE EXECUTION OF THESE PROJECTS REQUIRES EXTERNAL FINANCING THAT DOES NOT DEPEND ON ESVAL S.A.
CUSTOMER SERVICE REQUIREMENTS REGARDING NOISE AND ODORS AT ESVAL’S FACILITIES
90
RECORD A MAXIMUM OF 20 CUSTOMER SERVICE REQUIREMENTS FOR NOISE AND 45 FOR ODORS. UNDERTAKE 9 NOISE MITIGATION WORKS AT FACILITIES BY SOUNDPROOFING THEM.
TARGET ATTAINED THERE WERE 17 SERVICE REQUIREMENTS FOR NOISE AND 24 FOR ODORS. 8 NOISE MITIGATION WORKS WERE CARRIED OUT.
RECORD A MAXIMUM OF 20 CUSTOMER COMPLAINTS FOR NOISE. RECORD A MAXIMUM OF 40 CUSTOMER COMPLAINTS FOR ODORS. UNDERTAKE THE NOISE MITIGATION WORKS AT THE LOS MAITENES WASTEWATER TREATMENT PLANT.
AREA
2009 PERFORMANCE
2009 TARGET
2010 TARGET
SUPPLIERS AND CONTRACTORS
TARGET ATTAINED
DISSEMINATION ACTIVITIES OF THE INTEGRATED MANAGEMENT SYSTEM ON QUALITY, THE ENVIRONMENT, OCCUPATIONAL HEALTH AND SAFETY (SIG) FOR CONTRACTORS AND SUPPLIERS.
DRIVE ALL CONTRACTOR COMPANIES TO COMMIT TO THE SIG GUIDELINES BY MEANS OF ITS DISSEMINATION DEPLOYING THE ELEMENTS USED IN 2008 AND OTHERS, SUCH AS ACCESS TO ITS DOCUMENTAL MANAGEMENT SYSTEM.
THE FOLLOWING ACTIVITIES WERE CARRIED OUT: A CLAUSE WAS ADDED TO ALL WORKS, SERVICE AND CONSULTANT CONTRACTS, LAYING DOWN THAT THE CONTRACTOR SHALL TRAIN ITS WORKERS ON SIG ISSUES.
PROVIDE INDUCTION TO ALL NEW CONTRACTOR COMPANY PERSONNEL ON THE CORE ASPECTS OF THE SIG.
COMPLIANCE WITH TRAINING ON RISK PREVENTION AND SIG-RELATED ASPECTS WAS REVIEWED.
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08 GRI-G3 INDICATORS Profile INDICATOR
NUMBER
PAGE
1. STRATEGY & ANALYSIS 1.1
Statement from the CEO or most senior decision maker of the organization.
9-11
1.2
Description of key impacts, risks and opportunities.
9-11
2. ORGANIZATIONAL PROFILE
92
2.1
Name of the Organization.
12
2.2
Primary brands, products and/or services.
12-22
2.3
Operational structure, including main divisions, operating companies, subsidiaries and joint ventures.
12-22
2.4
Location of organization’s headquarters.
2.5
Number of countries in which the organization operates.
2.6
Nature of ownership and legal form.
2.7
Markets served.
2.8
Scale of the reporting organization.
16
2.9
Significant changes during the reporting period.
2
2.10
Awards received in the reporting period.
33
12 16
Esval only has operations in Chile
Cover & 29 17-19
Global Reporting Initiative (GRI) Index
INDICATOR
NUMBER
PAGE
3. REPORT PARAMETERS
REPORT PROFILE
3.1
Reporting period for information provided.
2
3.2
Date of most recent previous report.
2
3.3
Reporting cycle.
3.4
Contact point for questions related to the report or its content.
Annually 5
REPORT SCOPE AND BOUNDARY
3.5
Process for defining report content.
3-5
3.6
Boundary of the report.
3.7
State specific limitations on the scope or boundary of the report.
Not applicable
3.8
Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations and other entities.
Not applicable
3.9
Data measurement techniques and the bases for calculations.
3.10
Explanation of the effect of any re-statements of information provided in earlier reports.
3.11
Significant changes from previous reporting periods in the scope.
3.12
Table identifying the location of the standard disclosures in the report.
3.13
Verification
2
2-5 There was no restatement of information provided in earlier reports
2 93-102 103
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08
Global Reporting Initiative (GRI) Index
NUMBER
INDICATOR
PAGE
4. GOVERNANCE, COMMITMENTS & STAKEHOLDER ENGAGEMENT
94
GOVERNANCE, COMMITMENTS & STAKEHOLDER ENGAGEMENT
4.1
Governance structure of the organization.
4.2
Function of the highest executive officer.
4.3
State the number of members of the highest governance body that are independent and/or non-executive members.
4.4
Mechanisms for shareholders and employees to provide recommendations or direction to the highest governance body.
4.5
Linkage between payment for members of the highest governance body, senior managers, executives, and the organization’s performance.
4.6
Processes in place for the highest governance body to ensure conflicts of interests are avoided.
4.7
Processes for determining the qualifications and expertise of the members of the highest governance body.
4.8
Statement of mission, vision and values.
23
4.9
Procedures of the highest governance body for overseeing the organization’s identification and management of economic, social and environmental performance.
26
4.10
Processes for evaluating the highest governance body’s own performance.
25-30 25 25-26
Esval does not currently have this kind of mechanism.
Esval does not have these kinds of agreements.
Esval does not currently have these kinds of processes.
Esval does not have these kinds of processes to date.
Esval does not have these kinds of processes to date.
INDICATOR
NUMBER
COMMITMENTS TO EXTERNAL INITIATIVES
4.11
Explanation of how the precautionary approach or principle is addressed by the organization.
4.12
Externally developed economic, environmental and social charters to which the organization subscribes.
4.13
Memberships in associations.
PAGE
Esval’s quality, environmental, policy includes the pollution prevention principle, which concerns anticipating and avoiding events that certainly might cause pollution.
57-59, 79 32-33
STAKEHOLDER ENGAGEMENT
4.14
List of stakeholder groups engaged by the organization.
4-5
4.15
Basis for identification and selection of stakeholders with whom to engage.
24
4.16
Approaches to stakeholder engagement, including frequency of engagement by type and by stakeholder group.
24
4.17
Key topics and concerns that have been raised through stakeholder engagement.
4-5
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08
Global Reporting Initiative (GRI) Index
Environmental Area INDICATOR
NUMBER DMA
34-36
MATERIALS
EN1
Materials used other than water by weight or volume.
EN2
Percentage of materials used that are waste from other industries (valued).
45 Esval does not use raw materials that are waste from other processes or industries.
ENERGY
EN3
Direct energy consumption by primary energy source.
46
EN4
Indirect energy consumption by primary energy source.
46
EN5
Energy saved due to conservation and efficiency improvements
47
WATER
EN8
Total water withdrawal by source.
37
EN9*
Water sources and habitats significantly affected by withdrawal of water.
38
EN10*
Percentage and total volume of water recycled and reused.
39
96
Management Approach.
PAGE
BIODIVERSITY
EN11
Description of lands adjacent to, or located in natural protected areas or areas of high biodiversity outside protected areas.
38-39
EN12
Description of the most significant impacts on protected areas or those of high unprotected biodiversity.
38-39
*Additional indicator
INDICATOR
NUMBER
PAGE
EMISSIONS, DISCHARGES & WASTE
EN16
Total, direct and indirect greenhouse gas emissions.
40
EN17
Other greenhouse gas emissions.
40
EN20
Nitrate oxides (NOx), sulfur oxides (SOx), and other significant airborne emissions by weight.
40
EN21
Total wastewater discharge by quality and destination.
42-43
EN22
Total weight of waste by type and disposal method.
41-42
EN23
Total number and volume of significant accidental spills.
EN27
EN28
EN30
43
PRODUCTS & SERVICES Percentage of products sold and their packaging materials that are reclaimed by category.
39
REGULATION COMPLIANCE Incidents and non-monetary value of fines or penalties for non-compliance with environmental regulations.
During the reporting period there were no nonmonetary fines or penalties for non-compliance with environmental regulations.
GENERAL Total environmental protection expenditures and investments by type.
36
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Global Reporting Initiative (GRI) Index
Social Area INDICATOR
NUMBER DMA
Management Approach.
PAGE 64-65
Labor practices & work ethics EMPLOYMENT LA1
Total workforce.
66
LA2
Total number and rate of employee turnover.
66
LA3*
Social benefits provided to full-time employees.
68
COMPANY/EMPLOYEE RELATIONSHIP LA4
Percentage of union-represented employees.
LA5
Minimum notice period related to operational changes.
72 30 days’ notice
WORKPLACE HEALTH & SAFETY LA6*
Percentage of total workers represented in joint management-worker health and safety committees.
72
LA7
Rates of absenteeism, work accidents and injuries, days lost and number of work-related fatalities.
72
LA8
Education programs in place for HIV or other serious contagious diseases.
LA9*
Health and safety issues covered by formal agreements with unions.
Programs to prevent the Hanta virus, HIV and other contagious diseases, every 2 years.
72
TRAINING & EDUCATION LA10
Average hours of training per year per employee.
69-70
LA11*
Programs for skills management and lifelong learning that support the continued employability of employees, and assist them in managing career endings.
69-70
LA12*
98
*Additional indicator
Percentage of employees receiving regular performance and career development reviews.
All Esval’s employees receive performance reviews.
INDICATOR
NUMBER
PAGE
Human Rights INVESTMENT & PROCUREMENT PRACTICES HR1
Percentage of significant investment agreements that include human rights clauses.
Immaterial
HR2
Percentage of significant suppliers and contractors that have undergone screening on human rights.
Immaterial
NON-DISCRIMINATION HR1 HR4
Total number de incidentes of incidents de discriminación of discrimination y acciones andtomadas. action taken.
Durante Esvalelhad añono 2009 incidents Esval no in registró 2009 ningún incidente.
FREEDOM OF ASSOCIATION & COLLECTIVE BARGAINING HR5
Operations identified in which the right to exercise freedom of association and collective bargaining may be at significant risk, and actions taken to support these rights.
Esval had no incidents in 2009
CHILD LABOR HR6
Operations identified as having significant risk for incidents of child labor and measures taken to contribute to the elimination of child labor.
The company has no employees that breach what is laid down in the legal labor regulations of the Labor Code, i.e., chapter 11, articles 13-18
FORCED LABOR HR7
Risks or incidents of forced labor and measures taken to help eliminate them.
The law in force in Chile lays down and is above the worldwide average on human rights clauses. Esval complies with labor and civil laws. There were no incidents of forced labor in the reporting period.
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08
Global Reporting Initiative (GRI) Index
INDICATOR
NUMBER
PAGE
Product Responsibility DMA
MANAGEMENT APPROACH
48-49
CUSTOMER HEALTH & SAFETY PR1
Lifecycle stages in which health and safety impacts of products and services on customers are assessed, and the percentage of significant products and service categories subject to such procedures.
PR2*
Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of products and services.
60-62
Esval had no incidents due to health and safety impacts on the customer in 2009
PRODUCT LABELING & SERVICES PR3
Type of product and service information required by procedures and percentage of significant products and services subject to such information requirements.
Esval complies with the legal information requirements and regulations of its services by means of its bills and invoices.
PR4*
Total number of incidents of non-compliance with regulations and voluntary codes concerning product and service information and labeling, by type of outcomes.
The company had no incidents of non-compliance with the regulations and voluntary codes concerning product and service information.
PR5*
Practices related to customer satisfaction, including results of surveys measuring customer satisfaction.
50-54
MARKETING COMMUNICATIONS
100
PR6
Programs for adherence to laws, standards, and voluntary codes related to marketing communications, including advertising, promotion, and sponsorship.
In regard to ethical standards and regulations on advertising, communications and other promotion or sponsorship, Esval adheres to the Code of Conduct of the Chilean Association of Advertising Agencies (ACHAP).
PR8*
Total number of substantiated complaints regarding breaches of customer privacy and losses of customer data.
Esval had no legal penalties, fines or reprimands by any stakeholder for breach of regulations on communications, advertising and marketing.
*Additional indicator
INDICATOR
NUMBER
PAGE
REGULATION COMPLIANCE PR9
Monetary value of significant fines for non-compliance with laws and regulations concerning the organization’s provision and use of products and services.
Esval had no fines for non-compliance with the regulation on the provision and use of products and services. Significant fines are understood to be those over CLP20 million.
Society DMA
MANAGEMENT FOCUS
74-75
COMMUNITY SO1
Nature, scope, and effectiveness of any programs and practices that assess and manage the impacts of operations on communities, including entering, operating, and exiting.
74-79
CORRUPTION SO4
Actions taken Porcentaje y número in response total tode incidents unidades ofde corruption. negocio analizadas con respecto a riesgos relacionados con la corrupción.
31
PUBLIC POLICY SO5
SO6*
Public policy positions and participation in public policy development and lobbying.
Pursuant to its Code of Ethics, Esval rejects any form of influence to obtain benefits that are not based on applicable legality.
Total value of financial and in-kind contributions to political parties, politicians, and related institutions by country.
Pursuant to its Code of Ethics, Esval cannot make contributions to political parties.
COMPLIANCE WITH THE REGULATION SO8
*Additional indicator
Monetary value of significant fines and total number of non-monetary penalties for non-compliance with laws and regulations, related to society dealings (government, community, institutions. academics, NGOs, etc.).
During the reporting period, there were no significant penalties or fines for non-compliance with laws and regulations.
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08
Global Reporting Initiative (GRI) Index
Economic Area INDICATOR
NUMBER DMA
Economic value generated and distributed
EC4
Financial assistance received from government.
EC5*
Range of ratios of standard entry level wage compared to local minimum wage.
Practices and proportion of spending on locally-based suppliers.
EC7
Procedures for local hiring and proportion of senior management.
EC8
83-85 In 2009, Esval had access to a tax franchise for training amounting to CLP38,562,063 that was 100% of the SENCE33 franchise.
68
MARKET PRESENCE
EC6
80
ECONOMIC PERFORMANCE
EC1
102
MANAGEMENT APPROACH.
PAGE
63 All Esval’s senior management positions are filled by Chilean professionals.
INDIRECT ECONOMIC IMPACTS Description of infrastructure investments and services provided for public benefit.
*Additional indicator 33 National Training and Employment Department
10-11, 20, 81-82
INDEPENDENT VERIFICATION REPORT OF THE ANNUAL CORPORATE SUSTAINABILITY REPORT 2009 OF ESVAL S.A.
To the General Management of ESVAL S.A. Verification objectives
scope,
bases
and
We have made a limited independent verification of the information contained in the Sustainability Report 2009 of ESVAL S.A pursuant to the ISAE 3000 standard, which is limited to asking questions, undertaking analytical procedures and tests of the data sources and analyzing the procedures, systems and processes used to issue the report. The content of such report is the responsibility of the management of ESVAL S.A.. Our responsibility was to review the report and make conclusions about the data furnished by ESVAL S.A. in its Sustainability Report 2009, in accordance with the verification and scope outlined below. The content was appraised according to the information of the main impacts on, risks to and opportunities of stakeholders and from a long-term perspective. The review was carried out at the corporate offices where the data and information contained in the report was examined by means of: • • • •
Reviewing the processes, procedures and systems for gathering, compiling and disclosing the data. Reviewing the pertinent information according to its materiality. Verifying and consolidating the data furnished by ESVAL S.A.. Reliability of the data and information
• •
in the report by means of the sources cited and access to complementary information. Selective analysis of qualitative and quantitative information of the GRI indicators included in the report. Analyzing whether the structure and content of the Sustainability Report 2009 of Esval S.A. is in keeping with what is set forth in the G3 guidelines of the GRI.
Materiality To comply with the materiality principle in drawing up the report, a revision of external factors was considered, by means of benchmarking sustainability reports of other water utilities, analyzing press articles to find out the significant issues for the Company and that might be important when drawing up the sustainability report. A workshop was also held with community representatives to get stakeholder insight of the information presented in the sustainability report. Balanced Information Balanced information was presented, reflecting the positive and negative aspects of ESVAL’s performance on issues presented in the Sustainability Report 2009. Information Comparability The information provided in the report includes data beyond the year defined in the report’s scope, allowing for comparisons of the company’s performance over a two- to three-year timescale.
Our Independence As a way of assuring our independence in the verification of the sustainability report, we adhered to the guidelines of the Code of Ethics of the International Federation of Accountants (IFAC). Remarks For ESVAL S.A. to progress with continuous improvement of sustainability, we would like to make the following remarks: 1) Improve the information references used, particularly the quantitative data, making it easier for stakeholders who wish to review the original sources and giving the report more reliability. 2) In regard to periodicity and to improve the process of informing and analyzing the results in the reporting year, the report should be disseminated more timely to stakeholders and not so late in the year after releasing the report. 3) Improve the information on the main impacts, risks and opportunities, either for stakeholders or from a long-term perspective. 4) The data mainly concerns the company’s own performance with various issues. To enhance the comparability of the development of ESVAL S.A., it is suggested that data of other water utilities be provided.
•
to believe that the information presented contains material errors. There is no evidence and we are unaware of any aspect that leads us to believe that the Sustainability Report 2009 of ESVAL S.A. was not drawn up in accordance with the G3/2006 guidelines on issuing sustainability reports of the Global Reporting Initiative (GRI).
•
There is no evidence and we are unaware of any aspect that leads us to conclude that the selfassessment made by ESVAL S.A. does not correspond to level A in accordance with the standards laid down in the G3/2006 guidelines on issuing sustainability reports of the GRI.
Mercedes Vita H HSE Operational Manager Bureau Veritas Chile
Santiago, Chile, December 13, 2010
Conclusions Considering the review of the report and the remarks made, the following are our conclusions: •
There is no evidence and we are unaware of any aspect that leads us
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