table of contentsI. Message from the Chairman 04 II. The Report 07III. CUF 10 Vision, Mission and Values 11

Business Units 12

Products 14

Management Approach 15

Strategic Vision 16

Business Model 17

Stakeholders 18

Materiality 21

Governance 22

IV. Sustainability 24 Economic Domain 25

Environmental Domain 30

Social Domain 41

V. GRI Index 54 General Standard Contents 55

Specific Standard Contents 58

VI. Attachments 61 Human Resources 62

Methodological Notes 72

Abbreviations and Acronyms 73

VII. Verification Report 74

Message from the Chairman

CUF is steadfastly present in the Portuguese Chemical Industry, also being present in other regions through its exports, and industrial operations in Spain. Nowadays, the company is betting on an internationalization strategy paired with the development and demand for excellence of its activities in Portugal.

Aware of the mission and values intrinsic to CUF’s DNA, we aspire to be a company par excellence in the chemical sector, committed to fully satisfying every one of our stakeholders while contributing toward a prosperous and sustainable future.

CUF’s Sustainability Report, for the year 2015, mirrors our permanent focus on sustainable development in economic, environmental and social terms, by implementing several measures based on Innovation, Skill and Human Development.

5

The principles of sustainable development underpin the company’s strategy, by constantly implementing improvements to activities and processes, so that they become increasingly profitable and with lower environmental impact, as well as by always getting all of its employees to engage in social responsibility.

This is the context in which new activities were undertaken, throughout the year 2015, in order to respond to our goals, such as the various projects involving Research, Development and Innovation developed with the processes’ overall efficiency in mind. I would also like to highlight the publishing of CUF’s Code of Ethics, which raises awareness to the values we have all adopted, and the launch of CUF’s new website, which results from emphasis on a new communication strategy.

As part of an increasingly global and competitive market, we are committed to the success of the business, by combining the company’s long-term strategy and vision with the three pillars of sustainability – economic, environmental and social. These guidelines direct CUF’s operations, so that it can achieve growth as an environmentally responsible company while aiming for the satisfaction of all of our stakeholders.

Therefore, I am very pleased to note that the word sustainability currently cannot be dissociated from CUF’s strategy and operating mode.

João de MelloCUF’s CEO

6

The Report CUF’s Sustainability Report, drafted in accordance with the Global Reporting Initiative (GRI) guidelines, version 4.0, under “in accordance - Core”, is aimed at describing the company’s economic, environmental and social performance, namely as concerns its material topics during the 2015 fiscal year. In addition, the report seeks to publicly assume CUF’s responsibilities toward all stake-holders, namely by subscribing to the three principles under the AA1000APS standard.

Depending on their relevance and materiality, Environment and Product Re-sponsibility indicators only report the activities of CUF – Químicos Industriais, S.A. (CUF-QI). However, the indicators pertaining to the Economic and Social performance report CUF’s corporate activities on Portuguese territory (except the indicator EC1, which includes every CUF company).

The contents of this report can be supplemented with information from the previous CUF Sustainability Report 2014, the Annual Financial Statements and the company’s institutional website (http://www.cuf.pt).

8

All of the information included in this Report, along with its sources, was duly audited internally and externally by PricewaterhouseCoopers & Associados - Sociedade de Revisores Oficiais de Contas, Lda., in accordance with the Verification Report, enclosed at the end of the document.

Requests for clarification on this report may be addressed to:

• Micaela Pires Cabral (mpcabral@cuf.pt)Manager of Planning, Management Control, Innovation and Sustainability

• Ana Casaca (anacasaca@cuf.pt)Head of Innovation and Sustainability

9

Vision, Mission and Values

Vision

Mission

Values

CUF aims to be a competitive chemical company par excellence, which generates value in the global market through the production and commercialization of products that contribute to a better world.

CUF’s mission is to ensure the full satisfaction of its customers, suppliers, employees and shareholders through the growth and commitment to continuous improvement, in order to hold a prominent position in the Chemical Industry.

CUF follows a culture of quality and environmental protection, so as to develop its companies and promote shareholder satisfaction, as well as the fulfillment of its employees.

Whether in consolidated businesses or future projects, CUF adopts the values of the José de Mello Group. These values, present in all of CUF’s activities, include:

• Innovation • Skills • Human Development

CUF

11

CUF is organized into two business units: Industrial Chemicals and Nanomaterials.

Business Units

Industrial Chemicals

In Industrial Chemicals, CUF is mainly focused on two major value chains: aniline and chlor-alkali.In aniline’s value chain, CUF is positioned as a strategic partner for large consumers of this product. From its factory located at the Estarreja Chemical Complex (ECC), CUF supplies a nearby customer in an integrated manner. CUF also supplies several customers operating in various geographic locations through its distribution centers. CUF leads aniline sales in Europe and is the world’s 4th largest producer, not integrated in its own production of Diphenylmethane Diisocyanate (MDI). CUF is also the largest European producer of pure sulfanilic acid.In the chlor-alkali value chain, CUF is the 3rd largest Iberian producer, supplying a wide range of customers from the most diverse fields of activity.In order to complement these value chains, CUF also operates in the production of sodium chloride (common salt), chiefly for its integrated consumption.

Nanomaterials

LOCATION OF CUF’S MAIN ACTIVITIES

In the Nanomaterials business unit, CUF operates through its subsidiary Innovnano - Materiais Avançados, S.A. (Innovnano), providing a diversified range of nanostructured ceramic materials produced using a patented process internally designated as Emulsion Detonation Synthesis (EDS).

EstarrejaPontevedra Belgium

Antwerp

United KingdomLondon

Industrial Chemicals: production units Nanomaterials

Industrial Chemicals: logístics centres Headquarters

Aveiro

Coimbra

Pombal

OeirasBarreiro

PORTUGAL SPAIN NORTHERN EUROPE

legenda:

12

COMPANIES OF CUF’S UNIVERSE

CUF is 81.5% held by José de Mello, Participações II, SGPS, and 18.5% held by Guimarães de Mello Portugal, SGPS, S.A.

The Industrial Chemicals business is centered on the CUF-QI company, which, in turn, has several subsidiaries. In June 2015, the company CUF-QI integrated two of its subsidiaries, Aquatro and Quimigest, by including their activities and employees.

CUF’S MAIN COMPANIES

Location of Operations

% Ownership

CUF - Companhia União Fabril SGPS, S.A. (CUF SGPS)

CUF - Químicos Industriais, S.A. (CUF-QI)

AP - Amoníaco de Portugal, S.A. (AP)

Innovnano - Materiais Avançados, S.A. (Innovnano)

Eletroquímica del Noroeste, S.A. (Elnosa)

Industrial Chemicals

Support - Industrial Chemicals

Renoeste - Valorização de Recursos Naturais, S.A. (Renoeste)

SGPAMAG - Sociedade de Granéis, S.A. (SGPAMAG)

Nutriquim - Produtos Químicos, S.A. (Nutriquim)

CUF - Consultadoria e Serviços, S.A. (CUF C&S) Oeiras

Estarreja

Lisbon

Pombal

Pontevedra

Barreiro

Barreiro

Aveiro

Coimbra

100%

100%

100%

100%

100%

100%

100%

100%

Parent Company

Nanomaterials

13

In Industrial Chemicals, CUF holds a wide-ranging product portfolio in the aniline and chlor-alkali value chains.These products are manufactured chiefly from raw materials and utilities such as benzene, ammonia, salt, hydrogen and electricity.

CUF’s organic products are intended for export, either through DOW Europe, headquartered at the ECC, or directly to the international market (Germany, Belgium and Slovakia). Inorganic products are intended chiefly for the Iberian market.

In the Nanomaterials unit, the current portfolio of products intended for the international market comprises high-quality nanostructured ceramic materials, including monoclinic zirconium and various types of zirconium oxides stabilized with yttria. In addition, the ability to customize production technology allows for the adaptation or optimization of products according to specific client requirements. The main applications of these materials most notably include technical ceramics, thermal barrier coatings and photovoltaic components.

Products MAIN PRODUCTS OF INDUSTRIAL CHEMICALS

Main Products Applications

Nitric Acid Chemical industry, fertilizers, paints and pigments

Rubber industry, paints and pigments

Chemical, pharmaceutical and rubber industries

Polymer industry, special fibers

PVC, polyurethanes, water treatment

Aniline, chemical and parmaceutical industries

MDI, rubber industry, paints and pigments, special fibers

Chemical industry, PVC, steel industry, hygiene and clean-ing products

Water treatment, hygiene and cleaning products, textile bleaching

Hydrochloric Acid

Sulfanilic Acid

Chlorine

Aniline

Sodium Hypochlorite

Cyclohexylamine

Caustic Soda Chemical industry, textile, cellulose, food industry, detergents and soaps

Cyclohexanol

Mononitrobenzene

AN

ILIN

E A

ND

DER

IVA

TIV

ES(O

RG

AN

ICS)

CH

LOR

-ALK

ALI

(IN

OR

GA

NIC

S)14

Management Approach

Integrated Management System

In order to ensure responsible action at every level, the Industrial Chemicals business unit, namely CUF-QI, has used an integrated approach to implement the Management of Quality and Environment, Workplace Health and Safety, Serious Accident Safety and Prevention, and Research, Development and Innovation (RDI). Thus being the case, CUF-QI includes Policies governing Quality, Environment and Safety, Serious Accident Prevention as well as Innovation, along with advisory bodies for supporting the implementation and maintenance of the said management systems:

• Council governing the Quality and Environment Management System; • Workplace Safety, Hygiene and Health Commission; • Council governing the Research, Development and Innovation Management System.

These bodies act on every activity inherent to developing, producing, storage and marketing of products and support processes.

CUF-QI

• Certified under ISO 9001:2008 regarding its Quality Management System since 2003; • Certified under ISO 14001:2004 regarding its Environment Management System since 2007; • Certified under OSHAS 18001:2007 due to compliance with every requirement governing Workplace Health and Safety, as required under this international standard, since 2013; • Certified under NP 4457 regarding its RDI Management System since 2013.

Innovnano

At Innovnano, the quest for continued improvement and fostering the use of best practices led to the implementation of the following management systems.

• Certified under ISO 9001:2008 regarding its Quality Management System since 2014; • RDI Management System according to NP 4457 implemented since 2014.

15

CUF has developed a long-term vision of becoming a company par excellence, with strong growth, relevance in the chemistry sector and a superior ability to generate value for all of its stakeholders.

In order to respond to its ambitious vision and, simultaneously, to major external challenges, CUF has realigned its strategy and its business segments around future market trends, as well as its internal competencies, which are closely linked to technological innovation and operational efficiency. CUF has established a unique position in the intersection of these three elements, seeking to progressively accomplish them, in order to ensure the sustainability of its business.

For the near future, CUF has developed an action program - CUF 2020 - with specific strategic objectives and guidelines, in line with the company’s vision.

Strategic Vision CUF’S MACRO STRATEGY

CUF 2020 STRATEGIC GUIDELINES

Presence in value chains aligned with major trends over 20/30 years (e.g.: health, water, energy efficiency)

Balance between established and emerging products/markets

Entry into new geographic regions

Increasing efficiency, reducing consumption and waste

Efficient production scales

Safety and quality in production

Adoption of new technologies, disruptive and incremental, focusing on efficiency and/or more sustainable production methods

Adoption of new business models (e.g.: Over-The-Fence)

Development of new international opportunities in the aniline market, with the Over-The-Fence concept

Expansion in the Iberian chlor-alkali market, taking advantage of the need for technologically updating the installed capacity

Focus on products of higher added value in the business of nanomaterials, leveraged in Innovnano’s unique production

process

Improved efficiency in Estarreja, combined with the implementation of improvements in Quality, Safety

and Environment

Greater commitment in the operations of Research, Development and Innovation

CUF 2020 Strategic Guidelines

16

CUF 2020

Leader in core marketsRevenue > 900 M€EBITDA margin > 10%

CUF

SustainableMarkets

Excellence in OperationsDifferentiation via

Innovation

The companies’ business model in the field of Industrial Chemicals based in the Estarreja Chemical Complex adopts the Over-The-Fence concept.This concept aims to provide a direct link between key suppliers and customers by way of pipelines, in an integrated manner. Thus, the benefits of a vertically integrated production are combined with the advantage of access to prices, market rules and transparency of external suppliers.In addition to the Over-The-Fence model, CUF’s Industrial Chemicals also operate in a traditional supply model to domestic and international markets, through an efficient multi-modal logistics chain in order to meet customer requirements with competitive prices and differentiating service and flexibility.In both models, the idea is to find solutions that minimize the total cost of ownership for customers, providing high performance and efficient solutions, ensuring safety and reliability of the service provided.

In the Nanomaterials area, the business model is established on the principles of product differentiation and price competitiveness: product differentiation by means of the continuous search for innovative products that satisfy the needs of its customers, in terms of performance and technical features; price competitiveness by leveraging the competitive advantages of EDS technology while seeking to meet customer requirements at controlled costs.

Business Model

CUF Business Model

CUF BUSINESS MODEL

Differentiating value proposals for customers

Key upstream activities, particularly relations with key partner suppliers and efficiently procuring raw materials

The key production activities using CUF’s differentiating industrial assets, like skilled human resources and intellectual property

Key downstream activities, particularly relations with partner customers, with the various distribution channels and with the

different business segments

17

CUF’s main stakeholders were identified at a meeting regarding the topics of sustainability and ethics, through a dynamic group exercise. As a result, all stakeholders currently influencing the development of business were identified, discussed together and then validated and mapped in a matrix according to their degree of influence.

Aware of the contribution of different stakeholders toward the company’s future sustainability, CUF has developed various mechanisms to pro-actively and systematically manage and improve its relationship with them. Noteworthy examples include the following:

The relationship with the local community of Estarreja is strengthened by the Painel Consultivo Comunitário do Programa Actuação Responsável (PACOPAR), founded by CUF in 2001, in partnership with other companies operating in the Estarreja Chemical Complex. PACOPAR is a joint initiative group which aims to improve the quality of life of the local community by applying the principles of Responsible Care;

The relationship between CUF and its closest customers and suppliers is formally and informally strengthened through various meetings and regular coordination mechanisms allowing the integrated operation of the Estarreja Chemical Complex.

Stakeholders MATRIX OF CUF’S STAKEHOLDERS

Org

aniz

atio

n’s

Impa

cts

on S

take

hold

ers

0 4

4

Stakeholder’s Impacts on the Organization

Employees

Government/Regulators

Costumers

IndustryAssociations

Suppliers

Scientific and Technological

Partners

NGOs and Advocacy Groups

Analysts and Media

Shareholders

LocalCommunity

18

CUF AND STAKEHOLDERS RELATIONSHIP

Stakeholders

Interaction Mechanisms

Relevant Topics

Employees

Website, LinkedIn and Youtube

Intranet platforms

Information placards

Performance Assessment

Job stability Managing suggestions and complaints Ethics and transparency Ethics and transparency Ethics and transparency

Overall customer satisfaction Innovation and sustainability Innovation and sustainability Innovation and sustainability

Ethics and transparency

Innovation and sustainability

Strategic developmentHealth and safety

Working conditions

Technical assistance

Mass media

Open Doors Day

Information sessions

Satisfaction survey

Regular meetings

Contract negotiations

Satisfaction surveys

Skills management Contracts and payments

Remuneration and motivation

Contract negotiations Group Committees

Partnership RDI activities

Company performance Company performance

Risk controlLong-term commitments

Open Doors Day Regular meetings Regular meetings

Annual Financial Statement,Sustainability Report and Code of Ethics

Annual Financial Statement,Sustainability Report and Code of Ethics

Annual Financial Statement,Sustainability Report and Code of Ethics

Annual Financial Statement,Sustainability Report and Code of Ethics

Annual Financial Statement,Sustainability Report and Code of Ethics

Internal communication (e-mail and Newsletter)

Computer platforms (SAP and SIAWISE)

Sales and monitoring meetings

Price, product and safety features

Flexibility in product deliveries

Library (physical and digital)

Internal programs involving the company and the employees

Visits to companies of the José de Mello Group

Theme-based meetings with other companies

Training and awareness raising initiatives

Meetings of the Workers’ Committee

Business impact and risk mitigation practices

Human Resources and Communication Management

Website, LinkedIn and Youtube Website, LinkedIn and Youtube Website, LinkedIn and YoutubeWebsite, LinkedIn and Youtube

Clients Partners of the Scientific and Technological System ShareholdersSuppliers

19

CUF AND STAKEHOLDERS RELATIONSHIP

Stakeholders

Interaction Mechanisms

Local Community

Website, LinkedIn and Youtube Website, LinkedIn and Youtube Website, LinkedIn and Youtube Website, LinkedIn and Youtube

Open Doors Day Regular meetings Mass media Radio and television programs

Volunteer programs Signing agreements Information sessions

Local initiative programs Participation in working groups

Ethics and transparency Company strategy Environmental safetyRisk and impact mitigation mechanisms

Ethics and transparency Ethics and transparency Innovation

PACOPAR meetings and magazine

Signing agreements Innovation and sustainability

In late 2015, CUF started a new project in the field of Sustainability, aimed at formally consulting its stakeholders, reviewing CUF’s materiality and outlining the company’s sustainability strategy.The formal consultation of CUF’s stakeholders seeks to gauge their opinions regarding the company’s sustainability performance, reputation and image, sustainability reporting, material topics and how they relate to each other. The results of this consultation process will be used in reviewing the company’s materiality and in redefining its sustainability strategy, to be presented in CUF’s Sustainability Report pertaining to 2016.

20

Relevant Topics

Environmental and social impacts Company best practices Environmental and social impacts Local development

Industry Associations Regulators Comunicação Social

Annual Financial Statement,Sustainability Report and Code of Ethics

Annual Financial Statement,Sustainability Report and Code of Ethics

Annual Financial Statement,Sustainability Report and Code of Ethics

Annual Financial Statement,Sustainability Report and Code of Ethics

The identification of material topics for CUF, as approved by the Executive Committee, resulted from a process of internal analysis and international benchmarking.

Materiality

Based on this approach, eight topics were identified and deemed material for CUF’s stakeholders and for the organization at the same time.

APPROACH TOWARD DEFINING MATERIALITY

MATERIAL TOPICS

Benchmark Analysis

Technology and Innovation

Resources and Energy

Environment

Employees

Logistics

Water

Products and Safety

Community

Internal Reflection

Sector Trend Analysis

Benchmark analysis on the sustainability strategy to 5 peer companies considered references in sustainability management

Effective management of technology and innovation through partnerships with research centers and innovation processes, in production processes or in new product creation

Energy resources management, by reducing the intensity of its consumption and the subsequent impact on the level of Greenhouse Gas (GHG) emissions

Conservation of the environment, taking into account the need to ensure efficiency in production processes and the use of raw materials

Efficient recruitment, training programs for skills development and adoption of robust mechanisms for feedback and motivation

InternalExternal

InternalExternal

InternalExternal

InternalExternal

InternalExternal

InternalExternal

InternalExternal

InternalExternal

Optimization of logistics operations and subsequent improvement of the impact of these activities on the environment

Effective water management due to the high consumption of this resource combined with the forecast of its increasing scarcity

Responsible product management to promote their safe use throughout their life cycle

Preservation of community’s interests in order to contribute to its well-being, in the present and in the future

Analysis of the results of the preceding stepsIdentification of the material topics for CUF and its relevance

Analysis of key trends, impacts and risks that should be taken into account when defining the material topics for CUF’s sustainability strategy

Material Topic Relevance Limit

21

In late 2015, CUF started a project involving consultation with stakeholders and reviewing materiality, which will culminate in the outlining of a Materiality Matrix, where the priority will be material topics, considering their relevance to both internal and external stakeholders.

Governance

GOVERNING BODIES

General Assembly

Statutory Auditor

Alternate Statutory Auditor

Board of Directors

Chairman of the Board

CEO

Non-Executive Directors

Secretary

Executive Directors

Alexandre Cabral Côrte-Real de Albuquerque

ERNST & YOUNG AUDIT & ASSOCIADOS - SROC, S.A.

Paulo Jorge Luís da Silva

João Maria Guimarães José de Mello

Manuel José Gouvêa Portella de Herédia

André Cabral Côrte-Real de Albuquerque

João Jorge Gonçalves Fernandes Fugas

Luis Augusto Nesbitt Rebelo da Silva

Jaime Urquijo Chacón

Luís Eduardo Brito Freixial de Goes

Pedro Maria Guimarães José de Mello

22

23

Board of Directors

CUF’s Senior Consultants Pool

Executive Committee

Legal

Nanomaterials

Commercial Operations Technical

Operations Technical

ProcurementPlanning,

Management Control, Innovation and Sustainability

Science and Safety Marketing and Sales

Administrative and Finance

Information Systems

Corporate and support areas

External Communication

Human Resources and Internal

Communication

Functional Organizational Flowchart

Industrial Chemicals

SustainabilityFor the purpose of sustainability analysis, three key areas deemed vital – economic, environmental and social - were considered in which the topics identified as material for CUF are included. In the economic domain, Technology and Innovation is analyzed; in the environmental domain, Logistics, Resources and Energy, Environment and Water are considered; and regarding the social domain, Product and Safety, Employees and the Community are examined.

Economic Domain

Performance

Economic Performance

CUF has been focusing its initiatives on improving efficiency and productivity at various levels, such as production, logistics, financial and human resources.

25

In 2015, CUF achieved revenues of around 303 M€, comprising a 15% drop relative to the previous year. This decrease is associated with the business of organic chemicals, where both the sales price and the production cost are strongly correlated with international quotes, most notably the quote of benzene. Thus, there was a simultaneous decrease in turnover and production costs.

ECONOMIC PERFORMANCE

2013 (M€) 2014 (M€) 2015 (M€)

Economic Value Distributed

Economic Value Retained

Economic Value Generated

Operating Costs

Salaries and Benefits

Payments to Capital Providers

Payments to the State

Investments in the Community

Revenue 339

292

15

12

0.94

0.16

20

357

305

18

12

0.30

0.16

22

303

253

18

11

0.32

0.15

21

Despite the drop in revenues, in nominal terms, CUF experienced growth in business, with regard to both quantities produced – having achieved record high production levels – and quantities sold, noteworthy the increases of 10 kt of aniline and 12 kt of chlorine.

CUF attained an EBITDA margin of 11% for the year 2015 (higher than expected), while showing a 2% improvement relative to 2014.

In 2015, CUF purchased around 98% of its raw materials from domestic suppliers (for this indicator, the amount pertaining to the purchase of benzene is excluded), thus amounting to turnover of around 102 M€. A 4% increase was achieved, compared to 2014.

26

Technology and Innovation

In the chemical sector, Research, Development and Innovation are currently the major drivers for development and competitiveness, by creating new solutions and improvements to production processes. CUF is no exception, and the company systematically promotes a daily climate of innovation across the entire organization.

Innovation at CUF is established on the processes that cover the RDI Management System, as certified under the Portuguese Standard 4457, namely those pertaining to Interface Management, Surveillance Management, Intellectual Property Management, RDI Project Management, Idea Management and Knowledge Management.

27

RDI RESULTS

2013 2014 2015

Ph.Ds

Ongoing RDI projects

RDI investment

Families of Patents

Employees involved in RDI activities

Publication/Presentations to external bodies

RDI Partnerships

9

99

11

57

8%

1 M€

38

7

115

12

76

9%

4 M€

33

6

82

12

64

14%

3 M€

25

The intellectual capital held by CUF is one of the organization’s key differentiation factors. Thus, Intellectual Property is protected through a close management of the patent portfolio and contractual agreements suited to protecting its Intellectual Property assets. In 2015, CUF-QI held 4 patent families and Innovnano 8 patent families.

Idea Management is materialized in the Colombo platform, currently one of the company’s key activities while allowing ideas submitted by CUF employees to be further transformed, and thereby contributing toward creating value for the company. Since 2006, 365 ideas were submitted, 108 of which were approved and 81 implemented. These results are materialized as a financial return of around 3.6 M€, as well as countless intangible benefits in terms of safety, environment, employee well-being and productivity, among others. The “Open Day Colombo” event is expected to be held in 2016, where the Executive Committee and Directors will be shown the ideas submitted by employees throughout 2015, who thus become eligible to win the first awards given out under this platform.

With regard to Interface Management, we point out the RDI partnerships established by CUF and maintained throughout the year 2015, with strategic partners, namely suppliers, universities and companies. We also point out, with equal relevance, the knowledge networks in which CUF is engaged, such as Associação Industrial Portuguesa (AIP), Associação das Indústrias da Petroquímica, Química e Refinação (AIPQR), Associação Portuguesa das Empresas Químicas (APEQ), Conselho Empresarial para o Desenvolvimento Sustentável (BCSD Portugal), COTEC Portugal - Associação Empresarial para a Inovação (COTEC), European Chemical Industry Council (CEFIC), Confederação Empresarial de Portugal (CIP), European Petrochemical Association (EPCA), and Euro Chlor Safety Commitment (Euro Chlor).

28

COLOMBO IDEIAS

2013

25

16 19

10

58

41

2014 2015

Total No. of Ideas No. of Approved Ideas

In addition, CUF is part of the José de Mello Group’s Innovation Committee, which comprises participation from the innovation areas of the Group’s various companies, namely Brisa, CUF and José de Mello Saúde. Participation on the Innovation Committee fosters a systematic quest for continued improvement by sharing knowledge and the fostering of best practices.

Next Steps

29

Concerning the economic domain, the following goals have been set for 2016:

• EBITDA margin over 10%; • Maintenance of the NP 4457 certification for CUF-QI’s RDI Management System; • Maintenance of patent portfolio; • Outline the Innovation Roadmap and Ecosystem.

To achieve the established goals for 2016, the following measures are expected to be implemented:

•

•

•

CUF C&S intends to pursue a strategy based on the development of the current activities for both Industrial Chemicals and Nanomaterials and to establish partnerships with other stakeholders, namely international ones;CUF-QI intends to find new markets for its products and to maintain its position towards its clients; to maintain a firm attitude in finding new ways to optimize its activities by reducing consumption, and to pursue a growth and internationalization strategy by implementing new projects and establishing possible partnerships;Innovnano seeks to increase its production by adopting measures leading to improving production efficiency and by consolidating specific business opportunities.

Logistics

Environmental Domain

Performance

Logistics is a material topic for CUF, given the high impact of this area’s effective management on the global geographic placement of its products. In addition, we should point out the high impact of Logistics on the environment, due to the many road and maritime transactions that are conducted. As such, while executing and monitoring its various projects, CUF is committed to continuously improving the planning of its road shipments, namely projects aimed at optimizing road routes by reducing travel time and idle times.

The Industrial Chemicals business area monitors legislation in the field of transportation, and conducts audits to its suppliers, in order to ensure compliance with applicable laws. Throughout 2015, CUF-QI conducted two audits to its shipping suppliers, in order to increase the quality of its products and to properly distribute them among its customers.

In 2015, CUF-QI continued its Driver Certification project, which, in 2014, led to the certification of 14 new drivers entrusted with hauling inorganic products. Throughout the year 2015, new training initiatives for 2016 were prepared, which are expected to lead to the certification of a greater number drivers.

30

Resources and Energy

The high energy demand required for CUF’s production processes, as well as the large volume of raw materials used for producing the quantities required for meeting customer needs, mirror the materiality of these topics for CUF. Aware of its impact on resources and energy, and through its various projects, CUF is dedicated to continually optimizing its processes aimed at energy-related and operating efficiency. The continuous monitoring of its raw material and energy consumption, as well as of its GHG emissions, comprises one of CUF’s most effective methods for managing this material topic.

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PRODUCTION AT CUF-QI (t) CONSUMPTION OF NON-RENEWABLE MATERIALS AT CUF-QI (t)

CAP Sector ADP Setor

2013

547,852

605,085

670,713697,985

636,405

683,731

2014 2015

CUF-QI operates in two productive sectors, chlor-alkali (inorganic chemicals) and aniline and derivatives (organic chemicals). Chlor-alkali Production (CAP) saw an increase of around 47 kt relative to 2014. The Aniline and Derivatives Production (ADP) sector rose some 27 kt compared to the previous year. CUF-QI has been gradually increasing its production, having achieved record highs in the use of its installed capacity throughout the year of 2015.

Benzene Salt Ammonia Hydrogen Sulfuric Acid

In its operations, CUF-QI uses up various non-renewable materials that include benzene, salt, ammonia, hydrogen and sulfuric acid. Use of such materials rose slightly in 2015, due to an overall increase in production.

2013 2014 2015

156,

392

169,

211

173,

997

110

,10

5

120

,70

3

117,

249

37,9

51

43,9

52

46,2

36

11,3

30

12,3

10

12,4

39

3,83

7

4,0

67

4,0

92

32

ELECTRICITY AND NATURAL GAS CONSUMPTIONS AT CUF-QI (GJ)

Electricity Natural Gas

2013

976,398

493,983 546,753391,226

1, 092,9801, 177,221

2014 2015

Productive operations carried out by CUF-QI have high energy demands, while using two energy sources for its production: electricity and natural gas. The CAP sector uses mostly electricity, while ADP sector uses natural gas. In 2015, the increase in electricity consumption is consistent with increased production, namely in the CAP sector. The 28% drop in natural gas consumption resulted from increased efficiency of operations in the ADP sector, with a resulting decline in the need for steam and optimized internal steam production, when producing nitric acid.

ENERGY INTENSITY AT CUF-QI (GJ/ t of product)

2013

1.28 1.25

1.14

2014 2015

Energy intensity correlates the total consumption of electricity and natural gas with production, as this indicator recorded an 11% improvement during the period from 2013 to 2015.

Along with the electricity and natural gas consumption, in 2015 CUF-QI used up to 6,778 GJ of diesel fuel to operate its fleet, machinery and generators.

33

DIRECT AND INDIRECT GHG EMISSIONS AT CUF-QI (t CO2 eq.) CARBON INTENSITY AT CUF-QI (t CO2 eq./ t of product)

2013

152,059 155,205141,092

2014 2015

113,014 111,280

42,191 29,812

Direct GHG Emissions Indirect GHG Emissions Total GHG Emissions

Direct GHG emissions mostly result from natural gas consumption and from the burning of wastes in the incinerator. Indirect emissions are chiefly the result of electricity consumption, namely with regard to the CAP sector. Regarding total GHG emissions for which CUF-QI is responsible, in 2015 the company recorded 79% indirect emissions and 21% direct emissions, for a 10% drop compared to 2014. This decrease was basically due to continuous improvement of operations with a corresponding decrease in steam use during aniline distillation and an increase in steam production when making nitric acid, resulting in significant natural gas savings.

34

0.13

0.12

0.10

2013 2014 2015

CUF-QI’s carbon intensity relates total (direct and indirect) GHG emissions to the amount of product. There has been a significant decrease of this indicator, around 23%, since 2013.

114,051

38,008

OTHER ATMOSPHERIC EMISSIONS AT CUF-QI (t)

NO2 CO Partículas SO2 TOC

The quantity of other atmospheric emissions, such as NO2, SO2, particles, CO, TOC and heavy metals is monitored by CUF-QI, thereby ensuring average readings are within the legal limits for these emissions. In 2015, there was an abrupt decline in NO2 emissions. In addition, the reading for CO and SO2 emission also decreased, resulting from a drop in natural gas consumption in 2015.

2013 2014 2015

45

57

9 95 55

33

6 6741 1 1

35

In 2015, the company continued with the Leak Detection And Repair (LDAR) program (under EN 15446:2008, EPA -453/R-95-017 and EPA 21), begun in 2008, and which is designed to detect and eliminate fugitive emissions of volatile organic compounds. In the year 2015, the results of this program were reflected in a 44% decrease.

Environment

Because of the sector’s potential risks and impacts on the environment, the Chemical Industry needs to constantly raise awareness to this topic. The topic of the environment, which is intrinsic to this sector of activity, is addressed by CUF as a material topic for its business. CUF’s constant concern with the environment causes the company to promote a systematic control of its impacts, thereby expecting to adopt preventive measures to minimize risks. This way the company will continue to implement measures aimed at rationalizing its consumptions and mitigating the impacts associated with its operations.

The industrial effluents from CUF-QI go through a Wastewater Treatment Plant (WWTP) before being discharged into the wastewater network of the Sistema Intermunicipal de Saneamento da Ria de Aveiro (SIMRIA).

The increase in the volume of effluent discharges since 2013 has been in accordance with the company’s production increase during that period. However, in 2015 there was only a slight increase in the intensity of effluent discharges, which correlates the total volume discharged with the production.

36

EFFLUENT DISCHARGES AT CUF-QI (m3)

INTENSITY OF EFFLUENT DISCHARGES AT CUF-QI (m3/ t product)

657,828

0.57 0.57

732,505

0.56

783,854

2013 2013

2013

2014 2014

2014

2015 2015

2015

THE EFFLUENT’S QUALITY INDICATORS AT CUF-QI (t)

Sulfates COD Nitrates TSS

The indicators regarding the quality of discharged effluents are well below regulated legal emission limits. There was a slight increase in the emission of sulfates, nitrates and total suspended solids (TSS) in effluents.

431

452

339283 256 260282

182 182

20 2018

37

TOTAL WASTE PRODUCED AT CUF-QI (t)

2013 2014 2015

Total Recovered Waste

Total GeneratedWaste

Total Waste Placed in Landfill

16,15718,967

17,570

2,2552,906 1,808

15,76216,06113,902

Compared to 2014, the year 2015 recorded 7% drop in CUF-QI’s waste production, chiefly hazardous waste, due to the optimization of the aniline distillation process. For the same year, 98% of the waste produced was classified as hazardous industrial waste and 88% was enhanced, in energy terms, through CUF’s incinerator.

ENVIRONMENTAL COSTS AND INVESTMENTS AT CUF-QI

2013 (M€) 2014 (M€) 2015 (M€)

Investments

Operating Costs

0.33

2.73

0.46

2.72

0.94

2.28

As part of its environmental management strategy, CUF-QI systematically performs various investments and implements specific measures designed to mitigate its environmental impact. During the year 2015, CUF-QI saved 0.44 M€ in environmental operating costs, as a result of decreased waste and subsequently sending wastes for treatment. Also noteworthy is the reduction of wastewater treatment costs in the ADP sector. The amount assigned to environmental investments was nearly double due to the company’s investment in projects dedicated to its operations’ continuous improvement and to the procurement of equipment, aimed at the said operations’ operational/environmental efficiency.

38

Water

CUF-QI’s production processes are water dependent, which is a major concern because of its increased scarcity worldwide. Therefore, water is one of CUF’s chosen material topics, with various projects undertaken with efficiency in mind, along with specific practices to continually monitor them.

The catchment of this raw material was wholly done from the Antuã River. The average total water consumption over the three years was around 1.76 million m3, as there was a slight increase in this consumption for 2015, due to increased production.

TOTAL WATER CONSUMPTION AT CUF-QI (m3)

1,676,532

1,796,430

1,810,899

2013 2014 2015

39

WATER CONSUMPTION INTENSITY AT CUF-QI (m3/ t product)

1.45

1.37

1.31

2013 2014 2015

The intensity of water consumption reflects the relationship between total consumption and annual production. An improvement of 10% was achieved over the years under review. This improvement reflects a continuous effort toward reducing consumption of this resource through operational optimization.

Next Steps

Concerning the environmental domain, the following goals have been set for 2016:

• • •

To achieve the established goals for 2016, the following measures are expected to be implemented:

• •

•

Ensure full compliance with applicable legal requisites;Reduce electricity consumption compared to the previous year;Conduct a report on the identification of aqueous streams that are likely to be recovered in the selected area (ADP/CAP).

Continue the LDAR program;Start the process of implementation of the Energy Management System by the EN 50000 standards;Develop a project to identify the aqueous streams which are likely to be recovered.

40

Social Domain

Performance

Along with the chemical sector, CUF firmly invests in processes inherent to the safety of its products. The company employs robust practices to ensure that operations involving production, storage, shipping and product use takes place in accordance with the best safety practices, minimizing workplace risks and environmental accidents. As a reflection of such concern, in 2013 CUF-QI adhered to the guidelines of the Euro Chlor Safety Commitment, which aims to guide the chlor-alkali industry toward a sustainable future.

Product and Safety

41

INTERNAL AUDITS AT CUF-QI IN 2015

Industrial Safety

Occupational Health and Safety

Quality

Quality, Environment and Safety

Quality and Environment

Environment

Environment and Safety

MSSASP

CUF-QI’s operations, via its Management Systems, as well as proper compliance with its Policies, are monitored by conducting a strict annual program of internal audits. During the year 2015, CUF-QI conducted 32 Internal Audits to several areas, 6 more than in 2014.

16

4

4

2

2

21 1

To ensure correct use of its products, the company regularly invests in information disclosure practices, internal audits and visits and/or audits to its customers.

AUDITS TO CUF-QI CLIENTS

Installations of Chlorine Installations of Corrosive Liquids

2013

7395

125117

6168

2014 2015

42

CUF-QI discloses all relevant information concerning its products through safety and technical data sheets. Products are labeled according to national and european legislation.

PRODUCT AND SAFETY AT CUF-QI

After the audits and/or visits, CUF-QI usually prepares reports with photographic records, while drawing particular attention to critical points and proposals for improvement, which are then sent to all audited clients. Additionally, training needs are also identified at customers’ facilities, namely concerning product storage and handling.

TRAINING OF CUF-QI CLIENTS

Training Initiatives Total No. of Trainees

2013

20

251

176

135

15 9

2014 2015

2013 2014 2015

Products with related Safety Data Sheets

All Clients

Total No. of Deliveries (t)

Products with related Technical Data Sheets

Clients with updated Technical Data Sheets

Clients with updated Safety Data Sheets

% Compliant Deliveries

All Products

12

230

567,471

12

230

230

99.99%

12

12

238

620,989

12

238

238

99.96%

12

12

294

696,177

12

294

294

99.81%

12

43

CUF considers customer satisfaction to be a key factor for guaranteeing customer loyalty and, thus, for accomplishing the company’s strategic objectives.Every other year, CUF-QI conducts a survey with its customers in order to determine their satisfaction levels with the products and services provided by the company, as well as improvement opportunities.

In 2012, 122 CUF-QI customers answered the survey, and in 2014 feedback from 142 was recorded. In both years, the average level for customers’ overall assessment of CUF-QI was 4.17 out of 5.

All complaints addressed to CUF, regardless their origin or type, are subject to analysis. Whenever an opportunity for improvement is detected, a set of measures is immediately put to place in order to correct or resolve the situation, while preventing the problem from reoccurring in the future. Throughout 2015, there were 59 customer complaints, 32 more than in 2014. Of the 59 complaints recorded, whose causes have been identified and resolution have been put into practice, 19 pertain to Non-Compliant Product and 18 concern to Weighing Differences, thus accounting for 63% of complaints.

In 2015, there were also 2 environment-related complaints from a neighboring company, regarding the smell of chlorine.

44

Employees

CUF believes that the company’s sustainability is directly related to the involvement, performance and satisfaction of all its employees. As such, by means of various initiatives and projects, the organization ensures policies and management systems for Human Resources aligned with world-class best practices. Accordingly, and in order to share the performance of CUF’s activity, its strategy and action plans, CEO João de Mello has held disclosing sessions with all employees since 2012, thereby strengthening CUF’s resolve to get everyone to buy into the company’s strategy. In addition, a major milestone in 2015 involved the launch of CUF’s Code of Ethics, in which the company made known its commitment to acting with ethics and integrity, while respecting the rights of its employees as individuals.

On December 31st, 2015, CUF had a workforce of 338 employees, 86% of whom had permanent employment contracts, while 70% of the company’s staff were covered by collective bargaining agreements and/or extension ordinances. CUF’s hiring rate for 2015 was 6%, while the turnover rate was 12%.

45

EMPLOYMENT STRUCTURE BY GENDER EMPLOYMENT STRUCTURE BY AGE GROUP

2013

339 339 338

2014 2015

18% 20%

82% 80%

Males Females Under age 30 Age 30 to 50 Over age 50

2013 2014 2015

339

9%

37%

54%

339

10%

37%

53%

338

10%

40%

50%

46

17%

83%

EMPLOYMENT STRUCTURE BY REGION IN 2015

ESTARREJA DIR

ECTO

RS

AD

MIN

ISTR

ATIV

EST

AFF

MA

NA

GER

S

CO

OR

DIN

ATO

RS

TEC

HN

ICIA

NS

PER

SON

S IN

C

HA

RG

E

OPE

RAT

OR

S

FUN

CTI

ON

AL

TEC

HN

ICIA

NS

71%

2%5% 6% 6% 9%

16%9%

35%

21%

LISBON

13%

COIMBRA

9%

POMBAL

3%

LOULÉ

3%

BARREIRO

1%

EMPLOYMENT STRUCTURE BY FUNCTION IN 2015

47

Males MalesFemales Females

During 2015, taking into account the Seveso II directive, no serious industrial accidents occurred, and there were only 4 work accidents resulting in sick leave. Absenteeism rate for the last three years was 2%. In 2015, the return rate after paternity leave and retention rate were both 100%.

CUF invests, in a structured and systematic way, in promoting personal and professional development of its employees, thereby allowing equal opportunities and sustained growth of each professional. The annual training plan reflects this commitment, covering internal and external training initiatives as well as employee participation in seminars, conferences, trade shows and/or symposiums.

Both in 2015 and in the previous year, 91% of CUF employees were given training, and the total number of training hours was 6,466 h. In 2015, there was a decreased number of training hours compared to 2014, as some training initiatives typically held annually did not take place, as is the case with English. However, for the year 2016, such training initiatives have already been scheduled.

TOTAL NUMBER OF TRAINING HOURS (h)

5,8586,465

10,624

2013 2014 2015

In 2015, various internal training initiatives were provided across the board to all CUF employees, such as the Code of Ethics Training Initiative and other training in the field of Quality, Environment and Safety.Throughout 2015, CUF employees also take part in external training initiatives, such as Training in ADR, Training on Legal Aspects Linked to Safety, as well as the Advanced Management Program for Executives at the Universidade Católica Portuguesa/José de Mello Group.

48

Also noteworthy is CUF’s presence at various congresses, such as:

• • • •

•

Two of CUF’s iconic projects, in the sphere of training, include the Líderes CUF Project and the 4x4 Program. The former was developed through a partnership between CUF and the Faculdade de Psicologia e de Ciências da Educação da Universidade do Porto, aimed at developing leadership at the various levels of the organization, by identifying and implementing leadership strategies suited to the actual work context and to the activity carried out by each leader. The latter aims to bring about a rejuvenation of the company, via a methodology that promotes the suitable integration of young employees in the organization. This methodology provides for a complete, appropriate training plan comprising key topics for CUF, such as: integrated management system, production processes, safety standards, environmental education as well as workplace hygiene and safety, innovation management, among others.

The Program Conhecer o Grupo is also another of CUF’s best practices. Developed 14 years ago and implemented across the board for all of the companies of the José de Mello Group, the goal of this program is to acquaint employees with the business reality of the companies involved, while promoting the creation of internal synergies and knowledge sharing.

14th International Conference of the European Ceramic Society;ACHEMA – World Forum and Leading Show for the Process Industries;EPCA 49th Annual Meeting-2015;REACH - Registration, Evaluation, Authorization and restriction of Chemical substances;ASPEN TECH - solids modeling using aspen plus; among others.

While seeking a closer relationship between the company and its employees, and just like in previous years, the CUF Picnic and Christmas Party were held in 2015, as events where employees and their families had a chance to come together and socialize. In addition, as part of Internal Communication, the Intranet was developed as a privileged means of communication between CUF and its employees.

CUF offers its employees a range of benefits that most notably include:

• • • • • •

Health Insurance;A maternity kit upon the birth of employees’ children;Presents for employees celebrating their birthday;Tributes to senior employees;Summer Camp for employees’ children;Fundação Amélia de Mello Scholarship Program, a broad initiative of the José de Mello Group, intended to support the development and education of employees’ children by paying part of their university tuition.

49

The Collective Labor Agreement establishes the following:

•

• • Employee satisfaction is essential to achieving motivation. As such, in July 2014, a study on “CUF Organizational Climate” was conducted, which had a fulfillment rate of 96%, encompassing all of CUF’s companies. The motivation and satisfaction level of employees was gauged through a survey conducted for this purpose. The project identified main strengths and weaknesses of the current organizational climate, and outlined the actions to be carried out in the coming years. In 2015, sessions were held to present the main results of this study to all of CUF’s employees, while group work was conducted to jointly put together initiatives to be implemented over the next few years.

CUF invests in the Performance Management of its employees, as this is crucial to the strategy for valuing and empowering them. Since 2013, there has been an increase in the number of employees undergoing performance assessment, 83% for the year 2015. Throughout 2015, the new Performance Management platform for CUF was also completed, thereby making it possible to hasten and integrate this entire process.

Complement to sickness benefits, thereby guaranteeing the employee’s net monthly salary;Possibility of additional vacation days up to a maximum of 3 days;Carnival day and local municipal holiday as holidays.

Employee health and safety is another key topic in CUF’s management due to the nature of the business. Corrective and operational control measures stipulated by CUF provide risk assessments and compliance with applicable legal requirements. To ensure the health and safety of CUF’s employees, an Operational Control Plan for Health and Safety is outlined, as well as internal and external Emergency Plans. The internal plan systematizes all procedures to be performed in response to a disaster or a major emergency; the external plan ensures greater agility and operability for the municipality in responding to chemical emergency situations. The operability of these procedures is verified by conducting periodic drills. In 2015, 3 drills were conducted, one of which without prior notice.

50

Local Community

CUF believes in the importance of its role in the communities under its influence, as the company aspires to create a positive impact aimed at contributing toward local development, in both the present and the future. In this context, CUF promotes awareness-raising initiatives geared toward Social Responsibility by encouraging employees to participate in volunteer programs and activities organized within the company. In 2015, among several initiatives, the following are highlighted:

•

•

The Volunteer Program, including the entire José de Mello Group, aims to develop socially responsible corporate action and encourage personal and professional growth of its employees. This Program involves six partner organizations to host volunteers: the ATL da Galiza, the Centro Comunitário da Paróquia de Carcavelos, the Obra do Frei Gil, the Associação Coração Amarelo, Junior Achievement Portugal and Movimento de Defesa da Vida.Volunteers’ Day, an event commemorating the Volunteer Program held throughout the year. In 2015, this event was graced by the presence of over 100 volunteers at Cooperativa para a Educação e Reabilitação de Cidadãos Inadaptados de Cascais (CERCICA), which held various farming-related activities.

51

•

•

Due to social, economic or environmental impact on regional development, transparent communication and engagement with the local community is a priority for CUF. In November 1993, the companies of ECC, and CUF-QI in particular, voluntarily joined the Responsible Care program. This program promotes transparent communication with key stakeholders, allowing the development of policies and actions to minimize and/or mitigate the negative impacts of industry on society.

In response to the commitment made upon adhering to the Responsible Care program, the companies of Estarreja Chemical Complex formed a community panel named PACOPAR. PACOPAR’s mission is to continuously and sustainably improve the quality of life in Estarreja, bringing together synergies between the various members involved. In 2015, among several initiatives, the following

are highlighted:

•

•

•

•

In addition, CUF promotes several short- or long-term academic and vocational internships with various organizations such as Universities, Instituto de Emprego e Formação Profissional (IEFP) or Secondary Schools. Throughout 2015, 49 internships were held, 6 more than in 2014.

PACOPAR supported 16 community projects in the fields of education, social support and civil defense, by contributing around 40,000 €;CUF headed two projects for creating two free apps available for every operating system. The first one, “QUIZ4YOU PACOPAR,” with mini-games for all ages, and the second, “Trekking BioRia,” providing eight foot paths in Salreu and a regional flora and fauna guide;CUF and the other companies of the ECC hosted the “Open Doors” initiative, geared to the Municipality’s institutional representatives. During visits to the manufacturing facilities, the 30 guests observed the existing measures as part of personal safety and environmental protection, as well as their systems and resources for dealing with emergencies;As a communication policy, PACOPAR publishes, in its annual magazine and website, several interesting topics for the local community and for its sector of operations, as well as various indicators that reveal the performance of these industries in the spheres of Safety and Environment.

52

The Ser Solidário program, which is also applied across the board to the José de Mello Group, seeks to financially support charities. The institutions are chosen by the employees themselves, who participate in this initiative by donating a monthly amount of their salary. The financial support that resulted from the 2015 edition was delivered to Associação Humanitária de Salreu, Comunidade Vida e Paz, and to APATI - Associação Promotora de Apoio à 3ª Idade, each one receiving financial support in the amount of 4,000 €.The AMI – Papel por Alimentos Campaign, which CUF has signed on to and which is held in collaboration with Banco Alimentar Contra a Fome. In this initiative, paper collected by CUF for recycling is entirely turned into funding for Banco Alimentar Contra a Fome. For this campaign in the last three years, CUF has collected over 16 t of used paper.

Next Steps

Concerning the social domain, the following goals have been set for 2016:

• • • • • •

To achieve the established goals for 2016, the following measures are expected to be implemented:

•

• • • •

Build an action plan for CUF to become recognized as one of the top industrial companies to work for in Portugal by late 2020;Maintain compliance with the “0 serious industrial accidents” target;Promoting its management staff’s leadership skills;Proceed with the rejuvenation plan in the area of operations;Streamline CUF’s internal communication;Continue to encourage employee participation in initiatives such as the “Volunteer Program” and “Ser Solidário.”

To achieve the established goals for 2016, the following measures are expected to be implemented:Carrying out the Annual Training Plan;Continuing the Líderes CUF Program;Continuing the 4X4 Program;Consolidating the Intranet with all of its employees.

53

GRI IndexGENERAL STANDARD CONTENTS

Indicator

Strategy and Analysis

CEO’s statement on the relevance of sustainability to the organization and its sustainability strategy

Organization name

Primary brands, products, and services

Organization’s headquarters location

Nature of ownership and legal form

Served markets

Total number of employees

Percentage of total employees covered by collective bargaining agreements

Organization’s value chain

Significant changes during the reporting period regarding the organization’s size, structure,ownership, or its value chain

Number of countries where the organization operates, and names of countries where either the organization has significant operations or that are specifically relevant to the sustainability topics

Organization scale

Page 5-6

Page 5

Page 12

Page 12-13

Pág.13

Page 12-14; 26; 46-47Annual Financial Statement 2013, 2014 and 2015

Page 13

Page 14

Pág. 45-47

Pág. 45

Pág. 17

Page 12-14

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

G4 - 1

G4 - 3

G4 - 4

G4 - 5

G4 - 7

G4 - 10

G4 - 8

G4 - 11

G4 - 12

G4 - 13

G4 - 6

G4 - 9

Location External Verification

Organizational Profile

55

GENERAL STANDARD CONTENTS

Organizational Profile

Approach to the precautionary principle

Economic, environmental and social initiatives and principles to which the organization subscribes

Memberships of associations and national or international advocacy organizations

List of all entities included in the organization’s consolidated financial statements

List of stakeholder groups engaged by the organization

Process adopted for defining the report content and the material aspect boundaries

Basis for identification and selection of stakeholders

The boundary of each material aspect within the organization

Key topics and concerns that have been raised through stakeholder engagement, and how the organization has dealt with those key topics and concerns

Material aspects identified in the process for defining report content

Organization’s approach to stakeholder engagement, including frequency of engagement by type and by group

The boundary of each material aspect outside the organization

Restatements of information provided in previous reports, and the reasons for such restatements

Significant changes from periods covered by previous reports in the scope and material aspect boundaries

CUF has an active approach to managing financial, operational, patrimonial, environmental and health

and safety risks based on the precautionary principle. Through this principle, the company seeks to minimize

potential adverse effects associated with these risks Annual Financial Statement 2013, 2014 and 2015

Page 18; 35; 41; 51-52

Page 28

Page 8; 13

Page 21

Page 21

Page 21

Page 21

Page 18

Page 18

Page 18-20

N/A

Slight restatements were made to the report’s content relative to the previous report, in order

to adapt the report to the company’s current reality

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

G4 - 14

G4 - 15

G4 - 16

G4 - 17

G4 - 24

G4 - 18

G4 - 25

G4 - 20

G4 - 27

G4 - 19

G4 - 26

G4 - 21

G4 - 22

G4 - 23

Identified Material Aspects and Boundaries

Stakeholder Engagement

56

Indicator Location External Verification

Page 19-20

GENERAL STANDARD CONTENTS

Indicator

Report Profile

Governance

Ethics and Integrity

Forms of Management

Reporting period

Date of most recent previous report

Contact point for questions regarding the report or its contents

Organization “in accordance” option and GRI Content Index

Reporting cycle

Organization’s policy and current practices with regard to seeking external assurance for the report

The organization’s governance structure, including committees under the highest governance body

Organization’s values, principles, standards and norms of behavior

Page 8

Page 8

Page 9

Page 8

Page 9

CUF’s Sustainability Report will be published on an annual basis

Page 22-23

Page 11; 15-16

Page 15-16; 27; 29-31; 36; 39-41; 45; 51; 53

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

G4 - 28

G4 - 29

G4 - 31

G4 - 32

G4 - 30

G4 - 33

G4 - 34

G4 - 56

G4 - DMA

57

Location External Verification

SPECIFIC STANDARD CONTENTS

Economic Performance Indicators

Economic Performance

Materials

Energy

Water

Emissions

Effluents and Waste

Procurement Practices

Environmental Performance Indicators

Direct economic value generated and distributed

Proportion of spending with local suppliers

Total materials used, by weight

Energy consumption within the organization

Total water consumption, by source

Direct Greenhouse Gas (GHG) Emissions (Scope 1)

Water discharges, by quality and destination

Indirect Greenhouse Gas (GHG) Emissions (Scope 2)

Total weight of generated waste, by type and destination

Carbon Intensity

NOX, SOX and other significant air emissions

Energy Intensity

Page 26

Page 26

Page 32

Page 33

Page 33

Page 39

Page 34

Page 37

Page 34

Page 38

Page 34

Page 35

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

Yes

G4 - EC1

G4 - EC9

G4 - EN1

G4 - EN3

G4 - EN8

G4 - EN15

G4 - EN22

G4 - EN16

G4 - EN23

G4 - EN18

G4 - EN21

G4 - EN5

58

Indicator Location ExternalVerification

SPECIFIC STANDARD CONTENTS

Environmental Performance Indicators

Compliance

Global

Monetary value of fines and total number of non-monetary sanctions for non-com-pliance with environmental laws and regulations

Total environmental protection expenditures and investments, by type

CUF has not paid any significant penalty between 2013 and 2015, in

this regard

Page 38

Yes

Yes

G4 - EN29

G4 - EN31

Employment

Social Performance Indicators - Labor Practices and Decent Work

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

Percentage of total workforce represented in formal health and safety committees

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

Skills management and lifelong learning and occupational career management

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

Return to work and retention rates after paternity leave, by gender

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

Page 45 Attachments - Human Resources (page 65-67)

Attachments - Human Resources (page 64)

Page 48 Attachments - Human Resources (page 67-68)

Page 48 Attachments - Human Resources (page 67-68)

Page 50 Attachments - Human Resources (page 69)

Page 48Attachments - Human Resources (page 70)

Page 48 Attachments - Human Resources (page 71)

Yes

Yes

Yes

Yes

Yes

Yes

Yes

G4 - LA1

G4 - LA5

G4 - LA9

G4 - LA10

G4 - LA11

G4 - LA3

G4 - LA6

Occupational Health and Safety

Training and Education

59

Indicator Location ExternalVerification

SPECIFIC STANDARD CONTENTS

Social Performance Indicators - Human Rights

Investments

Total hours of training on Human Rights policies CUF had no training in Human Rights policies between 2013 and 2015

YesG4 - HR2

Compliance

Customer Health and Safety

Social Performance Indicators - Society

Social Performance Indicators - Product Responsibility

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

CUF has not paid any significant penalty between 2013 and 2015, in this

regard

YesG4 - SO8

Poducts and services for which health and safety impacts are assessed for improvement Page 43 YesG4 - PR1

Type of information on product and service labeling required by the organization for its products and services

Monetary value of significant fines concerning the provision and use of products and services

Customer satisfaction assessment

Page 43

CUF has not paid any significant penalty between 2013 and 2015, in this

regard

Page 44

Yes

Yes

Yes

G4 - PR3

G4 - PR9

G4 - PR5

Product and Service Labeling

Compliance

60

Diversity and Equal Opportunity

Composition of the organization’s governing bodies, by gender, employee category and age group G4 - LA12 Attachments - Human Resources (page 62-64) Yes

Indicator Location ExternalVerification

AttachmentsHUMAN RESOURCES

Number of Employees

Total No. of Employees

Total No. of Full-time Employees

Male

Female

Under age 30

Ages 30 to 50

Over age 50

Estarreja

Directors

Lisbon

Managers

Loulé

Coordinators

Pombal

Technicians

Barreiro

Persons in charge

Functional Technicians

Coimbra

Operators

Administrative Staff

339

339

281

31

58

124

184

231

42

14

14

14

24

6

14

22

63

19

130

52

33

339

339

278

33

61

125

181

240

42

14

14

2

27

7

14

22

63

19

128

58

28

338

338

272

35

66

134

169

241

44

11

11

2

29

7

18

20

70

20

118

55

30

2013 2014 2015

By gender

By age group

By region

By employee category

62

HUMAN RESOURCES

Percentage of Employees

Male

Female

Under age 30

Ages 30 to 50

Over age 50

Estarreja

Directors

Lisbon

Managers

Loulé

Coordinators

Pombal

Technicians

Barreiro

Persons in charge

Functional Technicians

Coimbra

Operators

Administrative Staff

83%

17%

9%

37%

54%

68%

12%

4%

4%

4%

7%

2%

4%

6%

19%

6%

38%

15%

10%

82%

18%

10%

37%

53%

71%

12%

4%

4%

1%

8%

2%

4%

6%

19%

6%

38%

17%

8%

80%

20%

10%

40%

50%

71%

13%

3%

3%

1%

9%

2%

5%

6%

21%

6%

35%

16%

9%

2013 2014 2015

By gender

By age group

By region

By employee category

63

HUMAN RESOURCES

Governing Bodies

Percentage of Governing Bodies

Employees covered by Formal Health and Safety Committees

Male

Male

Percentage of employees covered by Formal Health and Safety Committees*

*CUF-QI

Female

Female

Under age 30

Under age 30

Ages 30 to 50

Ages 30 to 50

Over age 50

Over age 50

6

100%

100%

-

-

-

-

2

33%

4

67%

7

100%

100%

-

-

-

-

3

43%

4

57%

7

100%

100%

-

-

-

-

3

43%

4

57%

2013

2013

2013

2014

2014

2014

2015

2015

2015

By gender

By gender

By age group

By age group

64

HUMAN RESOURCES

Employee Exit

Employee Hires

Total No. of Employee Exits

Total No. of Employee Hires

Male

Male

Female

Female

Under age 30

Under age 30

Ages 30 to 50

Ages 30 to 50

Over age 50

Over age 50

11

6

12

10

1

4

2

5

6

5

4

-

18

15

20

20

2

5

-

11

9

9

11

-

17

11

20

19

3

8

3

9

4

8

13

2

2013

2013

2014

2014

2015

2015

By gender

By gender

By age group

By age group

Estarreja

Estarreja

Lisbon

Lisbon

Loulé

Loulé

Pombal

Pombal

Barreiro

Barreiro

Coimbra

Coimbra

2

-

4

3

5

-

-

-

-

-

1

7

5

13

1

2

1

1

-

-

12

-

1

4

9

10

2

4

3

-

3

-

-

-

3

5

By region

By region

65

HUMAN RESOURCES

Employee Exit Rate

Rate of Employee Hires

Total Employee Exit Rate

Total Rate of Employee Hires

Male

Male

Female

Female

Under age 30

Under age 30

Ages 30 to 50

Ages 30 to 50

Over age 50

Over age 50

4%

2%

4%

3%

2%

7%

6%

15%

5%

4%

2%

-

6%

5%

6%

6%

3%

8%

-

34%

7%

7%

6%

-

6%

4%

6%

6%

5%

13%

9%

26%

3%

6%

7%

1%

2013

2013

2014

2014

2015

2015

By gender

By gender

By age group

By age group

Estarreja

Estarreja

Lisbon

Lisbon

Loulé

Loulé

Pombal

Pombal

Barreiro

Barreiro

Coimbra

Coimbra

1%

-

9%

7%

30%

-

-

-

-

-

5%

35%

2%

6%

2%

5%

7%

7%

-

-

150%

-

4%

16%

4%

4%

5%

9%

24%

-

24%

-

-

-

11%

18%

By region

By region

66

HUMAN RESOURCES

Turnover Rate

Training Hours

Total Turnover Rate

Total No. of Training Hours

Male

Male

Female

Female

Under age 30

Ages 30 to 50

Over age 50

6%

4.986

6%

5.858

9%

872

22%

9%

2%

12%

8.289

12%

10.625

12%

2.336

34%

14%

6%

10%

4.802

12%

6.466

17%

1.664

35%

9%

9%

2013

2013

2014

2014

2015

2015

By gender

By gender

By age group

Estarreja

Lisbon

Loulé

Pombal

Barreiro

Coimbra

1%

16%

30%

-

-

40%

8%

7%

14%

-

150%

20%

8%

14%

24%

24%

-

29%

By region

Directors

Managers

Coordinators

Technicians

Persons in charge

Functional Technicians

Operators

Administrative Staff

-

62

745

2.145

218

1.664

670

354

31

213

1.164

2.078

835

3.495

1.781

1.028

46

395

410

1.659

266

3.019

564

108

By employee category

67

HUMAN RESOURCES

Employees Having Received Training

Percentage of Employees Having Received Training

Total No. of Employees Having Received Training

Total Percentage of Employees Having Received Training

Male

Male

Female

Female

205

73%

233

69%

28

48%

253

91%

309

91%

56

92%

245

90%

308

91%

63

95%

2013

2013

2014

2014

2015

2015

By gender

By gender

Directors

Directors

Managers

Managers

Coordinators

Coordinators

Technicians

Technicians

Persons in charge

Persons in charge

Functional Technicians

Functional Technicians

Operators

Operators

Administrative Staff

Administrative Staff

-

-

5

36%

18

82%

35

56%

15

79%

94

72%

49

94%

17

52%

3

43%

13

93%

21

95%

59

94%

19

100%

117

91%

55

95%

21

75%

3

43%

18

100%

18

90%

65

93%

19

95%

107

91%

52

95%

26

87%

By employee category

By employee category

68

HUMAN RESOURCES

Employees Having Received Performance Evaluation

Percentage of Employees Having Received Performance Evaluation

Total No. of Employees Having Received Performance Evaluation

Total Percentage of Employees Having Received Performance Evaluation

224

80%

276

81%

52

90%

229

82%

279

82%

50

82%

228

84%

281

83%

53

80%

2013

2013

2014

2014

2015

2015

1

17%

11

79%

22

100%

54

86%

15

79%

95

73%

49

94%

29

88%

1

14%

11

79%

22

100%

51

81%

16

84%

102

80%

51

88%

25

89%

5

71%

18

100%

19

95%

52

74%

15

75%

98

83%

50

91%

24

80%

By employee category

69

Male

FemaleBy gender

Directors

Managers

Coordinators

Technicians

Persons in charge

Functional Technicians

Operators

Administrative Staff

By employee category

By gender Male

Female

Directors

Managers

Coordinators

Technicians

Persons in charge

Functional Technicians

Operators

Administrative Staff

HUMAN RESOURCES

Employees entitled to Paternity Leave

Employees who took Paternity Leave

Employees who have returned following Paternity Leave

Return Rate

Retention Rate

Male

Male

Male

Male

Male

Female

Female

Female

Female

Female

5

5

5

100%

250%

2

2

2

100%

75%

5

5

5

100%

100%

3

3

3

100%

50%

6

6

6

100%

100%

2

2

2

100%

100%

2013

2013

2013

2013

2013

2014

2014

2014

2014

2014

2015

2015

2015

2015

2015

By gender

By gender

By gender

By gender

By gender

70

HUMAN RESOURCES

Number of work-related Deaths

Number of Occupational Accidents entailing sick leave

Number of Lost Days due to Occupational Accidents

Rate of Hours Not Worked*

Absentee Rate

Total No. of work-related Deaths - - -

2013

2013

2013

2013

2013

2014

2014

2014

2014

2014

2015

2015

2015

2015

2015

Total No. of Occupational Accidents entailing sick leave

Total No. of Lost Days due to Occupational Accidents

Total Rate of Hours Not Worked

Total Absentee Rate

Male

Male

Male

Male

Female

Female

Female

Female

6

236

4%

2%

6

236

4%

2%

-

-

1%

2%

3

39

4%

2%

3

39

4%

2%

-

-

1%

3%

4

63

5%

3%

4

63

4%

2%

-

-

1%

1%

By gender

By gender

By gender

By gender

*Excluded from these statistics: Absenteeism due to Paternity/Marriage leave, Bereavement or Study Leave

71

Number of Hours Not Worked* 2013 2014 2015

Total No. of Hours Not Worked

Male

Female

24.683

26.136

1.453

23.581

24.888

1.307

26.163

27.347

1.184By gender

*Excluded from these statistics: Absenteeism due to Paternity/Marriage leave, Bereavement or Study Leave

Methodological Notes

(1) Excluded from these statistics Absenteeism due to Paternity/Marriage leave, Bereavement or Study leave72

Average Headcount =Nº of Employees in the report year +Nº Employees in the previous year

2

Nº of Employees ExitEmployees Exit Rate

Nº of Employees Hires

Employees Hires Rate

Nº of Employee Exits +Nº of Employee Hires

Average Headcount

Return Rate =Employees who have returned after Paternity Leave

Employees who planned to return after Paternity Leave

Retention Rate =Employees who remained on the job after 12 months of return

Employees who remained on the job after Paternity Leave in the previous year

Rate of Not Worked Hours =Rate of Not Worked Hours (1)

Nº of Workable Hours

Absenteeism Rate =Nº of Hours of Absences to work

Nº of Workable Hours

Abbreviations and Acronyms

ADP

AIPInnovnano

AIPQRLDAR

APMDI

APEQMSSASP

CO2 eq.

SIMRIA

CERCICA

Quimigest

EBITDA

GRI

AquatroNGO

COD

SO2

CIP

RDI

ECC

IEFP

BCSD Portugal NO2

COTEC

TOC

EPCA

CO

Renoeste

EDS

CAPNutriquim

CUF C&S

TSS

Euro Chlor

CO2

SGPAMAG

Elnosa

CEFICPACOPAR

CUF-QI

WWTP

GHG

Aniline and Derivatives Production Process Innovnano - Materiais Avançados, S.A.

Leak Detection And Repair

Diphenylmethane Diisocyanate

Management System of Serious Accident Safety and Prevention

Non-Governmental Organizations

Nitrogen Dioxide

Nutriquim - Produtos Químicos, S.A.

Painel Consultivo Comunitário do Programa Actuação Responsável

Sistema Intermunicipal de Saneamento da Ria de Aveiro

Quimigest - Sociedade Química de Prestação de Serviços, S.A.

Sulfur Dioxide

Research, Development and Innovation

Total Organic Carbon

Renoeste - Valorização de Recursos Naturais, S.A.

Total Suspended Solids

SGPAMAG - Sociedade de Granéis, S.A.

Wastewater Treatment Plant

Associação Industrial Portuguesa

Associação das Indústrias da Petroquímica, Química e Refinação

AP - Amoníaco de Portugal, S.A.

Associação Portuguesa das Empresas Químicas

Aquatro - Projectos e Engenharia, S.A.

Conselho Empresarial para o Desenvolvimento Sustentável

Chlorine-Alkali Production ProcessEuropean Chemical Industry Council

Cooperativa para a Educação e Reabilitação de Cidadãos Inadaptados de Cascais

Confederação Empresarial de Portugal

Carbon Monoxide

Carbon Dioxide

Carbon Dioxide equivalent

Chemical Oxygen Demand

COTEC Portugal - Associação Empresarial para a Inovação

CUF - Consultadoria e Serviços, S.A.

CUF - Químicos Industriais, S.A.

Earnings Before Interest, Taxes, Depreciation, and Amortization

Estarreja Chemical Complex

Electroquímica del Noroeste, S.A.

Euro Chlor Safety Commitment

Global Reporting Initiative

Emulsion Detonation Synthesis

European Petrochemical Association

Greenhouse Gases

Instituto do Emprego e Formação Profissional 73

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To the board of Directors of

CUF – Consultadoria e Serviços, S.A.

Independent assurance report

of the Sustainability Report 2015 (Free translation from the original in Portuguese)

Introduction

In accordance with the request of the board of Directors of CUF – Consultadoria e Serviços, S.A. (CUF), we performed an independent assurance of the ‘Sustainability Report 2015’ (Report). Independent assurance was performed according to instructions and criteria established by CUF, as referred in the Report, and according to the principles and extent described in the Scope below.

Responsibility

CUF’s Board of Directors is responsible for all the information presented in the Report, as well as for the assessment criteria and for the systems and processes supporting information collection, consolidation, validation and reporting. Our responsibility is to conclude on the adequacy of the information, based upon our independent assurance standards and agreed reference terms. We do not assume any responsibility over any purpose, people or organization.

Scope

Our procedures were planned and executed using the International Standard on Assurance Engagements 3000 (ISAE 3000) and having the Global Reporting Initiative, version 4 (GRI4) and AA1000APS Accountability Principles Standard 2008 as reference, in order to obtain a moderate level of assurance on both the performance information reported and the underlying processes and systems. The extent of our procedures, consisting of inquiries, analytical tests and some substantive work, was less significant than in a full audit. Therefore, the level of assurance provided is also lower. It was also considered the AA1000 Assurance Standard (2008), type 2 engagement, for a moderate level of assurance.

For the GRI4 and AA1000 AccountAbility Principles Standard (2008), our work consisted on the verification of the management’s self-declaration on the application of the GRI4 guidelines and level of adherence to the AA1000APS principles.

The following procedures were performed:

(i) Inquiries to management and senior officials responsible for areas under analysis, with the purpose of understanding how the information system is structured and their awareness of issues included in the Report;

(ii) Identify the existence of internal management procedures leading to the implementation of economic, environmental and social policies;

(iii) Testing the efficiency of process and systems in place for collection, consolidation, validation and reporting of the performance information previously mentioned;

CUF – Consultadoria e Serviços, S.A. PwC 2

(iv) Confirming, through visits to sites, that operational units follow the instructions on collection, consolidation, validation and reporting of performance indicators;

(v) Executing substantive procedures, on a sampling basis, in order to collect sufficient evidence to validate reported information;

(vi) Comparing financial and economic data with those in the Annual Report 2015, audited by the external financial auditor, to assess on the external validation of the information reported;

(vii) Analyse of the process for defining the materiality of the issues included in the report, according to methodology described.

(viii)Assess the level of adherence to the principles of inclusivity, materiality and responsiveness set by AA1000APS, by analysing the contents of the report and internal documents;

(ix) Verify the existence of data and information required to comply with the G4 version, option ‘In Accordance – Core’.

Confidentiality and Independence

Internally, PwC SROC is governed by ethical and deontological rules of confidentiality and independence quite rigid. Thus, in all aspects of our collaboration, the Firm and its employees maintain strict confidentiality of information obtained in the performance of their duties and complete independence regarding the interests of CUF.

Additionally, we develop our work in line with standard ISAE 3000 independence requirements, including compliance with PwC's independence policies and code of ethics of the International Ethics Standards Board of Accountants (IESBA).

Conclusions

Based on our work described in this report, nothing has come to our attention that causes us to believe that internal control related to the collection, consolidation, validation and reporting of the performance information referred above is not effective, in all material respects. Based on our examination of the Report and Guidelines GRI, with the assumptions included in the scope, we conclude that the Report includes the data and information required to comply with the G4 version, option ‘In Accordance – Core’.

Comments/Remarks

According to AA1000AS (2008) standard, we present the main observations regarding the adherence of CUF to the principles of AA1000APS (2008) standard:

Principle of inclusivity: CUF publicly assume its responsibilities to its stakeholders, by subscribing the three principles of AA1000APS standard, and the commitment to proceed with its sustainability strategy and value creation for its stakeholders. It is recommended to ensure periodic review of the identification and prioritization of stakeholders, especially in the case of significant changes in the Company or in the industry, as well as disclose in the next sustainability reporting, the main results of the latest stakeholder consultation carried out (2016).

Principle of materiality: CUF identified in 2014 the material issues, as a result of an internal stakeholder consultation process, benchmarking and international trends analysis. CUF recently held a review of material issues. It is recommended to disclose, in the next sustainability reporting, the main results of the latest stakeholder consultation carried out, as well as the review of the material issues of CUF and the new sustainability commitments.

CUF – Consultadoria e Serviços, S.A. PwC 3

Principle of responsiveness: CUF has a set of mechanisms for stakeholder consultation, aimed at understanding and addressing the expectations of its stakeholders. It is recommended to ensure that there are solid mechanisms of communication and engagement for all stakeholders, as well as ensure that the expectations and concerns of all stakeholders are addressed properly, through an integrated mechanism, e.g. sustainability report or sustainability website.

Lisbon, June 30th 2016

PricewaterhouseCoopers & Associados, S.R.O.C., Lda.

Represented by

António Joaquim Brochado Correia, ROC