These are the risks concerning the level of indebtedness, liquidity and access to credit and financing, impacting the solidity of the capital structure. These risks are managed through control of indebtedness; gains in revenue with efficiency in capital allocation; adoption of issuing securities and financial operations that guarantee the availability of funds; default possibility analysis; and definition, by the Board of Directors, of the level of protection (hedge) for long-term debt.
These encompass controls related to safety, efficiency and resilience of the industrial units, balancing production, supply and demand. These controls are managed through the Beef Desk, in which a multidisciplinary group meets to assess market forces, the effects on input and product price curves and changes in commodities, under the coordination of the Market Intelligence team. In addition, within the scope of risk management, there are weekly meetings, called Choice, where decisions for allocation and breakdown of raw material are taken..
These are linked to market concentration, changes in the profile of global customers, and the need for significant changes in the company’s portfolio and production processes. Through geographic diversity and attention to meeting the needs of the markets, we strive to reduce exposure and ensure predictability in cash generation, as well as explore new growth opportunities by means of the actions of the area of Innovation.
Risks associated with non-compliance regarding social and environmental standards and laws, which may result in fines, sanctions and penalties, as well as factors associated with non-compliance of labor legislation in our own operations and in the value chain, which could impact our business and our image and reputation. In order to mitigate these impacts, we have invested in improvements to our environmental, land and labor controls of our suppliers; in the development of our own technologies to monitor the efficiency and environmental compliance of our industrial units; in health, safety and well-being controls of our employees; and in the development of support programs for the communities in which we operate.
These are risks associated with adverse and/or extreme weather events and conditions that may affect commodity cycles, production costs, the integrity of rural and industrial assets and our production chain, as well as the availability of cattle and animal protein. Water scarcity, changes in rainfall patterns, temperature variations, floods, deforestation, fires and greenhouse gas emissions are among the factors that may produce financial implications for Minerva Foods.
In addressing these risks, we monitor greenhouse gas emissions in our operations through an annual inventory that follows the GHG Protocol methodology. Based on the emissions profile, mitigation actions are defined and systems and processes are improved. For monitoring of our supply chain, we rely on a geospatial system to detect deforestation, invasion of indigenous lands and environmental protection areas. We have also implemented, being pioneers in the sector, a monitoring tool directed at indirect suppliers and have developed an application to provide this same technology to our direct suppliers. Furthermore, we have created the Renove program, in a joint collaboration with our supply chain, for the measurement of the carbon balance on ranch properties.
Learn more about our activities to combat climate change.
Dedication to the Planet