COMMUNICATIONON PROGRESS (COP)GLOBAL	  	  2015

	  Message from thePRESIDENTTo all ourstakeholders,I’m pleased to renew Embraco’songoing commitment towardssupporting the Ten Principles ofthe United Nations GlobalCompact.
We have sustainability as astrategic guide for our business,so we’ve built a sound cultureby adopting good practices andprinciples encompassing theareas of Human Rights,Labor Relations, Environmentand Anti-Corruption.
In this publication, we presentour actions in each of theseareas, the results achieved in2015 for an increasingly valuegenerating operation for ourstakeholders and thetransformation which we aspirefor the future.

LUIS FELIPE DAUPresident of Embraco1	  At Embraco, one of our strongestcommitments is to "think sustainable".
This is evidenced by our actions in thecommunities where we operate, inenvironmental responsibility both oninternal processes and the value chain, indeveloping the solutions we offer themarket, and also in all decision-makingspheres. We have sustainabledevelopment as a driver of the company'sstrategy, challenging and inspiring theactions that will be presented throughoutthis publication.

URSULA ANGELIVice President of Human Resources, Communication,Sustainability and Institutional RelationsIntroductionOur business mission is to provideinnovative solutions for a betterquality	   of life, therefore, they areintrinsic behaviors in our activitiesand in our relationships, valuingeach person in our value chain,ethics and respect for theenvironment.
Get to know our initiativesidentified with icons:Promoting Human RightsLPromoting Better LaborConditionsAnti-CorruptionPreserving the Environment2

	  ResponsibleVALUE CHAINSuppliersWe work with more than fivethousand suppliers both direct related the operational materials,and indirect - providingadministrative materials, servicesand maintenance items. Thesesuppliers are present in over 30countries, and being aware of thereach our actions have on the realityof thousands of companies, wesupport their sustainabledevelopment.
Since 2012, we offer our directsuppliers, totaling around 500companies, the Supplier ExcellenceProgram, including workshops andmultidisciplinary actions in order toraise this public’s awareness andengagement for sustainability inrelation, mainly, to efficiency andquality, reducing its environmentalimpact.

Also, to be a supplier for Embraco,the company must be aligned withour principles, set out in the code ofconduct. That is, neither the suppliernor the contracted third parties may– under any circumstances –condone corruption, child labor, slavelabor, discrimination, deforestationor other environmental violations,and must comply with all labor laws.
From 2009 onwards, all suppliersbegan to receive our code of conductand, since then, were invited toparticipate in three self-assessmentprocesses, which included profileissues, labor relation rights,environmental impact managementand production chain control.
Additionally, the Company counts ona systematic routine of monitoringsustainability KPIs and promotesquality audits with the suppliers.
LIt’s worth noting that Embraco works with the aim of reducing the use ofrestricted substances in its operations.
With that in mind, the Company continuously evaluates the raw materials used inmanufacturing products, seeking lower social-environmental impact and is incompliance and meets all regulations of the markets in which it operates. TheCompany also continues looking for constant improvement based on adherenceto international best practices on the topic, such as the "Conflict Minerals"requirement, that, among other issues, restrict the use of minerals extracted fromthe Congo conflict zones in Africa, location where labor and human rights are notrespected.
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	  Circular economyInspired by nature, where all cyclesare closed and all elements arereused at the end of their usefullife, in 2014, we createdNat.Genius, a new operation thatuses decades of reverse logisticsexpertise of our compressors inBrazil to create a new business.
At the end of 2015, Nat.Geniuswas already operating in two units,with 80 employees dismantlingand recycling components not onlyfrom Embraco, but from allmanufacturers.
In all, since 2014 there havealready been recycled 1.3 millioncompressors, reusing 4.7ENthousand tons of steel.
In addition to the clear positiveimpacts on the environment, theproject plays a deeper social role,fostering a local network ofsuppliers and generatingincome for the community.	  
HRThus, knowing in detail that cycle,the Company has the opportunityto implement improvements tomitigate its negative impacts andboost its value creation.

2.4thousand tonsof steel recycled withNat.Genius since 2014In 2015, Embraco also initiated theLife Cycle Assessment studies(LCA) on compressors withFullmotion and Wisemotiontechnologies.
The LCA methodology providesenvironmental analysis of theproduct’s impacts from theextraction of raw materialsthrough production, usage andend of life.

4	  4	  Innovation forSUSTAINABILITYWe are world leader in coolingtechnology, always focused oninnovation, we are one of the largesthermetic compressor manufacturersin the sector, with production capacityof 40 million compressors per year.
We have the constant challenge ofbeing at the forefront in developingnew technologies and solutions thatmeet our customers’ demands andthat promote energy efficiency,reduce consumption of naturalresources and create solutions thatoffer increasingly less environmentalimpact.
For this, we have a Research &Development (R&D) area composedof more than 600 professionals,being 120 in partnerships withinstitutions, distributed in fivecountries, 47 laboratories, and thecontinued investment of 3% to 4% ofour annual revenues in innovation.
In addition, our new business areaworks in partnership with startupsand various institutions, in line withthe open innovation concept, in otherwords, to look at references outsidethe core business to attain disruptiveinnovations and bring them to thebusiness’ reality.
Therefore, the Company seeks toposition itself at the forefront of shortand medium term transformation inits segment.

In 2015, we were awarded 1 st placein the Large Companies Category inthe Innovation Management Case ofFINEP Innovation Award, promotedby FINEP (Financier of Studies andProjects). In the year, for the fourthtime, we were also recognized by theBest Innovator ranking as one of the10 most innovative companies inBrazil.
This strong innovation cultureprovides us with importantachievements.
From the environmentalmanagement perspective,Wisemotion is an example. Launchedin 2014, it allows reducing theenvironmental impact in theproduction chain: it eliminates theneed for lubricant oil, uses 50% lessraw material to be produced, makes a20% savings in energy possible andalso allows new refrigerator designpossibilities with less consumption ofnatural resources, since it can beplaced in different positions insidethe refrigerator.

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6	  Doing moreWITH LESSLean thinkingWe constantly assess our operation’s processes in the pursuit of leanthinking, which is, producing products using increasingly less naturalresources.
This means that our teams are always focused on avoiding waste of allinputs used in the operation, as shown in the following initiatives, as well asachieve continuous improvement, excellence in customer service and quality.

WCMIn order to become increasinglymore efficient, since 2013 webegan implementing a completesystem for continuousimprovement focused on safety,quality and cost reduction, basedon the World Class Manufacturing(WCM) methodology in all ouroperations.
Through WCM, we work on thesimplification and organization ofour work routine, to ensure zeroaccidents (learn more on page 12),zero waste, as well as productivitygains.
Environmental managementOne of the pillars of the WCMmethodology works, specifically,on environmental and energyissues, with a focus on reducingthe consumption of naturalresources and waste generation.
Energy - In 2015, we consumed260.7 thousand GWh, down 1%from the previous year's total.

Our energy consumption rate perunit produced fell by 4.58%, from6.39 KWh/unit in 2014 to 6.11KWh/unit in 2015.
Water - In 2015, we reduced by 9%the water consumption percompressor produced whencompared to 2014 and we reused10.8% of all the water thatentered our units.
Waste - In 2015, we produced109.9 thousand tons of waste, a3.0% decrease over last year.
Of this total, 86% was recycled, upone percentage point compared to
2014.
Emissions - In 2015, our directemissions totaled 39.1 thousandtCO2, down 1.6% over the previousyear, and indirect emissionstotaled 72.3 thousand tCO2, a1.2% decrease. Therefore, totalemissions fell by 1.3%, totaling111.4 thousand tCO2.
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7	  9%less water to produce acompressor in 20157	  SocialDEVELOPMENTOur employeesOur approximately 11,000 employeesdistributed in seven countries, areessential for sustainable businessdevelopment.
For this reason, we continually seekto stimulate their professionaldevelopment, recognize theirperformance through compensationand benefits in line with the market’sbest practices, provide an inclusiveenvironment that values diversity aswell as caring for their health, safetyand quality of life on a daily basis.
Learn more in the followingsubsections.

Professional developmentPeople Excellence is part of thebusiness strategy and has asignificant impact on the Company'sresults and achievements, byboosting the individual and collectivetalents, inspiring a winning cultureand creating competitive advantagesthat allow us to achieve resultsbeyond expectations.
We invest in developing our peoplethrough on-the-job training, jobrotation among units worldwide andby offering scholarships for technicaland post-graduate courses.

Strategically, we support theemployee in the professionaldevelopment necessary for their nexthierarchical level, while helping tobuild their career plan, so they can beprepared for their future step atEmbraco.
The Company also promotes theEngagement Survey, conducted withemployees both from administrativeand manufacturing departments,through a tool that evaluates threedimensions:Extraordinary Performance employee alignment with theCompany's strategy and goals.
Great People - skills and rightcapabilities that create a competitiveadvantage.
Winning Culture - Embraco valuesinto practice, focusing on the client toovercome competition through aninspiring and extraordinaryperformance, while allowing thateveryone reach their full potential.

80%employee engagementachieved in 20159	  Diversity and inclusionValuing diversity is part ofcompany’s leadershipmodel.
Apart from respecting thecultural and racial diversityinherent in the businessbecause of its globalprofile, in 2015, theCompany worked topromote women'sempowerment andinclusion of people withdisabilities.

Women's empowerment – Embracomonitors the percentage of women inleadership positions and seeks to createinitiatives that strengthen meritocracy,providing women with conditions toprogress in their careers.
Inclusion of people with disabilities - whenpromoting diversity, the inclusion of peoplewith physical and intellectual disabilities inthe Company's workforce is an importantaspect, as well as monitoring andencouraging their development throughawareness-raising campaigns, training andclose monitoring of teams.

10	  Health and SafetyTaking care of our employees’ health and safety is an ongoing commitmentof the Company.
To ensure this in practice, regarding workplace safety, Embraco has adoptedglobally Behavior-Based Safety, a program which seeks to build andmaintain a safe work environment. Since 2010, it has engaged employees,suppliers and visitors on the Golden Rules to keep their safety as a priority ineveryday activities.
When it comes to promoting health and quality of life, the Company alwaysseeks to be close to its employees, supporting prevention and care, whilealso providing support in the physical or psychological difficulties of theirlives.	  
L9	  	  Social InvestmentWe believe in our potential totransform the reality in thecommunities where we operate.
Accordingly, we make every effort toengage our employees in socialprojects that bring benefits topeople that live near our plants andoffices around the globe.
In 2015, we invested approximatelyUS$ 120 thousand in social projectsin the communities in which weoperate in Brazil, China, Slovakia, Italyand Mexico, which have benefitedand contributed to the well-being ofover 28 thousand people.

During this period, we also offeredclose to five thousand hours ofcommunity work, carried out withthe support of over 350 volunteers,with actions such as EmbracoEcology Award, held in Brazil andSlovakia, and voluntary actions,such as Global Volunteer Day(“Prove um Dia Diferente”- Prove - ADifferent Day).
Actions such as those generatecompetitive advantage for us andcontribute toward building a betterbusiness and a better world.
HREmbraco Ecology AwardIn 2015, we held the 23rd edition ofthe Embraco Ecology Award, whichrecognizes public and privateschools in Joinville (SC, Brazil) bycreating solutions that benefit theenvironment.
The award is divided into Action andTransformation categories and thewinners receive, respectively, R$8,000 and R$ 24,000 to developtheir project, strengtheningenvironmental education.
In addition to the monetary value,the Embraco Ecology Award offerssupport to the winners’ activities,such as monthly monitoring ofprojects by consultants specializedin environmental education, trainingworkshops for the projects’coordinating team in schools, visitsby Embraco to check the projects’progress and publication of thebimonthly magazine called“Ambiente-se”, which aims todisseminate the actions that arebeing implemented by schools. Inthe last edition five institutions wereawarded:Action category• CEI Professora Alzelir TeresinhaGonçalves Pacheco• CEI Cachinhos de Ouro• Escola Municipal AlfredoGermano Henrique Hardt• Escola de Educação BásicaProfessora Alícia BittencourtFerreiraTransformation category• CEI Alegria de ViverThe award is also given in Slovakia.
In its seventh edition, it granted US$11,000 to eight schools for theirrecycling and waste reuse projectsin 2015.	  

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	  EthicalCONDUCTWe have a structure dedicated topromote ethical conduct inbusiness and relationships aimingto combat corruption in all itsforms.
Our Ethics Committee managesissues regarding the conductexpected from our employees andsuppliers as well as maintains thecommunication channels thatreceive complaints or claims.
A list of 15 policies and principlesestablishes the guidelines tomaintain ethical conduct, besidesan anti-corruption managementsystem, Letter of OrganizationalValues – which are adhered to byall employees – as well as theCode of Conduct for our suppliers.
The Compliance Program has amanagement and indicatorssystem, provides for the audit ofthe various activities of theProgram - such as the training ofall new employees and annualCompliance Certification for allleaders -; it also offers aconfidential questioning andreporting communication process,ensuring no retaliation.

We adhere to the requirements ofthe Sarbanes-Oxley Act (SOX), aNorth American law created toreduce the risk of financial fraud,which provides for all significantinternal controls to be documentedand tested by the Internal andExternal Audit. In addition to SOX,to ensure the integrity of ouroperation, we conduct operationalaudits in our units: 100% of themare subject to periodic review of allinternal control processes.
All new employees are trained onhiring and the remainingemployees periodically go througha knowledge updating process,receiving instruction on topics suchas corruption, money launderingand antitrust actions. Thesedocuments and information arealso available at all times forconsultation on the intranet andwebsite.
In 2015, the Company heldtraining based on Embraco’svalues, including ethics, for allemployees in Brazil and intends toexpand that initiative to otherunits in 2016.	  

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	  September, 2016Content and LayoutRICCA RIPhotographersAndré KopschMarcelo CaetanoPress photoDevelopmentEliza Hostin SilvaMichelle ScachettiPatrícia de Morais Della Justina