We have applied for certification under the State-owned Company Highlight in Governance Program. The application was filed on Friday, June 2, with B3, formerly BM&FBovespa. Additionally, we have already started studies to join B3’s Level 2 special listing segment aiming to implement corporate governance measures that go beyond those required by the Brazilian Corporations Act and by Act 13,303/16, the State-owned Company Act.
Certification in both the State-owned Company Highlight in Governance Program and in B3’s Level 2 listing work as quality seals in Governance. The initiatives to join the Program and B3’s Level 2 reaffirm our commitment to continuously improving our governance, as well as our alignment with best market practices.
To be certified under the State-owned Company Highlight in Governance Program, the company must comply with the measures set forth in the Program. For example, it must have guidelines on the composition of the Board of Directors, of the Board of Executive Officers, and Audit Committee, such as diversity in experiences and qualifications and a minimum of 30 percent of independent members in the Board of Directors.
Establishing internal mechanisms to prevent actions of administrators in favor of policies that go beyond the public interest foreseen in the law that created the company and in its corporate purpose is also a condition for certification, as is improving the information disclosed in the Reference Form, with the prior, clear definition of the policies and public guidelines we must pursue. Another example of a requirement for certification is the public controller's commitment to governance practices and zeal in handling information the controller is aware of.
The documents and information that we submitted when applying for certification will be reviewed by B3’s Issuer Regulation Board (DRE), which will issue a report and an opinion on the company's application.
For a company to achieve Corporate Governance Level 2, it needs to meet yet another list of conditions, which include having at least 25 percent outstanding shares, and the Chairman of the Board cannot accumulate this position with that of chief executive of the company.
Joining Level 2 will depend on our securing the approvals from all necessary external bodies, as well as the signing, with B3, of the Participation Agreement at Level 2 of Corporate Governance.