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SUSTAINABILITY

REPORT 2014

GRAÑA Y MONTERO WORK STYLE INSPIRES USDISTINGUISHES USALLOWS US TO TRANSCEND

01_ 02_ 03_

MESSAGE FROM THE GENERAL MANAGER

PAG._04

WHAT DO WE DO?

PAG._06

HOW DO WE DO IT?

PAG._19

WHY DO WE DO IT?

PAG._96

OUR SUSTAINABILITY MODEL: GROW AND SHARE PAG._21

GROW: IN A RESPONSIBLE MANNER PAG._28 Ethical Conduct Development of our collaborators Safety and Health Environment Communication

SHARE: OUR KNOWLEDGE TO PROMOTE CIVILITY PAG._73 Suppliers Clients Community

AWARDS AND RECOGNITIONS PAG._93

LEADERS IN ENGINEERING AND INFRASTRUCTURE

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TABLE OF CON-TENTS

GRI INDEX

PAG._97

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SUSTAINABILITY REPORT 2014

<< menu MESSAGE FROM THE GENERAL MANAGER

DEAR FRIENDS:

For one more year, we are excited with the progress made by the Graña y Montero Group, which is a result of the trust generated by our sustainable management. In 2014, our sales grew 9.9%, to US$ 2,345 MM. By the end of the year our backlog portfolio reached US$ 3,765 MM and the recurrent businesses reached an amount of US$607 MM.

This performance was driven by our diversification and internationalization strategy and by a greater investment capacity as a result of our listing on the New York Stock Exchange (2013).

One of the highlights of 2014 was the acquisition of the companies COGA, in charge of operation and maintenance of the trans-Andean Camisea gas pipeline, and MORELCO, a Colombian company specializing in civil works, electromechanical assembly and services for the oil, gas and energy industry. Both are strategic

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<< menu

operations, as they will allow us to grow in key sectors such as oil and energy, and strengthen our presence in Latin America.

In addition to such acquisitions, we continued to wager on a long-term vision by our infrastructure concessions business. In this sector, in addition to funding, building and operating, in accordance with high quality standards, the major infrastructure works and public utilities required by our country, we found the opportunity to become providers of well-being and promoters of good civic behavior.

This successful growth of the Group has been possible thanks to the talent and commitment of our 46,762 collaborators who, inspired by our corporate values of quality, compliance, seriousness and efficiency, bring about the Graña y Montero Work Style, our way of doing things. In line with this way of doing business, in 2014 we enhanced our Grow and Share sustainability model, which provides a framework to promote

responsible management of our businesses and the development of positive relationships with our stakeholders.

Our responsible management focuses on five areas, prioritized based on the risks and impacts of our operations: ethical conduct, people development, safety, environment and communication.

Based on this good internal management, we seek to share our experience and knowledge with the various groups with whom we relate, in order to generate responsible civic behaviors that further their development.

We believe that the formula set by our Grow and Share model will allow us to continue generating trust and transcend as an organization, creating a virtuous cycle of development where the company wins and society wins. This Sustainability Report contains the progress made in 2014 and poses new challenges for upcoming years, which we take on with enthusiasm.

Lastly, we confirm our commitment to the United Nations Global Compact Principles, which guidelines we follow, as reflected in all aspects of our sustainable management.

In 2014 we enhanced our Grow and Share sustainability model, which provides a framework to promote responsible

management of our businesses and the development of positive relationships with our stakeholders.

>>

José GrañaPresidente

Mario AlvaradoGerente GeneralCorporativo

MESSAGE FROM THE GENERAL MANAGER

WHAT DO WE DO?

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<< menu SUSTAINABILITY REPORT 2014


WE ARE A GROUP OF 26 COMPANIES THAT COMPLEMENT EACH OTHER, ORGANIZED IN FOUR BUSINESS AREAS, WE OPERATE IN EIGHT COUNTRIES IN LATIN AMERICA AND WE ARE LISTED ON THE LIMA STOCK EXCHANGE (1997) AND THE NEW YORK STOCK EXCHANGE (2013).

With our 81 years of strong track record, we are the leading engineering services and infrastructure Group in Peru. We design, fund, build and operate the most complex engineering projects, generating value for our clients and furthering the development of our country. As part of our growth strategy, 30 years ago we bet on the diversification of activities, originating our subsidiaries GMI (Engineering Consulting), GMD (Information Technologies) and GMP (Oil and Gas). Since then, we have expanded our

business lines, strengthening our leadership in the infrastructure concessions business and our presence in key sectors such as oil, gas, energy and mining construction.

This growth was strengthened by listing of our shares on the New York Stock Exchange (2013), which increased our investment capacity and allowed furthering our regional development, mainly in Peru, Colombia and Chile.

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• We acquired 51% in COGA, the company operating the trans-Andean Camisea gas pipeline.

• We entered into a 10-year for design, construction and operation of the Vehicle Natural Gas Supply System for 10 cities in the High Andes.

• We were awarded the concession contract of two oil blocks in northeastern Peru for 30 years.

• We obtained management of five fuel storage terminals for 20 years.

• We acquired 70% of the shares of the building company Morelco S.A.S., a Colombian company specializing in civil works, electromechanical assembly and services of the oil, gas and energy industries.

• In addition to this acquisition, we purchased the Chilean companies DSD Construcciones y Montajes S.A. (2013) and Vial y Vives S.A. (2012), both merged during 2014, and incorporated Compañía Americana de Multiservicios Limitada (CAM) in 2011, a Chile-based company with operations in Colombia, Peru and Brazil.

• In 2014, billing of our companies abroad was US$ 487 MM.

DIVERSIFICATIONIN 2014:

INTERNATIONALIZATIONIN 2014:


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GRAÑA Y MONTERO GROUP IN NUMBERS

PERU

MEXICO

PANAMA

CHILE

GUYANA

BRASIL

COLOMBIADOMINICAN REPUBLIC

46,762collaborators


US$ 2,345 MM US$ 3,765 MM

91 millones

in revenues in backlog portfolio and US$ 607 MM in recurrent businesses

users(L1 and road concessions)

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WHAT GUIDES US AND INSPIRES US:

VALUES

VISIONTO BE RECOGNIZED AS THE MOST TRUSTWORTHY ENGINEERING AND INFRASTRUCTURE SERVICES GROUP IN LATIN AMERICA.

TRUST: WE ARE CONSISTENT IN WHAT WE SAY AND WHAT WE DO, AND WE TAKE RESPONSIBILITY FOR THE RESULTS. THUS, WE GENERATE COHERENCE AND CREDIBILITY WITH OUR TEAMS AND OUR ENVIRONMENT.


QualityDo things well by conviction, seeking to exceed expectations and improve industry standards.

ProfessionalismWe work with honesty and integrity and seek to be an example of conduct within and outside our working environment.

ReliabilityTime is an ever more valuable asset, which is why we fulfill our commitments before the deadline.

EfficiencyThe spirit that leads us to accomplish our objectives with the least possible resources, questioning our methods and processes to improve them.

>>

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BUSINESS AREAS

GMIGyMVIAL Y VIVES - DSDSTRACON GyMMORELCO

Provides engineering, procurement and construction services. It specializes in sectors such as mining, energy, infrastructure, industry, etc.

Develops real estate products such as homes, offices, shops and industrial lots. Most of its contracts are short-term.

It is the most important concessionaire in Peru. Manages projects that require a high investment and long-term contracts.

Provides operation services of infrastructure, electricity networks, business processes and information technology. Its contracts are medium-term.

NORVIALSURVIALCANCHAQUEVESURFERROVIAS GyMLA CHIRAGMPCOGA

VIVA GyMALMONTE

GMDCONCARCAM GyM

To support the rapid growth of the Group, since 2012 are we organized into four areas, gathering those with similar operations and management systems. This allows us to enhance the capabilities of the various areas and generate internal synergies in the Group.

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(*) In 2014, the companies Vial y Vives and DSD Construcciones y Montajes merged and became Vial y Vives-DSD.


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OUR VALUE PROPOSAL

We offer our clients, whether companies, users or the state, services of excellence, with high quality standards and compliance before the deadline, generating value for them through innovative solutions.

INTEGRATED SERVICES:

We encompass the full value chain of the sector, from project design to operation. The strengths of the Group companies allow us to propose comprehensive solutions and reduce project completion times.

For instance, in 2014, GyM completed, in a consortium, construction of tranche II of Line 1 of the Lima Metro. This public service is operated by Concar since January 2012, commissioned by Ferrovias GyM, the company holding the concession of Line 1.


>>

EXECUTION CAPACITY:

The experience and capabilities of our outstanding team allow us to execute projects of high technical and geographic complexity. In 2014, we generated over 124 million man-hours of work in the various companies of the Group. Among our projects, Las Bambas (Apurimac), of which GyM is in charge, was noteworthy for its complexity.

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OUR VALUE PROPOSAL

OPERATIONAL EXCELLENCETo ensure our operational excellence, in 2014 we developed a management model based on the Lean Construction philosophy, model which seeks to maximize the value generated for our clients, minimizing losses and maintaining the Graña y Montero Work Style.

In 2014, we conducted a pilot project for GyM and GMD to identify the various types of operations and the critical operational excellence factors associated with each business. In 2015 we will continue implementing the model, focusing on the efficiency of internal processes.

COMPLIANCE BEFORE THE DEADLINECompliance before the deadline is a central component of our value proposal that distinguishes us from other organizations. In 2014, according to the validation of the auditing firm PWC, 98% of our projects were delivered before the deadline to our clients.

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INTERNATIONAL STANDARDSIn 2014, our operations were certified under the following international standards:

EMPRESA ISO 9001

(Quality)

ISO 14001

(Environment)

OHSAS 18001

(Safety and

Health)

ISO 27000

(Information

Security)

Other

Standards

GyM/1 X X X

GMP/2 X X X

GMI X X X

Vial y Vives-DSD X X X

Line 1 Lima Metro X

GMD/3 X X X X

CONCAR X

CAM GyM X X X

/1 Project Management Control: ISO 9001. Electromechanical Division: ISO 14001 and OHSAS 18001 /2 Consorcio Terminales, Gas Plant, Blocks I and V Talara and Los Órganos, and the headquarters/3 CMMI Certified - (software product quality) and Information technology - Service management (ISO 20000)


OUR VALUE PROPOSAL

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INNOVATION AT THE GRAÑA Y MONTERO GROUPWe work in a competitive environment with increasingly complex projects and services, which require creative solutions to respond to the needs of our clients.

• Culture of Innovation: As part of the Graña y Montero Work Style, we promote a culture of innovation in our collaborators. Along these lines, in 2014, 173 collaborators were trained in the use of the Design Thinking methodology and nine innovation pilots to upgrade internal processes were implemented.

• Innovation in Business: In 2014, GMD, create a R&D area for each of its business lines and an Innovation Committee, through which work topics and methodologies are proposed, and tools and results are shared. The main topics worked during the year included data center monitoring, the express help desk project and telepresence solutions, among others.

• Innovation in the Engineering Community: Through our Impulso a la Innovación Compartida (Promoting Shared Innovation) program, we extend our culture of innovation to society. Thus, we promote the development and transmission of knowledge in the engineering field, to create innovative solutions that help raise competitiveness in our country.


OUR VALUE PROPOSAL

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OUR FINANCIAL RESULTS 2014

Sales of the Group increased by 9.9% compared to 2013, reaching US$ 2,345 MM. Furthermore, we generated a net profit of US$ 100 MM, capital investments for US$ 385 MM, a backlog portfolio of US$ 3,765 MM and US$ 607 MM in recurrent businesses.

REVENUES (US$ MM)

2011

2012

2013

2014

2,13

4

2,34

5

1,57

3

2,05

1

2011

2012

2013

2014

3,76

5

2,49

4

4,1

66

3,93

5

BACKLOG (US$ MM)


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Income generated during the year benefited our various stakeholder groups: US$ 1,167 MM were allocated to payments of our suppliers, US$ 621 MM to our employee and worker collaborators, US$ 35 MM to dividend payments, US$ 29o MM to the state for taxes, and over US$ 385 MM to capital investments.

APPLICATION OF PROFITS (MILLION US$)

DISTRIBUTION TO INTERNAL STAKEHOLDERS (US$655.7 MM)

2014 US$ %

Sales plus IGV paid 2,491.8

Payments to suppliers 1,167.5

Balance 1,324.3 100.0%

INTERNAL STAKEHOLDERS

Workers 351.8 26.6%

Employees 268.8 20.3%

Shareholders (dividends) 35.1 2.6%

Financial Expenses -15.8 -1.2%

Taxes 298.9 22.6%

Reinvestment (capex) 385.5 29.1%

Total 1,324.3 100.00%


54%

41%Workers

Employees

Shareholders (dividends)

5%

OUR FINANCIAL RESULTS 2014

HOW DO WE DO IT?

OUR SUSTAINABILITY MODEL: GROW AND SHARE

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WE GUARANTEE THE RESPONSIBLE MANAGEMENT OF OUR BUSINESS AND CONTRIBUTE TO THE GROWTH OF THE SOCIETIES IN WHICH WE OPERATE. THUS, WE ENSURE THE TRUST REQUIRED TO ENDURE OVER TIME.

Our sustainability model is based on the Graña y Montero Work Style and on our corporate values of quality, reliability, professionalism and efficiency, which are transmitted by example and determine how we do things in the Group.

Based on this way of doing business, we seek to GROW by a responsible management of our operations. Thus, in addition to profitability and technical quality, we defined five priority matters on which we focus our internal management

efforts: ethical behavior, personal development, safety, environment and communication.

Based on this good internal management, we SHARE our experience and knowledge with our suppliers, clients and communities, contributing to generate responsible citizenship. As a result, we strengthen trust and generate a virtuous circle of development, where both the company and the society win.


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+ =FOCUS: FIVE PRIORITY MATTERS

1. ETHICAL BEHAVIOR

2. PERSONAL DEVELOPMENT

3. SAFETY

4. ENVIRONMENT

5. COMMUNICATION

FOCUS: CIVIC BEHAVIORS

CLIENTS

SUPPLIERS

COMMUNITIES

RESPONSIBLE MANAGEMENT

SHARING KNOWLEDGE

TRUST


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THE CHALLENGE IN 2014: “TO DEFINE OUR SUSTAINABILITY PRIORITIES” (G4-18)Our Group consists of 26 companies with specific characteristics and different risks. Accordingly, in 2014 we decided to prioritize the most important matters for our 10 main companies, considering aspects of their internal management and relationships with stakeholders. This process was conducted as follows:

Step 1: Understand the impacts and risks in our value chainEach company worked on identifying the main impacts and risks in its value chain. This exercise, in which management and supervisory offices participated, allowed understanding sustainability from a business-focused perspective. As a result, a list with the most important matters for our companies was defined, also checking them against an analysis of 22 benchmark companies. 10 workshops / 72 participants

Step 2: Know and incorporate the perceptions of the stakeholder groupsWe conducted a dialogue panel with our main suppliers and clients, to know their perceptions on the prioritized matters. For companies whose clients are end users or the state, this process was complemented by satisfaction surveys. 1 panel / 15 participants / 5 satisfaction surveys

Step 3: Prioritize relevant matters and define goals of actionBased on the information obtained, the companies prioritized their relevant matters and proposed improvement objectives for the year.Lastly, the matters identified by each of the companies allowed defining the sustainability priorities of the Group, which were embodied in our Grow and Share corporate model.


CÓMO LO HACEMOS

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THE RESULT: OUR SUSTAINABILITY PRIORITIES (G4-19, G4-20)

Res

pons

ible

man

agem

ent

Priority Matters of the Group

GyM STRACON GyM GMI

1. Ethical Behavior Risk management, transparency, anti-corruption, corporate governance

2.Personal Development Professional development, technical and specialized skills development

Local hiring Local hiring Knowledge management

3.Safety Occupational safety

Road safety Road safety

4.Environment Waste Energy Environmental solutions

5.Communication Dialogue with clients and neighboring communities

Dialogue with clients

Shar

ing

know

ledg

e

Stakeholder Group GyM STRACON GyM GMI

1.Suppliers Sharing of standards and local supplier development

Local supplier development

2.Clients

3.Community Local hiring Local hiring

Knowledge management, research and innovation


ENGINEERING AND CONSTRUCTION

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Res

pons

ible

man

agem

ent


GMP Ferrovias GyM Road Concessions




Client safety Road safety

4.Environment Spills and emissions Energy EIA Compliance

5.Communication Dialogue with clients Enfoque hacia el usuario

Shar

ing

know

ledg

e

Stakeholder Group GMP Ferrovias GyM Road Concessions

1.Suppliers Sharing of standards

2.Clients Citizenship Development

3.Community Citizenship Development

Sustainable communities



INFRASTRUCTURE

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Res

pons

ible

man

agem

ent


Viva GyM




4.Environment Eco-efficient designs

5.Communication Dialogue and information transparency

Shar

ing

know

ledg

e

Stakeholder Group Viva GyM

1.Suppliers

2.Clients Citizenship Development

3.Community Knowledge management, research and innovation

REAL ESTATE


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Res

pons

ible

man

agem

ent


GMD CONCAR CAM Chile



Local hiring Capacidades técnicas


Road safety

4.Environment Electrical and electronic devices waste

Waste Energy efficiency

5.Communication Dialogue and information security

Dialogue with the community

Dialogue with clients

Shar

ing

know

ledg

e

Stakeholder Group GMD CONCAR CAM Chile

1.Suppliers Sharing of standards

2.Clients Road education

3.Community Road education


TECHNICAL SERVICES


GROWFROM A RESPONSIBLE MANAGEMENT

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CRECER A PARTIR DE UNA GESTIÓN RESPONSABLE

AT GRAÑA Y MONTERO, WE PRIORITIZE SUSTAINABILITY OBJECTIVES, FOCUSING OUR EFFORTS ON MATTERS THAT ARE RELEVANT TO THE ORGANIZATION AND TO OUR STAKEHOLDER GROUPS.

1. ETHICAL BEHAVIOR

At Graña y Montero, we promote responsible, upright and transparent conduct. This behavior is an essential part of our Graña y Montero Work Style, which we seek to transmit by example to each collaborator, on all levels of the organization, and to be embodied in every business decision.

We respect the laws and ensure responsible, upright and transparent conduct by our collaborators and companies

>>

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GOOD CORPORATE GOVERNANCE

We uphold the highest good corporate gover-nance standards, ensuring respect for the rights of shareholders, equitable treatment and the transparency of information. This has allowed us to be worthy of the trust of local and interna-tional investors and list our shares on the Lima Stock Exchange (1997) and the New York Stock Exchange (2013).

En 2014, we continued within the Good Cor-porate Governance index of the Lima Stock Exchange and, also, we received the Lima Stock Exchange Key, in recognition of our best gover-nance practices and the liquidity of our shares. Furthermore, we were elected Chairman of the Steering Committee of “Latin American Compa-nies Circle”, a group that brings together the 19 companies with the best governance standards in the region, of which we are a part since 2010.

MANAGEMENT TOOLS

• Ethics Charter (1995)• Code of Conduct (2012)• Ethics Channel (2013)• Ethics Commission (2013)• Regulations of the Regular Shareholders

Meeting and of the Board of Directors.• Principles of Good Corporate Governance

(BVL)• Manual for Asset Laundering and Financing of Terrorism Prevention (ALFTP)

1. ETHICAL BEHAVIOR

As part of our continuous improvement process, in March 2014 the Group elected a new Board of Directors for the 2014-2017 period and, taking into account the new equity structure resulting from our listing on the New York Stock Exchange, it was decided that the Board would consist of a majority of independent directors.

CORPORATE GOVERNANCE STRUCTURE

Directorio Graña y Montero S.A.A.• 9 directors; 5 out of whom are independent

Board of Directors Committees• Auditing and Processes:

3 independent directors• Human Resources Management and SR:

3 independent directors• Investment and Risk:

2 independent directors

Operation Committees• 1 Committee per Business Area

At least in independent director in each Committee

Board of Directors of Companies

Board of Directors of Divisions or of Subsidiaries

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1. ETHICAL BEHAVIOR

Working agenda in 2015

• Implement the preventive Master Plan in accordance with the Foreign Corrupt Practices

Act (FCPA).

• Incorporate in the Ethics Charter and the Code of Conduct the commitment to comply with the laws and regulations of the countries where we operate.

• Distribute the Ethics Charter and the Code of Conduct in Morelco, a Colombian company acquired in 2014.

>>ANTI-CORRUPTION SYSTEM In 2014, we evaluated our anti-corruption system in accordance with the Foreign Corrupt Practices Act (FCPA), the United States law also applicable to companies listed on the New York Stock Exchange, and we designed a Mas-ter Plan (Plan Director) that will allow us to strengthen some controls on a preventive basis.

ASSET LAUNDERING PREVENTION OFFICE: Since 2008 we have an Asset Laundering Prevention System and a corporate compliance officer who is in charge of its implementation. In 2014, we incorporated STRACON GyM to

this system and continued our training efforts in GyM y Viva GyM, providing training to 74.9% and 100% of their collaborators, respectively.

CORPORATE ETHICS CHANNEL: In 2014, 57 cases were reported through our Ethics Channel, 50% less than in 2013. Ten percent of the cases filed qualified as inadmissible for their non-relevance to the Code of Conduct, 52% are under investigation by the Ethics Commission and 39% have been settled, having applied the pertaining corrective and preventive measures.

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We promote the development of persons and teams, enhancing their knowledge, skills and attitudes within the framework of the Graña y Montero Work Style

>>

Our more than 46 thousand collaborators are at the core of our success. Their talent and commitment allow us to carry out the most complex projects and services and face up to the challenges of local and international growth strongly and efficiently.

Aware that this is our main competitive advantage, in 2014 we continued to bet on the professional and personal growth of every member of the organization, providing them

with the skills required to accomplish their full potential and providing them opportunities for development within the company.

Additionally, in support of our rapid growth, we made significant efforts to convey and anchor the Graña y Montero Work Style, which determines how we do things and distinguishes us from other companies. In this connection, in 2014 we published and distributed the book “Graña y Montero Work Style”, written by our Chairman of the Board, Architect José Graña Miró Quesada.

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EMPLOYEE COLLABORATORS

• Talent Development Model• Corporate Learning Center (CCA)

WORKER COLLABORATORS

• Development Model• Technical Training and

Development Center (CCTD)

MANAGEMENT SYSTEM

HUMAN RESOURCES MANAGEMENT IN THE GROUP

• Corporate Values and Policies

• Ethics Charter and Code of Conduct

• Book “The Graña y Montero Work Style”

GRAÑA Y MONTERO WORK STYLE


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OUR TEAMIn 2014, the development of new businesses, the acquisitions and international growth generated a 41% increase in the number of our collaborators, reaching 46,762. This makes us one of the leading employers in Peru and places us a talent-generating referent in the engineering field.

This outstanding human team was made up of 15,841 employer collaborators, among which 4,152 engineers in various areas of specialization stand out. Additionally, we have 24,259 worker collaborators and 6,662 collaborators in consortia.

One of the highest-growth segments was that of worker collaborators, in which GyM stood

out as a result of the increase of activities in the mining project Las Bambas and in Vial y Vives – DSD, for the Antucoya and Pelambres projects in Chile.

Fifty-five percent of our employee collaborators are less than 30 years-old, and they contribute their creativity and ability to adapt to change to the organization. Their youth allows us to form them in accordance with our way of doing things, foster their development and have a quarry of talent ready to take on new roles and responsibilities.

Furthermore, we are proud that 18% of the Group employees are women, notably, 50% and 56% of employees on their payroll of Viva GyM and Holding, respectively, are women.



TEAM OF THE GRAÑA Y MONTERO GROUP TOTAL: 46,762

EMPLOYEES

2013

2014

15,8

41

13,1

09

12,7

59

24,2

59

7,30

1

6,66

2

WORKERS CONSORTIA

30,000

25,000

20,000

15,000

10,000

5,000

0

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EMPLOYEE COLLABORATORS 2014TOTAL: 15,841

AGE DISTRIBUTION OF EMPLOYEESTOTAL: 15,841

GENDER DISTRIBUTION OF EMPLOYEESTOTAL: 15,841

2014 TEAMTOTAL: 46,762



52%57%

55% 82%

34% 26% 37%

14% 17% 8% 18%

WorkersTechnical employees Less

than 30male

employees engineers From 30 to 50

consortia other professionals

more than 50

female

36 >>


EMPLOYEE COLLABORATORSTo enhance and accelerate growth of our employee collaborators, we continue implementing our Talent Development Model, which identifies 21 key competencies required by the organization and promotes accomplishment of such competencies by the collaborators, through training, mentoring, approval and feedback programs.

Based on the progress made in these competencies, the collaborator will be able to grow in the five levels of development proposed by the organization: professional, entrepreneur, manager, strategist and director.

TALENT DEVELOPMENT MODEL

KNOWLEDGE + + =SKILL ATTITUDE

Training program to improve the

level of knowledge

Turning knowledge into

practice

Entrepreneurial actions that allow

us to do things right

TRAININGCOMPANY

TRAINING

OPPORTUNITIESLEADER

PREDISPOSITIONCOLLABORATOR

MENTORING, APPROVAL AND FEEDBACK

DEV

ELO

PMEN

T O

F C

OM

PET

ENC

IES



37 >>


Education and Training Programs:Through our Corporate Learning Center (CCA for Centro Corporativo de Aprendizaje) we seek to further the knowledge of Group collaborators, generating presential and virtual contents leading to accelerate their growth.

Along these lines, in 2014 we continued with our training offerings, with the participation of 300 internal trainers and prestigious educational institutions. These courses, in addition to those given by the companies based on their own

specific requirements, allowed us to provide a total 465,523 man-hours of training during the year, 8% more than in 2013. Furthermore, the use of technology was stepped up and field-trip courses were implemented to allow a closer view of the requirements of each project.

It should be noted that this training effort includes all levels of the organization, from young professionals to top executives, resulting in an average of 34 hours of training per person during the year.

Description GyM GMI STRACON GyM

VIAL Y VIVES -DSD

INFRAST. GMP VIVA GMD CAM GyM CONCAR G&M SAA TOTAL

Man-Hours of Training 91,952 15,977 27,376 5,788 5,226 16,778 12,845 64,273 102,267 121,016 2,027 465,523

Average per Employee 29 16 51 15 63 41 87 35 20 49 21 34

AVERAGE HOURS OF TRAINING PER COLLABORATOR IN THE EMPLOYEE CATEGORY 2014



(*) GMP is not included

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KNOWLEDGE MANAGEMENTAt Graña y Montero, we promote and strengthen the ability of our collaborators to learn, research, question, share and innovate, based on the learning culture of our organization. Thus we seek to make a classroom of every work position, where people may learn day-to-day from their peers, leaders and mentors.

On a corporate level, the strengthening of the Corporate Experts Network, which seeks to connect all collaborators with the referents and specialists of the Group and the implementation of the Corporate Virtual Classroom, which will allow us to extend coverage by training courses, were two of the highlights of 2014.

For GMI, this matter acquires special relevance because, being a consulting firm, “knowledge” becomes the differentiating and strategic factor for its clients. In 2014, the following areas were strengthened:

• Upgrading of the information systems, incorporating more sophisticated browsers for the virtual library, which allowed more than 22,465 visits and 4,876 downloads during the year.

• Sharing of the lessons learnt in projects.• Expansion of the scope of the “Knowledge Days”, by holding online meetings with four provinces at the same

time. This allowed participation and sharing of knowledge among 337 collaborators of GMI.• Holding of 115 virtual forums, which allowed answering to 104 queries from collaborators in real time.



PRIORITY FOR GMI

39 >>


• Mentoring: Through mentoring, we seek to accompany the development of the high potential of the organization, strengthening its leadership skills in the Graña y Montero Work Style. This allows us to strengthen growth of our management, develop a talent quarry, standardize the leadership style of the organization and build trust with our collaborators. In 2014, 387 collaborators participated in the mentoring program, 17% more than in the previous year.

• Approval and Feedback: This process is aimed at the professional development of our collaborators. An impartial committee identifies the development level of each professional and development plans are prepared with its supervisors. As of 2014, 3,155 collaborators have been approved

and 1,656 have received feedback from their supervisors.

BEST PRACTICES IN HUMAN RESOURCES MANAGEMENT

• Great Place to Work (GPtW): We have participated in the GPtW survey for seven years. This tool has allowed us to manage a better working climate for our collaborators. As a result, in 2014 the satisfaction rate of the Group improved by 4 points from 2013, obtaining 71%.

The following companies stood out in the 2014 measurement: Viva GyM, 6th place in the ranking of best companies to

work with less than 250 collaborators; GMP, 11th place in the 250-1000 collaborators category, and GMD, 12th place in the more than 1000 collaborators category. Also, Concar received the Further Progress Award for the highest progress in satisfaction level.

• Asociación de Buenos Empleadores (ABE): The seven companies of the Group are certified by Asociación de Buenos Empleadores (Good Employers Association), (ABE), sponsored by the American Chamber of Commerce of Peru (AmCham Peru), which ensures good labor practices.

• Employer Brand: GyM and Viva GyM received awards as the most attractive companies to work in the construction and real estate sectors, respectively, according to the Where Do I Want to Work survey conducted by Arellano Marketing and Laborum.



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>>Working agenda in 2015

• Continue deployment of the Talent Development Model and start applying it in the Group companies in Chile and Colombia.

• Further the development of our management talent through specific programs for leaders.

• Continue disseminating the Graña y Montero Work Style in the country and abroad.

• Promover sinergias entre las empresas del Grupo vinculadas al uso de la tecnología.

41 >>


WORKER COLLABORATORSThe sound performance of our more than 24 thousand worker collaborators allows us to ensure our execution capacity for major engineering projects, guaranteeing the quality and safety standards required by our clients.

During 2014, we strengthened our comprehensive management model, which allows us to attract, develop and retain the best worker collaborators. GyM gathers 78% of this group of collaborators, which is why in this report we will focus on communicating progresses made in their management.

HUMAN RESOURCES MANAGEMENT MODEL FOR GyM WORKER COLLABORATORS

Recruiting and selection processes

Training programsRecategorization

Social benefits and labor relations

ATTRACT

COMMUNICATIONS STRATEGY

DEVELOP RETAIN



42 >>


ATTRACT

1

• Thanks to the program Building Capacities for Labor Insertion, in 2014, 100% of the non-skilled labor (helper-laborer category) was hired from the local community.

• Our decentralized recruitment system served over 157 potential applicants at the Lima, Arequipa, Cusco, Cajamarca, Huancayo, Juliaca, Piura and Chimbote offices.

• Virtual recruitment channels, mainly the Chambita web page of GyM, received 13,500 applications.

• We launched the mobile recruitment strategy for critical and specialized positions, attracting 575 applicants in the towns of Huancavelica, Apurímac, Piura, Chiclayo, Trujillo and Tumbes.

• We have a base of more than 83 thousand worker collaborators specializing in civil construction at the end of 2014.

WE IMPLEMENT RECRUITMENT AND SELECTION PROCESSES THAT RESPOND TO THE REQUIREMENTS OF OUR PROJECTS AND, IN TURN, CONSIDER THE SOCIAL EXPECTATIONS OF THE ENVIRONMENT.



43 >>


DEVELOP

2

• Through the Technical Training and Development Center and the Building Capacities for Labor Insertion Program, in 2014 we provided 136,675 hours of training that benefitted 14,258 worker collaborators.

• This year, we implemented a new format of performance evaluation in order to strengthen our qualification tools, foster a greater commitment with direct supervisors and managers and determine training needs. As a pilot project, these evaluations were applied to 5% of worker collaborators.

• Seeking to offer a career line in the company, in 2014 we performed 1,654 evaluations that allowed recategorizing 79% of the collaborators evaluated.

WE PROVIDE WORKER COLLABORATORS TECHNICAL AND PERSONAL COMPETENCIES, IN RESPONSE TO THE TRAINING, PROMOTION AND RECOGNITION NEEDS OF THIS LABOR GROUP. THUS, WE PREPARE THEM TO BE BETTER PROFESSIONALS, BETTER PERSONS AND BETTER CITIZENS BOTH WITHIN AND OUTSIDE THE ORGANIZATION.



44 >>


RETAIN

3

• We conducted 4,658 briefings and 1,057 social skills workshops, which included topics of interest to families, such as responsible child-rearing, sexuality and bullying, among others, which amounted to 48,530 man-hours of training.

• We conducted 503 family integration activities with 18,355 participants.• Psychological counseling was provided, free of charge, to 382

collaborators. • According to the working climate measurement survey of Great Place to

Work 2014, 70% of GyM worker collaborators are of the opinion that the company is a great place to work. (66% in 2013).

FOR PURPOSES OF RETAINING A COMMITTED AND MOTIVATED TEAM IN THE ORGANIZATION, WE OFFER OUR WORKER COLLABORATORS COMPETITIVE SALARY STRUCTURES, SOCIAL WELL-BEING PROGRAMS THAT STRENGTHEN THE FAMILY-COLLABORATOR-COMPANY BOND AND ADDITIONAL BENEFITS ACCORDING TO THEIR TRACK RECORD AND SPECIALIZATION.



45 >>


LOCAL HIRINGIn response to the employment expectations of our projects’ neighboring communities, GyM, STRACON GyM and CONCAR implemented different programs, which seeks to expand technical and construction, safety and leadership skills of the local population by conducting training workshops prior to startup of the works.

Description GyM Stracon GyM CONCAR

% Local Employment (Common System) 55.94% 46.10% 80%

% Local Employment (Civil Construction) 34.10% 52.60%

LOCAL HIRING RESULTS



A PRIORITY FOR GyM, STRACON GyM AND CONCAR

46 >>




>>


• Strengthen international recruitment of worker collaborators.

• Disseminate the Worker Collaborator Development Model in projects to promote reclassification and further career development (GyM).

• Strengthen communication channels with the community in connection with local hiring processes (STRACON

GyM).

47 >>


3. SAFETY

We safeguard the physical integrity and health of our collaborators by managing risk and promoting a culture of prevention

>>

Our activities are exposed to major occupational safety risks. Aware of this, most companies of the Group have a comprehensive management system, based on the OHSAS 18001 standard, which allows us to reduce occupational safety risks and promote a solid culture of prevention among our collaborators.

We have a team of more than 590 professionals who lead safety management in the organization. Each company of the Group identifies the most sensitive risks based on its activities and the context in which they are conducted. Based on this information, timely action plans and evaluation systems are developed to promote continuous improvement.


48 >>


HEALTH AND SAFETY MANAGEMENT SYSTEM

• Risk Prevention Corporate Policy.• OHSAS 18001Guidelines.• Risk Prevention Corporate

Committee.• Risk Identification and Assessment Matrices.• Occupational Safety and Health Plans.• Performance Indicators.

MANAGEMENT SYSTEM

Leadership-based Safety: • Conducts observed in line

management, coaching, technical training and incentives.

Behavior-based Safety: • Identification of risk behaviors.• Training in the standards, procedures

and good practices required by the job position.

PREVENTIVE CULTURE


SAFETY MANAGEMENT

49 >>


MAIN PROGRESS IN SAFETY MANAGEMENT

3. SAFETY


Area Main Risks Identified Main Progress 2014

ENG

INEE

RIN

G A

ND

CO

NST

RU

CTI

ON

• Road accidents

• Falling from heights

• Electricity hazards

• Trapping

• Impacts (loose material, falling objects, incidents with

equipment)

• Work in confined space

• Contact with harmful substances

• Gas poisoning

GyM:

• Implementation of the Leadership-based Safety (LBS) strategy with the main line managers.

• Dissemination of the Technical Road Safety Guide to 100% of the projects.

• Increase from 16 to 20 in projects that apply the Behavior-based Safety strategy to promote safe behaviors among worker

collaborators.

STRACON GyM

• Management of critical task risks in operations by the “10 Greater Risks” campaign.

• Training to heavy equipment operators and maintenance technicians in our projects.

INFR

AST

RU

CTU

RE

• Road accidents


• Running over

• Burns

GMP

• Implementation of bi-monthly safety forums with business unit and operational area managements, which allowed

allocating clear and visible leadership and strengthening of the early warning systems.

• Strengthening of the Sub-standard Acts and Conditions Reporting system in all operations.

• As a result, Blocks 1 and V reported zero disability-causing accidents in 2014.

LINE 1

• Updating of risk maps of the shopyard and preparation of risk maps in stations and technical areas.

• Implementation of risk-prevention leadership workshops by international experts (Chile and Venezuela).

50 >>


REA

L ES

TATE

• Falls in offices

• Objects falling

• Dust and noise

VIVA GyM

• Over 600 man-hours of training to collaborators in fire prevention, hazard identification, and risk assessment and control.

SER

VIC

IOS

• Road accidents


• Electric arc burns

• Improper and/or overcharged electrical connections

• Dog bites

GMD

• Reinforcement of the safety strategy in five focal points: (i) Further involvement of the management offices; Training focused

according to the analysis of incidents; Benchmarking to incorporate good practices from other companies; Empowering the Health

and Safety Parity Committee; and Strengthening of the culture of prevention.

• These measures allowed us to reduce by 60% the accident rate of the company in 2014.

CONCAR

• Implementation of the risk prevention management and environmental management system under OHSAS 18001 and ISO 14001 standards.

• Implementation of the “Five Rhythms for Life” campaign to promote acknowledgment of hazardous situations and responsible

actions by collaborators.

CAM Chile

• Implementation of the Zero Tolerance Plan, which promotes commitment of first line management to safety.

3. SAFETY


Area Main Risks Identified Main Progress 2014

MAIN PROGRESS IN SAFETY MANAGEMENT

51 >>

<< regresar al menú INFORME DESOSTENIBILIDAD2014


3. SAFETY

ROAD SAFETYIn 2014, the Group companies made major efforts to raise road safety standards, promoting responsible and safe behaviors in their collaborators, subcontractor and main stakeholders.

GyM: • Implementation of theoretical-practical course of defensive driving for equipment operators.• Preparation of the Technical Guide for personnel transportation service.• Implementation of the prevention campaign “The Co-pilot of Life”.

STRACON GyM:• Implementation of a road safety plan for the transportation of collaborators, applying innovative

follow-up and monitoring methods.

CONCAR:• Implementation of vehicle driving standards, co-pilot and passenger leaflets, transit disciplinary

measures, procedure for inspections, and others.• Evaluation and strengthening of Road Education Program with users and neighboring

communities of the roads it operates.

A PRIORITY FOR GyM, STRACON GyM, CONCAR

AND ROAD CONCESSIONS

52 >>


RESULTS 2014In 2014, the Graña y Montero Group reported more than 124 hours worked, 6% more than in 2013. During this period, we had a Frequency Rate (FR) of 0.59 accidents for every 200,000 hours of work. This result involves an increase of 0.1 points from the previous year (0.49 in 2013), for which reason we are increasing our preventive efforts, evaluating and taking the necessary corrective measures.


3. SAFETY

JAN

UA

RY

FEB

RU

AR

Y

MA

RC

H

AP

RIL

MA

Y

JUN

E

JULY

AU

GU

ST

SEP

TEM

BER

OC

TOB

ER

NO

VEM

BER

DEC

EMB

ER

ACCIDENT FREQUENCY RATE OF THE GRAÑA Y MONTERO GROUP

MIL

LIO

N H

OU

RS

WO

RK

ED

FR 2

014

0.4

7

0.5

4

0.5

1

0.5

2

0.5

3 0.5

5 0.5

6

0.6

4 0.6

3

0.5

9

0,70

0,65

0,60

0,55

0,50

0.45

0.40

0.35

0.30

140.00

120.00

100.00

80.00

60.00

40.00

20.00

0.00

0.6

1

0.3

6

53 >>



3. SAFETY


• Strengthen preventive actions in our operations.

• Enhance safety synergies among Group companies.

• Evaluate the Leadership-based Safety pilot and increase the scope in projects (GyM).

>>

54 >>


4. ENVIRONMENT

We reduce the impacts of our opera-tions, promote an environmentally responsible culture and provide solu-tions that improve the environmental performance of society

>>

Based on a culture of respect for our environment, we take on a formal commitment to reduce the impact of our operations and promote responsible behaviors in our collaborators and main stakeholders. The environmental strategy of the Group focuses on three fundamental lines of action:


55 >>


• Corporate Environmental Policy(1998)

• ISO 14001 Guidelines• Corporate Environmental Committee• Environmental Impact Assessments• Environmental Management Plans• Environmental Risk Identification

and Assessment Matrices• Performance indicators

• Capacitaciones • Code of Conduct and “Graña y

Montero Work Style” book• Sensitizing campaigns within and

outside the organization.

• Environmentally efficient engineering designs

• Public-Private Partnerships, which improve environmental performance of the country

• Environmental consulting services

ENVIRONMENTAL MANAGEMENT SYSTEM

ENVIRONMENTAL CULTURE

ENVIRONMENTAL SOLUTIONS

ENVIRONMENTAL STRATEGY OF THE GRAÑA Y MONTERO GROUP


56 >>


results showed a footprint of 3,514 Tn of Co2 equivalent, or a volume of 2.81 Tn per collaborator during the year, generated mainly by air travel, transportation of collaborators and electric power consumption. The 16% increase in total emissions is due to increased air travel as a result of our greater regional presence. Based on the results, we will design plans of action for a better environmental management.

In line with our continuous improvement process, in 2014 we also launched a pilot to measure our carbon footprint in our operations, involving an economical housing project to be completed in July 2015.

• STRACON GyM: Due to the intensive use of fuel by our large earth-moving equipment, in 2014 Stracon GyM prepared a baseline of fuel consumption in its operations, the result of which was 16.5 million gallons consumed.

ENVIRONMENTAL MANAGEMENT SYSTEMWe seek to reduce our environmental risks, focusing on the most relevant matters according to our operations. In 2014, we defined two priority environmental matters: the responsible energy consumption and solid waste management.

ENERGY: We promote the efficient use of energy by up-grading our processes, training our collaborators and sharing good practices with our suppliers, communities and users.

Main Progress 2014: • Main Office: For the second consecutive

year, we conducted the measurement of our carbon footprint at the main office. The

4. ENVIRONMENT


62%25%

13%

RESULTS: CARBON FOOTPRINT MEASUREMENT OF THE HEADQUARTERS

Indirect emissions: waste,

transportation, travels

Emissions produced by electricity consumption

Direct emissions: air conditioning, fuel,

among others

PRIORITY FORSTRACON GyM, LINE 1AND CAM GyM

57 >>


The next step will be to analyze energy consumption of its main facilities, equipment and machinery, for purposes of setting the criteria for energy efficiency in its operations.

• Line 1 of the Lima Metro: In 2014, Line 1 of the Lima Metro used 36.8 million kWh of electric power, a volume that reflects a 34% increase in absolute terms. However, it should be noted that Tranche II of Line 1 started operating in 2014, generating an additional 963,724 kilometers run during the period. If we analyze performance per kilometer and per user, we find that electric power consumption has been more efficient.

4. ENVIRONMENT


22.2

16.7

25

20

15

10

5

0

ELECTRICITY CONSUMPTION KWH/KM - LINE 1 (FERROVIAS GyM)

2013

2014

• CAM GyM: It continued to promote the efficient use of energy for its clients by identifying electric power losses during field inspection, conducting energy balances, and installing concentrator boards to reduce electrical risk and energy losses due to poor connections. During 2014, 4.2 million de kWh were recovered for clients only from operations in Peru.

58 >>


SPILLSOne of the main environmental risks of GMP is associated with the occurrence of hydrocarbon spills. Accordingly, stringent preventive and supervision processes are deployed in all stages of operations. The most frequent causes are associated with pipe thefts from the oil pipeline and leaks through well pumping equipment cups. This is why, in 2015, various adjustments were made to prevent diversions in the wells, water-proofing airtight zones of the production batteries, improving the alignment of cups in new wells and increasing the frequency of cup changes in the pumping equipment.

In spite of these efforts, there were two hydrocarbon spills in 2014, one in the Talara oil blocks (0.4 m3) and another at Consorcio Terminales (0.56 m3). In both cases, the incidents were reported to the competent authority, the area underwent remediation and the contaminated material was removed and handled by a solid waste services provider.

4. ENVIRONMENT


PRIORITY FOR GMP

59 >>


SOLID WASTE: Our solid waste management plans focuses on appropriate segregation, storage, transportation and disposal. Such plans include complementary training programs allowing collaborators to strengthen their environmental stewardship and implement good practices both within and outside the company.

Main Initiatives 2014:• Main Office: For the second consecutive

year, the solid waste management plan was implemented at the administrative offices, entering into an alliance with an eco-social company for handling of recyclable material. Of the total waste that we generated in 2014, 4.98 tones were recycled, accounting for 13% of the total volume of non-hazardous inorganic waste.

• GyM: In 2014, GyM upgraded its on-site information records. Due to the temporary nature and the various stages of the projects, absolute volume ratios are not always sufficient to assess progress. Accordingly, ratios per collaborator and per day of work were estimated to allow better comparability over time.

In early 2014 we prepared a Waste Minimizing Plan that was adapted to the various projects, according to their characteristics. This plan was complemented by three specific procedures for management of residual concrete, composting and chemical product management.

GyM Organic waste

Non - hazar-dous inorganic waste

Hazardous inorganic waste

(Tn) (Tn) (gal) (Tn)

Volume of waste 1/

960.3 4,815.3 62,522.72 361.7

% reused waste - 1% 6.9% -

% recycled waste

11% 7.8% - -

KG/Person/day 0.28 1.22 - -

1/ The measurement includes the following projects: Panorama, Sol de Barranco, Real 8, Rivera Navarrete, Leuro, UTEC, Parques de San Martín, La Rambla, Parques VES II, Plaza Vea Valle Hermoso, CH Machu Picchu, Red Vial 5, Carretera Quinua SF, PTAR La Chira, Santa Teresa, PAD Cerro Verde, CH Cerro del Águila, Túnel Santa Rosa, Cerro Verde, Guyana, Inmaculada, Kepashiato and Pachachaca.

4. ENVIRONMENT


PRIORITY FOR GyM, CONCAR Y GMD

60 >>


• GMD: In 2014, the Ministries of the Environment and of Transportation and Communications approved the Electrical and Electronic Device Waste (WEEE) Management Plan of GMD. This plan is intended to ensure the responsible management of WEEE in compliance with the principles of minimization, environmental risk prevention and protection of human health.

As a producer company, GMD is responsible for the collection and segregation of this kind of waste, both at its facilities and at those of its clients. Accordingly, it has implemented a collection center at the facilities of GMD, which has the required safety conditions in place. Transportation, treatment and final disposal of this waste has been entrusted to a solid waste selling company duly registered with and authorized by DIGESA (the Peruvian sanitary authority).

During the year, GMD generated 3,9 tons of electronic waste, 100% of which were collected and disposed of.

• CONCAR: The sound management of waste on a national level is a challenge to the sector due to the lack of certified sanitary infrastructure throughout the country. To ensure a proper disposal of hazardous waste in the projects in the provinces, Concar makes various efforts that entail high operating costs resulting from the transportation of such waste to Lima. In 2014, the company reported 165 tons of hazardous waste disposed of at certified safety landfills.

MANAGEMENT OF SOLID WASTE FROM CONSTRUCTIONSolid waste generated by construction work involves a major impact on the environment. Even though it poses no health hazards as does urban waste, the large volumes thereof require becoming increasingly aware of its management and more stringent regulations. In 2014, GyM and Viva GyM conducted a pilot project to study the entire process of waste generation in a typical economical housing construction project. This sought to identify the types of waste generated in each stage of the process, determine their origin, the volume and current treatment method, for purposes of defining a more efficient management protocol.

Even though the measurement will be completed in July 2015, the main findings to date are: • Inconsistencies between the legal requirements and the sanitary infrastructure

available to comply with such regulations have been identified.• The contents of the various management tools (environmental impact assessments,

management plan, and others) used by the projects require to be aligned.• The feasibility of centralizing the transportation and disposal of waste by a

single waste services provider (EPS-RS) for the Lima projects will be assessed.

4. ENVIRONMENT


PRIORITY FOR GyM

61 >>


ENVIRONMENTAL CULTURE: We develop in our collaborators a culture of respect for the environment that allows them to adopt environmentally responsible behaviors. Additionally, we share our good practices and standards with our main stakeholders, furthering environmental stewardship.

Main Initiatives 2014:• Under the slogan “Small Actions, Big

Solutions” we strengthened the environmental stewardship of our collaborators, promoting the reduction and appropriate segregation of solid waste at administrative offices (1,200 collaborators trained).

• Line 1 joined the initiative “Pon de tu Parte”, (Do Your Part), a social mobilization campaign led by the Ministry of the Environment that took place concurrently with the United Nations Climate Change Conference (COP 20) held in the city of

Lima from December 1 to December 12. The company promoted the generation of environmental commitments by clients of Line 1 of the Lima Metro through activities at eight stations and by reinforcing the messages through the social media.

4. ENVIRONMENT


62 >>


ENVIRONMENTAL SOLUTIONS: We provide our clients solutions to enable them to improve their environmental performance and reduce the impacts of their operations.

Main Initiatives 2014:• GMI: Designed the industrial waste water

treatment project of the Cerro Verde mining company, incorporating the technology that allows reusing such water to wash heavy equipment.

• Through Ecotec, we provided technical advisory for design of the landfill in the city of Cerro de Pasco, a project funded by the company Volcan, under the works for taxes approach.

• Viva GyM: Implementation of the Wetland System in its economical housing projects has continued. This system allows reusing gray water from showers to irrigate the green areas

of the condominiums. By this technology, 897.9 m3 were reused in 2014.

• New business development: We design and operate projects with eco-efficient designs through public-private partnerships. In 2014, prominent among these projects is the construction and operation for 25 years of the La Chira Waste Water Treatment Plant, with a capacity of 11.3 cubic meters per second, which will allows treating 31% of the waste water of Lima before its discharge into the sea. On closing of 2014, progress of this project is 78.11% and is expected to be completed by the end of 2015.

Furthermore, in 2014 we submitted a private initiative to the Ministry of Housing, Construction and Sanitation to develop the waste water treatment system for the Lake Titicaca basin. At present, we are preparing the feasibility studies for this important

4. ENVIRONMENT


NATURAL GAS SUPPLY SYSTEM FOR VEHICLESIn 2014, the company Transportadora de Gas Comprimido Andino was created for the design, funding, construction, operation and maintenance of the gas supply system in 10 regions of the Peruvian Andean highlands.

This new mechanism will enable thousands of Peruvians access to a less polluting and more economical fuel. A gallon of gas is estimated to emit 30% less than CO2 equivalent than a gallon of 90-octane gasoline. It will allow reducing emissions per vehicle by 1.8 tons of CO2 equivalent per year, equal to approximately 184 trees.

project, which will serve 10 towns in Puno and allow treating 1,650 liters per second, which account for 90% of the total municipal waste water discharged into Lake Titicaca.

PRIORITY FOR GMI AND VIVA GyM

63 >>



• Updating of the Corporate Environmental Policy (1998)

• Preparation of the solid waste management protocol for construction projects.

• Preparation of the good practices manual for GyM projects.

• Analizar criterios de eficiencia

energética para el uso de combustible.

>>

4. ENVIRONMENT


64 >>


5. COMMUNICATION


We establish a dialogue with our stakeholders to know their perceptions and incorporate them in the continuous improvement of our management

>>

At Graña y Montero, we promote relationships of trust with our stakeholders, through a continuous and transparent dialogue. For such purpose, we have various listening spaces to gather the perceptions of our stakeholders and provide them with clear and timely answers to their concerns.

As part of our improvements, in 2014 we developed our Corporate Communication Policy, which defines the communication guidelines of the group, to strengthen our reputation, prestige and brand value.

65 >>


HOW DO WE ESTABLISH A DIALOGUE WITH OUR STAKEHOLDERS?We establish different channels, frequency and strategies of communication for each stakeholder group, in order to share relevant information and know their needs and expectations.

GRAÑA Y MONTERO STAKEHOLDERS (G4-24)

INVESTORS SUPPLIERS STRATEGIC PARTNERS

CLIENTS COMMUNITIES COLLABORATORS

ENVIRONMENT

5. COMMUNICATION


66 >>


Stakeholder Dialogue Space (G4-26)

Collaborators • Open-door policy, which brings collaborators and teams closer to their supervisory offices and management staff.• Mass media: newsletters, internal bulletins, intranet and web pages.• Correspondent network: collaborators who act as liaisons between the administrative offices and the projects.• Interactive media: Facebook and radio shows.• Knowledge portal.• Leadership, feedback and GPtW surveys.

Shareholders • Majority and minority Shareholder Service Office.• Corporate web page.

Suppliers • Supplier portal (SISPROV System).• Direct and ongoing relationships.• Dialogue panels.

Clients Company Client (B2B):• Client-partner workshops: aligns objectives and improves • Satisfaction interviews and surveys. processes between client and company. • Direct interviews. • Revista Viva GyM, Sustainability Report, Financial Report.• Dialogue panels. • Web page of the companies.

• User Client (B2C):• Client Service Office of Viva GyM and Line 1.• Complaints book and suggestions box.• Call center, toll-free call from any landline or mobile telephone. • Social media: Facebook (Graña y Montero Group, Viva GyM and Line 1) and Line 1 Twitter.• Web page of the companies.

Community • Community relations experts and queries and complaints systems.• Academic spaces: conferences, fairs, forums, unions.• PI Engineering Portal.• Social media: Facebook (Grupo Graña y Montero, Viva GyM and Line 1) and Line 1 Twitter


67 >>


DIALOGUE WITH CLIENTS (G4-27)As a result of the growth of the Group and the diversification of our business, at present we have various types of clients with whom we need to relate in different ways.

• Company Clients: With whom we promote relationships of trust, based on our execution capacity, compliance before the deadline and high quality and safety standards.

5. COMMUNICATION


Company Main Initiatives 2014:

GyM: • Enhanced the client – partner workshops that allow acquiring a better knowledge of the needs of its clients. In 2014, it held seven workshops with its building and civil work clients.

• Strengthened its client satisfaction measurement system, incorporating qualitative surveys during execution of the works, which complement the final interviews of the project. During the year, five surveys of building and civil work clients were conducted.

GMI • Changed its client satisfaction measurement system, incorporating direct interviews of the Senior Management with its main clients. In 2014, this system was applied with Antamina, Cerro Verde, Fluor, Shougang and UNACEM.

GMD • Incorporated further disaggregation in its satisfaction surveys to gain an in-depth knowledge of client perceptions on management and combined scheduled bi-annual surveys with electronic surveys conducted immediately upon providing the services. In 2014, it reached 90% satisfaction.

CAM GyM • Continued to promote closer relationships with its main clients, through the Discovery Teams, which seek to identify opportunities for improvement of current services.

• Strengthened its post-sales system and the mechanisms to obtain feedback from clients after the services. This entails further automation of processes, which will allow controlling response times and the solutions generated.

PRIORITY FOR GyM, GMI, GMD AND CAM GyM

68 >>


5. COMMUNICATION


DIALOGUE PANEL WITH CLIENTS AND SUPPLIERS (G4-27)For the second consecutive year, we held a corporate dialogue panel with 15 clients and suppliers of the main companies of the Group to know their perceptions on our management and identify social environmental and operational improvement opportunities.

Our recruitment processes in the neighboring communities of the projects, our occupational safety and our operational excellence were acknowledged as good practices.

One the main challenges was the need to create more synergies with suppliers and contractors to share good safety and environmental practices. These matters are being worked with the Group companies as part of their sustainability goals for 2015.

69 >>


5. COMMUNICATION


Company Main Initiatives 2014:

Line 1 of the Lima Metro

• As part of the ISO 9000 certification, it upgraded its claims and grievances system, identifying the main causes and designing preventive and corrective actions in the operation.

• In 2014, Line 1 of the Lima Metro obtained a satisfaction rate of 85%.

Viva GyM • As part of its continued improvement, it is working on integrating its post-sales and client service systems, so the client may interactively track the status of its requirement.

Concar • Strengthened its teams, incorporating a person in charge of external communication in its main projects, in order to establish closer relationships with its stakeholders and appropriately monitor their needs.

• Continued conducting quarterly satisfaction surveys to know the improvement opportunities in road management and operation. In 2014, it obtained 93% satisfaction.

• User Clients: In 2014, we interacted with more than 90 million users, between the road concessions that we operate and Line 1 of the Lima Metro. This generated us more public exposure and greater reputational risks, but also an opportunity to further civic growth by the services provided.

PRIORITY FOR LINE 1, VIVA GyM AND CONCAR (G4-27

70 >>


COMPLAINTS AND GRIEVANCES SYSTEM – LINE 1: (G4-27)This tool allows us to gather and systematize comments, complaints or suggestions from Metro clients, to subsequently implement preventive and corrective actions in our operation. This analysis considers the various processes followed by clients within the Metro system, placing more emphasis on the most stressful stages and focusing on the attributes that our clients value the most. In turn, this information is complemented by “mystery shopper” surveys and with the bi-annual results of the satisfaction surveys.

In 2014, the ratio of complaints received by Line 1 of the Lima Metro was 45 per million trips, the main causes of complaint being associated with the implementation of the new passenger control system, the saturation of trains and the management of flows on entering and exiting the stations. These results reflect a very good management, according to international standards, especially in a context where the number of daily passengers doubled from 150 thousand to 317 thousand as a result of the startup of operation of Tranche II of the line, that goes up to San Juan de Lurigancho.

5. COMMUNICATION


71 >>


CREATION OF THE INSTITUTIONAL RELATIONS MANAGEMENT (G4-27)

To better understand the needs of our client – the state, the Institutional Relations Management was created to promote a positive relationship with this important stakeholder, always under the Graña y Montero Work Style, with special emphasis on the Ethics Charter and taking citizens (the end users) into account.

• State Client (G4-27): We establish a transparent and long-term relationship. We seek to be strategic partners, channeling private resources to fund, build and operate public service infrastructure with the highest

quality standards.

5. COMMUNICATION


72 >>



• Implement the Corporate Communications Policy among the companies of the Group.

• Continue strengthening the corporate customer relationships through feedback channels.

• Keep satisfaction levels, and enhance virtual channels and signage available at the stations of the Line 1 of the Lima Metro.

• Strengthen the system for the reception, care and systematization of claims, to improve the management (CAM GyM).

• Set follow-up and monitoring indicators for the post-sales service, based on response times and quality (Viva GyM).

>>

5. COMMUNICATION


73 >>

CAPÍTULO

<< menu ESTILO GRAÑA Y MONTERO NOS INSPIRA NOS DISTINGUENOS PERMITE TRASCENDER


SHARINGSHARING WITH OUR STAKEHOLDERS

74 >>


WE SHARE WITH OUR SUPPLIERS, CLIENTS AND THE COMMUNITIES, THE KNOWLEDGE AND EXPERIENCE ACQUIRED IN THE COURSE OF 81 YEARS, CONTRIBUTING TO THE GENERATION OF RESPONSIBLE CIVIC BEHAVIORS IN SOCIETY.

SHARING WITH OUR STAKEHOLDERS

1. OUR SUPPLIERS

We work hand-in-hand with more than 7,900 suppliers and contractors to accomplish the goals and meet the commitments taken on with our clients. They account for 47% of our revenues and are strategic partners in the performance of our operations and services.

This relationship is not exempt from the challenges posed by the regional context, such as

Formal suppliers who respect regulations and meet our standards of conduct

>>

75 >>


Item GyM STRACON GyM GMP CONCAR

% of Purchases from Domestic Suppliers 99% 79% 95% 98%

% of Decentralized Purchases /1 22% 17% 34% 40%

% of Local Purchases /2 9%

/1 Pertain to purchases from suppliers with Taxpayer Registration (RUC) in the provinces. /2 Pertain to purchases from suppliers in the direct and indirect influence areas of the projects.


1. OUR SUPPLIERS

low training levels or high informality rates. To face these challenges, at the Group we promote and accompany the growth of our suppliers by evaluation and training initiatives. Thus we contribute to raise the industry standards, ensure quality services that respond to the expectations of clients and promote responsible behaviors in our value chain.

76 >>


PROGRAMS DEVELOPED IN 2014:

SUPPLIER APPROVAL:Since 2012, we evaluate and categorize ourmajor suppliers in accordance with quality,safety, environment, respect for labor laws and community criteria. This allows us to have formal and reliable suppliers and ensureethical and responsible behavior throughoutour value chain.

On the other hand, companies that fail to be approved receive feedback on the aspectswhere they should become stronger to improvetheir performance and be admitted to workwith us in the future.


1. OUR SUPPLIERS

MAIN PROGRESS 2014

GyM

- 459 suppliers approved, accounting for 42.8% of our significant suppliers and 34% of the purchase volume.

- 27.3% of approved suppliers were audited in 2014.

- 100% of approved suppliers received our Ethics Charter and Code of Conduct.

GMP- 75 approved, 33.5% of significant suppliers.- External audits conducted by Bureau Veritas.

PRIORITY FOR GyM AND GMP

77 >>




1. OUR SUPPLIERS

SHARING OF SAFETY STANDARDS: We contribute to raise the standards of our suppliers and contractors, sharing our good occupational safety practices. For this purpose, in 2014 we identified our critical suppliers in safety management and developed with them lectures, training workshops, and defensive driving courses imparted by our professionals of the risk prevention area.

MAIN PROGRESS 2014

GyM- 78 personnel and cargo transportation service

providers participated in the safety workshops.

GMP- Safety and health induction and evaluation prior

to admitting any contractor to work with us.- Four client – partner quality meetings

for sharing of quality, environment, and occupational safety and health standards with strategic suppliers.

PRIORITY FOR GyM AND GMP

78 >>


LOCAL SUPPLIER DEVELOPMENT: We build the capacities of our local suppliers for them to formalize, develop their business and improve the quality of the goods and services that they provide. Thus, we contribute to invigorate local economies by promoting a formal and responsible management.


MAIN PROGRESS 2014

GyM Continued implementing the Development of

Local Suppliers pilot project, which supports the formalization process and growth of the businesses associated with our direct influence areas.

As part of the program, suppliers received training in technical aspects, product quality, customer service and good conduct of business. The result of the advisory is materialized in an Improvement Plan developed with a one-year horizon. Thus, they are expected to reach a maturity level that makes them profitable and sustainable businesses.

MAIN PROGRESS 2014

STRACON GyM Provides management, tax and contract-related

training to local suppliers of its projects. In 2014 it held the “Managing my Business” event, which served to strengthen the initial stages of the undertakings, including aspects such as the preparation of invoices, valuations, contract meanings, basic accounting, tax laws and regulations, so they could familiarize with the context where they will conduct their business.

CONCAR Training was provided to local suppliers, with a focus on the food and lodging services

business. In 2014, 15 local suppliers of the SURVIAL highway participated, which whom we promoted responsible management, focusing on hygiene in the handling of food, nutrition and client services.

PRIORITY GyM, STRACON GyM AND CONCAR


1. OUR SUPPLIERS

79 >>



• Continue furthering spaces to share good safety practices with suppliers and subcontractors (GyM and STRACON GyM).

• Implement a feedback system that incorporates quality assessments (GyM).

• Continue implementing the approval system (GMP).

• Implement an approval system for strategic

suppliers and of affidavits for small businesses (CONCAR).

• Implement safety audits for subcontractors (CONCAR).

>>


1. OUR SUPPLIERS

80 >>



2. OUR CLIENTS

We interact with more than 90 million clients (users), whether by operating our infrastructure concessions, by providing public services or by selling real estate products.

With them, we not only seek to provide world-class infrastructure and services, but we take this scenario as an opportunity to share our knowledge and experiences with clients, promoting responsible civic behaviors and coexistence and mutual respect principles.

Clients who use the infrastructure properly and live in community as good neighbors.

>>

PRIORITY FOR LINE 1, VIVA GyM AND CONCAR

81 >>


METRO CULTURE – LINE 1 OF THE LIMA METROIn 2014, the Metro Culture program continued to educate Line 1 clients in the good use of the system and promoting civic coexistence and social commitment to the environment.

The opening of Tranche II of Line 1 of the Lima Metro in July 2014 involved the incorporation of 10 new stations, an additional 12 km of roads and 10 additional trains that allowed the service to reach San Juan de Lurigancho, the most densely populated district of Lima. As a result, the number of daily passengers who use the Metro increased from 150 thousand to 317 thousand. This posed the challenge of maintaining the respectful coexistence and civility that had been achieved with Tranche I of the system.


To face up to the challenge, the We Are Line 1 program was created in 2014 to foster a more active role of the current clients and collaborators of the Metro, making them civic promoters. These are formally trained and accredited and are required to promote the good use of the system and civic behaviors by setting the example.


2. OUR CLIENTS

MAIN PROGRESS 2014

- 1,488 clients and 84 collaborators accredited as civic promoters.

• 16 guided visits with students.

• 28 training workshops with 1084 neighbors.

• 87% of clients think that the Metro promotes civic growth.

• Infrastructure 360° Award from IADB in recognition of companies that generate sustainable investments.

82 >>




2. OUR CLIENTS

MAIN PROGRESS 2014

- 1,293 families trained in leadership and coexistence.

- 67 workshops in Lima and the provinces.

- 7 housing compounds participated in the sustainability competition.

- 84% of owners think that Ayni improves coexistence among neighbors.

AYNI: NEW NEIGHBORS, BETTER CITIZENS – VIVA GyMFor the third consecutive year, Viva GyM continued executing the Ayni program, which seeks to generate a respectful coexistence among the new owners of the real estate projects developed. As part of this initiative, neighbors are trained in legal, administrative, conflict resolution and leadership matters, and are lent support to promote a better quality of life in these new urban spaces. In order to strengthen the accomplishments already achieved, for the second consecutive year, a sustainability competition among the steering committees of each condominium was held in 2014. Thus, owners were evaluated according to their payment default rates, compliance with internal regulations, attendance to meetings, and others. Winners received a fund to implement various improvement project for their condominiums.

83 >>


MAIN PROGRESS 2014

- Impact assesment of the road education program.

- More than 4,400 students trained in road education.

- More than 300 teachers, 27 schools and 5,500 children participated of the program from 2011 to 2013.

ROAD EDUCATION – CONCAR: Seeks to reduce the accident rate in the roads it operates or maintains, extending its culture of prevention and road safety to the users and neighboring communities of such roads. In 2014, the program was evaluated and restructured, which will allow incorporating other groups involved in road safety issues, such as passenger and goods transportation companies.



2. OUR CLIENTS

84 >>



• Continued implementing the “We Are Line 1” program, increasing the number of civic promoters (Line 1)

• Implementation of the road education program strengthening the role of internal trainers and incorporating transportation carriers (CONCAR).

• Strengthen the program results measurement system (Viva GyM)

>>


2. OUR CLIENTS

85 >>



3. OUR COMMUNITIES

Due to the nature and diversity of our businesses, at the Graña y Montero Group the concept of community includes not only the neighboring communities of our projects but the other strategic groups, such as the engineering, academic and scientific community. With each of them, we seek to share our knowledge and experiences so they can use them for their own benefit and that of their environment.

Communities that develop and take advantage of the knowledge and infrastructure that we provide them, for their own growth.

>>

86 >>


BUILDING CAPACITIES FOR LABOR INSERTION - GyM: GyM faces a complex context, where bad practices of informal groups and the low educational level of the population restrict and jeopardize the local creation of jobs.

This is why, for the past nine years, GyM has been developing a recruitment program by which it shares its construction knowledge and trains community members in construction techniques, risk prevention and leadership.

Thus, GyM increases employability of the local population, formal jobs are generated, risks to the project are reduced, more efficient hiring processes are generated and trust with the local communities is strengthened. From 2006 to 2014, more than 20,000 persons were trained, providing 917,906 man hours of training.

PROGRAMS DEVELOPED WITH THE LOCAL COMMUNITY:


3. OUR COMMUNITIES

MAIN PROGRESS 2014

- 118,560 man-hours of training.

- 2,778 locals trained during the year.

- 60% of trainees during the year became employed by GyM projects.

- 100% of non-skilled labor hired from the local community.

PRIORITY FOR GyM, STRACON GyM, GMP, AND CONCAR

87 >>



CONSTRUCTION MANAGEMENT EDUCATIONAL PROGRAM:GyM, in a partnership with Instituto de Educación Superior Tecnológico Público “Fe y Alegría N° 75”, is implementing the technical career “Planning and Control for Construction Projects”, which seeks to train low-income youths to increase their employability in construction projects.

This program lasts two years and during the vacation period it offers youths the opportunity to conduct pre-professional practices at GyM projects. At present, it allows obtaining a medium-level technical certificate issued by the Ministry of Education. MAIN PROGRESS 2014

- 35 youths trained

- 17 conducted pre-professional practices at GyM projects

- More than 26,000 man-hours of training

- 149 postulantes a la segunda edición del curso.


3. OUR COMMUNITIES

88 >>


WORKS FOR TAXES AND PROMOTION OF SAFE BEHAVIORS - GMP: GMP seeks to reduce safety risks for the Talara community (direct influence area) by promoting responsible behaviors. For such purpose, it uses the works for taxes approach, which allows it to complement the development of public infrastructure with the generation of civic competencies and behaviors and the strengthening of local institutions.

Under this approach, in 2014, GMP conducted the construction and equipment of the firefighter company Compañía de Bomberos Voluntarios Nº 62 in the District of La Brea, a Project that will allow promoting a preventive culture and a timely response to fire hazards, which are compounded by the theft and illegal storage of fuel, which are usual in the area.


MAIN PROGRESS 2014

- More than 3.7 million in investment.

- More than 120 thousand beneficiaries.- Honors Mention in the Sustainable

Development Award 2014 of the National Society of Mining, Petroleum and Energy.


3. OUR COMMUNITIES

89 >>


PROMOTING SHARED INNOVATION:Through this program, we seek to share our own internal knowledge management and innovation experience with society. Thus, we promote a research culture within the engineering community, generate the competencies required to implement it, share the knowledge and generate a stronger articulation between the company, the state and academia. The following are part of this program:

• Structure your IDEAS: A scientific essay competition aimed at engineering and architecture undergraduate students. In its two editions it has benefitted 10,400 students and trained 1,700 students by theoretical-practical research workshops.

• Engineering Research (Thesis Students): We promote the development of R&D projects

by encouraging thesis student to write their “degree dissertations” on topics of interest to

PROGRAMS DEVELOPED WITH THE ENGINEERING COMMUNITY


3. OUR COMMUNITIES

Group companies. In its five editions it has benefitted 54 thesis students.

• Graña y Montero Peruvian Engineering Research Award: Launched in 2009 to recognize the value of research and reward the talent and dedication of engineering professionals. In its five editions, 16 engineers who are members of the Peruvian Engineers

MAIN PROGRESS 2014

- US$ 1 MM invested (2009 - 2014)- Articulations with 36 institutions of the

academia, the State and the companies.- Perú 2021 award for Corporate Responsibility

and Sustainable Development of Companies, in the Multistakeholder category.

Association and 8 professional teams have received this award, after an evaluation process in which 225 research papers from 16 cities of Peru participated.

• PI Engineering Portal: A web platform created to transmit and share knowledge among members of the engineering community. PI has 31,500 registered users and over 160,000 followers in the social media.

• Student Volunteering: PI Agents: We encourage the involvement of university students in knowledge dissemination activities and we empower them to transmit the importance of research in their immediate environments: 145 volunteers have received training to improve their leadership, communication and teamwork skills.

CORPORATE PRIORITY

90 >>



3. OUR COMMUNITIES


• Local community: Continue promoting civic behaviors among our communities and strengthen our system to measure results and impacts.

• Engineering community: Continue to promote research and the articulation of the state, academia and companies.

>>

91 >>



3. OUR COMMUNITIES

ESPACIO AZULThis is the non-profit civil association of the Graña y Montero Group that promotes and channels the efficient implementation of social responsibility plans and initiatives in the external front. In 2014, the main initiatives implemented through Espacio Azul were:

• Learning to Grow Program: For the second consecutive year, we continue implementing the Learning to Grow program in Talara, an area of influence of GMP. This program seeks to improve public teaching practices and more effective learning in reading, writing and mathematics by the children.

In consistency with our internal management practices, the program provides technical training and support to teachers so they can grow and develop within their careers, fosters research to innovate in the classroom, enhances the role of school principals as responsible managers and complements learning in students with the generation of civic values.

This program is conducted in a partnership with Universidad Peruana Cayetano Heredia and Empresarios por la Educación and, in 2014, it benefited 92 teachers and 2,138 children from six public schools in Talara, Piura.

• Graña y Montero Corporate Volunteering Program: Through corporate volunteering, our collaborators project the Graña y Montero Work Style into society and act as agents of change. In line with the “Grow and Share” sustainability strategy, corporate volunteering focuses on two lines of action: the promotion of civic behaviors and the improvement of education in Peru. In 2014, more than 1,250 volunteers participated, benefitting 11,831 persons in 19 departments of Peru. Julio Aguilar | Volunteer from Concar

To be a volunteer is a personal commitment that has allowed us both to work as a selfless team and to organise ourselves to share and bring wellbeing to those who live in poor conditions.

92 >>


The various sustainability initiatives implemented by the Group with the external front required a total investment of 2.4 million dollars. As a result, more than 380 thousand direct beneficiaries received 237 thousand man-hours of training in technical skills, road safety, responsible behaviors, and others.


3. OUR COMMUNITIES

SOCIAL PROGRAMS 2014: PROMOTING CIVIC BEHAVIORS

INITIATIVE TYPE NUMBER OF DIRECT BENEFICIARIES

MAN-HOURS OF TRAINING

US$

Related Training 11,834 187,127 410,077

Non-related Training 9,387 31,073 164,382

1. TRAINING 21,221 218,200 574,459

Social Investment 263,013 4,862 1,520,713

Environmental Investment 15,876 795 79,437

Financial Investment 1,080 9,390 42,145

Corporate Philanthropy 32,967 5,760 236,092

2. OTHER CORPORATE ACT. 312,936 20,807 1,878,388

3. COLLAB. PHILANTHROPY 580 1,400 40,535

TOTAL ACTIVITIES (1+2+3) 334,737 240,406 2,493,382

AS A RESULT OF ITS CONSISTENT AND TRUST-GENERATING MANAGEMENT, IN 2014 THE GRAÑA Y MONTERO GROUP WAS RECOGNIZED FOR ITS WAY OF DOING THINGS.

AWARDS AND RECOGNITIONS

94 >>


• One of the 10 Most Admired Companies in Peru, awarded by Revista G de Gestión and PricewaterhouseCoopers.

• Ranked 7th among the 100 Peruvian Companies with the Best Reputation, according to the survey conducted by the international consultant Merco and KPMG.

• Ranked 11th among the 100 Most Responsible Peruvian Companies with Best Corporate Governance, according to the survey conducted by the international consultant Merco and KPMG.

• Company with the best variable income strategy in Latin America, awarded by the journal LatinFinance.

SOME OF THE MAIN RECOGNITIONS WERE:


• Company with the best capital market strategy in the Andean Region, awarded by the journal LatinFinance.

• Best Managed Company in Latin America 2014, awarded by the magazine “Euromoney”.

• Lima Stock Exchange Key 2014, awarded by BVL (the Lima Stock Exchange).

• Perú 2021 award for Corporate Responsibility and Sustainable Development of Companies, in the Multistakeholder category for the “Shared Innovation Promotion” program.

• Socially Responsible Company 2013, awarded by the Mexican Center for Philanthropy (CEMEFI) and Perú 2021.

95 >>


Our companies were also awarded the following recognitions:

• GMP: Honors Mention in the Sustainable Development Award 2014 for management of local development of the hydrocarbon sector for its program “Promotion of Civic Behavior in Safety through Works for Taxes”. Awarded by the National Society of Mining, Petroleum and Energy.

• GyM, fourth in the overall ranking and first in the construction sector companies ranking, in the “Where Do I Want to Work” survey conducted by Arellano Marketing and Laborum.

• Viva GyM, first in the ranking of real estate companies in Where Do I Want to Work” survey conducted by Arellano Marketing and Laborum.

• Viva GyM, 6th place –companies with 30-250 collaborators in the “Best Companies to Work 2014” ranking of Great Place to Work® Peru.

• GMP, 11th place –companies with 251-1000 collaborators in the “Best Companies to Work 2014” ranking of Great Place to Work® Peru.

• GMD, 12th place –companies over 1000 collaborators in the “Best Companies to Work 2014” ranking of Great Place to Work® Peru.

• CONCAR, Further Progress Award in the “Best Companies to Work 2014” ranking of Great Place to Work® Peru.

• Ferrovías GyM: Infrastructure 360° Award, organized by the Inter-American Development Bank (IADB) with support from Harvard University in recognition of the private companies that generate sustainable investments.


SOME OF THE MAIN RECOGNITIONS WERE:

WHY DO WE DO IT?OUR VISION, "TO BE RECOGNIZED AS THE MOST RELIABLE ENGINEERING AND INFRASTRUCTURE SERVICE GROUP IN LATIN AMERICA", DOES NOT COMMIT US TO QUANTITY BUT QUALITY, AND IT IMPLIES THE RESPONSIBILITY OF TRANSCENDENCE, FORMING A TEAM OF ENGINEERS CAPABLE OF DEVELOPING, IN ALL STAGES, THE MAJOR ENGINEERING PROJECTS THAT OUR REGION REQUIRES.

97 >>


GRI INDEX

Our Sustainability Report 2014 responds to the essential compliance indicators, as required by the Global Reporting Initiative Guide –GRI G4. The following table indicates where to find information related to Guide G4 in our 2014 Sustainability Report.

GRI INDEX

98 >>


GENERAL BASIC CONTENTS

BASIC GENERAL CONTENTS DESCRIPTION PAGE EXTERNAL VERIFICATION

STRATEGY AND ANALYSIS

G4-1 Statement from the top decision-maker

in the organization on the importance of

sustainability for the organization

Page 4 Yes

Page 108 -110

ORGANIZATIONAL PROFILES

G4-3 Name of the organization Graña y Montero S.A.A. Yes

Page 108 -110

G4-4 Major brands, products and/or services Page 12 Yes

Page 108 -110

G4-5 Location of the organization’s main

office

The main office of Graña y Montero is located at: Av. Paseo de la República 4667- 4675,

Surquillo, Lima.

Yes

Page 108 -110

G4-6 Countries where the organization

operates

Page 10 Yes

Page 108 -110

G4-7 Nature of the ownership system and

legal form.

Graña y Montero S.A.A., the parent company, was organized by a Public Instrument on

August 12, 1996, within a growth process that started with Gramonvel in 1933. Its main

corporate purpose is to engage in investments and commercial operations in general and,

especially, engineering services, management consulting, real estate investments and

concessions. All of the companies in the Group are joint-stock corporations (sociedades

anónimas), with the exception of its holding company, Graña y Montero S.A.A., which is

an open-stock corporation (sociedad anómina abierta). As of December 31, 2014, we have

1,854 shareholders, 99.19% of which own less than 1% of the capital stock and close to

0.32% hold between 1% and 5%.

GRI INDEX

99 >>


G4-8 Markets served by the organization 9

For further information see the Annual Report 2014

http://investorrelations.granaymontero.com.pe/sites/granaymontero.investorhq.

businesswire.com/files/doc_library/file/GyM_espanol_web_vf.pdf

Yes

Page 108 -110

G4-9 Size of the organization, based on its

number of employees, operations, sales

or net revenues, among others

Page 10 Yes

Page 108 -110

G4-10 Number of employees by employment

contract and sex

Page 35

The 71% of our employee collaborators is in Peru. The 29% is loctaed in Chile, Colombia,

Brazil, Panama, Guyana, Mexico and Dominican Republic.

Yes

Page 108 -110

G4-11 Ratio of employees covered by collective

bargaining agreements

At GyM, there are two types of collective bargaining agreements: with the Federación

de Trabajadores de Construcción Civil (construction trade union) and with the union

representatives at each project. In both cases, they cover 100% of workers employed

under the regular employment system.

Yes

Page 108 -110

G4-12 Supply chain of the organization Page 74

Our management involves more than 7,900 suppliers of goods and services. This matter

was prioritized by two of the Group companies, GyM and GMP, which currently have

deployed approval systems for their large and medium suppliers. These databases of

eligible suppliers are shared with the Group companies that may require it.

The matter of developing local suppliers is a priority for GyM, Stracon GyM

and CONCAR, companies which are currently implementing various efforts to promote

the growth of small suppliers in their areas of influence.

Yes

Page 108 -110



GRI INDEX

100 >>


G4-13 Significant changes that occurred

during the reporting period in the size,

structure, equity structure or supply

chain of the organization.

Page 30 Yes

Page 108 -110

G4-14 Description of how the organization has

adopted a precautionary principle.

30, 47 and 54 Yes

Page 108 -110

G4-15 Letters, principles or other external

initiatives of a financial, environmental

and social nature subscribed to or

adopted by the organization.

See Sustainability Report 2013

http://www.granaymontero.com.pe/pdf/reporte_sostenibilidad/reporte_

sostenibilidad_2013.pdf

Yes

Page 108 -110

G4-16 National and international associations

and organizations to which the

organization belongs.

See Sustainability Report 2013

http://www.granaymontero.com.pe/pdf/reporte_sostenibilidad/reporte_

sostenibilidad_2013.pdf

Yes

Page 108 -110

MATERIAL ASPECTS AND COVERAGE

G4-17 Entities appearing in the consolidated

financial statements and other

equivalent documents of the

organization.

See Annual Report 2014

This Annual Report includes the financial statements of the companies comprising the

Graña y Montero Group

http://investorrelations.granaymontero.com.pe/sites/granaymontero.investorhq.

businesswire.com/files/doc_library/file/GyM_espanol_web_vf.pdf

Yes

Page 108 -110



GRI INDEX

101 >>


G4-18 Procedure for determining the contents

of the report and coverage of each

aspect.

Page 23 Yes

Page 108 -110

G4-19 Material aspects identified during the

process to define the annual report

contents.

Page 24 - 27 Yes

Page 108 -110

G4-20 Coverage of each material aspect within

the organization.

The results matrix (page 24-26) presents the companies that were included in the

materiality analysis and the matters that are part of this report.

Yes

Page 108 -110

G4-21 Limit of each material aspect outside

the organization.

The material aspects identified are applied to our operations and the stakeholders with

whom we relate.

Yes

Page 108 -110

G4-22 Consequences of re-expressions of

information of previous reports and

their causes.

The definition of indicators pertains to those contained in the previous report. Yes

Page 108 -110

G4-23 Significant changes in the scope and

coverage of each aspect with respect to

previous annual reports.

In 2014, aligned to the GRI G4, we reported only aspects which are material to our

organization. Coverage has not changed from the previous year as we report the

performance of the main companies of the Group.

Yes

Page 108 -110

STAKEHOLDER PARTICIPATION

G4-24 Stakeholders related to the organization. Page 65 Yes

Page 108 -110

G4-25 Basis for selecting stakeholders with

whom the organization works.

A materiality process aligned with the process suggested by the Global Reporting

Initiative (GRI) was conducted to determine the stakeholders and matters to report and

manage.

Yes

Page 108 -110



GRI INDEX

102 >>


G4-26 Approach of the organization to the

participation of stakeholders (frequency,

participation in preparation of the

annual report, among others).

Page 66 Yes

Page 108 -110

G4-27 Key concerns and problems that

have arisen as a result of stakeholder

participation.

Page 67-71 Yes

Page 108 -110

ANNUAL REPORT PROFILE

G4-28 Reporting period. 2014 Yes

Page 108 -110

G4-29 Date of last annual report. 2013 Yes

Page 108 -110

G4-30 Timing of submission of annual reports. Annual Yes

Page 108 -110

G4-31 Contact to respond to any questions on

the contents of the annual report.

Legal and Corporate Affairs Management: [email protected] Yes

Page 108 -110



GRI INDEX

103 >>


G4-32 Option selected for the annual report. Core Yes

Page 108 -110

G4-33 Policy and practices of the organization

in connection with external verification

of the annual report.

This Sustainability Report has been submitted to verification by the Global Reporting

Initiative (GRI), in accordance with GRI – G4 reporting guidelines.

Yes

Page 108 -110

GOVERNANCE

G4-34 Governance structure of the

organization.

Page 30 Yes

Page 108 -110

ETHICS AND INTEGRITY

G4-56 Values, principles, standards and

regulations of the organization, such as

codes of conduct or ethics codes.

Page 11 Yes

Page 108 -110



GRI INDEX

104 >>


SPECIFIC BASIC CONTENTS

MATERIAL ASPECTS DESCRIPTION PAGE EXTERNAL VERIFICATION

Ethi

cal

Beha

vior

Own indicator Training rate in the asset laundering prevention

system

Page 31 Yes

Page 108 -110

Own indicator Percentage of reports received and evaluated by

the Corporate Ethics Channel

Page 31 Yes

Page 108 -110

Pers

onal

Dev

elop

men

t

Prof

essi

onal

Dev

elop

men

t

G4 - LA9 Average hours of training per year per employee,

by sex and employee category.

Page 37 and 43 Yes

Page 108 -110

G4 - LA10 Programs for skills management and

lifelong learning that support the continued

employability of employees and assist them in

managing career endings.

Page 36 and 43 Yes

Page 108 -110

G4 - LA11 Percentage of employees receiving regular

performance and career development reviews,

by sex and employee category.

Page 39 Yes

Page 108 -110

Know

ledg

e

Man

agem

ent Own indicator Knowledge management initiatives, number of

forums and meetings held, and number of visits

to the knowledge portal.

Page 51 Yes

Page 108 -110

GRI INDEX

DESEMPEÑO ECONÓMICO

G4 - EC1 Valor económico directo generado y distribuido. Página 17 y 18 Yes

Page 108 -110

105 >>


Pers

onal

Dev

elop

men

t

Loca

l Hir

ing

Own indicator Percentage of collaborators from the local

community in locations where significant

operations are developed.

Page 45 Yes

Page 108 -110

Own indicator Percentage of recategorizations of operator

collaborators.

Page 43 Yes

Page 108 -110

Supp

lier

App

rova

l

G4 - LA14 Percentage of new suppliers that were screened

using labor practices criteria.

Page 76 Yes

Page 108 -110

Safe

ty

Gen

eral

G4- LA5 Percentage of total workforce represented in

formal joint management–worker health and

safety committees that help monitor and advise

on occupational health and safety programs.

In the Group companies 100% of collaborators are

represented in Safety and Health Committees.

Yes

Page 108 -110

Own indicator Accident frequency rate and number of hours

worked under exposure to risk.

Page 52 Yes

Page 108 -110

Road

Saf

ety Own indicator Road safety management initiatives with

collaborators, users and society.

Page 51 Yes

Page 108 -110

GRI INDEX



106 >>


Envi

ronm

ent

Ener

gy

G4 - EN3 Energy consumption (internal) Page 57 Yes

Page 108 -110

Spill

s

G4 - EN24 Total amount and volume of significant spills Page 58 Yes

Page 108 -110

Was

te

G4 - EN23 Total weight of waste, distributed by type and

treatment method

Page 59 Yes

Page 108 -110

Envi

ronm

en-

tal s

olut

ions G4 - EN27 Level of mitigation of environmental impact of

products and services

Page 62 Yes

Page 108 -110

Supp

lier's

appr

oval

G4 - EN32 Percentage of new suppliers who were assessed

based on environmental criteria

Page 76 Yes

Page 108 -110

GRI INDEX



107 >>


Com

mun

icat

ion

Dia

loge

wit

h cl

ient

s G4 - PR5 Results of client satisfaction surveys Page 67 - 70 Yes

Page 108 -110

Own indicator Amount of claims and complaints made by

clients

Page 70 Yes

Page 108 -110

GRI INDEX



108 >>


VERIFICACIÓN DE LA TERCERAPARTE

CONCEPT AND DESIGN

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