Dear stakeholders:

Granjas Carroll de México S de RL de CV gladly reaffirms its intention to apply all our efforts in the achievement of the Ten Principles of the United Nations Global Compacts. Our goal is to create a wide Corporate Volunteering, including employees, partners, suppliers, government instances and other institutions, that guarantees our Mission and Vision in this matter are accomplished. The main areas of working are: Human Rights, Labour, Environment and Anti-Corruption.

Now we present this Communication on Progress which details our actions of 2013 and 2014 on this commitment. You can see our policies, strategies and productive activities are closely following this goals.

I hope you enjoy the reading.

Victor M. Ochoa Calderón
CEO

The company prevents conducts of abuse with its intern Code of Ethics, whic every employee respects and applies inside the organization.
Our Mission and Vision establish the goal of being a sustainable company commited to the people living around our area of influence and achieving a better society by reducing poverty, poor education and social problematics.
Our Safety Policy ensure the workers are protected from any damage from our operations.
Through the Corporate Volunteering, our suppliers and partners are invited to join the activities for the benefit of the extern community, with actions in 4 fields: education, health, social improvement and environmental care.

We have a line for anonymous reports of bad conducts; the Ethics Committe then carefully studies every single report, finds the best solution to the problem and watches for some months after the results given. People involved in the reports have the opportunity for a close-door alone talk with the Commitee, so that everybody give their testimonies and points of view.
Every employee have a copy of the Ethics Code book and about every month the Human Resources and Communication departments publishes a reminder of the Ethics Call Center.
The company's partners are involved in some decisions regarding employee's behaviours, according to the situation.
There is also another Call Center, specific for the external community. So, people living around our facilities can approach the company for any complaint of our proccesses for their daily life. This reports have immediate solution by the involved areas.
Employees and suppliers are aware of the respect the company shows to people in the rural towns surrounding and voluntarily help achieving the goals of the company's Mission and Vision by joining the Corporate Volunteering.

In this report, we detail the number of conducts reported and also the actions taken over the two reported years in the external communities.

Granjas Carroll de México S de RL de CV is ruled by a Code that clearly states employee rights, and it also obeys the national and partners's codes. In this codes, forced labour, child labour and discrimination are banned; they also states the obligations and benefits every employee has, which includes the access to health (Social Security is provided and the compay has three doctos and a nurse to watch over the employees in daily basis).
The Safety Policy stablishes that security is priority.
Also, what we produce (pigs) are healthy food, regulated by the federal government and other institutions. We have various certificates in the matter.

"ALERTA" is an internal program that GCM began in 2010 with the objective of teaching employees how to prevent accidents in their tasks, and with ALERTA Line everyone inside the company can make anonymous calls (or emails) to report situations, conducts and buildings or machines of potencial danger.
GCM has the best salaries of the region and all employees have above the law rights. For example, not only have Social Security provided but a medical office for they and their families' use. Another examples could be the monthly food coupons, economic bonuses for achieving goals, student grants for employee's children and support for employees continuing education, several productive courses and more.
Discrimination is not applied in this company, since women are hired for being farmers and take care of the pigs we produce. We hire people with tatoos, long hair, any national or international procedence, etc.
In producing healthy food, employees follow all the biosecurity rules, carefully supervised by veterinarians, nutritionists and other experts. Our rules are very strict and one of them is about the god care of the animals, always following and respecting the international Animal Rights.

The CEO presides monthly meetings with managers, coordinators and supervisors to review actions taken in order to achieve the annual goals that were taken in a week working-meeting between all departments represented by their managers.
Senior management also have periodic meetings within all the different departments.
Audits from Sagarpa are implemented frequently in hog production and other productive tasks such as vehicle mainteinance, environment, prevention of accidents, etc.

GCM has an Environmental Policy that every employee follows. The main goal in the area is to produce healthy food with no bad consequences for the water, air and soil. Near agriculture lands and cities are safely doing thier activities.
All suppliers and partners also obey the policy and take all actions needed in order to succesfully produce in a sustainable way. They are also invited to our environmental activities, such as our reforestation program.
In the future, the company has a clear goal in mind: the continuity of our certificates from ISO 14001 and Profepa.

Within the company, the Energy & Environmental department implements programs for reducing the waste materials and giving them correct final disposition. Employees receive training for the disposal of materials.
The Environmental Management System of GCM was developed by the Energy & Environmental department with the help of an external office. This system is audit every three months as a part of the ISO 14001 certificate mainteinance.
GCM has, in its production proccess, biodigesters, artificial evaporation ponds for the cleaning and recycling of water, methane capture and reuse proccess, solar energy panels and else.
A forestal nursery and a private conservation area, are part of the GCM actions for the environmental care.

Between 2013 and 2014, a group of Master students of a university in Puebla made a research of one year duration in the private conservation area about the plants and animals in existence and the number of them, allowing the company to establish norms to take care of them. Now, GCM has a well documented project of action for the conservation of species in danger.
Profepa and ISO 14001 audits every few month all the proccess of GCM.

In the Code of Ethics we have specific policies against practices of any kind of corruption.
This report contains clear statements about our sales anti-corruption behaviour.
The Etichs Commitee closely watches over the minnimum sign of any practice contrary to our policy.

The Ethics Line is for the use of everybody, inside and outside the company, to report conducts of bribery, conflict of interests and any other corrupt behaviour.
All employees have a copy of the Ethics Code, where the company establishes all rules, consequences of infractions, responsabilities of employees and else.
Human Resources and Communication departments frequently remind employees by mailing and the internal magazine of the company about this rules, call center and consequences.
The company gives a public report of frequent clients.

The Ethics Commitee and internal auditors carefully follows every corruption case and acts in consequence by starting a detailed investigation which can lead to fire the person involved.