The Gerdau Group operates with a team of professionals focused on the business and on the search for differentiated performances.
CORPORATE GOVERNANCE
Management model in line with best market practices
Efforts to consistently increase transparency and meet growing capital market
demands are an integral part of the Gerdau Group’s history. Since 1999, solid
results and the continuous improvement in corporate governance practices have
translated into an 88.4% average annual increase in the value of Gerdau S.A.
shares, and an 86.0% average annual increase in Metalúrgica Gerdau S.A.
shares. Share liquidity has also improved measurably, a fact that is demonstrated
by a drastic increase in the average daily trading volume during this same
period: 429.5% for Gerdau S.A. and 247.4% for Metalúrgica Gerdau S.A.
The performance of the Group’s companies is founded on a team of
To provide support for company
professionals who are focused on steelmaking and who strive for differentiated
operations, the Strategy Committee
performances in each geographical region where our units are located.
includes Executive Committee
members and those individuals
Governance structure
The corporate governance structure is formed by the Board of Directors and
responsible for major operations to
assist the Board of Directors in the
the Executive Committee, together with their supporting bodies – the
formulation of company strategies.
Strategy Committee and the Excellence Committees – in addition to the
The Excellence Committees provide
Board of Auditors.
support for the functional processes
and encourage debate and the
The Board of Directors is composed of eight members who play a
exchange of practices.
fundamental role in the approval of strategic decisions and risk and growth
76
policies. The Board includes three independent members who provide
The Boards of Auditors in each of
important contributions for business development. Following our mission to
the Group’s two public companies
be an international world-class company, the Gerdau Group works with a
in Brazil were created four years
team that has extensive experience in steel production management.
ago and operate with the
participation of minority
Board meetings occur at least four times a year. Directors are invited to
shareholders. Their function is to
present and discuss strategic issues relevant to their area of operation,
accompany the activities of
granting the external members a closer proximity with the company and the
administrators and control the
scenario in which it operates.
accounting operations of the
companies. In both companies,
The Executive Committee is responsible for business management and
members are elected on an annual
serves as a liaison between the Board of Directors and the five steelmaking
basis at the general shareholders’
operations. These operations are defined according to product line and/or
meetings. The Committee meets on
the geographical location of the units: Long Steel (Brazil), Specialty Steel
average four times per year.
(Brazil), Gerdau Açominas – Ouro Branco (Brazil), North America (Canada
and the United States) and South America (Argentina, Chile and Uruguay).
Gerdau companies
In Brazil, the public companies
Each of the seven members – a president and six vice presidents – are
Gerdau S.A. and Metalúrgica
responsible for functional processes and/or business operations. Functional
Gerdau S.A. are part of the
processes are: logistics & transportation, procurement, scrap purchasing,
Level 1 Corporate Governance
industrial process, marketing & sales, information technology, strategic
program of the São Paulo Stock
planning, corporate communications, organizational development and
Exchange (Bovespa), which
human resources, legal, finance and investor relations, accounting and audit,
establishes the standards for
and management technology.
conduct in capital markets.
Responsible for the Group’s steelmaking operations in Brazil, Gerdau
Açominas is a closed-capital company. However, it is as committed to
presenting the same level of transparency in the disclosure of information as
Gerdau’s public companies. Gerdau Açominas has a Board of Directors that is
formed by six members, one of which is indicated by the Açominas
employee stockholding association (Clube de Participação Acionária dos
Empregados da Açominas – CEA). An administrative board manages the
unit, and the board’s Executive Committee coordinates three business
operations: Long Steel, Specialty Steel and Gerdau Açominas – Ouro Branco.
The Gerdau Ameristeel Corporation was founded in October 2002 in North
America as a result of the merger of the Gerdau Group operations in the
Wire
region with those of the former Co-Steel company. The corporation is a
Wires serve as raw material for a series of
public company and has a Board of Directors that is formed by nine
construction, industrial and agricultural
members, five of whom are independent. Gerdau Ameristeel meetings occur
products. Depending on the final application,
as auditing, human resources, corporate governance, safety, health and the
environment. Gerdau Ameristeel is managed by a group of officers who
focus on processes and/or geographic regions.
polished, annealed or galvanized, providing
the customer practicality in use, low cost and
higher durability.
is exercised by unit operating committees that report to the Gerdau
77
Executive Committee.
2003 Annual Report
In Argentina, Chile and Uruguay, with closed-capital companies, governance
wire is sold with a normal finish, or is
Gerdau
each quarter and committees were created to deal with specific topics such
Shareholder meetings
Once a year, the Ordinary Shareholders’ Meeting analyzes and approves annual
reports, and ratifies or supplements the distribution of dividends and/or interest
on capital stock. The meetings also serve as a space for members to elect Board
of Administration and Board of Auditors members. Extraordinary Shareholders’
Meetings are called to resolve specific issues requiring shareholder approval.
Relationship with independent auditors
As required by instruction 381/2003 of the Brazilian Securities and Exchange
Commission (Comissão de Valores Mobiliários, CVM), the Gerdau Group’s
public companies in Brazil hereby inform that the services provided by
PricewaterhouseCoopers Independent Auditors were limited to external auditing
for the companies. The policy to hire an independent auditor for eventual
services that are not related to the
Board of Auditors is based on the
principles that safeguard the auditor’s
independence: auditors should not
audit their own work; auditors
should not perform management
functions for their clients and should
not promote the client’s interests.
BOARD OF DIRECTORS
Substitutes
OFFICERS
Chairman
Pedro Floriano Hoerde
President
Jorge Gerdau Johannpeter
Ruben Rohde
Jorge Gerdau Johannpeter
Cláudio Vilar Furtado
Vice Chairmen
Vice Presidents
Germano H. Gerdau Johannpeter
Gerdau S.A.
Frederico C. Gerdau Johannpeter –
Klaus Gerdau Johannpeter
Permanent
Senior Vice President
Frederico C. Gerdau Johannpeter
José Antônio Cruz de Módena
André B. Gerdau Johannpeter
Carlos J. Petry
Peter Wilm Rosenfeld
Claudio Gerdau Johannpeter
José Bernardo de Medeiros Neto
Osvaldo B. Schirmer
Affonso Celso Pastore
Substitutes
Gerdau Brazil Long Steel
André de Lara Resende
Rudolfo Teodoro Tanscheit
Operation
Oscar de Paula Bernardes Neto
Tranquilo Paravizi
Domingos Somma –
Alfredo Tostes Bello da Silva
Executive Vice President
Brazil
Gerdau Açominas – Ouro
GERDAU AÇOMINAS S.A.
Branco Operation
GERDAU EXECUTIVE COMMITTEE
BOARD OF DIRECTORS
Luiz André Rico Vicente –
President
Chairman
Executive Vice President
Jorge Gerdau Johannpeter
Jorge Gerdau Johannpeter
Board Members
General Secretary
Expedito Luz
78
Gerdau Specialty Steel
Vice Presidents
Vice Chairmen
Operation
Frederico C. Gerdau Johannpeter –
Germano H. Gerdau Johannpeter
Cláudio Mattos Zambrano –
Senior Vice President
Klaus Gerdau Johannpeter
Executive Director
Carlos J. Petry –
Frederico C. Gerdau Johannpeter
Senior Vice President
André B. Gerdau Johannpeter
Carlos J. Petry
Claudio Gerdau Johannpeter
Executive Officers
Alfredo Huallem
Domingos Somma
Board Member
André Felipe G. Reinaux
Osvaldo B. Schirmer
Marco Antônio Pepino
Dirceu Tarcisio Togni
Elias Pedro Vieira Manna
General Secretary
Substitutes
Érico Teodoro Sommer
Expedito Luz
Claudio Gerdau Johannpeter
Expedito Luz
Expedito Luz
Fladimir B. Lopes Gauto
BOARD OF AUDITORS
Osvaldo B. Schirmer
Francesco S. Merlini
Metalúrgica Gerdau S.A.
Ruy Lopes Filho
Geraldo Toffanello
Permanent
Guilherme Rocha Murgel de Rezende
Gerson Marcos Venzon
Carlos Roberto Schroder
Guilherme C. Gerdau Johannpeter
Domingos Matias Urroz Lopes
General Secretary
Heitor L. B. Bergamini
Luciano Carvalho Ventura
Expedito Luz
João A. de Lima
João Carlos Salin Gonçalves
Mike Mueller
Joaquim de Souza Gomes
Tom J. Landa
Joaquim G. Bauer
Andre Beaudry
Julio Carlos Lhamby Prato
J. Neal McCullohs
Luiz Alberto Morsoletto
James S. Rogers
Luiz Augusto Polacchini
Robert P. Muhlhan
Manoel Vitor Mendonça Filho
James F. Oliver
Moacir Curi Meneguzzi
Donald R. Shumake
Nestor Mundstock
Edward C. Woodrow
Omar de Oliveira Fantoni
Wilburn G. Manuel
Paulo Ricardo Tomazelli
Anthony S. Read
Paulo Roberto Perlott Ramos
Roger Paiva
Ruy Lopes Filho
Glen A. Beeby
Sirleu José Protti
William E. Rider
Tadeu Petterle
Robert L. Bullard
GERDAU AMERISTEEL CORP.
MRM Special Sections Division
Garry A. Leach –
President
Board of Directors
Chairman
Chile
Jorge Gerdau Johannpeter
GERDAU AZA S.A.
Hermann Von Mühlenbrock S. –
Board Members
General Manager
Phillip E. Casey
Kenneth W. Harrigan
Uruguay
Joseph J. Heffernan
GERDAU LAISA S.A.
J. Spencer Lanthier
Salvador Elias Gimenez Daou –
Michael D. Sopko
Executive Director
Frederico C. Gerdau Johannpeter
André B. Gerdau Johannpeter
Stakeholding – Argentina
Arthur Scace
SIPAR ACEROS S.A.
Amaury Cordeiro de Oliveira –
Officers
Executive Director
President and CEO
Phillip E. Casey
Vice Presidents
André B. Gerdau Johannpeter
Paulo Fernando Bins de Vasconcellos
GG 50 rebar inventory at Gerdau
Cosigua. State of Rio de Janeiro - Brazil
79
2003 Annual Report
Canada and the United States
Gerdau
Matthew C. Yeatman