Set up in 2006, the Ombudsman´s Office is one of the dialogue channels that support the evolving relationship with our stakeholders. Linked to the Chief Organizational Development and Sustainability Office, the office is responsible for mediating solutions for matters that run counter to the Natura Relationship Principles, and also for identifying opportunities to improve our processes, policies, and relationships. The procedure for contacting the office is simple: once the comment is received, it is forwarded to the manager responsible and then used to help improve the process. Each year we try to expand the scope of the service. In addition to the employees in Brazil and Latin America and suppliers, we developed a pilot project, launched in early 2008, to extend the service to some 10,000 consultants.

In 2008, the number of contacts received by the office grew by 27.5% compared to the previous year (see graph below). The issues the contacts addressed were related to technical matters (policies, processes, and infrastructure) and conduct: 70% of the contacts received related to criticisms and the other 30% were consultations or suggestions. Allegations of ethical misconduct are forwarded to and analyzed by the Ethics Committee, on which the CEO serves. Whenever it is considered necessary, the involvement of the Internal
Audit department is requested, as mentioned on chapter
Corporate Governance.

Internal Stakeholders in Brazil and Latin America

The Ombudsman´s Office serves as another dialogue channel with employees. In 2008, the office received 809 contacts from employees in Brazil and Latin America, from all levels of corporate hierarchy and different departments. Of the 783 contacts received from employees and in-house outsourced workers (outsourced workers allocated in the company’s units in continuous services) in Brazil, most (47%) were addressed to the Human Resources Board and dealt with technical matters related to people management, such as benefits, quality of life, employment contracts, and training. For the Latin American operations, meanwhile, 96% of the contacts dealt with matters of conduct related to people management.

Each person who contacts with the Ombudsman´s Office is asked to fill out a survey to determine his or her satisfaction with this dialogue channel. In 2007, the survey revealed a satisfaction rate of 97% among the internal stakeholders in Brazil. In 2008, the rate was 96%, which we consider positive and statistically the same as the previous year. We have
not reported the results of the survey for the internal stakeholders in Latin America because there is not a statistically significant sample.

Consultants – Brazil

At the end of 2007, a pilot project was launched for a group of nearly 10,000 consultants in the city of São Paulo. Throughout 2008, the Ombudsman´s Office received and processed 52 contacts, the majority related to Sales Promoters. Also in 2008, as support for the service and as experience ahead of expanding the channel to this public, the Ombudsman´s Office handled another 687 critical matters submitted by consultants from across Brazil through the Natura Service Center (CAN). All the contacts followed the same course as the other contacts. We have not reported the results of the satisfaction survey for the pilot program with consultants since we have yet to obtain a significant sample.

Suppliers – Brazil

The Ombudsman´s Office has also, since May 2007, been supporting the evolving relationship with Natura suppliers in Brazil. In 2008, we received 19 contacts, namely criticisms and charges - addressing primarily technical matters regarding the process of identifying and selecting suppliers and contract management, which includes the stages of negotiation
and payment.