Investor Relations

  • ENPT

Corporate Governance Model

On March 31st, 2006, the General Shareholders Meeting approved Embraer’s corporate restructuring proposal, turning it into the first large Brazilian Company with dispersed corporate control, without any control group or controlling shareholder. Since the Company’s privatization, this significant restructuring allowed the creation of bases for the sustained growth and continued operation of Embraer, allowing wide access to world capital markets, increasing its ability to finance and develop new programs.

The restructuring also provided strength to management with the adoption of best corporate governance practices, while preserving the Brazilian Federal Government’s strategic rights.

The capital reorganization allowed the Company to unify its classes of shares in only one class of common shares, extending the right to vote to all of its shareholders and enabling its inclusion in the New Market (“Novo Mercado”) of BM&FBovespa, which has the highest level of corporate governance in Brazil. The unification of share classes, along with changes in the Company’s by-laws, created the benefit of 100% tag-along rights, in which all shareholders have the same economic rights in the event of a tender offer for the Company’s shares.

The Golden Share, a special class of share held by the Brazilian Federal Government, which has veto powers over specific issues in connection with Embraer’s business, remained with its rights fully preserved under the new structure.

The Company’s by-laws establish protection mechanisms to ensure not only dispersed capital ownership, but also that a majority vote on shareholders meeting resolutions will be exercised by Brazilian shareholders, thus ensuring that decision-making for corporate resolutions remains in Brazilian hands – a condition established when the Company was privatized. The key control mechanisms are:

  • No shareholder or shareholder group, whether Brazilian or foreign, may exercise voting rights at the General Shareholders Meetings representing more than 5% of the issued and outstanding shares of the Company. This limitation aims to discourage excessive concentration of shares or American Depositary Shares (ADS) in the hands of one single shareholder or shareholder group;
  • The total votes that may be cast by foreign shareholders, individually or collectively, in any General Shareholders Meeting, will be limited to 40% of the total votes present at such meeting;
  • Restriction to the acquisition by any shareholder or group of shareholders of a stake equal to or in excess of 35% of Embraer’s capital, unless under the express approval of the Brazilian Federal Government, as holder of the Golden Share, and subject to the realization of a public tender offer;
  • Mandatory disclosure of share ownership whenever a shareholder participation, direct or indirectly, exceeds, upwards or downwards, the levels of 5%, 10%, 15%, and so forth, of the Company’s capital stock.

Embraer’s governance structure is composed of the Board of Directors and its auxiliary committees, Fiscal Council, Executive Officers, Internal Audit and External Audit.

Board of Directors

composed of a minimum of 9 and a maximum of 11 members of which 8 are independent. The Brazilian Federal Government, holder of the Golden Share, nominates 1 member and employees put forward 2. For the 2021/2023 period alone, the Board of Directors will have 13 members, 10 of which are independent. The Board usually meets 8 times a year or whenever necessary, with the support of 3 auxiliary committees: Strategy and Innovation Committee, Audit, Risk and Ethic Committee and Personnel and ESG Committee.

Fiscal Council

composed of a minimum of 3 and a maximum of 5 members and an equal number of alternates. The Fiscal Council reports directly to the Company’s shareholders and is charged with overseeing administrative management, through regular quarterly meetings or extraordinary meetings to review the financial statements.

Executive Officers

appointed by the Board of Directors and is responsible for managing the Company in accordance with the Strategic Plan and the Action Plan approved by the Board of Directors. It is evaluated by the Board of Directors and compensated in line with market benchmarks and according to performance relative to the economic-financial, operational, and socio-environmental goals set out in the Action Plan. The Board of Executive Officers is supported by several management committees such as the Financial Management, Ethics, Sustainability, Environmental Risks and Trading and Disclosure committees.

Internal Audit

responsible for all auditing activities, acts independently and reports directly to the Audit, Risk and Ethic Committee of the Board of Directors.

External Audit

Company norms governing the contracting of services unrelated to the external audit carried out by its independent auditors ensures there are no conflicts of interest or impairment of independence and objectivity.

Golden Share of the Brazilian Federal Government

Section 9 – The Golden Share confers on the Brazilian Federal Government veto powers over the following matters:

  • I. Change in the name of the Corporation or its purposes;
  • II. Modification and/or use of the Corporation’s logo;
  • III. Creation of and/or changes in military programs involving the Federative Republic of Brazil or otherwise;
  • IV. Technological training of third parties in connection with military programs;
  • V. Discontinuance of a supply of spare parts to service military aircraft;
  • VI. Change in a controlling interest in the Corporation;
  • VII. Any amendments to: (i) the provisions of this Section, Section 4, the leading paragraph of Section 10, Sections 11, 14 and 15, item III of Section 18, Paragraphs 1 and 2 of Section 27, item X of Section 33, item XII of Section 39 and Article VII; and (ii) the rights conferred by these By-Laws on the Golden Share.

Paragraph 1 – The conduct of a public offering for the purchase of shares, as referred to in Section 54 hereof, will require the prior approval of the Brazilian Federal Government as the owner of the Golden Share.

Paragraph 2 – Subject to the provisions of Law No. 6,404/76 and Section 18, item III, of these By-Laws, the matters listed in this Section will fall within the decisionmaking authority of the Board of Directors of the Corporation and will be subject to the following procedures:

  • I. The matter at hand will be the object of a resolution of the Board of Directors.
  • II. If the matter at hand is approved by the Board of Directors, the Chairman of the Board will notify the director elected by the Brazilian Federal Government to either exercise his veto right or express his approval, within a period of 30 days from receipt of such notice.
  • III. After expiration of the period mentioned in item II above, a new meeting of the Board of Directors will be convened: (i) to reconsider the resolution, if the Brazilian Federal Government exercised its veto right; or (ii) to confirm the resolution, if the Brazilian Federal Government expressed its approval or failed to voice an opinion within the period referred to above.
  • IV. If the resolution is confirmed by the Board of Directors, the matter at hand will be submitted to the Shareholders’ Meeting for approval, where so required by applicable legislation, at which time the Brazilian Federal Government may yet again exercise its veto power under this Section.

Paragraph 3 – Without prejudice to the procedure defined in Paragraph 2 above, all matters to be acted on by the Board of Directors that are subject to a veto by the Brazilian Federal Government must also be communicated in advance to the Ministry of Finance by notice given concurrently with the notice mentioned in item II above, the Ministry to pass on the matter within 30 days after receipt of the notice referred to in item II above.