Special Report of the Business Group

Employee from the Pastas Business, Colombia.

By the end of 2019, the Nutresa Business Group was formed by 74 companies, grouped as follows for administrative purposes: eight food Businesses and their production platforms in Colombia and abroad; an international distribution network; four local distribution companies; and four companies that render administrative, logistical and transport services, which provide the corresponding support to the Group’s companies.

In compliance with the provisions of the Colombian laws, particularly Article 29 of Act 222 of 1995, Grupo Nutresa S. A., as the parent company of the Business Group, received from its subordinates for the sales of goods and services the sum of COP 2.75 billion, and the amount of
COP 262.36 billion as dividends. Throughout 2019, to secure the financial obligations of its subordinates, Grupo Nutresa allocated endorsements and guarantees for COP 644.0 billion and COP 167.31 billion, accordingly. The subordinates, for their part, did not carry out operations for third parties by influence or in the interest of the parent company.

Moreover, in 2019, Grupo Nutresa S.A. did not make or stopped making decisions to address the interest or by influence of any of its subordinate companies, and none of them made or stopped making decisions to address the interest or by influence of Grupo Nutresa S. A.

Grupo Nutresa ensures an adequate and timely disclosure to its shareholders, the market and the general public.

Legal provisions

Grupo Nutresa y sus subordinadas dieron Grupo Nutresa and its subordinates strictly complied with all intellectual property and copyright regulations, their trademarks are duly registered, and they all own the respective licenses of the software installed at all facilities and keep the corresponding evidence that allows to verify such compliance.

In 2019, the Organization did not receive any notices of lawsuits and there were no judicial rulings that could significantly affect its financial condition. No fines or significant penalties were imposed on Grupo Nutresa’s companies or their executive managers.

The Note 17 of Grupo Nutresa’s separate financial statements, which are published on our website, contains all the details of the operations with shareholders and the persons addressed in the Article 47 of Act 222 of 1995 and other concordant regulations. All such operations were carried out under market conditions.

The Company declares that it did not hinder the free circulation of invoices issued by the Business Group’s vendors or suppliers. Additionally, the Company certifies that the financial statements and other relevant reports do not contain any flaws, inaccuracies or errors that would impede finding out the true equity situation of the Company, pursuant to the provisions of the Article 46 of Act 964 of 2005.

Assessment of the performance of the information disclosure and financial information control systems

Grupo Nutresa’s internal control system includes the necessary resources to guarantee the verifiability, reasonableness and reliability of the information required to plan, direct, control, measure and record the performance of its businesses, and to ensure an adequate and timely disclosure of financial information to its shareholders, the market and the general public.

This system includes, among other elements, comprehensive risk management processes, accountability systems, control plans and programs, tools for budgets and costs, chart of accounts, standardized policies and procedures, integrated information systems and templates for documenting and recording operations, and indicators dashboards that for the continuous monitoring of the processes carried out by the Administration.

Additionally, the Internal Audit Department verifies the fulfillment of the Company’s goals and objectives and the protection, utilization and conservation of its assets. The Tax Auditor, for its part, is responsible for verifying and certifying relevant aspects such as the compliance with legal, statutory and administrative standards, the reasonableness of the Company’s financial statements and the disclosures contained therein.

The results of the activities performed by the Internal Audit Department and by the Tax Auditor are timely informed to the corresponding authorities, which implement the required improvement measures.

The aforementioned activities confirm that the performance of the Company’s financial information disclosure and control systems is adequate and that, over the fiscal term, there were no significant deficiencies in the design and operation of these systems that could have kept the Company from adequately arranging, recording, processing and presenting the financial information, cases of fraud with an effect on the reasonableness of such information, or significant changes in the financial information assessment methodology.

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