2010Sustainability Report Annual

Index

ProfileOur history

Where we areOur essence

Our performanceMessage from Management

About the reportBuilding our future

Corporative GovernanceWho we are

How we do itInnovation, Research and Development

SustainabilityDiagnostic MedicinePreventive Medicine

RecognitionFinancial Highlights

AttachmentsCredits

page 6

page 8

page 10

page 12

page 14

page 16

page 22

page 28

page 36

page 48

page 62

page 70

page 76

page 94

page 106

page 112

page 116

page 124

page 136

ProfileThe Grupo Fleury is one of the most traditional medicine and health organizations in Brazil. We’ve been around for 85 years, recognized by the medical community and public opinion by our excellence in customer service, innovation and technical quality. |GRI 2.1|

We have a team of professionals recognized in Brazil and abroad. In the national market, we stand out in offering increasingly integrated and complete solutions in the health industry, in the preventive and diagnostic stages. In addition, we conduct more than 30 million tests and procedures per year, and provided services for more than 5 million clients. Through our diversification, we act in different lines of business: |GRI 2.2, 2.7|

• In our patient service centers, we operate with different brands for different health insurance categories in the states of São Paulo, Rio de Janeiro, Rio Grande do Sul, Pernambuco, Bahia and Paraná, besides Distrito Federal. In these places, we provide services to individual customers or those linked to health plans. As part of our differentiation in the provision of services, we have a high quality customer relationship with our clients and with their doctors, always seeking to offer complete diagnostic solutions;

• Provide diagnostic services in hospitals, either clinical analysis or imaging and other specialties. For physicians housed in these institutions, we

provide high valued diagnostic information in order to conduct their work with their patients;

• in the reference laboratory business sector, we mainly perform medium and high complexity exams for laboratories, hospitals and clinics throughout Brazil, enabling them to expand its range of products supply with unique diagnostic quality;

• In the preventive medicine business, we conduct (i) health promotion projects for employees of various companies, (ii) health assessment, especially for corporate executives, hired by companies or health plans, (iii) chronic diseases management, which improves quality of life of chronically ill, while allowing reduction of expenses and health insurance claims.

WE OFFER COMPLETE AND INTEGRATED SOLUTIONS IN DIAGNOSTIC AND PREVENTIVE MEDICINE

::::

: Gru

po

Fleu

ry 2

010

::::

:

7

Fleury starts its activities as a clinical analysis laboratory in São Paulo.

The first technical and scientific cooperation between Fleury and the best universities of Brazil.

Pioneer in the implementation of computerized system for customer service.

Implementation of the code bar system to secure identification of tests.

The Fleury Paraíso PSC at Rua Cincinato Braga is inaugurated.

The first imaging exams are performed.

Fleury becomes pioneer in integrated medical solutions offering.

1926

19361982

1994

1962

1983

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

8

Fleury becomes a market consolidator with acquisitions in the sector.

Chronic Diseases Management.

First company in the world to provide tests results on the Internet.

Now, through the Internet, customers also have access to imaging exams.

Venture in the capital market - New Market BM&F Bovespa.

Creation of a+ Diagnostic Medicine (launch in 2011).

Signing of Memorandum of Understanding for the acquisition of Labs D’Or.

And the historycontinues...

2001

2008

2010

19982002

2009

Our history

::::

: Gru

po

Fleu

ry 2

010

::::

:

9

Our 141 PSCs are located in the states of São Paulo, Rio de Janeiro, Bahia, Pernambuco, Paraná, Rio Grande do Sul and Distrito Federal, and offer value proposals compatible with different socio-economic sectors.

São PauloGrupo Fleury headquartersFleury Medicina e SaúdeCriesp Medicina DiagnósticaCampana Medicina DiagnósticaLego Medicina DiagnósticaURP Diagnósticos MédicosBiesp Laboratório ClínicoDI Diagnóstico por Imagem

Rio de JaneiroFleury Medicina e SaúdeLaboratório Helion Póvoa Medicina DiagnósticaLaboratório Maiolino Medicina DiagnósticaLaboratório Daflon Medicina Diagnóstica

ParanáLaboratório Champagnat Medicina Diagnóstica

Rio Grande do SulWeinmann LaboratórioLaboratório Faillace

BahiaLaboratório Qualitech Medicina Diagnóstica

PernambucoLaboratório Paulo Loureiro Medicina Diagnóstica

Distrito FederalFleury Medicina e Saúde

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

10

Where we are

Integrated Solutions in Medicine and Health

Health Assessment

141 units

Market leader (customized programs to executives)

Accountable for tests in 8 hospitals

Health and well-being programs to companies

solutions to more than 3,000 laboratories

Pioneer in the Brazilian market, Healthways partnership

Operations in Hospitals

Health promotion

Reference Laboratory

Complete portfolio of diagnostic tests

•Clinical Analysis (Laboratory tests, Anatomical pathology and high-complexity tests)•Diagnostic Center (Imaging and tests of more than 40 diagnostic specialties)

Chronic Diseases Management

|GRI 2.2, 2.3, 2,4 e 2.5|

Patient Service Centers (PSCs)

::::

: Gru

po

Fleu

ry 2

010

::::

:

11

Our essence|GRI 4.8|

Health and well-being for people’s complete fulfillment.

Vision

To provide more complete and integrated solutions for health management and people’s well-being, with excellence, humanity and sustainability.

MissionFocused on the clientIntegrity Innovation Enthusiasm Excellence Respect Interdependence Solidarity

Values

::::

: Gru

po

Fleu

ry 2

010

::::

:

13

Our performance|GRI 2.8|

* Compound Annual Growth Rate (CAGR)

Gross revenue Average revenue per PSC

EBITDA Net income

::::

: Gru

po

Fleu

ry 2

010

::::

:

15

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

16

Message from Management|GRI 1.1|

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

18

Commitment to corporate governance, with sustainability, with the development of Medicine and human capital, with the development of shareholder value, with ethics and integrity. 2010 was marked by great awards and achievements for us in all these dimensions.

This year, we faced a favorable macroeconomic scenario. In view of the economic growth reported in 2010, with a GDP of R$ 3.675 trillion, there was the creation of approximately 2.5 million formal jobs. This is a highly relevant indicator because it expands the number of private health system users, in which we operate. According to the Agência Nacional de Saúde Suplementar (ANS) [National Agency for Supplementary Health], the number of private services beneficiaries peaked at 45.7 million people, an 8% increase compared to 2009, with 41.9 million covered people. This data, added to the increase in life expectancy and greater awareness of health prevention, provide a suitable environment for the development of the sector.

In our first year as a publicly traded company, we were awarded with the IBGC 2010 Corporate Governance prize in the listed companies category, an award that we had achieved in 2007 in the non-listed companies category. In the evaluation to which we subjected, the following key elements were highlighted: structured evaluation system for executive and employees of all levels, with variable remuneration and stock option plan; strict rules for the interaction with related parties.

It is also worth noting that the brand Fleury Medicina e Saúde, besides medical community recognition as the best and most reliable medical diagnostic center in Brazil, was ranked by BrandAnalytics and Millward Brown as the most valuable brand in the Brazilian healthcare sector,

the sixth most valuable brand among service companies and the 25th most valuable brand in Brazil.

Fleury brand was classiFied by brandanalytics and by Millward brown as the Most valuable oF brazil’s healthcare sector

In our social and environmental commitments, we were the first company in the sector in Brazil to achieve the Leadership in Energy and Environmental Design (LEED) certification - Gold Standard for the Rochaverá-Morumbi PSC, a Fleury Medicina e Saúde brand in São Paulo. In parallel, complementing the Code of Conduct and after joining the Business Pact for Integrity and Against Corruption in June, we also adopted an Integrity Policy to guide the relationship with public agencies and other stakeholders.

Strategic Positioning The strategic positioning of differentiation was once again evidenced by the offer of services and solutions increasingly integrated and complete, in all our business sectors. They are 4.6 thousand employees and more than 600 highly qualified physicians, united by a knowledge management system, using artificial intelligence tools designed to support the analysis of results, working in 39 medical specialties and producing 53 integrated reports. One of the pillars of our competitive advantage, the knowledge applied to provision of diagnostic and preventive medical services, may be exemplified by the publication

::::

: Gru

po

Fleu

ry 2

010

::::

:

19

of more than 170 articles, over 310 abstracts in scientific meetings and 95 book chapters, besides consulting services in more than 40 thousand complex cases.

Therefore, our investment in qualifying professionals provided an expansion in the differential of services in all our brands. A comprehensive education program was implanted, totaling an average of 65 training hours per employee throughout the year. In 2010, we also received the title of Company of the Year in people management practices, awarded by Gestão & RH Editora. The investments in Research and Development allowed the continued expansion and evolution on product offers, with the launching of 107 new products throughout 2010 (103 in 2009).

In the constant innovation process, Integrated Medical Centers were created, with multidisciplinary services to specific areas or diseases that benefit from a comprehensive and integrated approach. To the client physician, this represents an even more efficient diagnostic support service. To his/her patient, this means a more accurate and safe diagnosis, in one place, outside the hospital environment. The first four centers inaugurated were the Lymphoma Center, Center for Investigation & Rehabilitation of Urology Disorders, Advanced Gastroenterology & Endoscopy Center and Integrated Neurology Center & Center for Sleep Disorders.

Financial PerformanceIn the financial field, we presented significant revenue growth by reaching R$ 935 million, a value of 13.9% above 2009. It was the fourth

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

20

consecutive year of double-digit growth, with our revenue expanded by more than 2.5 times in the last six years. The revenue increase was followed by an even steeper net income increase, which reached the record figure of R$ 130 million, 56% higher than 2009, rising more than four times in last four years. The results were in accordance with the expectations and goals established by Management, which allowed the launching of the Results Participation Program (RPP) for all our employees.

It is worth noting that the financial and operational information of our Group for 2010 were audited, respect the most advanced corporate governance recommendations and comply with the International Financial Reporting Standards (IFRS) and the accounting practices adopted in Brazil (BRGAAP), including the pronouncements issued by Accounting Pronouncements Committee (CPC). Our stocks (BOVESPA: FLRY3) showed an increase in value of 45% in 2010, 67% since the IPO, which occurred in December 2009.

Operational performanceAll business sectors showed favorable improvement. The expansion of the activities took place from strong organic growth, particularly in two last quarters of 2010, coupled with strategic acquisitions, such as:

• the operation of our 141 PSCs showed an expansion and adequacy of the range of services offered, with the opening of more complete units and upgrading or closure of inadequate units, the rapid expansion in offering imaging exams and other high value exams and procedures;

• expansion of hospitals partnerships, driven mainly by the growth of the institutions that

already counted with our services: Hospital Sírio-Libanês (SP), Hospital Alemão Oswaldo Cruz (SP), Hospital Samaritano (SP), Hospital Santa Catarina (SP),Hospital Santa Joana (PE), Unicordis (PE), Hospital Moinhos de Vento (RS) e Hospital Ernesto Dornelles (RS);

• expansion of health assessment services and intensification of negotiations for the generation of new contracts in Chronic Diseases Management;

• in May 2010, we held the 24th Group´s acquisition, the DI Diagnóstico por Imagem company. The acquisition enabled us to incorporate 60 reputable and highly qualified physicians, specialized imaging exams and other diagnostic procedures in a hospital environment; |GRI 2.9|

• in December, we signed a Memorandum of Understanding (MoU) for the acquisition of Labs D’Or. The transaction, once completed, will increase our revenue and our operating income in about 40%, besides strengthening our presence in Rio de Janeiro and boosting even further our line of business of diagnostic operations in hospitals. |GRI 2.9|

OpportunitiesFollowing the example of our stance adopted in 85 years of operation, we keep alive our concern in constantly enhancing the operation. In 2010, we identified improvement opportunities in processes and management, as well as the preservation of our values and differentials faced to the rapid annual growth.

::::

: Gru

po

Fleu

ry 2

010

::::

:

21

we will pursue ahighlighted organic expansion, with a capacity increase in the next two years

PerspectivesThe maintenance of a macroeconomic scenario which is promising for Brazil, particularly with strong creation of formal jobs, and tendency to greater use of medical services and increasedlongevity of the population, create a very favorable environment for all companies in the healthcare industry. Moreover, the global trend of increased use of preventive services and advanced diagnostic techniques, which seek to address the source of health problems and to promote greater longevity and quality of life, favors the increase in demand and the practice of qualified services.

We will pursue a highlighted organic expansion, with an increase in our capacity in the next two years. Among the current projects, we emphasize the expansion of the total square footage in the PSCs network; the investments to increase services delivery in the regions where we operate; and the Branding project, which will strengthen our presence in the standard and executive plans, consolidating the preference for their brands among patients and doctors. The acquisitions program will also continue, to expand our presence in new locations and the offer of services where we have operations.

The acceleration of Chronic Diseases Management contracts, and other preventive

health services and permanent innovations in products and solutions will continue to contribute to revenue growth.

We believe that the actions undertaken in recent years will enable the improvement of the return In capital invested in the coming years, through synergies, the maturity curve of new units and new businesses and the economies derived from the unification and integration of areas and systems.

We will maintain high standards of corporate governance, meritocracy and commitment to ethics, sustainability, the evolution of medicine and the individuals well-being for the development of society.

ThanksWe would like to express our thanks to all our employees for their dedication and commitment to our mission, to our clients and the medical community for the confidence in our services, to shareholders for their continued support and guidance, to the suppliers for the partnership and to the Brazilian society for being part of our history and of our future.

São Paulo, July 1st, 2011.

Omar HauacheCEO

Mauro FigueiredoBoard of Directors Chairman

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

22

About the report

::::

: Gru

po

Fleu

ry 2

010

::::

:

23

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

24

Our Group’s Annual Sustainability Report, first written under the Global Reporting Initiative (GRI) guidelines, comprises results and actions consolidated from January 1st to the December 31, 2010 and has national coverage, in all states where the company is present (PE, BA, RJ, SP, PR and RS) and the Federal District. In the year reported, there were no joint ventures established. |GRI 3.3, 3.1, 3.6, 3.7| The report includes a message from the Administration, relevant management facts and calculated financial statements for the 2010calendar year. The previous report for the year of 2009, was published in August 2010. |GRI 3.2|

The report covers financial and economic information and social affairs of the Grupo Fleury. Some environ-mental data refer only to our headquarters and units of the Fleury Medicina e Saúde brand. Any limited scope of the indicators is explained in each, if any. |GRI 3.8|

The financial data, audited by PriceWaterhouseCoopers Auditores, follow, for the first year, international accounting standards - International Financial Reporting Standards (IFRS), which led to some changes in the results published in 2009. Another reference is the

quality certifications (ISO 9001 and ISO 14001) and the Brazilian standards applied to labor law. The social and environmental indicators were obtained through surveys and internal checks, on management information systems or manual collection (quantitative data), without the participation of external audit. Changes on previously reported data and eventual estimates are properly noted throughout the document. Qualitative assessments of results were obtained from the direct manager of the reported activities. Data that may have been omitted were not reported because they were not available in a structured format, did not meet the criteria or standard proposed by the GRI reporting or were considered strategic. |GRI 3.9, 3.10, 3.11, 3.13|

This report has self-declared C+ level, verified by Det Norske Veritas (DNV), and serves the parameters established in the Levels of Application section below.

C C+ B B+ A A+

G3 Profile RESULT Answer the items: 1.1; 2.1 to 2.10; 3.1 to 3.8; 3.10 to 3.12; 4.1 to 4.4; 4.14 to 4.15

With

ext

erna

lve

rifica

tion

Answer all criteria listed to Level C plus: 1.2; 3.9, 3.13; 4.5 to 4.13; 4.16 to 4.17

With

ext

erna

lve

rifica

tion

Same required for level B

With

ext

erna

lve

rifica

tion

Information about the G3 management approachRESULT

Not required

With

ext

erna

lve

rifica

tion

Information about the Management Approach to each Indicator Category

With

ext

erna

lve

rifica

tion

Management approach disclosed for each Indicator Category

With

ext

erna

lve

rifica

tion

G3 Performance Indicator & Performance Indicator of the Sector SupplementRESULT

Answer a minimum of 10 Performance Indicators, including at least one of the following performance areas: social, economic and environmental.

With

ext

erna

lve

rifica

tion

Answer all criteria listed to Level C plus:1.2; 3.9, 3.13; 4.5 to 4.13; 4.16 to 4.17

With

ext

erna

lve

rifica

tion

Same required for level B

With

ext

erna

lve

rifica

tion

levels oF application

::::

: Gru

po

Fleu

ry 2

010

::::

:

25

Stakeholder Engagement|GRI 3.5, 4.15, 4.16|

We maintain constant dialogue with our stakeholders through various channels, instances and partners: either by our 24 hour Service Center (individual or business customers and doctors), or through the Ombudsman (internal and external), satisfaction surveys, Investors Relationship Area (shareholders and capital market agents), Institutional Relationships (unions, class entities, government, regulatory agencies), Sustainability (NGOs, certification agencies) and Relationship Program with the Supply Chain (suppliers), among other channels.

The definition of these groups was made from consulting company managers, who opted to select stakeholder categories with whom we maintain a long relationship history that are considered strategic for our activities.

public |GRI 4.14|Shareholders 5

Government 1

Class entities 5

Physicians 10

Clients (individuals) 10

Paying sources (health plans, hospitals, etc.) 5

Suppliers 5

Employees 20

Community (NGOs) 2

Total 63

Specifically for this report, Ibope Institute conducted a research by telephone and Internet, from February 17th to 22nd, 2011 with 63 public representatives of interest.

The selection of members of the categories of shareholders, government, class entities, doctors, paying sources, suppliers and communities was guided by the strategic relevance of each one to our activities or by the criteria of relationship seniority. Employees were randomly selected by sector within our payroll base management, while the clients (individuals) were sorted among those enrolled in our Relationship Program. Those interviewed were asked to prioritize subjects in three dimensions: environmental, economic and social.

The environmental dimension emerged with the most important theme to 48% of the respondents. Within this dimension, the interviewed people indicated a preference for knowing a little more about waste creation (41%) and the use of materials and natural resources (24%), for example.

Then, social issues were highlighted by the strategic public interviewed as the second most important dimension of an annual sustainability report. Training and education (27%), job development (22%) and health and safety at work (18%) were highlighted in the survey.

We also recorded that 16% of those interviewed demonstrated greater interest in knowing issues related to the economic aspects of our Group’s activities. In this share of respondents, there is greater interest on revenue and operational cost information (64%) and impacts arising from climate change (29%). |GRI 4.17|

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

26

Dimensions

16

37

48

Economic

Social

Environmental

Environmental Dimension

21

24

41

Transportation impacts

Biodiversity

Environmental investment

Use of raw materials and resources

Waste creation, sewage, etc.

11

3

NS/NR

Economic dimension

5

29

64

NS/NR

Financial aid received from the government

Beneficiary pension plan

Impacts derived from changes

Revenue, costs

3

Social dimension

18

22

27

Actions in the community and client safety

Non-discrimination, diversity and equal opportunity

Health and work safety

Job creation

Training and education

13

10

Marketing communication

Unions and freedom of association

Practices with suppliers

Child labor and slave labor

Client data confidentiality

NS/NR

0

0

0

0

8

3

stakeholders priorityAccording to Ibope survey with 63 individuals

0

0

::::

: Gru

po

Fleu

ry 2

010

::::

:

27

Materiality Matrix

The intersection between stakeholders involvement research, consultation with the Administration and strategic planning, resulted in the materiality matrix, which highlights the most relevant issues to this story.

From the Group’s point of view, we considered the issues inserted or contextualized within the scope of the Company’s strategic projects. Our view on materiality and sustainability demonstrated a clear alignment with the expectations of the different public, raised in the preliminary phase of the report development. This was ratified in 2010 by development of our Strategic Sustainability Planning and related projects.

One of the objectives of corporate strategy is to position our group as a sustainability reference

among the healthcare companies. Also in 2010 we completed the first inventory on Emission of Greenhouse Gases and our Volunteer Policy, a few examples of synergy and convergence of interests.

Thus, our Annual Sustainability Report seeks to advance one more step in building a transparent and responsible relationship with the public, including clients, physicians, shareholders, employees, suppliers, governments and their municipalities, institutional and corporate peers. More information about this report can be obtained from the Relations Investors area, by e-mail at ri@grupofleury.com.br or by telephone +55 11 5014-7413. |GRI 3.4|

Revenues, costs, compensation

Significant indirect economic impacts

Local suppliers

Sewage and waste

Investment in infrastructure

Impacts of climate change

Training and education

Wage variation (lowest and highest salary)

Management recruited in the community

Raw materials and resources

Job creation

Environmental investment

Health and safety

Non-discrimination and diversity

Biodiversity

Actions in the community

Confidentiality of client information

Pension plan and benefit

Environmental transportation impacts

Child and slave labor

Government financial support

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

Key

1

2

3

4 5

9

13

191817

1210 7 6

1614

20 21

15

11 8

Fleury Group

Sta

keho

lder

s

+

- +

priority level

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

28

Building ourfuture

::::

: Gru

po

Fleu

ry 2

010

::::

:

29

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

30

diagnostic Medicine and diversiFy the business. through these two developMent routes, the coMpany prepares For toMorrow

GrowthOur goal is to expand the Diagnostic Medicine business unit in a different and innovative way, with efficiency and profitability. We also work to further expand our presence in the medical diagnostics segment through organic growth and acquisitions in markets where we already operate and main Brazilian economic centers where we are not yet present. The key initiatives for facilitate this expansion are the following:

• expansion of the services portfolio offered in each of our Group’s brands, mainly for diagnostic imaging services and other specialties that have strong growth trend. This strategy has enabled the company to grow with best integrated services offering for the clients and better occupation of the installed capacity for each service unit;

• expansion of the PSCs network of all brands. Thus, we seek to improve the reach and visibility and to attract more clients;

• expansion of our business lines with diagnostic operations in hospitals and solutions in diagnostic medicine, through expanded service portfolio of and the number new clients;

• growth through acquisitions of other diagnostic services providers.

DiversificationIn the area of preventive medicine, we will continue to diversify our activities, providing progressive increase in the representation of this business line in our results. Among the latest developments in this strategy is the Chronic Diseases Management service, which presents significant growth potential.

Why we are differentStrong reputation, differentiated quality and brands positioned to different segments plans. We believe that the recognition and leadership that the Fleury Medicina e Saúde brand currently holds in the health sector is a reflection our medical excellence, quality customer care and services, methodologies and efficient business models, reliable and innovative.

The network growth improves reach, visibility and attracts potential clients

::::

: Gru

po

Fleu

ry 2

010

::::

:

31

The brand positioning for the different socioeconomic segments served by health plans, offering integrated services and differentiated in comparison to the competition, with presence in major economic centers, brings high growth potential for different lines of business.

in são paulo, we areknown as thebest and Most reliablediagnostic Medicinecenter

This privileged position contributes to our success in maintaining strong and lasting relationships with our patients and the medical community, and at the same time it gives us credibility with health plans operators, hospitals, companies, laboratories and public opinion.

In the City of São Paulo, the largest economic center and the most important medical center of Latin America, we are known as the best and most reliable diagnostic medicine center by 85% of the medical community, according to a survey conducted by the Ipsos Institute in August 2010, while the second place obtained the preference of 6% of physicians interviewed. Furthermore, surveys with our customers confirm satisfaction levels above 90% on all brands and services.

Business model focused on the client Since the beginning of our activities in 1926 health and well-being of our clients, as well as the support and knowledge added to the doctors, are the origin and the reason of all our initiatives. We seek to offer services that are appropriate to their needs, considering the different socioeconomic

segments in which they are included and the markets in which we operate, and that assure them a safe, efficient, friendly, close experience, with empathy and convenience.

As an example, Fleury Medicina e Saúde Patient Service Centers (PSCs) offer pleasant and conveniently environments located to perform exams or procedures, and an efficient flow of services that adapts to our customer’s needs. Each client has his/her service and medical history that is consulted and compared by our staff at each new visit contributing to a precise and progressive diagnosis. This individualized historical is also available on the Internet to expand and facilitate access and management of information about the health of each client. Numerous other conveniences are available, such as expanded business hours, service at the client’s home and receipt of notices via SMS.

Innovation, research and development We believe that one of our competitive differentials derives from our strong innovation culture, expressed in our business through appreciation, attraction and differentiated intellectual capital retention and constant incentive to this practice. Through methods, tools and structured processes, our professional staff systematically applies their knowledge in medicine and health in the continuous pursuit for innovations.

As a result, we are pioneers in the health services industry, both in products and in processes and service provision formats. Examples include the following:

(1) availability of exam and procedures results on the Internet since 1998, first company in the world to launch this initiative; (2) constant offer of new exams and procedures,

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

32

for example, testing for identification of the influenza virus H1N1 (swine flu) in the Brazilian private market;

(3) use of artificial intelligence electronic tools such as Fuzzy logic, standing by our integrated reports in different medical specialties with diagnostic solution. Today we already have 53 types of integrated reports, gathering 39 medical specialties, offering added knowledge not likely to be copied by competitors;

(4) availability of individual service and medical historical through the Internet;

(5) innovation on offers for different audiences, such as the Women’s Center and the Village Health (using the Sesame Street characters in two special centers for children);

(6) creation of Integrated Medical Centers, which offer a comprehensive approach to a diagnostic conclusion. These services perform tests in a sequential and prioritized order and offer expert medical consultation with integrated reporting of conclusive illustration of complex clinical cases. In 2010, we opened four centers: Integrated Neurology Center & Center for Sleep Disorders, Advanced Gastroenterology & Endoscopy Center, Lymphoma Center, Center for Investigation & Rehabilitation of Urology Disorders;

(7) creation in 2010 of “a+ Medicina Diagnóstica”, the first national brand in diagnostic medicine with a unique offering of attributes, built to the needs of segments B and C, which will be officially launched in 2011.

Integrated solutions and excellence inservices and methodologies Our commitment is not restricted only to deliver a result of an exam or report about certain clinical condition, but it extends to provide solutions for each service we provide, to the doctor requesting health services.

we have Medical advisory services available tothe Medical coMMunity according to each brand’s oFFering

We have a decision support system, which compiles the results of several exams, performs an interpretative analysis of the set that results from this compilation and offers concluding individual diagnosis. For some offer segments, this becomes the production of integrated report in different medical specialties. We have medical advisory services available to the medical community, according to the each brand’s offering, which represents a 24-hour open channel to discuss complex cases. In our Chronic Diseases Management line of business, we introduced innovative solutions in Brazil in order to contribute to a reduction of events and complications associated with chronic diseases, resulting in better quality of life for our clients and reduction of expenses with treatments and, consequently, reduction of health care costs for health plans operators and contractors. The growing integration of our service portfolio allows us to offer, in an increased and comprehensive way, the resources and solutions to contribute to the health management of each client.

::::

: Gru

po

Fleu

ry 2

010

::::

:

33

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

34

Financial soundness and sustainable growthOur businesses have a history of solid financial performance, with recognized organic growth and consistent profitability. From 2007 to 2010, our net sales increased on average 16.8% per year, while our EBITDA increased by an average of 27.0% per year. Our EBITDA margins and net income were 23.1% and 11.9% in 2010 respectively.

In addition to the significant growth, we have been able to present consistently high return on invested capital (ROIC). We follow the optimization of assets invested in a systematic manner with indicators such as revenue per square meter, aiming to offer the best medical and financial rationale for the provision of services. Our financial strength is also represented by our low rate of financial indebtedness. Our financial debt was R$ 90 million on December 31st 2010, which represented less than 0.5 times the EBITDA. The total debt, including tax and acquisition, was R$ 197 million on the same date, with net cash of R$ 360 million.

The strong cash production of our group is due mainly to: (1) growth due to strong organic expansion through, among others, broadening our service portfolio and more complete and integrated solutions; (2) the acquisitions of other health service providers and taking advantage of operational synergies; (3) our initiatives to improve operational efficiency, including adequate management of costs and expenses; and (4) our strategy to prioritize our resources and investments as relevant for our business.

Highly qualified teamsWe believe that the excellence of our services is a result of the quality of our medical, technical and health teams, who work in an integrated way and focused on client solution. Our medical team is composed by professionals trained in most prestigious universities in Brazil and

abroad, including doctors, postdoctoral fellows who studied abroad and associate professors. This team interacts constantly with the medical community to discuss complex cases.

the excellence oF our services is the result oF the quality oF our teaMs, who work in an integrated way and Focused on client solution

In parallel, we maintain high standards in our selection processes and we have invested enough, over the years, on updating, training and the development of our teams, before they provide their first service and throughout their careers, including motivating them to constantly add knowledge in medicine and health, with intense training programs and facilities devoted to education.

This qualification has been instrumental to ensure that our business has a high degree of innovation, excellence, profitability and efficiency allowing to successfully replicating our business model in large scale to other market segments and geographic regions.

::::

: Gru

po

Fleu

ry 2

010

::::

:

35

the qualiFication oFour adMinistration has been recognized through several awards

Experienced management and high standards of corporative governance We have a professional Management team that is experienced and committed to high standards of corporate governance.

Our main executives have a strong experience in the industry and hold diverse knowledge that complements each other in the joint business conduct. The qualification of our Administration has contributed to the current excellence of our operations and has been recognized through several awards. Moreover, in 2010 we received from the Instituto Brasileiro de Governança Corporativa [Brazilian Institute of Corporate Governance] (IBGC), the award of the business with the Best Corporate Governance among all listed companies - less than a year after the IPO. We had already received also from the IBGC, this award in the Non-listed Companies category in 2007. This strong governance culture is the result of numerous initiatives, which include, for example, a third independent member on our Board of Directors; a compensation and indicator system that allows strategic and operational alignment of all employees; and wide disclosure on the evolution of our business and results through physical distribution and availability of our annual report in our website.

IBGC award for company listed withBest Corporative Governance

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

36

CorporativeGovernance

::::

: Gru

po

Fleu

ry 2

010

::::

:

37

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

38

Recognized with IBGC 2010 Award, in the publicly traded companies category, we follow a rigorous discipline of corporate governance even before entering the Brazilian capital market in 2009. Examples of this transparent and pro-active attitude are: establishment of the Board of Directors in 1998, with independent members (three of the nine members are independent);

external audit since 1992; employee evaluation system in all levels, with targets related to strategic management. We also disclosed, voluntarily and periodically, our results in press even before the IPO, in addition to publishing an annual report with an institutional profile, main achievements and financial statements for the period. |GRI 2.6|

corporate structure |GRI 2.6, 2.8|

62.8% 5.4% 31.8%

131.3 million of ordinary shares

Bradseg Core Participações

22.3% 77.7%

Integritas Participações

ManagementOur Group is managed by a Board of Directors and by an Executive Board and adopts the best corporate governance practices. In addition to these two elements, it is advised by technical advisory committees. Currently, the Board of Directors has the support of the Strategy Committee, the Audit and Risk Management

Committee, and the Compensation, Nomination and Organizational Development Committee. The latter two earned the status of permanent committees in September 2010. Our bylaws also provide for a Tax Council, not installed. |GRI 4.1|

Performance monitoring in economic, social and environmental aspects is done quarterly by the

Core Participações Partners

Free Float

::::

: Gru

po

Fleu

ry 2

010

::::

:

39

Board of Directors, reporting the results of the previous period, and week and by the Executive Board. The analysis takes into account the financial, client, internal processes, innovation, learning and sustainability perspectives. This process includes discussion of risks and opportunities identified as the most relevance to the achievement of results. |GRI 4.9|

the board oF directors Monitors the environMental, econoMic and social perForMances

Board of DirectorsThe Board of Directors is an element of collegiate deliberation of the Company, composed of at least five and, at most nine regular members, all shareholders of company, being that at least 20% should be independent and up to six should be alternate members. The Board of Directors mandate is two years. Currently it is composed of nine regular members, where three are independent and two are alternate members. For the definition of independent counselor, the BM&FBovespa standards are considered, including not maintaining any link with society, except stake in the non-controlling capital, and not receiving any other compensation from the Company beyond that of counselor and the proceeds from capital share. |GRI 4.3|

The Board of Directors meetings occur, usually, every two months, and extraordinarily at any time, whenever necessary, by notice of its president, vice president, or by call of any member of Board of Directors. The Chairman of the Board is a shareholder and holds only this function. |GRI 4.2|

If conflicts of interest are found between our Company and administrators, these are prevented from voting on the matter in Directors Meetings. Additionally, as member of the BM&FBovespa, we employ the arbitration mechanism to solve conflicts between our Company, its shareholders, officers and directors. |GRI 4.6|

Members of the Board should gather necessary skills to define the strategies of the organization according to the corporate sustainability principles. The members have a comprehensive view of health industry, which helps to guide business management. |GRI 4.7|

Members of the Board of Directors receive only fixed compensation, without any other benefit, bonus or participation in results. The alternate members are not remunerated. In 2010, all nine

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

40

effective members of the Board received a total of R$ 1.42 million. |GRI 4.5|

Strategy Committee |GRI 4.1|It was formed in September 2010 to support the Board of Directors to establish corporate guidelines and monitor the development strategic direction for the Company. It consists of three members, with a mandate of term of two years.

Audit and Risk Management Committee |GRI 4.1|With continuous operation since September 2010, it was originally created in 2004 to ensure and improve internal controls and adoption of the best administrative and accounting practices and processes. Currently this Committee has two members, who are also members of the Board of Directors with a mandate of term of two years.

Compensation, Nominating and Organizational Development Committee |GRI 4.1|This permanent committee was created in 2007 and supports the Board of Directors on issues related to people management macro policy. It consists of three members, also members of the Board of Directors for a term of two years.

Tax Council The Company’s Tax Council works in a non-permanent format, and it is formed by a resolution of the General Assembly at the request of shareholders and composed of three effective members and their respective alternates. Law # 6,404/76 states that shareholders representing at least 10% of the capital share may request the installation at any time after this instance. According to the CVM 324Instruction, the percentage to request the installation of the Tax Council of public traded companies has been increasing due to the amount of capital that, in the case of the Company, will be 2%. In addition,

minority shareholders who represent at least 10% of capital are entitled to vote separately one member to the Tax Council and their alternate. Once installed, the Tax Council will run up to the first General Assembly meeting that follows its installation.

Executive BoardAccording to our bylaw, the Executive Board should consist of a President, a Finance Executive Director, a Human Resources Executive Director, a Diagnostic Medicine Executive Director, a Preventive Medicine Executive Director and an Investors Relations Director. The mandate of the statutory officers is two years and must coincide with the mandate Board of Directors, allowing for reelection. It is up to its members to comply with the Bylaws, the Code of Conduct, Strategic Planning and deliberations of the Board of Directors and the Assembly General, approve plans, programs and general rules of operation, administration and control, periodical accountability to the Board of Directors regarding business results, among other assignments. The directors’ remuneration is composed by fixed and variable installments.

The monthly base salary is based on market practices and variable remuneration is conditioned to goals of personal and company performance. The overall goals take into consideration financial, client, internal processes, innovation, learning and sustainability aspects. These corporate goals include items such as paper and energy consumption, which influence the calculation of the Profit Sharing Program. The five executive officers remuneration in 2010 totaled R$ 7.52 million and had the following composition: monthly base salary (41%), variable bonus (23%), stock option (26%) and benefits (9%). |GRI 4.5|

TransparencyWe have established a Material Fact’s Disclosure

::::

: Gru

po

Fleu

ry 2

010

::::

:

41

and Confidentiality Policy to ensure that the information disclosed publicly are reported accurately and at the right time. Prepared under the CVM Instruction #358, dated January 3rd, 2002, the policy adopted by the Company aims to establish the rules that should be followed by the Director of Investor Relations and by other persons related with respect to the disclosure of relevant information and maintaining confidentiality

about relevant information that has not yet been disclosed to the public.

Securities TradingApproved by the Company’s Board of Directors on March 30th, 2010, in accordance with the standing laws and regulations, the Securities Trading Policy establishes guidelines and procedures to be observed by our Group and

BOARD OF DIRECTORSAparecido Bernardo Pereira | chairmanJosé Gilberto Henriques Vieira | vice-chairmanMauro Figueiredo |memberEwaldo Mário Kuhlmann Russo | memberMilton Almicar Silva Vargas | memberrMárcio Serôa de Araújo Coriolano | memberMarcelo Pereira Malta de Araújo | independent memberLuiz Carlos Vaini | independent memberJosé Paschoal Rossetti | independent memberSamuel Monteiro dos Santos Junior | alternate memberManoel Antonio Peres | alternate member

ExECUTIVE BOARDMauro Figueiredo | CEOFábio Marchiori | CFO & IRO Maria Lucia Cardoso Gomes Ferraz | Human Resources executive directorOmar Hauache | Preventive Medicine executive directorWilson Leite Pedreira Jr. | Diagnostic Medicine executive director

AUDIT AND RISK MANAGEMENT COMMITTEELuiz Carlos Vaini | coordinatorEwaldo Mario Kuhlmann Russo | member

COMPENSATION, NOMINATING AND ORGANIzATIONAL DEVELOPMENT COMMITTEEMarcelo Pereira Malta de Araujo | coordinatorMauro Figueiredo | memberAparecido Bernardo Pereira | member

STRATEGy COMMITTEEBoard election expected to 2011

corporative governance structure in 2010

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

42

related people for the trading of securities issued by the Company (credit titles, stocks, bonds, debentures, investment fund shares), or related to them, in accordance with CVM Instruction # 358 of January 3rd 2002. This precaution ensures negotiation transparency to all interested parties, without privileging some over others.

Related partiesIn the normal course of our business, entered into transactions with related parties on terms and conditions applicable to similar transactions with third parties.

In the implementation of business and contracting of services, we conducted quotes and market research, with the criterion to search for the best technical and financial conditions, leaving the decision to conduct the transactions, regardless of it being held between related parties, to the person responsible for the area that led to the acquisition of the product or service.

Independent audit We have been audited since 1992 by independent auditing companies. In 2010, we were audited by Deloitte Touche Tohmatsu Independent Auditors. In early 2011, we replaced it for PriceWaterhouseCoopers. The periodic change of auditors is recommended by best corporate governance practices. |GRI 3.13|

Shareholders The main forum for shareholders to make recommendations to the Board of Directors is the Ordinary General Meeting that occurs annually, when shareholders manifest about the management accounts, the financial statements, the Report of the Directors, the proposed allocation of net income and dividend payments. The Access is also given through the Investor Relations area, which forwards to the Council any demands and suggestions. In addition, our

stakeholders can communicate by letter or e-mail sent to the headquarters or to the e-mailri@grupofleury.com.br.

we value transparency and the quality oF relationships

It is worth remembering also that the employees still have, as the main channel of contact, the People Management Service Center located in the Corporate Portal.

The main topics discussed in 2010 were the company results, including the allocation of income to enable the expansion plan - without harming dividends distribution, and the incorporation of Weinmann Laboratory, which required the convening of an Extraordinary General Meeting on 1 March 2010, among other points of interest. In relation to staff, the most relevant issue was the dissemination and training of the new group of corporate skills designed the previous year and implemented in 2010. |GRI 4.4|

::::

: Gru

po

Fleu

ry 2

010

::::

:

43

Communication with the MarketThe transparency of our communications staff, that uses multiple channels of contact with their strategic public to disclose the results and actions that contribute to the development of the Company.

One of the vehicles of our external communications mix is the Annual Report, first released in 2005 and that for the first time this year, is edited under the title Annual Sustainability Report and in accordance with the Global Reporting Initiative (GRI) standards. The GRI’s guidelines allow for better comparability and detailing of results and economic, social and environmental impacts of our work.

We also channel our financial demonstrations periodically at the Diário Oficial do Estado de São Paulo [Official Gazette of the State of São Paulo] and in newspaper with wide circulation. In addition, since 2007, we have published the Annual Report in the Valor Econômico newspaper and maintain a web page dedicated to the relationship with investors at www.fleury.com.br/ir. In this online environment are gathered the company profile, with its respective industries and competitive advantages, and the company’s regular and special financial disclosures.

Another title of our mix of communication with investors is the Shareholder Newsletter, a quarterly printed publication started in 2008, and distributed to our national and international investors. An electronic version is available on our website for Investor Relations. The content includes the most relevant facts for each quarter and news about our business units and most strategic corporate actions.

To share and standardize information on the performance of the company betweenmanagers and to facilitate the alignment of

information among the internal public, we conduct a Leaders Meeting in which the Executive Board presents the main results of the period and transmits general guidelines, which are later passed on to each team. |GRI 4.9|

Informe ao acionista: publicação trimestral distribuida para os investidores do Brasil e do exterior

CAGR 17,5%16,1%

20,7%

366

488 521587

720

820

605

702

206249

2004 2005 2006 2007 2008 2009 9M09 9M10 3T09 3T10

14,4%

11,7%

CAGR 23,5%

95 98

155179

138

158

54

60

2006 2007 2008 2009 9M09 9M10 3T09 3T10

56,9%

29,4%CAGR 37,6%

3225

42

84

64

100

34

45

2006 2007 2008 2009 9M09 9M10 3T09 3T10

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

44

Code ofConduct |GRI 4.8|

We are committed to transparency in relationships and we care for its quality. Therefore, we include a module on our Code of Conduct in the integration of employees, which demonstrates the expected behavior of each professional in the interactions with our stakeholders and demonstrates potential conflicts of interest.

The Code of Conduct aims to inform and formalize the commitment of the employees of our group with the ethical and Sustainability principles that should rule everyone’s conduct in the development of their professional activities.

We understand by associates, all who work in the different brands and business units of our Group: partners, counselors, directors, managers, employees, interns and service contractors.

The document is divided into topics such as Laws and Regulations Commitment, Personal and Professional Integrity of Associates, Individual Customer Service and Relationship with Suppliers, Community and Government Agencies.

In 2010, there was an intensive activity of recycling the concepts of the Code of Conduct. The leaders participated in workshops on relevant topics and were trained to pass on the concepts to their teams. For 2011 it is planned a review our Code of Conduct. The last update occurred in 2009.

Integrity PolicyOur Code of Conduct is supplemented by an Integrity Policy, whose objective is to define procedures established to prevent any action that may be characterized as active or passive corruption in the relationship with government officials or private companies, or as unfair competition. |GRI 4.12|

Unfair competition |GRI S07|At Grupo Fleury the following practices are prohibited:

•forming trust: the use of market power to restrict output and raise prices, so as not to attract new competitors or eliminate competition;

•application of predatory pricing: setting product prices below their costs, to eliminate competition, prevent entry of new competitors and enjoy excessive economic profits;

•forming cartels: the establishment of agreements between companies to set prices at the same margin and not lose customers or eliminate a new competitor.

::::

: Gru

po

Fleu

ry 2

010

::::

:

45

It is also vetoed:

•to publish by any means, false statement, detriment to a competitor, in order to obtain advantage;

•to demonstrate defects or deficiencies in products/services from the competition to promote our own products;

•to use fraudulent means to divert someone else’s clients, for own or another’s benefit;

•to use someone else’s expression or advertising slogan, to create confusion between the products or establishments;

•improper use of someone else’s trade name, establishment title or insignia; replace our own company name in someone else’s product without his consent;

•assign, as advertising means, reward or distinction that we have not obtained;

•disclose, exploit or use, without authorization, private knowledge, information or data from the competition;

•acquire and/or use contraband forged or tampered products.

Internal OmbudsmanWe also installed an Internal Ombudsman to investigate complaints about alleged breaches in the Code of Conduct.

The analysis of each case is carried out impartially, with full guarantee of secrecy on the identity of the party and defense for the professional mentioned. All complaints are answered.

in 2010, we signed the business pact For integrity and against corruption

Business PactIn June 2010, we signed the Business Pact for Integrity and Against Corruption, movement articulated by the Business and Social Responsibility Ethos Institute in partnership with Patri Government Relations & Public Policy, the United Nations Development Programme (UNDP), the United Nations Office on Drugs and Crime (UNODC) and the United Nations Global Pact Brazilian Committee. Their goal is to enlist the support of entrepreneurs and entities for the implementation of the commitments made through the Pact in their organizations, facilitating the promotion of health policies and fighting corruption.

SustainabilityWe invest in quality as one of the pillars of our sustainable development. In 1999, we implemented the Quality Assurance System, certified according to ISO 9001:1994, and in 2002, we moved up to the Integrated Management System, which joined the environmental and quality management, certified in accordance with the ISO 9001:2000 and ISO 14001:1996. All these initiatives, together with the social initiatives, were consolidated in the Sustainability operations area, rooted in a project that seeks to align them to business strategies and create a comprehensive and integrated organizational culture of the concept. Currently, through dialogue and interaction with our various stakeholders, we seek the key to ensuring its continuity.

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

46

::::

: Gru

po

Fleu

ry 2

010

::::

:

47

Public Policies |GRI SO5|We maintain multilateral relationships with the agents of the segment, promoting, since 2007, discussions aimed at building balanced relationships among all the sectors, having as one of the main guidelines establishment of quality standards of the health services area in providing services to the population.

To this end, these discussions have relied on participation of representatives of the Ministry of Health, National Agency for Supplementary Health (ANS), Union for the Hospitals, Clinics, Nursing Homes, Research and Analysis Clinic Laboratories of São Paulo (Sindhosp) National Agency of Private Hospitals (ANAHP) Regional Council of Medicine of the State Sao Paulo (Cremesp), the Brazilian Center for Accreditation (CBA), National Supplemental Health Federation (Fenasaúde), the Brazilian Accreditation Consortium and private institutions, among others.

In these opportunities, besides promoting these discussion meetings, we seek to influence and contribute within the precepts of business ethics and good corporate governance practices.

We have joined the board of Medicine and Health Commercial Association Committee of Rio de Janeiro, which has intended to contribute to the integration of network public and private assistance to qualify and sustain the productive chain of health in Rio de Janeiro.

We celebrated an institutional agreement with the National Agency for Supplementary Health (ANS) for scientific and technical cooperation on adoption, dissemination and monitoring clinical guidelines in the health insurance.

During the term of this Agreement we shall hold the implementation and monitoring of clinical guidelines previously selected from the Chronic Diseases

Management program of Fleury Medicina e Saúde.

In October 2010, in partnership with the Union Hospitals of the State of São Paulo (Sindhosp), we held a seminar on the Incentive Program for Service Providers Qualification in Supplemental Health. The event counted with the presence of representatives from the National Health Service Confederation (CNS), the National Supplemental Health Agency (ANS), Federal Supplemental Health Agency (Fenasaúde) and the Union of Hospitals, Clinics and Nursing Homes of the City of Rio de Janeiro (Sindhrio).

we proMote debates thataiM to build balanced relationships aMong all the sectorial agents

We also participate as associates of the Brazilian Society of Clinical Pathology/Laboratory Medicine (SBPC/ML), Corporate Governance Brazilian Institute, Ethos Institute, the Brazilian Association of Technical Standards (ABNT), the National Quality Foundation (FNQ) Brazilian Association of Equipment Importers (Abimed), American Chamber of Commerce (AmCham) and Clinical and Laboratory Standards Institute (CLSI). |GRI 4.13|

Donations in campaignsWe do not perform any financial or cash contribution to political parties, politicians or related institutions. |GRI S.06|

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

48

Who we are

::::

: Gru

po

Fleu

ry 2

010

::::

:

49

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

50

The mission of people management is to ensure the perpetuation of our excellence through attraction, retention and development of our professionals, to stimulate the organization and encourage dissemination of knowledge, besides to care for the quality of medical practice, consolidating our role as the national reference in medicine and health.

In 2010, we deepened and improved management of company’s talent with a new definition business skills, organizational climate research, identification of talents and elaboration of succession mapping for various hierarchical levels

of leadership. We have also intensified coaching and human resource training in behavioral skills and techniques and promoted professional valuation actions and of setting company values.

This year, we also anticipated the law and kept the initial date for the deployment of the electronic sign in, which is already in force at all workplaces in the company, and due information has been previously provided to all employees.

total eMployees(1) |GRI LA1|

By type of employment

Contracted (CLT) 4.581

Interns 26

Base salaried 12

Total 4.593

By work contract

Work load higher or equal to 150 hours/month

4.324

Work load lower than 150 hours/month

269

Total 4.593

By region

Bahia 137

Distrito Federal 7

Pernambuco 151

Paraná 103

Rio de Janeiro 400

Rio Grande do Sul 642

São Paulo 3.153

Total 4.593

(1) Does not consider interns and third party contracts.

We do not yet have control over third party contracts.

proFile |GRI LA13|

Position AdvisorsExecutive directors

Employees

Gender No. % No. % No. %

Women 0 0 1 0 3.725 81

Men 8 100 6 100 868 19

Total 8 100 7 100 4.593 100

Age Group No. %

Up to 30 years old 1.780 39

From 30 to 50 years old 2.604 57

More than 50 years old 209 5

Total 4.593 100

Seniority Number of employees

Less than 1 year 869

From 1 to 3 years 1.754

From 4 to 10 years 1.169

From 11 to 20 years 632

Above 20 years 169

Total 4.593

::::

: Gru

po

Fleu

ry 2

010

::::

:

51

turnover |GRI LA2| Active Terminated

% Terminated x Active (4581)

Gender Women 3725 853 19%

Men 868 256 6%

Time in-house Above 20 years 169 33 1%

From 1 to 3 years 1754 569 12%

From 11 to 20 years 632 88 2%

From 4 to 10 years 1169 264 6%

Less than 1 year 869 155 3%

Age Up to 30 years old 1780 501 11%

From 30 to 50 years old 2604 559 12%

More than 50 years old 209 49 1%

Types of contract CLT 4581 1107 24%

Base salary 12 2 -

Intern 26 13 -

Work load less than 150 hours 269 269 63 1%

Equal and greater than 150 hours 4324 1046 23%

Regional

Bahia 137 20 0%

Distrito Federal 7 3 0%

Paraná 103 48 1%

Pernambuco 151 27 1%

Rio de Janeiro 400 93 2%

São Paulo 3153 738 16%

Rio Grande do Sul 642 180 4%

Admitted 986

RemunerationOur salary policy is based on collective regional agreements of the category and the median market positioning. To ensure such alignment, we participate in periodic salary surveys with renowned external consulting companies. Our pay scale is applied regardless of employee gender, and the existing wage differences among professionals in the same position are due to individual performance assessments provided in the merit policy.

In addition to the monthly salary, the employees are still included in the Results Participation Program (RPP), which takes into account the degree of fulfillment of corporate and individual goals for the calculation of quota of each employee. The lowest wage paid in City of São Paulo, where our headquarter is located, is the base salary determined in collective accordance (R$ 880.00), representing 1.72 of the national minimum wage, which was R$ 510.00 in late 2010. The lowest wage paid by our Group in São Paulo is still equivalent to 1.52 of the regional minimum wage in the State of São Paulo for health professionals, equivalent to R$ 580.00. |GRI EC5|

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

52

SkillsWe also reviewed the corporative competency profile in 2010. With the aid of a external consultant and weighing behaviors that we would like to maintain in the Group and new behaviors that should be included to meet the defined strategic challenges, five corporative competencies were established:•positiveattitude;•makeithappenwithexcellence;•solutionfortheclient;•cooperation;•developingpeople.

Each one of them comprises a group of behaviors that are the basis for employee performance evaluation, compensation system, internal shifts and selection of new talent that impact both career development and the calculation of individual quota for the Results Participation Program (RPP). In 2010, the process of performance evaluation covered 75% of the employees. In 2011, the areas of expertise will be defined. |GRI LA12|

our beneFit policy includes, in a hegeMonic Manner, eMployees oF the saMe hierarchical level in all regional brands

BenefitsWithin the corporate principle of equality, our benefit policy seeks to address, in a hegemonic manner, employees of same hierarchical level in all regional brands, with some local variations in suppliers.

The benefits package includes basic food voucher, life insurance and medical assistance and dental care. The only benefit not offered to part-time employees is the food voucher. |GRI LA3|

coMpensation by gender |GRI LA14|

Position Description Women Men Proportion (W x M)

AdvisorQuantity 20 4 -

Average salary 6.754,81 8.288,38 0,81

CoordinatorQuantity 217 66 -

Average salary 4.298,57 6.127,10 0,70

LeadershipQuantity 42 52 -

Average salary 12.523,25 20.296,43 0,62

OperationalQuantity 3.439 741 -

Average salary 1.514,55 1.999,27 0,76

::::

: Gru

po

Fleu

ry 2

010

::::

:

53

Quality of LifeHealthy habits, safe behaviors and emotional balance are attitudes that when assumed in our daily routine, present to be good alternatives for healthy living. Aiming to provide a better quality of life to employees and to be a transformation component in the workplace we created in 2006, the Viver Melhor Program. Since then, increasingly, we have developed a series of activities, always focusing on the physical, mental and social health of the employee.

Viver Melhor |GRI LA8|Currently, our promotion Health program Viver Melhor is undergoing expansion to all regional offices. In 2010, shares covered the equivalent of 12.99% of the staff. Check out the main programs available to our employees:

• Viver Melhor: anti-smoking program that offers a six month treatment, including medical, psychological and nutritional visits, diagnostic tests and medicines.

• Ginástica Labora: all employees have access to exercise during working hours, taught by physical education professionals. This initiative seeks to reduce the sedentary levels and the load of stress of everyday work life.

• Gesto: telephone follow-up program of all pregnant women covered by our business health insurance plans. It is offered to employees and their dependents. The instructions include tips and monitoring of the health status, directed guidance, and clarification of administrative procedures,such as documentation to file for maternity leave, orientation for returning to work, among others. Sixty participants signed up in 2010.

• Acerte: This personalized financial health program answers questions about household budget administration and conscientious use of credit. It had 43 participants in 2010.

• Saúde em Dia: led by Occupational Safety and Health department, it oversees the periodic examinations and deals with all matters related to the employee’s health since the monitoring of their general health until the appropriate referral for treatment.

• Quick Massage: the professionals of the Customer Care Center count on this program of Eastern massage techniques, leading to relaxation of body areas most affected by stress, such as neck, back, hands and arms.

• Grupo de Corrida: this program aims to assess, plan, and prescribe physical activity directed to runners and beginners. A minimum attendance of at least 85% in the quarter entitles to a street race to their choice. It is offered in São Paulo, Rio de Janeiro and Rio Grande do Sul.

• Circuito de Corrida: geared towards people who like street racing. In addition to signing up with discounts in the races, the employee has the infrastructure of a tent to store their belongings during the race, adequate meals and monitoring of adequate Physical Education professionals during the initial warming up and the final stretch.

• Academia: The Paraíso PSC of the Fleury Medicina e Saúde brand and our headquarters in São Paulo have facilities dedicated to exercise conditioned and guided by Physical Education professionals. Added to the Group Racing and Street Racing activities, it recorded the participation of 477 employees.

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

54

• Gestão de Doenças Crônicas: with national coverage and availability to employees and their dependents, is an important monitoring system for people with chronic diseases, with solutions to contain health problems related to pathology. It had a total of 201 covered lives in 2010.

::::

: Gru

po

Fleu

ry 2

010

::::

:

55

Occupational Health and SafetyWe keep a permanent schedule that comprises vaccination, accident prevention and occupational diseases, in accordance with the best labor practices in the health sector.

In the area of Occupational Health & Safety (OHS), Grupo Fleury meets all sector regulations through several preventive actions and control protocols, besides complying with Law no. 6.514 of 12/22/1977, which amends chapter V of title II, Consolidation of Labor Laws, and Port no. 3.214, of 6/08/1978 from the Ministry of Labor and Employment.

ohs initiatives

According to the legislation in force, we keep several preventive programs with the aim to ensure the safety of collaborators. Bellow you will find the list and its respective legal requirements

Programs and actions Legal requirement

Management of Services Specialized in Safety Engineering and Labor Medicine (SESMT)

Regulatory Standard No. 4 – Port No. 1, of 5/12/1995

Occupational Health Medical Control Regulatory Standard No. 7 – Port No. 24, 12/29/1994 and Occupational Health & Safety Service (OHSS) Order, of 10/01/1996 Regulatory Standard No. 32 – Port No. 485, of 11/11/2005 Decree No. 6,042, of 02/12/2007 – List B

Vaccination Regulatory Standard No. 32 – Port No. 485, of 11/11/2005

Ergonomics Regulatory Standard No.17 – Port No. 3,751, of 11/23/1990 Addendum II of Regulatory Standard No.17 – Port No. 9, of March 30th, 2007, from the Ministry of Labor and Employment

Procedures for pregnant women exposed to ionizing radiations

Regulatory Standard No. 32 – Port No. 485, of 11/11/2005 CNEN-NE-3.01 – Basic Guidelines for Radioprotection, Brazilian Nuclear Energy Commission (CNEN) – Port No. 453, of 6/01/1998, from the Brazilian Surveillance Agency

Compliance with personal protection equipment (PPEs) in case of allergies

Regulatory Standard No. 6 – as worded by Port No. 25, of 10/15/2001

Reporting of accidents involving exposure to potentially contaminant biological material

Regulatory Standard No. 32 – Approved by Port No. 485, of 11/11/2005 Port GM/MS No. 777, of 04/28/2004 – Compulsory Notification of Worker Health Harms Act No. 8,213 – of 07/24/1991 – Social Security Benefit Plans

Biosafety Group - deployment of protection devices for piercing materials

Regulatory Standard No. 32 – Approved by Port No.485, of 11/11/2005, regulated by Port MTE No. 939/2008

Work leave Act No. 8,213 – of 7/24/1991 – Social Security Benefits Plans

Regulatory Standards Audits and Environmental Surveys

Regulatory Standard No. 4 - Occupational Health & Safety Regulatory Standards – and No. 9 – Environmental Risk Prevention Program

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

56

Regionally arranged safety committees disseminate safe behavior practices and account for more than 75% of the workforce, operating in the following activities: Occupational Health and Medicine Services, Internal Committee for Accident Prevention (Cipa); Fire Brigade; and Biosafety Group. |GRI LA6|

accidents at work (1) |GRI LA7|

year 2010

Seriousness rate (2) - average/year 674

Frequency rate (2) – average/year 3

Absence rate – average/year 1.56%

Fatality rate 0%

N° of days lost (3) 16.414

By region Number of medical certificates

Number of lost days

Bahia State 108 427

Pernambuco State 235 1.050

Paraná State 338 789

Rio de Janeiro State 349 1.494

São Paulo State 4.099 12.654

Total 5.129 16.414

(1) Only considering fixed-term contract employees, since there is no control over outsourced employees yet, which should take place in 2012; (2) Work accidents calculations take into account disabling injuries; (3) absent day sick leave certificate. Counting starts from the day set on sick leave statement until the end of the period. Obs.: there are no specific occupational diseases in the performance area.

Occupational Diseases |GRI LA7|Occupational diseases rate marked 0.12% for female workers and zero for male. This rate refers to the relative number of cases (% employees total), as shown in table IV – NR4. For calculation purposes, the operation data in Rio Grande do Sul state (Weinmann and Faillace brands) were not considered.

An eye in the future In 2010, collaborators undertook training on the strategic planning of our group, and on matters related to values that guide our business approach. All that to secure our sustainable development and add value to our relationship with all stakeholders.

TraineesOne of the tasks in people’s management is to provide the company with professional who will support its growth. To this aim, we launched the first edition of Trainees Program, which received 11,027 submissions. Within this number, 15 professionals were selected to several areas.

These young professionals will support the company’s growth and improve the succession plan for the following years. During a two year period, they will get acquainted with the routine of PSCs and corporate areas and develop multifunction projects to be implemented in the Group, participating in an intense routine of formal training, developed by our leaders as well as by external partners. By the end of such period, they will be working as consultants or coordinators, according to performance. Training of freshly graduated professionals will be continued in 2011, with 15 estimated job positions open.

Trainees 2010

::::

: Gru

po

Fleu

ry 2

010

::::

:

57

DiversityIn addition to law enforcement, the integration of People with Disabilities (PWD) to our staff is one of People’s Management premises. For that reason, by the end of 2010, we counted on 62 people with disabilities. This means a 35% increase compared to February in the same year (46).

This year, as part of PWD training, we made a partnership with Serasa Experian for the training of three collaborators to work in administration areas. In similar initiative, we established an agreement with Lar Escola São Francisco for the training of 20 professionals in customer service area. Yet, a multidisciplinary group was formed to discuss the inclusion of PWD in the company.

To meet legal requirements, we would need to hire, by December 2010, 198 PWDs, considering the population of 3,968 active workers. Several actions are foreseen for 2011, both for enhancing the attractiveness and retention of these collaborators and to enable their integration in our corporate environment. Featured among these measures is the conduction of benchmarketing in recruitment processes, the development of a specific policy for this people’s management and review of accessibility studies in our facilities. In 2011, we will keep our efforts towards building a more diversified environment while complying with the legislation.

DiscriminationIn 2010, there was no report of any legal action against our Group in respect of discrimination. |GRI HR4|

We also did not report any violation to indigenous people’s rights in our operations within the entire period referred to this paper. |GRI HR9| Organizational Climate SurveyFor the first time, we conducted an Organizational Climate Survey, which should be redone every two years. Over 70% of the target audience composed by collaborators and physicians answered the survey, which is considered high to this type of research in the corporate world. The total average of favorability (gathering all answers) reached a 66.26% mark, placing our Group in the same level of other companies in the market (64.93%). The indicators assembled helped to identify improvement opportunities and to design a global action plan, which was broken down into actions suggested and implemented by collaborators themselves, in their management. By the time a new survey is carried out, within two years, we look forward to higher standards for our goals. Our intention is to have favorability indexes aligned with the top companies to work.

CorporateEducation |GRI LA11|

One of our greatest highlights in people’s management is the Corporate Education. In 2010, we consolidated Fleury Corporate University [Universidade Corporativa Fleury], with the responsibility to educate and develop our collaborators, clients and suppliers, in accordance with the organization’s business strategies and core competences.

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

58

Fleury Corporate University is composed by 10 functional areas, supported by three Learning Centers. Today there are 440 training subjects in line with the Group’s Strategic Planning until 2014.

In 2010, the Universidade Corporativa [Corporate University] carried out trainings in 232 subjects. 182 collaborators attended courses and external events against 167 attendances in 2009.

We have provided a total of 136,341.51 training hours, 14.6% higher than 2009 figures (181,911.36). This represents 67.16 training hours per collaborator, 16% higher than 2009 (57.98 hours per collaborator). In order to reach this level, we invested R$ 3.3 million in 2010, an amount 14% higher than 2009, when R$ 2.9 million were allocated for training programs.

Our growth led the Corporate University to implement a program for counselors and multipliers, with the aim to extend educational activities capillarity in all marketplaces.

Medical ImprovementThe market is stimulated and the offer of medical professionals is limited. One strategy to retain and attract these professionals is fostering innovation and scientific development in a corporate environment that seeks excellence in all specialties.

This is why we can count on highly qualified professionals. Among 581 physicians that worked in Grupo Fleury in 2010, 18 were lecturers, 26 post-doctorate, 117 doctorate and 91 completed their master degrees.

acadeMic proFile

Development Program in Imaging Diagnosis |GRI LA11|In order to attract and retain radiologists with specialized education, we implemented the Theoretical-Practical Development Program in Imaging Diagnosis – equivalent to the fourth year of medical residence in Radiology and Imaging Diagnosis.

48,7757,98

67,16

2008 2009 2010

training hours per eMployee

Others

64%

Master Degree

16%

Doctorate Degree

20%

Post Doctorate Degree

4%

Lecturers

3%

::::

: Gru

po

Fleu

ry 2

010

::::

:

59

The five selected professionals in 2010, with three years of residence in the area recognized by the Ministry of Education, receive payments and become specialized in one of the four offered areas: neurology and head/neck, abdomen, thorax or musculoskeletal system. Training includes ultrasonography practices, among other scientific and recycling activities.

Knowledge dissemination We disseminate relevant knowledge for the clinical practice and release our professional scientific production, whether through internally edited publication, both in print or electronically or through events or partnerships with publishing houses in the market. Check some titles for physicians published by Grupo Fleury in 2010:

Medical publications

ScientificBoletim Fleury Medicina e Saúde [Fleury Health &

Medicine Bulletin]: 10 issues/year

Medical Specializations Bulletins: Endocrinology,

Hematology and Gastroenterology

Boletim Espaço Diagnóstico [Diagnosis Space Bulletin]:

5 editions/year

Diagnostic algorithms

Reference

Functional Tests Manual

Specific Examinations Manual

Medical Literature

Check-Up - Experiência no Rastreamento de Indivíduos

Assintomáticos [Check-up – Experience in tracking

Asymptomatic individuals], by Patricia Marinho Costa de

Oliveira and Nelson Carvalhaes Neto – Editora Manole

Medicina Diagnóstica - Algoritmos Diagnósticos em

Medicina Interna [Diagnostic Medicine – Diagnostic

Algorithms in Internal Medicine], by Maria Lucia Ferraz and

Conceição Lemes – Editora Manole

we encourage scientiFic production and disseMinate relevant knowledge For clinical practice

Scientific eventsWe promoted 15 external events for the medical community, which were attended by 993 physicians. The International Maternal-Fetal Medicine Recycling Symposium was one of the highlights in the scientific agenda for the medical community last august, with two international guests, Kypros Nicolaides, from Fetal Medicine Foundation (England) and Howard Cuckle, from Columbia University (United States) and from the University of Leeds (United Kingdom).

Other important event was the Symposium of Women’s Diseases Diagnosis Medicine, which took place in November, with the purpose of updating participants on the investigation e follow-up of the main diseases affecting women, specially breast and genital tract injuries.

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

60

In the same year 2010, 16 Advanced Cardiological Life Support (ACLS) courses were carried out, providing 240 health professionals with certifications from the American Heart Association (AHA).

Encontro Científico [Scientific Meeting] Grupo Fleury Scientific Meeting is an opportunity for internal dissemination of our physician’s scientific production and for knowledge interchange. In 20th edition, it had held 108 presentations.

Update meetingsWe conducted 63 update meetings attended by 1,864 employees in 2010. 19 lectures were offered in our units for the general public. We also carried out courses for 485 medical clinics secretaries

and receptionists.

Fleury ChallengeFleury Medicina e Saúde Challenge was conducted in August for the 6th consecutive year, which involved a competition among students from 11 Medicine courses across the State of São Paulo. Students answered questions prepared by Fleury Medicina e Saúde medical advisors. The event gave prizes to three finalist institutions. First place was granted R$ 10,000 and three notebooks. Second and third finalist institutions received R$ 5,000 and R$4,000 respectively, besides purchase coupons and three Advanced Cardiological Life Support courses (ACLS).

Public information

We create content to help clients look after their health. This information on prevention, diagnosis and treatment is elaborated with support of our professionals, who are specialized in several/similar

medicine areas, and published on the website www.fleury.com.br, among other channels targeted to the public.

We also provide health information through the Fleury Saúde em Dia magazine, with 85,000 copies per edition, freely distributed at the PSCs. Additional and exclusive content is elaborated for each magazine edition, and released in an online version on Fleury´s brand website .

Publications

Coleção Saúde em Dia – Alimentação Saudável by Carla Yamashita and Karin Sedo Sarkis – Editora Campus-Elsevier

Coleção Saúde em Dia – Memory by Gislaine Gil – Editora Campus-Elsevier

Carlos Chagas, a Ciência nos Trópicos by Daniel Piza – Ediouro

Courses & Lectures We offer 18 free of charge lectures on health subjects. These activities have benefited around 600 people. Moreover, we provide 11 courses for pregnant women in São Paulo.

::::

: Gru

po

Fleu

ry 2

010

::::

:

61

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

62

How We Do

::::

: Gru

po

Fleu

ry 2

010

::::

:

63

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

64

After medical care, there are complex structures supporting our operations and requiring strict quality control standards and continuous investments on training, physical remodeling and updating of the technology park, in several specialties that comprise the diagnosis & laboratory medicine services.

ExcellenceWe processed approximately 30 million exams in 2010. Half this volume, mainly composed by more complex exams, is processed in Grupo Fleury Central Technical Area in São Paulo.

We also keep regional technical areas in the states we operate (RS, PR, RJ, BA and PE) for intermediate complexity examinations and

technical centers in hospitals where we provide clinical analysis services.

In 2010, we reap the rewards from unifying our Central Technical Area in the previous year: productivity grew by 46% and the technical-operational cost had a 24% decrease in São Paulo, while keeping the top excellence standards. To testify to this, the Central Technical Area obtained Palc [Medical Laboratories Accreditation Program] certification from the Brazilian Society of Clinical Pathology/Laboratory Medicine (SBPC/ML), besides maintaining its ISO 9001 and 14001 certifications and being recognized by the College of American Pathologists (CAP). Palc also obtained revalidation in the remaining five regional technical areas.

Another evidence of efforts towards continuous service improvement is the Central Technical Area

Approximately 30 million exams were carried out in 2010. Most of the high complexity programs are processed in Sao Paulo

::::

: Gru

po

Fleu

ry 2

010

::::

:

65

engagement in Pelm (Laboratory Tests Proficiency Program), which is devoted to interlaboratory comparison of quantitative and qualitative analysis results.

Pelm enables diagnosis medicine companies to compare their results, thus ensuring compliance between lab reports of the same patient in different parts of the Country. Customer service In 2010, we were granted for the 9th time the Modern Consumer Award for Customer Service Excellence “Prêmio Consumidor Moderno de Excelência em Serviços ao Cliente”, which is being organized by Grupo Padrão in its 11th edition.

Despite the recognition achieved with our clients, the maintenance of quality standard

requires continuous improvements, such as exams scheduling optimization and employment of new management tools, as well as process standardization across healthcare networks spread around the Country, especially among recently acquired brands. In this sense, the Customer Support Center of our Group also undertook the operation of CMRJ (Mastology Center of Rio de Janeiro), a migration that brought significant gains on productivity and service efficiency.

Another step taken towards the exploiting of existing synergies in the Group was the transference of Lego Consultório service, which allowed physicians with in loco material collection, to the Criesp Diagnosis Medicine Solutions business center.

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

66

Patient safetyIt is responsibility of every professional from Grupo Fleury to report the occurrence of adverse events. From this point of view, we developed the Client Safety Management System, which continuously identifies and reduces adversity risks to minimal levels, in 100% of the customer service phases. An event is considered adverse when damages a Client, by action or omission, instead of health or illness status. To that end, we created a compulsory notification and an events treatment flow. Treating adverse events in a centralized manner results in more effective actions overall. |GRI PR1|

At first, we implemented the Client Safety Management System in Fleury Medicina e Saúde brand, and we will gradually extend it to others brands’ units in our Group.

Marketing &CommunicationThe mainspring for marketing & communication guidelines we employ is the Federal Council of Medicine (CFM), which regulates medical services dissemination. We also comply with the legislation in effect and specific for publicity, marketing & advertising in all regions we operate. |GRI PR6|

Our legal department is also an important source for referral and guidance for publicity, marketing & advertising related actions.

External Communication Policy Our External Communication Policy sets out guidelines for advertising services to our clients.

HON CodeWe voluntarily agreed to comply with the HON Code for the website www.fleury.com.br. The HON Code was designed to promote dissemination of quality health information to patients, professionals and general public, and to enable access to the latest and most important medical data via Internet. This certification is an ethical standard for quality health information supply, which is annually verified. The site transparency will enhance information use and objectivity and the publication of accurate data. |GRI PR6|

Promotions & Sponsorships The elaboration of marketing-related policies for the Group and its brands is underway. Through this document, every business will know selection and support rules for practices related to promotional and sponsorship activities. |GRI PR6, PR7|

::::

: Gru

po

Fleu

ry 2

010

::::

:

67

Our Marketing department do not establish formal non-compliance indicators, but relies on voluntary guidelines for promotional and sponsorship activities.

Satisfaction surveyEvery year we carry out a satisfaction survey with clients of all brands, in all marketplaces where we operate. In 2010, we achieved a 9.34 mark within a 1 to 10 scale, in the first stage of the Client Satisfaction Annual Survey, in May, and 9.27 in the second stage, in October.

This survey was conducted by Ibope, which consulted 3,260 clients by phone, in each one of the stages, totaling 6,520 people.

Survey’s general lines of investigation bring up the following information: First time using the services; Reasons for choosing unit/service/brand; Satisfaction with around 43 attributes (1 to 10 scale); General Satisfaction; Reason for dissatisfaction (marks <=6); Questions related to fidelity; Recommendation and/or suggestions. |GRI PR5|

InformationtechnologyWe deal with important information for our client’s health on a daily basis. Therefore, our investments in computing and data safety stand above the average investments in the health sector, in order to ensure our organic expansion and increase the range of services.

We have always traditionally operated with the cutting edge information technology. During the 90s, we were the first company to employ barcode readings for exams processing, to facilitate

automation and increase samples traceability, delivering results via Internet.

IT is becoming more and more important within our sustainability initiatives, including matters related to the portability of results delivered to physicians and their patients. Digitalization of diagnosis park and improvement of IT and telecommunications solutions have a strong impact on reducing paper consumption and waste disposal.

Evolution Program Our process for range of products expansion and the strong organic and inorganic growth, which became more pronounced since 2008, created the need to modernize and easy the IT systems. Program Evolution [Programa Evolução] is our answer to this need, covering product registration up to medical reports elaboration.

In 2010, we defined platforms that take part in the program and started structuring actions, such as information recording and payers’ contract loading. Next year, we will work on CRM (Customer Relationship Management) improvements, on defining a data model for product registration, on electronic validation architecture, on a strategic definition for pre-service and in new locations. In the medical report front, we will work on redesigning processes and complete the medical workstation system. Thereby, Evolution launched in 2010 a new systems era in our company.

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

68

SuppliersIn March, 2010 we launched Perc, the Supply Chain Relationship Excellence Program. It aims at enhancing communication and integration among strategic inputs and services suppliers that can impact the business, clients’ and environment health and stimulate the use of sustainable practices and efforts for ongoing improvements in our company and our partners’ processes. |GRI EC6, HR1|

The first Perc edition was formed by 24 strategic partners, representing 40% of the total purchase volume, which were quarterly evaluated in several aspects, including sustainable-related issues.

We call “strategic” those suppliers that comply with at least one of the following criteria: be a homologated supplier for more than two years; present some level of environmental risk or supply continuity risk; be strategically representative to our activities or ratified by the senior management and the Evaluation Committee.

33% of the total contracts celebrated during the year included citizenship criteria clauses. |GRI HR2|

The alignment with our business partners resulted in 46 improvement projects suggested by suppliers, 27 of which were implemented in 2010. The three most outstanding companies evaluated – Zaori, Roche and Siemens – received recognition.

Perc performance is one of the key elements to consider when evaluating and choosing a supplier. Other factors include technical qualification; compliance, documentation assessment (records, certifications, among others); supplier impact and risk assessment; and value, with the best cost-effectiveness.

Local suppliers We do not hold a local supplier protection policy in the six states where we operate. Nonetheless, we consider the local supplier presence a positive factor when evaluating criticality and impact on operations. In 2010, local suppliers represented 99.5% of the purchase financial volume.

anexo de cidadania e

citizenship & sustainability addenduM |GRI HR1|

Contracted companies must sign the Citizenship & Sustainability Addendum, regardless their participation on Perc. With this document, parties agree to comply with all legislation and rules related to the Brazilian environmental policy, including sustainable use of legally originate resources practices and waste management and appropriate disposal.

Parties also agree to comply with all legal requirements in respect to labor safety and

medicine, as well as conventions, labor and trade union agreements, applicable to their collaborators. Signatories undertake not to hire workforce in conditions analogous to slavery; not to hire workforce less than 16 years of age, except for apprenticeship, starting from 14 years of age; and not to hire workforce less than 18 years of age in environments considered potentially harmful to their professional training and development, hazardous or unhealthy, or for night shift work.

::::

: Gru

po

Fleu

ry 2

010

::::

:

69

Campana Santana [Santana Campaign]

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

70

Innovation, Research& Development

::::

: Gru

po

Fleu

ry 2

010

::::

:

71

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

72

One of our competitive differentials is our historical capacity to generate and employ knowledge. This versatility mostly occurs as a groundbreaking event, generating solutions to provide even higher excellence in diagnosis, comfort and safety to our clients, within a proposal that integrates services and specializations. This is made possible through collaboration of highly qualified intellectual property and research & development incentives.

Our Research & Development Innovation policy comprises the encouragement to academic activity, scientific production, basic research as well as exchanges with education institution, besides fundraising for research development.

Research and DevelopmentIn 2010, we consolidated R&D activities, enabling the scientific knowledge expansion and innovation deployment. Such activities are a result of substantial investments and enhancement of scientific-technologic partnerships with Brazilian and international research centers.

In 2010, Grupo Fleury carried out 53 research projects and our physicians published a total of 172 articles in indexed journals, 95 book chapters and 313 work summaries in scientific meetings.

We also implemented 107 new products and changes in methodologies for laboratorial exams and diagnosis centers in 2010, against 103 products and changes in methodologies in 2009. It is important to highlight the advancements in proteomics, where research projects were developed in partnership with universities, specially the research on new biomarkers in cardiovascular medicine. Grupo Fleury also carried out research projects with new methodology platforms, such as the comparative genomic hybridization (CGH array) and flow cytometry.

In the final fiscal year of 2010, the total gross income derived from new products launched in the previous 24 months reached R$ 33.5 million – a 187% increase in comparison to 2009 (R$ 17.9 million).

We implemented 107 new products and changes in methodologies in 2010.

New productsAmong the products developed in 2010, we can highlight the HPV (human papillomavirus) genotyping and E6/E7 viral oncoproteins detection. Validated and implemented in 2010, the microarray technique for HPV genotyping can help detect a larger number of viral types possibly involved with the HPV infection, including the majority of the high risk subgroup, as well as infections by more than one virus variant – with the advantage of being the only method to enable the individual detection of HPV types. Also, it allows analysis of formalin-set and paraffin-soaked tissues, facilitating the clinical practice.

::::

: Gru

po

Fleu

ry 2

010

::::

:

73

To complete, the HPV genotyping also holds internal controls to minimize false negative results incurring from the absence of cells in the evaluated material. Additionally, new tests have been helping the clinician to assess probability for women infected by high risk viral HPV types and with undefined or low level epithelial changes to progress to pre-malignant or malignant lesions.In 2010, we also validated and implemented the viral oncoproteins detection test, based on mRNA amplification of E6 and E7 of five types of the high HPV risk subgroup: 16, 18, 31, 33 and 45. The test enhances the identification of women with higher risk to develop cervical cancer, enabling an individualized and more efficient monitoring of these patients.

Research Funding We stress that the resources employed in R&D activities were financed by Inova Brazil Program, from Finep (Study and Projects Financing Institution), a company associated with the Ministry of Science and Technology (MCT). The program was approved in the end of 2009 and its financing forecasts a total amount of R$ 7.2 million for research and development activities in our Group, for a two-year period. In 2010, Finep granted R$ 3.2 million for the execution of 185 Inova Brazil program projects, including 11 basic area projects (proteomics, genomics and cellular biology), 33 applied research projects and 142 projects for the development of new products and methodologies.

Finep granted 3.2 Millions in 2010 For the execution oF our research and developMent projects

We obtained R$ 1.2 million in fiscal benefits with innovation, research and development activities, through the Federal Law no. 1,196, of November 21st, 2005 (The Good Law). |GRI EC4|

We also entered the selective process for Finep’s Subvenção Econômica [Financial Subsidy] 2010 program, which foresees the direct investment of public non-reimbursable resources in companies, aiming to promote an increase in innovations activities and enhance business competitiveness and the country’s economy. Out of 993 companies that submitted projects, 252 were approved in the first phase. For our participation in the Biotechnology area, the entity provided us R$ 7.1 million in funding, from which R$ 2.5 million were granted in 2009, and R$ 3.3 million in 2010. The R$ 1.3 million grant installment is forecast for 2011. |GRI EC4|

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

74

PeemThe Strategic Planning of Medical Specializations (Peem) results were quite evident in 2010. In addition to 107 new products and changes in methodologies derived from Peem, we designed 22 new integrated report models and developed 20 medical specializations centers.

The interaction between our medical teams from several specializations and debates about complex cases resulted in 7,242 integrated reports for physicians-clients, surpassing the goal set for that year by 21%.

IntegratedMedical CentersOur group has been preparing over the years its future operation as a provider of more and more complete management solutions for people’s health & wellness. In this regard, the implementation of medical specializations integrated centers is an accurate translation of the strategic plans in medical specializations. These centers carrying Fleury’s health and medicine brand offer multidisciplinary and integrated services.

Centro de Atendimento Especializado ao

We ended the year 2010 with the distribution of 53 models and 7,424 integrated reports to physician clients

::::

: Gru

po

Fleu

ry 2

010

::::

:

75

One of the highlights is the integrated report, a multidisciplinary statement that consolidates multiple results of diagnosis procedures, carrying the opinion of medical advisors. We have already structured 53 integrated report models, 31 completed in 2009 and 22 in 2010.

It represents an even more efficient diagnosis support service for the physician-client, whereas for his patient, it means more accurate and convenient diagnosis, in one site, away from the hospital environment.

It is important to stress that, after holding exams in this integrated medicine centers, the patient will always return to his/her doctor to follow up and start the required treatments. Check out four Integrated Medical Centers already open:

Specialized Healthcare Center for Lymphoma PatientsIndividuals suffering from lymphoma or with diagnostic suspicion are provided with a suitable place to take all exams related to hematologic investigations at once, at the Higienópolis PSC, within a flow projected to offer them better care. The center keeps one pathologist on duty to take immediate action after the biopsy preliminary examination, revealing the need of new collection if there is no sufficient material and, above all, to provide guidance for the next steps in the investigation, eliminating unnecessary procedures.

Advanced Gastroenterology and Endoscopy Center With anesthetist support and appropriate atmosphere for post-anesthetic recovery, the Advanced Advanced Gastroenterology and Endoscopy Center was set up at the Higienópolis PSC to exclusively focus on advanced diagnosis and therapeutic procedures through digestive system endoscopy, as in the case of removal of larger polyps or those that are hard to visualize. In practice, the centers represent the ideal solution for individuals who, for comfort or health requirements, prefer to avoid going through more invasive methods at hospitals.

Integrated Neurology Center and Center for Sleep Disorders Also located at the Higienópolis PSC, the Integrated Neurology Center and Center for Sleep Disorders enables a sequential conduction of neurophysiological methods to evaluate brain and neural activities, as well as resources indicated to approach sleep disorders. Every client directed to the center is previously interviewed by a neurologist who can obtain as much clinical information as possible, which are essential to diagnosis, thus caring for the safety of every patient. Given that the center conducts exams that require overnight stay, all relevant customer service infrastructure is also provided.

CenterCenter for Investigation and Rehabilitation of Urology DisordersWith a specialized customer service to support urinary dysfunction patients, the CenterCenter for Investigation and Rehabilitation of Urology Disorders, set up at the Ibirapuera PSC, offers therapeutical services indicated by the physician assistant, following the diagnosis. Therefore, the center has Nursing and physiotherapy teams, trained to perform and teach different kinds of treatments and support, at all times under supervision of an urologist or gynecologist. Services include physiotherapy for pelvic floor rehabilitation, including biofeedback, behavior therapy and training for intermittent vesical catheterization operation.

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

76

Sustainability

::::

: Gru

po

Fleu

ry 2

010

::::

:

77

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

78

Grupo Fleury SuStainability Statement

We believe that a sustainable attitude must permeate all healthcare chain.

Our commitment is to lead the change process in the sector, evolving to a

sustainable model with shared responsibilities. We contribute to the health

and wellness of people, society and environment through knowledge

diffusion, valuing diversity and full adoption of ethical and transparent

practices. Our actions today aim at a healthy future for the planet.

We consider that integration and balance between social, economic and

environmental aspects, aligned with the quality of organizations’ processes

are key subjects for a sustainable development.

That is why we implemented in 2002 an Integrated Management System to

address our environmental and social impacts, simultaneously to the quality

of our activities, and verified through internal and external audits.

The compliance with these criteria led Fleury Medicina e Saúde brand to

win the ISO 14001 certification in 2002. The company was also a pioneer

in the health sector by obtaining Cetesb (Environmental Company of the

São Paulo State) authorization to perform infecting waste treatment in our

headquarters in Sao Paulo (2005).

::::

: Gru

po

Fleu

ry 2

010

::::

:

79

Moreover, it has become a metallic mercury-

free company, replacing all devices that made

use of such metal. This initiative

was worth an honored mention from the

Regional Labor Office of Sao Paulo State,

and subsequently propagated to the other

Group brands. In our company, sustainability is

everybody’s commitment.

For instance, energy, water and paper

consumption is monitored and for many

years comprised the corporate performance

indicators panel employed to calculate the

Result Sharing Program (PPR in Brazil),

alongside other sustainability goals. Even

feasibility studies for research products take

into account possible environmental impacts.

Furthermore, the collaborators’ engagement

in socially-related initiatives is a primary

touchstone in our operations.

Grupo Fleury Headquarters in detail

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

80

Strategic SustainabilityProject

In 2010, we defined our strategic sustainability project, with the establishment of four main goals:

•addvaluetothecompanyandtotheenvironment through effective programs to reduce consumption of natural resources and environmental risks and continuous improvement of processes;

•developstrategicinitiativesthatcontributestrongly and permanently to the improvement of our society in places where we work;

•alignthecompany’sgoalsanditskeystakeholders’ in order to strengthen relationships, establish lasting partnerships and obtain mutual benefit;

•createanorganizationalculturefocusedonsustainability and innovation.

QualityWe consider quality as one of the pillars our sustainable development approach. To ensure excellence in provision of our services and meet the expectations of our stakeholders, we’ve participated in rigorous national and international quality control and we’ve submitted ourselves to several internal and external audits. The Fleury Medicina e Saúde brand kept the

certification of its Integrated Management System (Quality - ISO 9001 and environment- 14001) and received accreditation by the Programa de Acreditação de Laboratórios Clínicos [Clinical Laboratory Accreditation Program] (Palc), the Sociedade Brasileira de Patologia Clínica/Medicina Laboratorial [Brazilian Society of Clinical Pathology/Laboratory Medicine] (SBPC/ML). The regional brands located in São Paulo, Rio de Janeiro, Paraná, Pernambuco and Bahia renewed their Palc accreditation.

In the quality dimension, we’ve also developed 12 Lean6Sigma projects over 2009/2010, in several areas of the company, which showed measured profits of about R$ 1 million.

Still in 2010, there were over 100 internal audits in the Group and nine external audits of the business processes.

Environment |GRI EN26|

Environmental aspects and impactsThe identification and evaluation of environmental aspects and impacts associated with our products and services is an ongoing process.Established in 2002 for the Fleury Medicina e Saúde brand, the result of the environmental certification, the program currently manages 448 identified aspects and impacts, of which 50.7% are considered significant, that is, of highergreater severity and higher frequency/probability of occurrence. In 2010 we initiated the expansion this endeavor to other brands of our Group.

The main control measures are associated with procedures established, employees training program, monitoring measurements and the implementation of goals and Environmental objectives and goals reached by environmental

::::

: Gru

po

Fleu

ry 2

010

::::

:

81

management programs. In regards to educational measures, the Sustentabilidade Vai até Você program stands out, which is composed of visits from the Sustainability team to the units of the group aiming to guide the employees as to the key practices related to Sustainability.

Deployed in SP, BA, PE, PR and RJ, over 120 visits were made to units of the Group in 2010. For 2011, the plan is to expand this program to the Regional office in Rio Grande do Sul. Other measures to minimize these impacts are described in the following topics.

Greenhouse Gas Emission Inventory (GHG)Considered as the main elements responsible for global warming, greenhouse gases (GHG) emissions have been the subject of constant concern by the general population. Therefore, increasingly, the various segments of society try to measure greenhouse gas emissions and seek ways to replace them or reduce their use or to compensate, in some way, the impact of these emissions in the atmosphere.

In 2010, we concluded, for the first time, our inventory of greenhouse gas emissions for the year 2009, for all the organization.

The identification, quantification and analysis of the sources of GHGs in this inventory wereobtained according to the guidelines of the Brazilian Program of the GHG Protocol, developedby the World Business Council for Sustainable Development (WBCSD) and World ResourcesInstitute (WRI), and calculation formulas approved by the United Nations Framework Convention for Climate Change (UNFCCC) and the 2006 IPCC Guidelines for GHG Inventories.

This methodology is recognized worldwide as the

standard for the preparation of GHGs emission inventories. All the emissions of the brands featured in the Group were quantified in 2010. For the Weinmann brand, were considered emissions from October 2010, the month following the announcement of the acquisition. |GRI EN16|

Types and volume of GHG |GRI EN16, EN17, EN19, EN20|

In all our activities, we identified the following gases:

CO2 Carbon Dioxide GWP 1

CH4 Methano GWP 21

HFC Hydrofluorocarbon GWP 6.300

N2O Nitrous Oxide GWP 310

Emissions considered as the most significant, by analyzing sources, were carbon dioxide (CO2), which total 649.45 tons per year and account for 96% of the total, and methane (CH4), responsible for 4% of the amount (23.89 tons). Other emissions, such as nitrous oxide - N2O (0.2417 t), and those with substances destructive of the Ozone layer, like the hydrofluorocarbon - HFC (0.0002 tons or 0.000011 t CFC-11e),

represent less than 1% of overall emissions.

Applying the global warming potential (GWP) values for gases inventoried, we conclude that our total emissions of greenhouse gases in the year 2009 was 1,228 tons of CO2 equivalent.

CO2

CH4

96%

4%

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

82

Emissions type 1 CO2 (ton) CH4 (ton) N2O (ton) HFC (ton) Total (tonCO2eq.)

Vehicle fleet 83,71 1,20 0,24 - 183,66

Fugitive emissions - - - 0,0002 1,35

Emissions type 2 CO2 (ton) CH4 (ton) N2O (ton) HFC (ton) Total (tonCO2eq.)

Electricity consumption 475,85 - - - 475,85

Emissions type 3 CO2 (ton) CH4 (ton) N2O (ton) HFC (ton) Total (tonCO2eq.)

Air travel (employees) 89,87 0,05 0,0017 - 91,51

Air travel (biological material)

0,01 - - - 0,01

Wastewater - 22,63 - - 475,30

Biomass emission CO2 (ton) CH4 (ton) N2O (ton) HFC (ton) Total (tonCO2eq.)

Ethanol consumption 21,46 - - - 21,46

Overall total 1.228 +CO2e

Sources of emissionOur GHS inventory showed four main sources: electricity consumption (39%), wastewater (39%), vehicle fleet (15%) and employee air travel (7%).

Based on the inventory, we defined actions that were most significant for emission reductions. Other complementary actions, such as the inclusion of criteria of environmental control of the fleet and use of flex-fuel vehicles were also considered. |GRI EN29|

In order to minimize the effects of these emissions of greenhouse gases, we conducted and developed initiatives focused primarily on emissions resulting from consumption of energy. It is worth noting the decision to obtain unit certification according to the Leadership in Energy and Environmental Design (LEED) model for the prioritized Fleury Medicina e Saúde brand PSCs

in São Paulo, or incorporation of the principles of this certification in its construction, even without formal certification, in other brands and states by installing heat sensors, the use of energy efficient lamps or LED, among other actions. The subject was also featured in the Corporate Sustainability, Health and Occupational Safety Week of 2010. |GRI EN18|

In addition, we adopted the compensation strategy by purchasing carbon credits (Verified Emissions Reduction - VERs) for the 2009 emissions, benefiting developing projects in the states of Sao Paulo and Minas Gerais. We also compensated emissions of two events a year - the institutional event and employee party, both in São Paulo, and two greater educational trainings.

As further actions, it’s planned the inventory of 2010 and compensation of their emissions. 1,600

total ghgs eMissions

::::

: Gru

po

Fleu

ry 2

010

::::

:

83

carbon credits were purchased to compensate our activities related to 2010. |GRI EN29| Green sealIn 2010, the Rochaverá-Morumbi PSC of the Fleury Medicina e Saúde brand was the first health facility in Brazil to receive the Leadership in Energy and Environmental Design (LEED) Gold standard certification. This certificate is issued by the U.S. Green Building Council, an American non-profit entity which aims to set standards for the construction of sustainable buildings. We will employ the same sustainability standard in building other units in the future.

BiodiversityWe have not identified facilities situated in protected areas or classified as high biodiversity sites or ecological reserves. Thus we have not categorized any significant impact of our operations in areas with these characteristics or we elaborated plans to managing impacts on biodiversity, or for the conservation or protection of animals at risk of extinction, listed in the Red List of the International Union for Conservation of Nature (IUCN) or in national environmental protection organs in different governmental spheres (municipal, state and federal). We have not conducted any habitat recovery or restoration.|GRI EN11, EN12, EN13, EN14, EN15|

Climate changes |GRI EC2|We considered aspects related to climate changes in developing a sustainable business model that establishes strict goals to reduce environmental impacts of the operations through the proper use of natural resources and following applicable laws. In this sense, we aresubject to adjustments arising from regulations, such as the Climate Changes Policy of São Paulo State, which anticipates a 20% reduction in CO2 emissions by 2020 compared to 2005 levels, or the National Climate Change policy, or other municipal or state laws related to the subject.

Assessment of climate events in the mountains region of Rio de Janeiro that occurred in early 2011revealed some potential risks to which our local operation is subjected, such astemporary interruption of operation of nearby units, increased absences in the region and spread of diseases associated with contact with contaminated water. The financial impacts for the business of these possible events were not calculated quantitatively. On the other hand, we are prepared for eventual needs in the health area in diagnostic medicine, such as the development of new methodologies and techniques for identifying viruses or bacteria. An example is the laboratory test for the diagnosis of influenza A (H1N1) developed by the Company in 2009.

Waste managementIn our waste management program, we follow reference standards in the area. In addition to the discharge and adequate disposal of various types of commonly generated waste (biological, chemical, radioactive, common and recyclable), we count with specific programs for the disposal of fluorescent lamps, batteries, cooking oil and discarded X-ray films, among others.

Rochaverá-Morumbi: Leed Gold standard

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

84

we have an internal inFecting waste treatMent systeM licensed in são paulo

Selective collection is also part of our everyday life, as well as maintaining an internal treatment system of potentially infectious waste generated in our headquarters in São Paulo, duly licensed by the environmental agency.

The system allows the disposal of these materials, after processing and characterization, directly as common waste, with no risk of contamination.

The environmental program for reducing the generation of common waste, implanted in our headquarters and Fleury’s PSCs in São Paulo showed, as result, the generation of 0.65 kg/exam, higher than the recommended goal.

The generation of waste in 2010 suffered significant impact due to the construction and remodeling finished and ongoing in the Fleury’s PSCs and the increased number of employees hired to meet the demands of corporate areas and new services implanted in the units. In addition, the number of examinations and clients served has increased significantly.

The amount of waste generated in the Fleury brand is distributed as follows:

waste generated |GRI EN22|Tipe Weight (ton) %

Infecting 572,44 38,277

Common 632,58 42,290

Recyclable 286 19,097

Chemical 4,87 0,326

Radioactive 0,03423 0,002

Total 1.495,53 100

Note: : In São Paulo, for infectious waste, common and recyclable, the quantity is defined by counting the number of bags generated, multiplied by the average weight measured.

Regarding waste treatment methods, the distribution takes place as follows:

918.184

Dangerous Not dangerous

577.341

Common

Infecting

Recyclable

Chemical

42%

38%

19%

0,3%

Radioactive

0%

ton ton

::::

: Gru

po

Fleu

ry 2

010

::::

:

85

Final destination oFwaste in 2010 |GRI EN22| Destination Peso (ton) %

Landfill 632,52 42,298

Electro-thermal deactivation

505,47 33,799

Recycling 285,61 19,097

Licensed internal treatment

49,41 3,304

Microwave 11,85 0,793

Municipal autoclaving 5,71 0,382

Incineration 4,87 0,326

Decay 0,03 0,002

Total 1.495,53 100

The final destination was given by companies contracted directly by the company or consortium services in the cities where Fleury’s PSCs are installed.

In addition, we discarded about 3 thousand fluorescent lamps in São Paulo, and we sent about 300 kilos of radiographic films for treatment in this location. For the other brands, this program was established as monitoring in Bahia, Paraná and Rio Grande do Sul regional offices.

Waste (ton) PR BA RS

Dangerous 8,2688 17,26489 83,6011

Not dangerous 16,0649 10,8275 64,7653

The amount of waste generated in these locations is distributed as follows:

Waste PR BA RS

Infecting 6,6563 17,251 83,6011

Common 9,6636 7,4473 31,6134

Recycling 6,4013 3,3802 33,1519

Chemical 1,6125 0,01389 -

Total 24,3337 28,09239 148,3664

Autoclaving

44%

0%1%

31%

17%

5% 2%

Landfill

Electro-thermal deactivation

Recycling

Internal autoclaving

Microwave

Municipal autoclaving

Incineration

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

86

Regarding waste treatment methods, the distribution takes place as follows:

Destination PR % BA % RS %

Landfill 9,6636 39,7 7,4473 26,5 31,6134 21,3

Recycling 6,4013 26,3 3,3802 12 33,1519 22,3

Incineration 1,6125 6,6 0,01389 0 - -

Microwave 6,6563 27,4 - - - -

Autoclaving - - 17,251 61,4 83,6011 56,3

Total 24,3337 100 28,09239 100 148,3664 100

Monitoring of the amount of waste generated by other brands in São Paulo and in Pernambuco was started, respectively in April and June of 2010. Thus, we chose not to include that data in this report. Likewise, it was decided not include data relating to the generation of chemical residues in the Rio Grande do Sul Regional office. For 2011, we plan to expand the monitoring.

During the year, we have taken steps to reduce various types of waste generated by the company, including biological. Among them, we note the 25% reduction in disposal collection tubes in the Technical Center, where the company tests are processed in Sao Paulo, due to the rationalization of test grouping. In 2011, this reduction will represent approximately 735 thousand less tubes or about seven tons of infecting material discarded. The project also allowed streamlining of the Nursing workload, reduced service time and the amount samples collected and increased the degree of customer satisfaction.

EffluentsWe periodically perform physicochemical analysis of effluents generated in our facilities to ensure compliance with the applicable laws. The results indicate adjustments to these legal parameters, in values well below those recommended as a maximum limits in specific legislation. In 2010, there were not detected parameters outside the limits prescribed in the legislation in monitored units.

Natural resources Since 2002, we have been motoring the consumption of natural resources (paper, energy, and water) at the Fleury brand through environmental management programs. As of 2009, we implemented this same initiative into the other brands

EnergyConsumption of indirect energy, used in support services for the business, and such as lightingand cooling for management buildings, totaled 72,400 gigajoules. Hydroelectric prevails as themain power supply (85%), following the standard of the Brazilian energy mix. |GRI EN4|

Primary measures to be adopted for conserving energy regard the inclusion of energy consumption assessment as one of the criteria for purchasing and selecting equipment (the inclusion of the Energy Star seal, for instance), and the construction of sustainable PSCs. Such “green buildings” feature a number of measures, taken into consideration since the project phase, that aim to reduce such a consumption. Thus the construction of the Rochaverá-Morumbi PSC, the first to feature a Gold standard Leed certification,is a highlight. Measures for conserving energyadopted by this project led to the reduction of 55% of its average consumption (41.353 GJ/month), when compared to other PSCs with

::::

: Gru

po

Fleu

ry 2

010

::::

:

87

similar service mix and number of processed records (92.837 GJ/month). Furthermore, in 2010, we adopted structuralactions for conserving energy, such as theinstallation of presence sensors and LED bulbs in our facilities. |GRI EN7|

For the Fleury brand, beingmonitored since 2002, the year when theenvironmental program intended to reduceenergy consumption, we have determined theaverage consumption per unit, measured in 2010 (56,328.4 kWh/un), to be 7,4% lower, when compared to that of 2002 (60.884,1 kWh/un), which is equivalent to 4,555.7 kWh/un (16,5 GJ/un). |GRI EN5|

indirect power consuMption |GRI EN4|

State No. ofmonitoredStateunits

kWh/year GJ/yeark

SP 43 1.7001.581,04 61.206

RJ 24 1.286.963,00 4.633

BA 15 491.180,00 1.768

PE 6 649.024,00 2.336

PR 10 164.581,00 592

RS 17 518.111,00 1.865

Total 130 20.111.440,04 72.400

WaterOut of the consumed amount, 21.5% (19,463 m³) derive from underground water (artesian well), while the remaining 78.5% is from mains. |GRI EN8|

Education related actions connected to the Vai até Você [Comes to You] Sustainability program - the Sustainability team timeline of visits to the PSCs-, and the creation of groups of environmental monitors, let alone structural and punctual

changes to processes, were the highlights in 2010.

water consuMption |GRI EN8|State No. of monitored

unitsM³/yearm

SP 38 65.812,00

RJ 8 6.226,66

BA 6 1.424,00

PE 5 2.996,35

PR 4 1.710,00

RS 9 12.398,00

Total 70 90.567,01

Less paperBy modifying the methodology and computerized systems, we have reduced the consumption of paper by nearly 360 thousand sheets/year. We not only encourage checking for tests online and making electronic copies of the results, but also measure the adjusted average consumption for all States. Results are as indicated in the following table:

State Adjusted average consumption (packages

of 500 sheets of paper) packages with 500

sheets/month)

SP 2.264

RJ 462

BA 229

PE 277

PR 110

RS* 837

Total 4.179

**Based on the average consumption between January and

June, 2010

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

88

Reduction related actions were mainly based on changes to technical processes, such as tests interface, suppression of printing or adaptations to worksheets, and replacement of paper records by electronic records.

Social |GRI SO1, EC9|

The company has long been concerned about the improvements to be made to the communities in locations where our brands are present. Such a commitment, expressed in the mission and objectives of the Sustainability Strategic Plan, is rooted in social initiatives carried out along the year across the entire organization. Hence the definition of different approaches being gradually disseminated throughout the whole company.Data for the definition of social initiatives are collected by the Sustainability area itself, with the aid of local social partners.We also survey information of those assisted by the program, who are selected according to criteria specifically designed for each one of them (age bracket, for instance), and choose social institutions through the assessment of institutional alignment and interests, available infrastructure, and legality.

We assess education, employment, and health indicators by authorized bodies (IBGE [Brazilian Institute of Geography and Statistics], for instance) in order to define the best strategies. We monitor social activities developed based on satisfaction researches and interviews with people assisted, besides periodic meetings with social partners.

We have not yet interrupted our activities in any of the local communities, but are concerned about trying and directing those under assistance to other alternatives available in their area, in case of discontinuation of any action.

Social Objectives Our social initiatives intend to reduce child death rate, teenage pregnancy, and the level of unemployment among the assisted age bracket, besides promoting social inclusion.

To attain such objectives, we have made punctual investments, such as in facility improvement, which includes renovations in classrooms, in partnership with Centro Assistencial Cruz de Malta, in São Paulo. Besides the above, no other systematic assessment of the community’s infrastructure needs has been carried out. |GRI EC8|

Cisne Negro is one of our social partners

::::

: Gru

po

Fleu

ry 2

010

::::

:

89

Health PromotionInternational researches prove that people awareness regarding their own health, as well as the development of prevention programs, provide both short and long term benefits to the community. Therefore, health prevention projects, such as the health promotion programs carried out by us in companies, provide an enhanced quality of life for covered workers and more productivity for companies. Anti-smoking and obesity reduction projects to minimize heart disease risks are examples of that. Education programs complement medium and long term benefits.

One other social initiative provides full access to medical diagnosis. For the Campana brand, we have reduced medical exam fees and facilitated the payment for the service as a way of attracting consumers who are not clients of health plans, but do not wish to use the public hospital network, either. The elder were granted an additional discount of 10% over exam fees.

Rudi Hemb Unit – Pescar Project |GRI EC9|Created in 1999, the Rudi Hemb Unit of the Weinmann brand, in Rio Grande do Sul, is connected to the Pescar Foundation and is focused on the professional inclusion of youths in a socially vulnerable situation. Thirteen classes have already graduated from the Rudi Hemb Unit, which is also included in the Jovem Aprendiz [Young Apprentice] Program. The courses last for one year and started as a qualification for clerks, evolved to administrative assistants and, nowadays, they cover professional initiation and customer service quality.

Youngsters between the age of 16 and 19 years old, who are either currently attending or have already completed secondary school, participate in these programs. Around 200 youngsters have gone the Rudi Hemb Unit and an average 70% of them came into the job market. The rate of internal absorption of participants in the local operation is about 40%. There are currently 40 of the project’s former students working at Weinmann PSCs.

Sp

ba

pr

rS

rJ

DF

pe

Volunteering

Donation program

Occasional campaigns

Fiscal benefit

Social programs 33% (SP e RS)

17% (SP)

100%

100%

100%

social work by region

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

90

In 2010, 18 youngsters graduated from the Professional Initiation course on Quality in Customer Service at the Rdi Hemb Unit in the Pescar Project

eMployability rate 2008 2009 2010

Total No. of Youngsters

17 22 18

Hired byWeinmann

13 13 6

Hired bypartners

2 3 3

Total No. ofContracts

15 16 9

% ofInternalemployability

76% 59% 33%

% ofMarketemployability

88% 73% 50%

Goal 70% 70% 70%

AwardsAn educational “tic-tac-toe game” made with recyclable materials, developed by students at the Pescar Project of Weinmmann’s Rudi Hemb, was awarded in the three categories of the award granted on an yearly basis by the Miniempresa Program of Junior Achievement (RS): Best Product in Rio Grande do Sul, Best Product in Porto Alegre and Best Project Management Report.

The Miniempresa program of Junior Achievement provides public and private secondary school students with practical experience in economics and business, as well as a company’s organization and operation.

Pregnancy |GRI EC9|

Since 2001, we have been developing the Pregnancy Program in partnership with Centro Assistencial Cruz de Malta.The program was implemented in the south zone of the City of São Paulo and, through this initiative, we have, in 2010 alone, assisted 191 pregnant women, and conducted 1.2 thousand antenatal screening tests. More than 2.5 thousand women have been assisted since the beginning of this program.

The Pregnancy Program also includes the participation of our volunteers.They register pregnant women, collect and conduct tests, as well as develop educational activities on subjects related to the pregnancy period, labor, breastfeeding, and newborn care.

191 young women assisted 1,2 mil thousand tests

Employability Rate

Goal (historic average on the percentage of young individuals absorbed by the market over the past 3 years)

2008 2009 2010

50%

70%73%

88%

::::

: Gru

po

Fleu

ry 2

010

::::

:

91

Also in partnership with Centro Assistencial Cruz de Malta, we sponsor the Reciclando Sonhos Project, of Cisne Negro dance school. This is an extracurricular program developed in the city of São Paulo and intended to promote citizenship, health and social inclusion through art and education for adolescent audiences. In this program, in which our volunteers also participate, 14 youngsters were covered in 2010.By demand arising among the benefited

youngsters covered by the Reciclando Sonhos project themselves, we have instituted the Professions Workshop. Representatives from different professions were invited to share their experiences with the community. Researches also address health and hygiene subjects approached during the program that contribute with the awareness of the covered population.

Reciclando Sonhos |GRI EC9|

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

92

Donations |GRI EC8|In 2010, we donated 6,954 items (laboratory materials and equipment, computer equipment, household appliances, furniture, etc.) for 26 non-profit institutions in Brazil. During the same period, we also conducted the equivalent of R$ 129,610.15 in diagnostic tests for social projects.We also cooperated through the donation of tests to the Atendimento Multi-Assistencial [Multi-Assistance] (AMA) Project of Hospital Samaritano, at a limited amount of R$ 90 thousand/year. In 2010, 704 children were benefited through such an action. This project covers needy children through free health assistance. Created in 2000, the objective of the project is to prevent diseases through frequent assistance to children and guidance to mothers, with lectures on hygiene and nutrition care held by nurses and nutritionists.

Punctual Campaigns |GRI EC8|In 2010, we promoted corporate punctual social campaigns, among which one was specifically intended to assist those affected by the rain in Niterói (RJ). Those campaigns have benefited 10 social entities throughout Brazil, through the donation of circa 11,000 items among food, clothing, toys, and personal hygiene items.

Tax Incentives |GRI EC4|In 2010, we have directed a total of R$ 92 mil in contributions made to Centro Assistencial Cruz de Malta and Lar Escola São Francisco, in use of the tax incentives granted by the Fundo Municipal de Direitos da Criança e do Adolescente [Municipal Fund for Children’s and Adolescents’ Rights] by the City of São Paulo (Fumcad). We have also invested R$ 450 thousand in dance related cultural projects through Rouanet Law’s mechanisms. Out of those, R$ 200 thousand were dedicated as a sponsorship to Reciclando Sonhos social and cultural project.

The Centro Assistencial Cruz de Malta houses 170 children aging 0 to 6 years full time; assists 140 children aged 7 to 15 years in extracurricular activities and 800 adolescents and youngsters learn physical education, capoeira, dance, and a number of other sport modalities.The entity also offers legal advice to the participants of probation programs and maintains a medical and dental center.

Lar Escola São Francisco is a medical rehabilitation center assisting physically disabled and reduced mobility people of all ages. These are typically low income patients referred by the Sistema Único de Saúde [Brazilian Unified Health System] (SUS). One thousand assisted people with temporary or permanent orthopedic, neurological, rheumatology, or geriatric related deficiency diagnosis.

Volunteer Work PolicyThe activity of volunteers is a basic requirement for the company’s involvement in the social area to ensure the success of the initiatives. Considering the above, we have, in 2010, restructured our Volunteer Work Policy with the purpose of guiding our and other public volunteers (legal entities, service providers, relatives, and suppliers). In order to encourage this activity, volunteers were given four hours a month to dedicate themselves to our social initiatives. We ended 2010 with a total of 210 volunteers, allocated to assist Gestação, and Reciclando Sonhos projects, as well as punctual campaigns. The 2011 goal is to increase by 50% the number of volunteers.

::::

: Gru

po

Fleu

ry 2

010

::::

:

93

Youngsters: one of the audiences benefited by our social actions

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

94

MedicalDiagnosis

::::

: Gru

po

Fleu

ry 2

010

::::

:

95

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

96

We came about as a Medical Diagnosis company and this is still our main source of income.

This business unit is divided into three different modalities: assistance units, hospital operations, and diagnostic solutions for laboratory clients.

In 2010, we consolidated to our Medical Diagnosis operations the strategy to offer distinct solutions with valuable proposals to all segments in which we are present.

We completed the integration process of all brands by implementing technical, process, and service quality guidelines which shall ensure a highly valuable proposal the health market.

In regional brands, adapting physical structures and qualifying medical and technical teams had, as a response, a continuous increase in our market share through the progressive growth in the number of people assisted along the year.

Such an integration effort shall allow our portfolio to consolidate with the launching of a new national brand in 2011.

In the meantime, we have implemented projects which are the basis for the distinction of our premium brands (Fleury and Weinmann), with innovative products and services, reaching new levels in the Brazilian health market through Vila da Saúde [Health Village], Integrated Medical Centers, launching of new tests, and segmented assistance, among other initiatives.

Service units |GRI 2.3|Consisting of 141 assistance units located in six states and in the federal district, this line of business contemplates complete and integrated solutions in clinical analysis, image and other diagnosis procedures in more than 30 medical areas. In 2010, Medical Diagnosis income totaled R$ 786 million, 13.3% higher than that of 2009, a growth propelled mainly by an organic expansion and, additionally by acquisitions. Average income per square meter was increased by 6% when compared with the fourth quarter in 2009, to R$ 3.5 thousand, as a result of an expansion to the services portfolio, network enhancement, and a growth in the installed capacity utilization.Average income per assistance unit has grown 22.9%.

::::

: Gru

po

Fleu

ry 2

010

::::

:

97

Fleury Medicina e SaúdePresent in the premium segment featuring 21 PSCs in São Paulo, Rio de Janeiro, and the Federal District, the Fleury Medicina e Saúde brand unites all services with a higher value added to the company’s portfolio.

In 2010, we dedicated our best efforts into increasing even more the integration in clinical analysis and diagnostic center, which includes imaging tests and other medical specialties, and enhance the portfolio of offered tests.

Besides improving even further the quality of services and the convenience to clients, the brand registered an increase of approximately 10% in its average ticketing, without elevating its operating cost.

It is also relevant to highlight the incorporation of professionals in the renowned medical diagnosis company DI Serviços Médicos, responsible for imaging tests at Hospital Alemão Oswaldo Cruz, and which became a service provider for the PSCs of that brand, increasing flexibility in the assistance schedule.

In 13 out of the 21 of the Fleury brand PSCs, there was an expansion in the night hours schedule for some tests or in the units’ working hours on weekends, in an effort to increase geographical coverage and service availability to better serve our clients.

In the Campinas PSC, for instance, we have expanded the product mix by including MRI, densitometry, ergometric tests, fetal medicine, and colposcopy. That allowed us to migrate the unit’s

portfolio from intermediate level to complex.

In virtue of such modifications, PSCs such as Higienópolis, Shopping Anália Franco, Sumaré, Campinas, Alphaville, Ibirapuera and the Mobile Assistance Service, which occupies position number six in volume of tests conducted among the units of the brand, showed an average growth in the volume of assisted people, in December, 2010, of approximately 20%, when compared to the same period in 2009.

we have expanded the portFolio oF tests oFFered and the integration oF the operations oF both clinical analysis and diagnostic center

The proposal to offer integrated and specialized services segmented according to the needs of patients, we have opened different diagnostic spaces to better assist people, such as the Integrated Medical Centers (page 75). The opening of four more centers is expected in 2011. The first one of them is dedicated to Fetal Medicine, and is expected to be opened during the first half of 2011, in the Paraíso PSC.

MRI Extremities We have implemented, in the Fleury brand, one of the first high field MRI extremities machines in São Paulo. University. Installed in the Higienópolis PSC, the MSK Extreme 1 5T is specifically dedicated to the diagnosis of foot, knee, hand, wrist, and elbow osteoarticular problems.

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

98

Since it produces a high magnetic field, i.e., 1.5 Tesla, the equipment can generate images with a higher quality than those obtained through the majority of the machines available in the market, which are usually limited by fields that are equal to less than 1.0T. Furthermore, the equipment provides more comfort to people with restrictions regarding confined places.

Vila da SaúdeVila da Saúde, at the Ibirapuera PSC, is an example of a specialized service started in 2010.Dedicated to the assistance of children aged between 0 and 12 years, its flow was designed to offer quick responses in tests for children. This is the group that benefits the most from the reduced delivery time of results, from the x-ray equipment, and from the ultrasound that are exclusive to the pediatric population and, above all, from a specialized medical assistance which follows up the progress and release of the most urgent tests and gives a feedback to the requesting doctor, so that they may speed up the institution of therapeutic measures.

::::

: Gru

po

Fleu

ry 2

010

::::

:

99

Regional BrandsDuring 2010, we witnessed a vigorous growth in regional operations supported by nationwide corporate initiatives. As a response by the market, the acceptance and the level of satisfaction of clients are also verified by the low volume of negative manifestations regarding our services, when compared with the volume of compliments. Despite the verified results, we are continuously updating and perfecting the valuable proposal of our portfolio in accordance with the attributes designed for each brand.

BahiaThe Bahia Regional, which has public engagement by the Grupo Fleury, has adhered to the management system integrated in 2010 and has standardized regional procedures of several areas, increasing synergy with the other regional operations of our Group. This Regional has also successfully renovated the certificate by the Programa de Acreditação da Sociedade Brasileira de Patologia Clínica [Accreditation Program by the Brazilian Society for Clinic Pathology] (Palc) and intensified environmental and social related activities, such as donations to the Lar Vida NGO in Salvador.

During the same period, we have incorporated the operation to the environmental management integrated system, which monitors the consumption of resources such as paper, water, energy, and the generation of common, recyclable, and infecting residues. In addition to that, we have expanded selective collection to 100% of the assistance PSCs in 2010, a significant growth considering the coverage of 20% of the 14 units in 2009.

We have also straightened our relationship with the local medical community, through the promotion of free updating events.

Paraná The Paraná Regional reopened, in 2010, one of its most important PSCs, Alto da XV, located in the mid-east part of the city of Curitiba, in the Alto da Rua XV section. That is a traditional area where European immigrants settled back in the days when agriculture and cattle raising used to be the main economic activity in the capital of Paraná.

Following the city’s dynamic profile, the Regional unit revised the location of its units, enhancing the exposure of the network, and developed multi-functional competencies. That has increased the quality of assistance even further and reduced delivery time. One other point which reinforced our commitment with quality was the renewal of the Palc seal.

We have also implemented a structured Ombudsman service, using the synergy and expertise of our Group, considered a standard in assistance and client satisfaction.

Simultaneously to these measures, taken to make clients’ experience with our network even more positive, we have sought a greater approximation with the medical community, as well as with the main paying sources in Paraná, through of institutional relationship and the organization of scientific events, increasing our performance in this area.

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

100

Weinmann Nilo Peçanha

PernambucoOur Pernambuco Regional was included in the Central Bank’s credentialed network and entered into agreements with Petrobras and Companhia Energética de Pernambuco (Celpe) for the conduction of periodical tests in 2010. In addition to that, it has promoted free updating events for doctors.

Rio de JaneiroWe have closed 2010 with the Rio de Janeiro operation being taken to a higher level in the market, through the announcement of an understanding memorandum between our Group and Rede D’Or for the acquisition of the Labs D’Or medical diagnosis network (more details on page 103). In 2010, we also completed the integration of systems, reactivated and expanded the relationship with important paying sources in that State. Local clients were also benefited by new installations in the Recreio dos Bandeirantes and Leme PSCs.

Rio Grande do SulThe Rio Grande do Sul Regional surpassed production expectations in 2010. The incorporation of three out of the five existing franchises and the closing of the two remaining outsourced units have contributed with such a performance. During that period, the process of integrating systems with our Group, which facilitated management and widened the portfolio of high complexity tests, was also initiated.

::::

: Gru

po

Fleu

ry 2

010

::::

:

101

Campana Brigadeiro

São PauloOperations in São Paulo have recorded a significant growth in the mix of imaging tests and other medical specialties. In 2010, a higher efficiency in occupation rates increased by 15% the average ticket per assistance record, when compared with 2009. Besides the expansion in the tests schedule, there were investments in the opening of units in the neighborhoods of Mooca and Santo Amaro.

In addition to that, the Campana Brigadeiro PSC has had its area doubled in order to meet the demand. The Campana Fácil, which offers some procedures at a reduced price, is one of the examples of our concern regarding access to health and quality for all.

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

102

HospitalsWe are present in eight important hospitals located in São Paulo, Porto Alegre, and Recife. In 2010, we obtained, through this line of business, an increase of 48%, when compared with 2009, totaling R$ 92 million, i.e., 9.9% of our total income. The number of tests processed increased by 39%, when compared with the previous year.

PreviousSuch a result is due to recent contracts and to an organic growth - increase in the demand in outstanding medical institutions, which operations are our responsibility.

Hospital operations Have increased by 48% and represent 9.9% of our revenue

While Weinmann has added two leading hospitals in RS to our clients portfolio, the acquisition of DI incremented the scope of the alliance with Hospital Alemão Oswaldo Cruz in São Paulo.

Hospital operations by state

são paulo

pernambuco

rio grande do sul

::::

: Gru

po

Fleu

ry 2

010

::::

:

103

Acquisitions |GRI 2.9|

DIThe acquisition of DI Diagnóstico por Imagem, a company with activities in São Paulo for 22 years, especially in units such as Hospital Alemão Oswaldo Cruz, has allowed the incorporation of approximately 60 highly qualified and significantly renowned physicians.

Pioneers in the implementation of several solutions in medical service provision in hospital diagnostic imaging centers, these professional were also added to the team of professionals in our network of PSCs, allowing for the expansion of services in several specializations.

Labs D’OrLabs D’Or is a standard in the medical diagnosis segment and a leader in imaging tests in the State of Rio de Janeiro, providing clinical analysis tests and other specialties.

With more than 200,000 clients assisted per month in 57 PSCs and diagnostic operations in 19 hospitals (Rio de Janeiro, São Paulo Metropolitan Area, and Pernambuco), the assets object of the negotiation add a R$ 415 million/year estimated Net Income (with 71% of this amount deriving from diagnostic imaging) to a R$ 100 million/year estimated EBITDA (a 24% margin over net income).

In 2010, we signed an understanding memorandum for the acquisition of Labs D’Or.

The total amount of the business was estimated by the parties to be R$ 1.04 billion. Fifty percent will be acquired through payment in cash by our Company and 50% will be incorporated through the issuance of new ordinary shares.It

is estimated that, after closing the transaction, the partners of Labs D’Or will have 15% of our Group’s stocks, subject to adjustments provided for in the understanding memorandum.

According to negotiation terms, there will be an expansion to the Board of Directors in our company from 9 to 10 members. Labs D’Or may also appoint candidates for the fulfillment of one position as an independent advisor.

tHe acquisition of labs d’or will be tHe biggest in our group’s 84-year History

Through this acquisition, the estimated annual net income will surpass R$ 1.25 billion.

In addition to that, we will intensify our presence in the important Rio de Janeiro macroeconomic hub, through the expansion of the network from 29 to 85 assistance units in that state, as well as strengthen the line of business of hospital operations in Brazil, increasing the current number of 8 to 27 served hospitals.

We will also reinforce this brand’s growth path by offering distinct products. Prospects are positive and arise from the strategic alliance established in order to meet the demand for diagnostic services, originated by the expansion of Labs D’Or. As soon as the negotiation is completed, after due diligence, this will be the biggest acquisition in our Group’s 84-year history.

::::

: Ann

ual S

usta

inab

ility

Rep

ort

::::

:

104

ReferenceLaboratoryIn 2010, we offered medical diagnosis solutions to circa 3 thousand laboratory clients through two different valuable proposals.

First, we have positioned ourselves as a stan-dard laboratory for more complex and cutting-edge-technology tests, with focus on serving clinical laboratories and hospitals in Brazil and the world over

As a legacy of our trailblazing in functional tests in the São Paulo Regional, we offer a wide range of tests with highly sensitive and specific analytical techniques and with national logistics, which allow us to offer our clients the option of receiving samples delivered directly to the technical area.

The consolidation of the technical park and the unification of management and assistance systems were the main relevant facts in this operation in 2010.

Through complementary value-added propos-als, we offer services that meet the best excel-lence and quality standards in each one of their market segments.

The Standard Laboratory income reached R$ 34 million in 2010, 6.4% lower than that of 2010 due to the rationalization of the clients portfolio.

Additionally, also at the end of 2009, we de-cided to progressively discontinue the Clinical Research service, and only maintained previ-ously hired studies.

As a result, this service’s income was de-creased from R$ 8.2 million in 2009 to R$ 4.2 million in 2010.

::::

: Gru

po

Fleu

ry 2

010

::::

:

105

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

106

Preventive Medicine

::::

: Gru

po

Fleu

ry 2

010

::::

:

107

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

108

The Preventive Medicine Business line grew 48% in 2010 and reached BRL 18.6 million. It comprehends integrated solutions to obtain effective results in health promotion and quality of life, as well as reduction of the claim rate. The entire program is customized and adjusted according to the need and reality of the companies.

Based on the pillars of nutritional education, physical activity and stress management, we offer services to all profiles of employees, from healthy to chronic. This means a complete portfolio, including population mapping; educational lectures; check-ups and traveler support; vaccination; physical activity, nutrition and stress programs; occupational health support and

monitoring of patients with chronic diseases, such as diabetes, hypertension, asthma and renal conditions.

Our main expertise is integrating all preventive actions, supporting the commitment of every employee - through customized content and motivational campaigns -, preparing risk assessment questionnaires and integrated reports to evaluate return on investment, analyzing the next steps.

Another differential is the possibility to adapt and invest in individual and population actions, according to the goals, financial resources and needs of the company.

portFolio

• Monitoring of Pregnant Women

• Nutrition Monitoring

• Tobacco Control

• Occupational Health Support

• Physical Activity Monitoring

• Check-Up

• Traveler Support

• Stress Management

• Chronic Diseases Management

• Health Coach

• Population Mapping and Screening

• Nutrition

• Lectures and Workshops

• Vaccination

Health Promotion With a portfolio of 29,965 lives in 2010, the health promotion solutions in companies were developed to the convenience of the hiring organizations, including on site collection units to avoid human resources displacement and consequent absences.

The results of the health promotion programs are measurable and indicators are developed to monitor the improvement in the employees’ health and quality of life. We do everything to promote well-being, satisfaction and motivation among the

teams, increasing the productivity and reducing the health expenses of the company. The Health Promotion revenue increased by 28% in 2010 compared to 2009.

portFolio oF

29.965 lives

revenue

increased 28%

::::

: Gru

po

Fleu

ry 2

010

::::

:

109

Chronic Diseases Management This innovative model of chronic patients’ health assistance and education, developed for more than twenty years with proven results in the United States, is based on using the return on investment rate to measure the results.

As the health of the patients improves, the complications caused by the disease are reduced; and, as a consequence, the claim rate and the health expenses of operators and companies that offer this service are also reduced.

Product of a partnership with the U.S. company Healthways, our Chronic Diseases Management program had a portfolio of 29,200 lives eligible to health monitoring in 2010, with a BRL 3.6 million revenue. In the end of 2009, 8,259 lives had access to this service.

The entire follow-up is done by a team of nurses that check, by phone, if the client is following the treatment prescribed by the doctor.

They also identify the client’s topics of interest that could be used as motivational factors to a lifestyle change, resulting in an improvement in well-being.

The monitored customer base is contacted in variable intervals according to the level of risk to the health of each eligible life, in a maximum period of three months between each contact.

New services In 2010, two new services were included in the Chronic Diseases Management program portfolio: Health Coach and Pregnant Women Monitoring Whereas the Chronic Diseases Management program focus on monitoring patients with previous conditions, the Health Coach focus on prevention, promoting healthier habits among high-risk patients.

It is mainly recommended to companies that prioritize talents retention.

In turn, the Pregnant Women Monitoring program aims at preventing pregnancy complications caused by lack of proper professional assistance.

The team of nurses guides women during pregnancy to ensure the prenatal procedures are being followed and reduce the risk of complications.

Nurse of the Chronic Diseases Management

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

110

Health AssessmentFleury’s Health Assessment is based on scientific evidence, that is, its protocol only covers the tests indicates to each risk profile, in accordance with updated statistical references of the medical literature.

This precaution ensures the tests recommended by the medical literature and relevant to the clinical practice are advised to every client, upon completing a previous questionnaire and consulting a medical history. This avoids unnecessary procedures to the service users and additional expenses to the companies and other payers. In addition to companies and health insurances, Fleury’s Health Assessment serves individuals.

The preventive service attended 5,806 lives in 2010, 23% more compared to 2009 (4,734 lives). In 2010, the multidisciplinary team of the service had 45 doctors.

The year of 2010 was also a period of consolidation for the PSCs where the service is developed, Itaim and Rochaverá-Morumbi. The latter PSC was more and more demanded by executives of the companies located in its surroundings, in the south region of the city of São Paulo, where the most important business centers are located. In total, the Health Assessment revenue increased 23.9% in 2010 compared to 2009.

New servicesThe Health Assessment portfolio was expanded in 2010 with two new services: the inclusion of nutrition counseling in the return visit and the calcium score test to individuals with intermediate risk of cardiovascular diseases. This test measures the level of coronary calcification and helps the re-evaluation of the client’s coronary risk. The types of check-up offered are:

•ExecutiveCheck-Up;•Check-UpFitness;•Check-UpNippon;•FunctionalEvaluationinMaturity.

::::

: Gru

po

Fleu

ry 2

010

::::

:

111

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

112

Recognition

::::

: Gru

po

Fleu

ry 2

010

::::

:

113

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

114

We have achieved great recognition concerning management and service excellence in 2010 |GRI 2.10|

ibgc award In our first year as a public company, we received the IBGC award for Corporate Governance 2010 in the listed companies’ category, an award we won in 2007 in the unlisted company category.

Most valuable brand The Fleury brand was rated the most valuable of Brazil’s health sector, the sixth most valuable brand among service companies and the 25th most valuable brand of Brazil, according to a survey conducted by BrandAnalytics and Millward Brown.

personnel ManageMent Gestão & RH Editora conferred our group with the title of Empresa do Ano em Práticas de Gestão de Pessoas [Company of the Year in Personnel Practices and Management]. The publisher frequently highlights the organizations that invest in the employees’ quality of life and work. We were among the 10 best companies ranked in the study “As 50 Melhores Empresas Psicologicamente Saudáveis 2010” [2010 50 Best Psychology Healthy Companies], with emphasis on Safety and Health.

valor 1000First place in Geração de Valor e Margem das Operações [Value Generation and Margin of the Operations] among the companies of the sector - Valor 1000, by the newspaper Valor Econômico.

best oF dinheiro First place in the category Sustentabilidade Financeira e Governança Corporativa [Financial Sustainbility and Corporate Governance] among the companies of the sector, according to the Melhores da Dinheiro [Best of IstoÉ Dinheiro], by the magazine IstoÉ Dinheiro.

leed goldThe Rochaverá-Morumbi PSC of the Fleury brand received the Leadership in Energy and Environmental Design (Leed) Gold certification. We were the first company of the diagnostic medicine sector to achieve the Gold certification in Brazil.

::::

: Gru

po

Fleu

ry 2

010

::::

:

115

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

116

Financial highlights

::::

: Gru

po

Fleu

ry 2

010

::::

:

117

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

118

RevenueAs the previous years, the consolidated gross revenue had a two-digit growth by the end of 2010, achieving a total of BRL 935 million, an increase of 13.9% in relation to 2009.

The differentiation strategy for the services offered and the maximization of the value proposition to clients, in each one of the brands and business lines of our Group, helped them achieve remarkable progress in the structuring of operations, such as:

•expansionandadaptationoftheservicesofferedin the service units, including the opening of more complete units and adaptation or closing of damaged PSCs;

•rapidexpansionoftheimagingtestsandothertests offer and high-added value procedures;

•hospitalspartnerships;

•intensificationofthenegotiationstocreatenewcontracts in Chronic Diseases Management.

2010 2009

BRL million %RB1 BRL million %RB1 D

PSCs 785.6 84.1 693.6 84.5 13.3%

Diagnostics Operations in Hospitals 92.2 9.9 62.2 7.6 48.4%

Reference laboratory and clinical trials 37.9 4.1 44.3 5.4 -14.4%

Reference laboratory 33.7 3.6 36.0 4.4 -6.4%

Clinical trials 4.2 0.4 8.2 1.0 -49.5%

Preventive Medicine 18.8 2.0 20.4 2.5 -7.8%

Preventive Medicine (ex-FHD) 18.6 2.0 12.6 1.5 48.0%

Fleury Hospital Day (FHD) 2 0.2 0.0 7.9 1.0 -96.9%

Gross revenue 934.5 100.0 820.4 100.0 13.9%

1- Consolidated gross revenue percentage (%) 2- The service was discontinued in October 2009 due to issues concerning regulation

366

488 521587

720

820

935

2004 2005 2006 2007 2008 2009 2010

CAGR 16,9%

gross revenue evolution BRL million

gross revenue breakdown by business line

::::

: Gru

po

Fleu

ry 2

010

::::

:

119

Business Lines PerformancesPSCs: composed by 141 units located in six states and in Distrito Federal, provide complete and integrated solutions in clinical analysis, imaging and other diagnostic procedures in more than 30 medical areas. In 2010, the turnover of this business line summed up R$ 786 million, 13.3% higher than 2009, a growth especially driven by the organic expansion and, additionally, through acquisitions. The average revenue per m² increased by 9.8%, compared to 2009, to R$ 14.6 thousand, as a result of a larger service portfolio, network optimization and the increased use of the installed capacity. The average revenue per PSC grew by 22.9%.

Diagnostic Operations in Hospitals: provide diagnosis services to important hospital institutions in São Paulo, Porto Alegre and Recife, achieving a significant expansion of 48% in comparison to 2009, reaching R$ 92 million in 2010, taking a 9.9% stake of our revenues. The number of processed exams increased 38%. Likewise, organically incurring growths and those derived from acquisitions made a strong contribution to such expansion.

Preventive Medicine: comprising Health Assessment, Health Promotion and Chronic Diseases Management services, it showed highly positive results, developing its revenues by 48% compared to 2009, standing at R$ 19 million, 2% of the group’s consolidated revenues. The Health Assessment service, customized and offered in a non-hospital environment, increased its revenue by 23.9% in 2010, with a 24.6% growth in check-ups carried out. Health Promotion services increased

3.3 3.4

4.24.5

5.6

2006 2007 2008 2009 2010

CAGR 11.7%

gross revenue per pscR$ million

gross revenue per square Meter and total square Meter

1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10

51.4 51.6 51.0

54.653.4 53.6 53.6 54.5

3.23.3 3.4

3.33.5

3.73.9

3.5

Receita UAs por m2 (R$ mil)

mil m2 UAs

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

120

their revenues by 28% per year, mainly due to new contracts. The Chronic Diseases service, targeting care and prevention of complications in people suffering from chronic diseases, attained 29,000 contracted lives, totaling R$ 3.6 million in revenues in 2010. Recurring and cumulative profits are another key aspect in this business, given its continuous provision of services nature.

Reference Laboratory and Clinical Trials: The Reference Lab conducts clinical analysis and pathological anatomy exams to approximately 3,000 labs and hospitals located all over the Brazilian territory. The Reference Lab revenues resulted in R$ 34 million in 2010, 6.4% lower than 2009, due to client’s portfolio streamlining. In addition, we decided to gradually discontinue the Clinical Trials service also in the end of 2009, only maintaining previously contracted studies. As a result, this service revenues dropped from R$ 8.2 million in 2009 to R$ 4.2 million in 2010.

Costs and expenses The total cost of services provided was R$ 507 million, 12.3% higher than 2009, accounting for 58.2% of the net revenues (compared to 58.7% in 2009), an improvement primarily enabled by fixed costs dilution and negotiations with suppliers.

Gross profitIn 2010, the gross profit registered was R$ 364 million, 14.4% above 2009. This value represents a 41.8% gross margin of Net Income.

Operational expenses and revenuesThe general and administrative expenses increased 7.7% in 2010, reaching R$ 196 million in the consolidated statement, including R$ 16.1 million in marketing expenses.

Other operational net revenues (costs) summed up R$ 2.2 million, condensed in fiscal credits derived from tax debts negotiation. In 2009, these

expenses totaled R$ 2.6 million.

In 2010, provisions for tax, labor and civil risks were established for causes that are considered predictably lost by legal advisors and the Management, resulting in a total cost of R$ 1.6 million. In 2009, provisions for tax, labor and civil risks totaled R$ 14.6 million in revenues, concentrated in reversals of contingencies incorporated in previous periods.

Financial Result The financial result reported was R$ 26.7 million in 2010 versus R$ 21.2 million in 2009. This change was mainly driven by cash on hand as a consequence of an IPO in December 2009. On December 31st, 2010 we reported R$ 543 million in cash and cash equivalents, resulting in R$ 453 million of financial net cash (difference between cash flow and bank loans).

Income tax and social contributionIncome tax and social contribution were adjusted to the new accounting standards, accounting as IT and SC based on temporary differences due to the effects of goodwill amortization in IT and SC expenses calculations. Therefore, the recognized book value was R$ 65.3 million in 2010. Considering the amount of current tax registered, the effective rate was 13.4%.

Net profit and Net profit per share The group acquired R$ 130 million in net profit, 55.5% higher than the fiscal year 2009 amount. This value represents a 14.9% margin in relation to the Net Income, 406 basis points above the previous year.

The net profit per share was R$ 0.99. To make an accurate comparison with the value reported in 2009 (R$0.66), we need to adjust the number of shares, in a way to reflect the Share Capital increase, approved in January 04th, 2010, related

::::

: Gru

po

Fleu

ry 2

010

::::

:

121

to issue and subscription of supplementary allotment of shares. Taking this adjustment into account, the net profit per share value in 2009 was R$ 0.92.

EBITDAEBITDA reached R$ 201.6 million, 12.4% higher than 2009, representing a 23.1% margin of the net revenues.

It is important to highlight that values referred to one-off expenditures incurred in 2010 through integrations, systems unifications, closing down loss-making units, provisions adjustments, fiscal credits and provisions for contingencies reversals represented R$ 6.5 million, which were not used for any type of adjustment in the above mentioned EBITDA calculation.

Added value We distributed R$ 568.4 million as added value

in 2010, compared to R$ 452.6 in the previous year. Added value is a wealth aggregation indicator provided by the company’s activity, and represented by the difference between gross revenues in the year and expenses with material and third party services acquisition plus depreciation & amortization deductions.

The largest share (43.6%) was received by collaborators in the form of salaries, benefits and social security contributions. 21.8% of the total amount was entitled to the government, through taxes, duties and contributions. Investors also earned 11.7% through payment of interests, rentals and other operational expenses. Dividends and interest on equity paid to shareholders accounted for 7.0% and 15.9% referred to retained earnings.

3225

42

84

130

2006 2007 2008 2009 2010

CAGR 42%

net proFit evolution R$ million

95 98

155179

202

2006 2007 2008 2009 2010

CAGR 20.6%

ebitda evolutionR$ million

::::

: Rel

atór

io A

nual

de

Sus

tent

abili

dad

e ::

:::

122

added value stateMent |GRI EC1|

2009 2010

Revenues 812.463 914.364

Sales of goods, products and services 820.439 934.514

Allowance for doubtful accounts (9.613) (21.463)

Other revenues 1.637 1.313

Inputs acquired from third parties (342.844) (369.180)

Cost of products, goods and services sold (266.913) (283.822)

Materials, energy, third party services and others (74.125) (84.438)

Loss/Recovery of Assets (1.806) (920)

Gross Added Value 469.619 545.184

Depreciation, amortization and depletion (30.982) (32.972)

Net Added Value 438.637 512.212

Added Value received in transfers 13.970 56.216

Equity result - -

Financial revenues 13.970 56.216

Total added value 452.607 568.428

Added value distribution (452.607) (568.428)

Personnel and taxes (202.185) (247.755)

Taxes, duties and contributions (96.856) (124.096)

Interest, rental and other operational expenses (69.989) (66.576)

Interest on company’s capital and dividends (44.000) (40.000)

Retained earnings (39.577) (90.001)

::::

: Gru

po

Fleu

ry 2

010

::::

:

123

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

124

Appendices

::::

: Gru

po

Fleu

ry 2

010

::::

:

125

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

126

gri suMMary |GRI 3.12|

ES Essential IndicatorAD Additional Indicator

Level of Information Page / Comment

Strategy & Analysis

1.1 Sustainability Relevance Statement total 16

1.2 Description of main impacts, risk and opportunities partial 20

Organizational Profile

2.1 Name of Organization total 7, 94, 106

2.2 Main brands, products and/or services total 7, 94, 106

2.3 Operational structure total 11, 96,106

2.4 Headquarters location total 10, 86, 94

2.5 Number of countries where the organization operates total 10, 94,106

2.6 Type and legal nature of ownership total 36

2.7 Supplied markets (regions, sectors and clients/beneficiaries types) total 7, 11, 94, 106

2.8 Size of organization total 6, 10, 38, 94, 106

2.9 Main changes during the period covered by the report, related to size, structure or shareholding

total7, 94, 106

2.10 Awards received during the period covered by the report total 114

Report Profile

3.1 Period covered by the report for information disclosure total 22

3.2 Date of the last report total 22

3.3 Reports issue cycle (annual, biennial) total 22

3.4 Contact data total total 27

Report scope and limit not informed

3.5 Content definition process total 25

3.6 Report limit (countries, divisions, subsidiaries, suppliers) partial 24

3.7 Statement on any specific limitation regarding scope or report limit partial 24

3.8 Basis for report elaboration in respect to joint ventures, subsidiaries, etc. partial 24

3.9 Data measurement techniques and calculation bases partial 24

3.10 Consequences of any previous information restatement total 24

3.11 Significant changes compared to previous years’ total 24

3.12 Table to locate information in the report total 126

::::

: Gru

po

Fleu

ry 2

010

::::

:

127

Assessment

3.13 Current policy and practice related to the external assessment search for the report

total24

Governance, commitments and engagement

Governance

4.1 Governance structure total 38, 40

4.2 Referral in case the president of the highest governing body is also a director

total39

4.3 Independent or non-executive members of the highest governing body total 39, 43

4.4Mechanics for recommendations from stakeholders and employees total

total 43

4.5 Relationship between performance and remuneration partial 40, 41

4.6 Process in effect to avoid conflicts of interest total 39

4.7 Process to determine counselors qualifications and knowledge partial partial 40

4.8 Relevant mission & values statements, conduct codes and in-house principles for economic, social and environmental performance, as well as their implementation stage

partial13, 44

4.9 Procedures from the highest governing body to oversee identification and management by part of the organization in respect to economic, social and environmental performance, including relevant risks and opportunities, as well as agreement or compliance with internationally agreed standards, conduct codes and principles

total 39, 43

4.10 Processes for performance self-evaluation of the highest governing body, particularly with regard to unreported economic, social and environmental performance

Commitments with external initiatives

4.11 Unreported precaution principle not informed

4.12 Endorsed or subscribed letters, principles or other external initiatives total 44

4.13 Participations in national/international bodies and/or associations total 47

Stakeholder’s engagement

4.14 List of stakeholders’ groups engaged in the organization partial 25

4.15 Basis for stakeholders’ identification and selection for engagement partial 25

4.16 Approaches to stakeholders’ engagement partial 25

4.17 Main subjects and concerns brought up by the stakeholders’ engagement

partial25

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

128

MANAGEMENT APPROACH Level of information Page / Comment

Economic Performance

Unreported economic performance not informed 15

Market presence partial 10

Unreported indirect economic impacts not informed 14

Environmental Performance

Materials partial 76

Energy partial 76

Water partial 76

Biodiversity partial 76

Emissions, effluents & waste partial 76

Products & services partial 76

Compliance partial 76

Transport partial 76

General partial 76

Labor Practices and Decent Work

Employment total 44

Worker/Governance Relations total 44

Occupational Health & Safety total 53

Training and education partial 57

Diversity and equal opportunities total 57

Equal pay for men and women total 52

Human Rights

Investment practices and purchasing processes total 44

Non-discrimination total 44

Freedom of Association and collective negotiation partial 68

Child labor partial 68

Forced labor or similar to slave labor partial 68

Security practices not informed

Indigenous rights not informed 57

Society

Community partial 88

Corruption partial 45

Public policies partial 47

Dishonest competition not informed 44

Conformity total 44

Responsibility over the product

Client’s health and security total 66

Labeling of products and services total 66

Marketing communications total 66

Client’s privacy total 66

Conformity total 66

::::

: Gru

po

Fleu

ry 2

010

::::

:

129

PERFORMANCE INDICATORS Level of Information Page / Comment

Economic performance

Economic performance

ES EC1 Direct economic value generated and distributed (DVA) partial 122

ES EC2 Financial implications, risks and opportunities of climate changes

not informed -

ES EC3 Coverage of the obligations of the definite benefit pension fund

not informed -

ES EC4 Significant financial support received from the government total 73,92

Market presence

AD EC5 Lower wage compared to the local minimum salary partial 52

ES EC6 Policies, practices and proportion of expenditures with local suppliers

total 67

ES EC7 Procedures for local hiring not informed -

Direct economic impacts

ES EC8 Investments in infrastructure and services in the community not informed 88, 92

AD EC9 Significant indirect economic impacts not informed not informed 88, 89, 90, 91

Environmental performance

Materials

ES EN1 Materials used by weight or volume not informed -

ES EN2 Percentage of materials used originated from recycling not informed -

Energy

ES EN3 Direct energy consumption identified by primary energy source not

not informed -

ES EN4 Indirect energy consumption identified by primary source partial 87

AD EN5 Energy saved as a result of improvements in conservation and efficiency

partial 87

AD EN6 Initiatives to supply products and services with low energy consumption

partial

AD EN7 Initiatives to reduce the consumption of indirect energy and the reductions obtained

partial 87

Water

ES EN8 Total of water withdrawal by source total 87

AD EN9 Water sources significantly affected by water withdrawal not informed -

AD EN10 Percentage and total water volume recycled and reused not informed -

Biodiversity

ES EN11 Location and size of the company area in protected or high diversity areas

total 83

ES EN12 Description of the significant impacts on biodiversity total 83

AD EN13 Habitats protected or restored not informed 83

AD EN14 Management of impacts on biodiversity not informed 83

AD EN15 Number of species in the IUCN Red List and in national conservation lists

not informed 83

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

130

Emissions, effluents and waste

ES EN16 Total de emissões diretas e indiretas de gases de efeito estufa, por peso

total 81

ES EN17 Other relevant indirect emissions of greenhouse gases, by weight

total 81

ES EN18 Initiatives to reduce the emission of greenhouse gases and the reductions obtained

partial 82

ES EN19 Emissions of substances destructive of the ozone layer, by weight

total 81

ES EN20 NOx, SOx and other significant atmospheric emissions, by type and weight

partial 81

ES EN21 Total water discard, by quality and destination not informed

ES EN22 Total waste weight, by type and method of disposition partial 84, 85

ES EN23 Number and total volume of significant overflow not informed -

AD EN24 Weight of the dangerous waste transported, imported, exported or treated

not informed -

AD EN25 Biodiversity of water bodies and habitats affected by water discards and draining

not informed -

Products and services

ES EN26 Initiatives to mitigate the environmental impacts of products and services

partial 80

ES EN27 Percentage of products recovered and its packages not informed -

Conformity

ES EN28 Fines and sanctions for non-conformity with environmental laws and regulations

not informed -

Transportation

AD EN29 Environmental impacts of the transport of products, goods and materials and workers

partially 82, 83

General

AD EN30 Total of investments and expenses in environmental protections, by type

not informed -

Labor practices and decent work

Employment

ES LA1 Workers by type of job, work contract and regiono partial 50

ES LA2 Total number and turnover rate of employees, byage group, gender and region

partial 51

AD LA3 Benefits that are not offered to temporary or part-time employees

total 52

ES LA15 Return to work and the retention rates after paternity or maternity leave, by gender

not informed

Relationships between workers and the governance

ES LA4 Percentage of employees affected by collective negotiation agreements

not informed

ES LA5 Minimum timeframe for notification in advance regarding operational changes

not informed

::::

: Gru

po

Fleu

ry 2

010

::::

:

131

Health and security at work

AD LA6 Percentage of employees represented in formal security and health committees

total 56

ES LA7 Rates of injuries, occupational diseases, days lost, absenteeism and deaths

partial 56

ES LA8 Educational, training, counseling, and risk prevention and control programs

partial 53

AD LA9 Topics related to the security and health covered by formal agreements with unions

not informed -

Training and education

ES LA10 Average of training hours per year, per employee, per functional category

not informed

AD LA11 Programs for competency management and continuous learning, and end of career

partial 57, 58

AD LA12 Percentage of employees that receive regular performance analysis

partial 52

Diversity and equality of opportunities

ES LA13 Responsible by the governance and employees by gender, age group, minorities

partial 50

ES LA14 Proportion of base salaries among men and women, by functional category

partial 52

Human Rights

Practices of investment and buying processes

ES HR1 Investment contracts that include clauses on human rights not informed 67

ES HR2 Suppliers submitted to human rights evaluations partial 68

ES HR3 Training for employees in human rights not informed not informed -

Non-discrimination

ES HR4 Total number of discrimination cases and the actions taken not informed -

Freedom of Association and collective negotiation

ES HR5 Operations with a risk to the freedom of association right not informed -

Child Labor

ES HR6 Operations with a significant risk of child labor not informed -

Forced labor or similar to slave labor

ES HR7 Operations identified with a risk of forced labor or work similar to slave labor

not informed -

Security practices

AD HR8 Security personnel trained in human rights not informed -

Indigenous rights

AD HR9 Total number of cases of indigenous people’s rights violations and actions taken

total 57

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

132

Evaluation

ES HR10 Percentage and total number of operations that have been submitted to human rights revisions and/or impact evaluations

not informed -

Remediation

ES HR11 Number of complaints related to the human rights area, addressed and resolved by means of formal complaint mechanisms

not informed -

Society

Community

ES SO1 Programs and practices to evaluate and manage the impact of the operations in the communities

not informed 89

ES S09 Operations with potential or current significant impacts in local communities

not informed -

ES SO10 Prevention and mitigation procedures implemented in operations with significant current or potential negative impacts in local communities

not informed -

Corruption

ES SO2 Business units submitted to risk evaluations regarding corruption

not informed -

ES SO3 Employees trained in anti-corruption policies and procedures not informed -

ES SO4 Actions taken in response to the cases of corruption not informed -

Public policies

ES SO5 Positions and participation in the development of public policies and lobbies

partial 47

AD SO6 Contributions to political parties, politicians or related institutions

total 47

Dishonest Competition

AD SO7 Legal actions for dishonest competition, trust practices and monopoly

partial 44

Conformity

ES SO8 Fines and sanctions for non-conformity with laws and regulations

not informed -

Responsibility over the product

Client’s health and safety

ES PR1 Phases of the products and services’ lifecycle in which the impacts on health and safety are evaluated

not informed 66

AD PR2 Conformity with regulations and voluntary codes related to health and safety

not informed -

Labeling of products and services

ES PR3 Type of information about products and services required by labeling procedures

not informed -

AD PR4 Cases of non-conformity related to the information and labeling

not informed -

::::

: Gru

po

Fleu

ry 2

010

::::

:

133

AD PR5 Practices related to the client’s satisfaction, including research results

partial 67

Marketing communications

ES PR6 Compliance with the laws, norms and voluntary codes of marketing communications

partial 66, 67

AD PR7 Cases of non-conformity with marketing communications not informed 67

Client’s privacy

AD PR8 Proven complaints related to the violation of the clients’ privacy and loss of data

not informed -

Conformity

ES PR9 Fines for non-conformity in the supply and use of product and services

not informed -

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

134

DNV Assurance Statement SummarySustainability Report Grupo Fleury 2010 printed version in english

1. Context and responsabilidades For the first year, requested by Grupo Fleury, Det Norske Veritas (DNV) has carried out an independent verification of the English version of Grupo Fleury Sustainability Report 2010 (‘the Report’). This Report is intended to its readers and interested parties in the Grupo Fleury sustainability performance. The Board of Grupo Fleury is responsible for all information provided in the Report as well as the processes for collecting, analysing and reporting that information. DNV’s responsibility consists to verify the quality of the information and data supplied in Report 2010, in accordance with the terms and scope established by Grupo Fleury, as well in the preparation of an Assurance Statement summary based upon this verification process. DNV disclaims any liability or responsibility to a third party for decisions, whether investment or otherwise, based upon this Assurance Statement summary.

2. Independence DNV was not involved in the preparation of any statements or data included in the Report, except for this Assurance Statement summary. DNV also declares its independence in relation to the fostering, influences or conflicts of interest associated with the Grupo Fleury or its interested parties.

3. Scope and limits of the verificationThe scope of this verification included information provided in the period of January,1st to December,31th 2010. Based on the scope of work established with Grupo Fleury, the main objectives of this verification were to evaluate and ensure:

• Thelevelofreliabilityassociatedtotheprocessesandtoolstocollectandaggregatethesustainabilitydata;• Processesestablishedtoidentifyingandassessingmaterialsustainabilityissues,inclusionandrespondto

stakeholders’ expectations done by Grupo Fleury, with the objective of preparing the report;• ManagementsystemsandperformancemeasurementofGrupoFleury,focusingonthemanagementof

sustainability issues;• ReportadherencetotheGlobalReportingInitiativeSustainabilityReportingGuidelines,2006(GRIG3),

including a check of the application level declared by Grupo Fleury.

This verification process focused to evaluate and assure information and data about management and performance of Grupo Fleury presented in the Report. DNV’s scope of work did not include an assessment of the adequacy, effectiveness or efficiency of Grupo Fleury or management of sustainability perfomance by Grupo Fleury or any other third parties mentioned in this Report.

4. Aproach and methodologyThis verification was carried out between July and August 2011 by suitably and qualified and experienced professionals, following DNV´s Protocol for Verification of Sustainability Reports. DNV’s Verification Protocol has been developed in accordance with the most widely accepted reporting and assurance standards, including

::::

: Gru

po

Fleu

ry 2

010

::::

:

135

GRI Sustainability Reporting Guidelines, 2006 (GRI G3), GRI Sustainability Reporting Guidelines 3.1, and AccountAbility’s AA1000 Assurance Standard (2008) . This evaluation process includes the following activities:

• VisitstoGrupoFleuryoperationalfacilitiesinSãoPaulo;• Interviewswithmorethan30directors,managersandsupervisorsresponsibleforvariousareasand

processes at the company in Brazil;• Analysisofdevelopmentsinthecompany’scommitments,activitiesandresourcesallocatedtosustainability;• Analysisofpolitics,proceduresandSustainabilityperfomancereports;• Testingofasampleofsustainabilitydataanddatamanagementsystems(forcollection,aggregation,quality

control/assurance and reporting).

5. Conclusion and recomendationsBased on the work undertaken of this verification, DNV has drawn the following main conclusions:

• TheReport2010providesanaccurateandfairrepresentationofthepolicies,strategies,managementsystems, initiatives and projects carried out by Grupo Fleury over the reporting period.

• TheReportmeetsthecontentandqualityrequirementsoftheGRISustainabilityReportingGuidelines(GRI3.1), 2006 (GRI G3), complying with the requirements of the level of implementation C+, declared by Grupo Fleury.

DNV recommends to Grupo Fleury establish actions with the objective to promote the continuous improvement of the Report:

• Establishastructuredprocessofdefinitionofmaterialsissuesforsustainabilitymanagementoftheorganization and define the Report content, associated to stakeholders engagement process about these issues;

• Systematizeprogressivelytheprocessesofcollectionandaggregationofsustainabilitydata,alongwithdatainternal control procedures to promote reliability about reported data;

• CarryoutacomparativeanalysiswithsectordataandwithhistoricalevolutionoftheresultsobtainedbyGrupo Fleury;

• Improveinformationclarity,usingclearandobjectivetechnicalconceptsandimproveEnglishReporttranslation;

• Improveprogressivelycoverageofsustainabilitydata,consideringallregionalbrandsofthegroup,besidesFleury branch in Brazil;

• ContinuousimprovementofReportstructuretoensuresustainabilityinformationbalance,reportingdifficulties faced during in the Report period, as well the main challenge to sustainability management in the next year.

Alexandre Simões Leader Tester

Det Norske Veritas, São Paulo, September 1, 2011.

::::

: Ann

ual S

usta

inab

ility

Rep

ort :

::::

136

CreditsEditorial coordinationMarcelo de Andrade, Rendrik F. Franco e William Malfatti

Text adaptationEditora Contadino

Stakeholder engagement researchIbope

Text revisionKleber Torres Soares Filho e Sergio Auerbach

Graphic designLuciano Morales

DiagrammingLuciano Morales and Solange Mattenhauer Candido

PhotosThe Fleury Group archives, Getty Images

IllustrationsRoberto Weigand

VerificationDNV

PrintBurti

Collaborated in this issue: Afrânio Haag, Alexandre Désio Toscano, Ana Reinert, Antonio Carlos Borba, Augusto Silva Segrégio, Breno Jatobá, Carlos Alberto Iwatta Marinelli, Claudio Laudeauzer, Cristiana Mello Portugal Gomes, Daniel Marques Périgo, Débora Elias Stiebler, Débora Tineo, Fábio Marchiori, Gian Carlo La Barbera, Guilherme Alan Silva Borensztajn, Jeane Tsutsui, João Paulo Reis Faleiros Soares, João Ricardo Kalil Patah, José Carlos Navarro Junior, Paula Montoro Flaith, Renata Lamonica, José Marcelo Amatuzzi de Oliveira, Leandro Esteves Veiga, Letícia Kaori Komesu, Levy Patriani, Lílian Nunes Silva, Líllian Miranda Zanetti, Luciana Spring, Marcello Santos Cunha, Marcia Bueno Rocha, Marcos Bezerra de Menezes Riva, Maria Cláudia Fernandes Neves, Mário Roberto Perines Varela, Mônica Schaper Correa, Marisa Mateus, Omar Magid Hauache, Paulo Pedote, Regina Satomi Ishy, Rildo Caetano, Talita Amorim, Thamires Fray de Barros, Wilson Shcolnik, Rita Braghetti, Rogério Rabelo e Wilson L. Pedreira Jr.