Corporate Governance Policies and Procedures Compendium

Corporate governance aims to facilitate the creation of an environment of trust, transparency and accountability, which in turn promotes and fosters long-term investment, financial stability and business integrity, ultimately contributing to stronger growth and the development of more inclusive societies. The commitment to ethical behavior in strategy, operations and corporate culture should govern the foundations of corporate governance and Board leadership, since, in the globalized and interconnected world, investors and/or creditors, as well as other stakeholders, view environmental, social and governance aspects of companies as an integral part of their long-term performance and sustainability.  Aguas Andinas S.A. is an environmental services company, respectful of its surroundings, which sees in integrated water management an opportunity to build a sustainable and friendly city for those who live and develop in it. This approach requires providing quality services, sustainably managed and closely linked to the current needs of citizens, seeking a better future for all and assuming a high commitment to the delivery of a continuous, safe and quality service to all its customers. Considering that sustainability practices may have a material impact on the performance of securities issuers and on investors' decisions Within the framework of the above, the provisions of General Rule No. 461 issued by the Financial Market Commission, whose provisions modify the content of the Annual Report of issuers of publicly traded securities, incorporating sustainability and corporate governance issues comprehensively in such reports, and finally the Corporate Governance Principles of the G20 and the OECD, the Board of Directors of Aguas Andinas S. Andinas S. A. (hereinafter indistinct, hereinafter referred to as "Aguas Andinas S. A.") (hereinafter referred to as "Aguas Andinas S. A." or "Aguas Andinas S. Andinas S. A."), has adopted the following principles of corporate governance A. (hereinafter, indistinctly, "Aguas Andinas", the "Company", the "Company" or the "Company"), has approved a series of policies and adopted other agreements in such matters.

This Compendium takes into consideration the best corporate governance practices, international experience and the latest regulatory reforms in this area. Thus, in Board meetings held on November 25, 2015 and May 25, 2022, various policies have been agreed and progressively incorporated to generate a successful company, led by an "effective and enterprising Board of Directors, whose main role is to promote the long-term sustainable success of the Company, generating value for shareholders and contributing to society in general". 3 These policies and guidelines are set out in the following section of this instrument. In order to facilitate the understanding of the Compendium, its structure is presented following the numbering or order resolved in the ordinary meeting of the Board of Directors No. 529, dated May 25, 2022 mentioned above, as well as the guidelines set forth in the General Rule No. 461 of the Financial Market Commission, published in the Official Gazette on November 12, 2021.

The Company has a formal procedure of continuous improvement to detect and implement eventual improvements or areas of strengthening in its organization and operation, considering the advice of an expert. In this sense, the Board of Directors decided to maintain the evaluation process, also considering its committees, in order to guarantee and evaluate the good functioning of its corporate governance and detect those aspects in which its members can be strengthened and continue to improve, carried out on a biennial basis. 3 FINANCIAL REPORTING COUNCIL. UK Corporate Governance Code. 2018. P.7. 5 Likewise, the aforementioned evaluation process, together with the Board Nomination Policy, allows detecting and reducing organizational, social or cultural barriers and identifying and reducing obstacles that prevent the natural diversity of skills, visions, characteristics and conditions of the members of the Board of Directors. For the implementation of this policy, the Chief Executive Officer shall submit at least two proposals in this regard, prepared by external advisors with accredited experience in this area, among which the Board will decide with whom to carry out the evaluation. In this way, the Chief Executive Officer of the Company is responsible for managing this practice, and must also propose in the Board's calendar of activities the dates defined for this purpose. The consultant will deliver a report of his work with the conclusions obtained, which will be made available to the Board of Directors, who in turn will manage the report in a reserved manner.

The Company contemplates annual training for the members of the Board of Directors. This, considering as part of the matters contemplated in such training, at least the following: (i) Best corporate governance practices that have been adopted by other entities at local and international level; (ii) Main advances that have occurred in the last year at local and international level in terms of inclusion, diversity and sustainability reports; (iii) Main risk management tools, including sustainability risks, that have been implemented in the last year at local and international level; (iv) Most relevant rulings, sanctions or pronouncements that have occurred in the last year at local and international level related to the duties of care, reserve, loyalty, diligence and information; and, (v) Review of examples of situations that constitute a conflict of interest in the Board of Directors and ways in which such conflicts of interest can be avoided or resolved in the best social interest. (vi) Any other matter that is considered relevant and of interest. The matters on which training activities have been carried out for the Board of Directors in the last year will be included in the Annual Report in order to make them known to the shareholders and the general public. The Secretary of the Board of Directors is responsible for coordinating the annual training process, and shall agree with the Chairman of the Board of Directors the dates and subjects on which the meetings referred to in these practices will be held, and shall propose in the Board's calendar of activities the dates defined for such purposes, as well as the specific subjects and the speakers in charge of them.

Aguas Andinas understands and recognizes that proper induction of new Directors - meaning those elected at the Annual Shareholders' Meeting or, failing that, those appointed by the Board of Directors - is a practice that allows effective and informed integration into the corporate business and a tool for new members to make an effective contribution to the functions of the Board of Directors. Thus, the Company adopts as a practice that, each time there is a renewal of the Board or of one of its members, during the first weeks after taking office, the Chief Executive Officer and/or the other managers shall make one or more presentations aimed at informing the new incoming Director(s) about the Company, its business, risks, policies, procedures, main accounting criteria and the most relevant legal framework applicable to the Company and its Board of Directors. This induction process shall be led by the Secretary of the Board of Directors. For the implementation of the foregoing, the Chief Executive Officer shall provide the new Director with at least the information indicated below within 15 working days of his or her acceptance of his or her appointment. The above, by means of a physical or virtual folder, and/or through access to the Board's Dropbox, as the case may be.

Subject	Information to be delivered
Subject Matter Information to be delivered (i) Businesses, matters and risks, including sustainability risks considered most relevant and the reasons why, in the opinion of the Board of Directors, they have this status.	Integrated Report. Copy of the minutes of the Board of Directors meeting that approves the Integrated Report. Bylaws and powers of attorney. Code of Ethics. General Habituality Policy. Crime Prevention Model. Relevant aspects regarding sustainability. Code of Conduct of the Board of Directors regarding Conflicts of Interest. Manual for Handling Information of Interest to the Market. Information related to Risk Management and Administration. Rules of Order, Hygiene and Safety.
(ii) Relevant stakeholders identified by the entity and the reasons why, in the opinion of the Board of Directors, they have this status. Also, the main mechanisms used to know their expectations and maintain a stable relationship with them.
(iii) Mission, vision, strategic objectives, principles and values that should guide the actions of the company, its Directors and personnel, and risk management policies approved by the Board of Directors.	12. Política de Igualdad de Género y Conciliación de la Vida Laboral, Familiar y Personal. 13. Política de Nominación de Candidatos al Directorio. 14. Política de Derechos Humanos. 15. Política de Diversidad e Inclusión. 16. Política Anticorrupción. 17.Procedimiento de Interacción con Funcionarios Públicos y Lobby.
(iv) The most relevant current legal framework applicable to the entity, the Board of Directors and its senior executives.	18. Law No. 18,045 - Securities Market Law. 19. Law No. 18.046 - Corporations Law. 20. Regulation of the Corporations Law. 21. Law No. 20.393 - Law that establishes the Criminal Responsibility of Legal Entities. 22. CMF-NCG 270: Publicity of policies and procedures relating to the acquisition or disposal of securities of the entity and the handling and disclosure of information to the market. CMF-NCG 314: Sending legal, economic and financial information through the Internet (SEIL System).
(v) Duties of care, confidentiality, loyalty, diligence and information that, in accordance with current legislation, are incumbent upon each member of the Board of Directors, with examples of the most relevant rulings, sanctions or pronouncements that have occurred in the last year in relation to these duties at the local level.	24. Legal report with conceptual explanation of the Director's fiduciary duties towards stakeholders, and their representation in the current legislation. 25. Summaries of recent relevant cases.
(vi)Main resolutions adopted in the 2 years prior to the beginning of its term of office and the reasons that were taken into consideration to adopt such resolutions.	Copy of minutes of ordinary and extraordinary meetings of the Board of Directors corresponding to the last two years.
(vii)The most relevant items of the quarterly and annual financial statements for the last year together with their respective explanatory notes, as well as the accounting criteria applied in the preparation of such financial statements. 8 the accounting criteria applied in the preparation of such financial statements.	27. Delivery of Accounting and Internal Audit report in this regard.
(viii) What in the opinion of the Board of Directors is a conflict of interest and how in its opinion, or in accordance with the Code or Manual established for this purpose, and without prejudice to those conflicts of interest expressly addressed by law, situations in which one of them may arise should be dealt with.	28. Copy of the Board of Directors' Code of Conduct regarding Conflicts of Interest.

Policy: At the Board meeting held on November 25, 2015, the Board of Directors agreed to conduct at least two visits to different Company facilities during each year.

In view of the consequences of the Pandemic, this measure may be carried out remotely, and as long as there are no extraordinary circumstances that make its suspension necessary.

The purpose of the visits shall be to ascertain

 

The state and operation of these dependencies and facilities.
The main functions and concerns of those who work in them.
The recommendations and improvements that, in the opinion of those responsible for these units and facilities, should be made to improve their operation.
 

Procedure: For the implementation of this agreement, at the same meeting the Board of Directors agreed to approve the following procedure:

 

Introduction.
 

This document establishes the manner in which the aforementioned visits shall be carried out.

 

Purpose.
 

To allow the Board of Directors to have direct and close contact with both the operation of the business and with the workers and persons in charge of these tasks in the different offices and facilities of the Company.

 

Development.
 

The Board of Directors shall visit, on a biannual basis, the different facilities and installations of the Company, according to the recommendation and proposal made by the Chief Executive Officer, considering the most relevant works and installations.



The visits shall consider, in addition to the inspection of the works that allow to know their status and operation, meetings with those who work in these facilities, allowing direct contact with the members of the Board in order to know their opinion and concerns.

4. Responsible for the practice.

 

The General Manager of the Company is responsible for coordinating at least two visits to different facilities and installations of the Company, and must propose in the calendar of activities of the Board of Directors the dates defined for such purposes.

The Board of Directors shall agree on a biennial basis to carry out an evaluation of the same, with the purpose of detecting and implementing improvements in its organization and operation. For this purpose, the Chief Executive Officer shall submit at least two proposals in this regard, prepared by external advisors with accredited experience in the matter, among which the Board of Directors shall decide with whom to carry out the evaluation. The advisor shall submit a report on his work, with the conclusions obtained, which shall be made available to the Board of Directors, which shall manage the report in a confidential manner.

a. In relation to background information to be discussed by the Board of Directors. The Chairman of the Board of Directors, at least 3 to 5 days prior to the respective meeting, shall send by e-mail to the directors the table of the matters to be discussed at the meeting and the other background information to be presented, necessary to prepare for the meeting. It shall be the responsibility of the Chief Executive Officer to collect and make the aforementioned information available to the Chairman, with due anticipation to enable him to make it available to the directors in the terms indicated.

b. Regarding the minutes of the Board of Directors' meeting. Once the corresponding Board meeting has concluded and at least 2 days prior to the following meeting, the Secretary of the Board of Directors shall make available to the directors a draft of the minutes of the respective meeting for comments by sending them by e-mail, and the directors shall send their comments to the Secretary of the Board of Directors by the same means.

a. General considerations. Any natural person who is a free administrator of its assets and who is not included in any of the cases expressly indicated in Articles No. 35 and 36 of Law No. 18,046 may be elected as a director of the Company. In order to be an independent director, the conditions set forth in Article 50 bis of Law No. 18,046 must also be met.

b. Application process. Those who wish to promote the nomination of any person to occupy a position as a director or wish to apply directly, may submit to the Chief Executive Officer of the Company their personal background or that of the person they propose, by delivering it to the Company's main offices, Av. Presidente Balmaceda 1398, Santiago, attaching the information they wish to be presented to the public through the Company's web page. For this purpose, it is proposed that applicants submit at least the following information: - Curriculum Vitae with summary with studies and experiences and professional profile; e - Inform whether they maintain or have maintained in the last 18 months contractual, commercial or other relationships with the Company's controller, or its main competitors or suppliers, understanding "controller" in the terms defined in Article 97 of Law No. 18,045 of the Securities Market Law. The Company shall not be responsible for verifying the veracity of the information provided to it, but shall limit itself to receiving it and making it available to the shareholders through its website.

c. Making information available. The Chief Executive Officer shall make available to the shareholders, at least 2 business days prior to the Meeting, all documents and information that have been delivered to the Company regarding the director candidates up to that date. The background information received from each director candidate who has so requested shall be posted on the Company's website.

Annually, during the first half of each year, the Board of Directors shall meet with the person in charge of Social Responsibility and Sustainable Development, and a sustainability report shall be presented and submitted to the Board of Directors for approval, prepared based on the Principles and Standards for Reporting and Disclosure of the Global Reporting Initiative, or similar instrument. The report shall consider the policies adopted by the company regarding social responsibility and sustainable development, the stakeholders identified by the company as relevant, as well as the reasons why such stakeholders have this status, the relevant risks, including sustainability risks, of the company, as well as the main sources of such risks. In addition, the Board of Directors shall analyze annually with the person in charge of Social Responsibility and Sustainable Development, in accordance with the provisions of Section 1.g) NCG No. 461, the following matters:

a. The effectiveness of the policies approved by the Board of Directors to disseminate within the organization, its shareholders and the general public the benefits of diversity and inclusion for society.

b. Organizational, social or cultural barriers detected that may be inhibiting the natural diversity that would have occurred in the absence of these barriers.

c. The usefulness and acceptance of the sustainability reports disseminated to relevant stakeholders in society.

This procedure considers the review of all disclosures of information to the market made by the Company. The Board of Directors shall annually evaluate the sufficiency, timeliness and relevance of the various communications that the company has sent to the market in the last year, in order to analyze possible improvements that could be made in the process of sending information from the company to the general public, both in relation to their ease of understanding, as well as that such communications are provided to the market in a timely manner. The Board of Directors may request additional or complementary information from the Chief Executive Officer and shall analyze whether the information was disclosed in a sufficient, timely and pertinent manner, taking into special consideration whether (i) the Company was requested to complement such information; (ii) whether the complementation was made and what it referred to; (iii) the number of organizations that communicated with the Company; and (iv) the nature of the communications received. The Board of Directors, at its December meeting of each year, shall review the information received in this regard, and shall decide on its content and, if it deems it necessary, propose measures to improve the form, timeliness and relevance of the information communicated by the Company. It shall be the responsibility of the Board of Directors to define the mechanisms to improve the Company's information provided to the general public, if necessary.

Annually, each management will make a survey of its main risks and propose the actions to be implemented for their mitigation, which must be implemented by such management and their compliance must be accredited at the request of the internal auditors. The General Management will in turn determine which of these risks are the most relevant, with respect to which a more exhaustive follow-up should be carried out, documenting the evidence that will allow a posteriori evaluation of compliance with the committed actions. 24 The risk quantification, monitoring and communication process should consider both the entity's direct risks and those of its subsidiaries. The principles, guidelines and national and international recommendations developed by "The Committee of Sponsorship Organizations", COSO or other of similar characteristics should be used as a guide. The Board of Directors shall be informed of these matters at least once a year, in the last quarter of each year. In addition, the Board of Directors shall analyze annually with the risk management unit, in accordance with the provisions of Section 1.e) NCG No. 461, the following matters:

a. The adequate functioning of the risk management process.

b. The risk matrix used by the unit as well as the main sources of risks and methodologies for the detection of new risks and the probability and impact of the occurrence of the most relevant risks.

c. The recommendations and improvements that, in the unit's opinion, should be made to better manage the entity's risks. d. The contingency plans designed to react to the risks. The contingency plans designed to react to the materialization of critical events, including the continuity of the Board of Directors in crisis situations. Likewise, and in accordance with Section 1.f) NCG 461, the Board of Directors shall meet annually with the internal audit unit to analyze:

a. The annual audit program or plan.

b. Any serious deficiencies that may have been detected and those irregularities that by their nature should be reported to the competent auditing bodies or to the Public Prosecutor's Office.

c. Recommendations and improvements that, in the opinion of the unit, should be made to minimize the occurrence of irregularities or fraud. Regarding the crime prevention model implemented in the Company, and in accordance with the same section mentioned above, the Board of Directors will meet every six months with the person in charge of prevention, to review the implementation of the Crime Prevention Model, to see in detail the events occurred, the complaints received and the investigations carried out, as well as the preventive measures and plans implemented in the fulfillment of its mission; a practice that has been carried out since the implementation of the Model.

The Company will make available to its employees on the intranet site a complaints channel, which will be managed by an external company that guarantees seriousness, confidentiality and proper handling of such complaints. This company is currently Fundación Generación Empresarial.

En caso de ausencia definitiva del Gerente General, el Directorio podrá contratar los servicios de una empresa de head hunter u otra empresa que preste servicios similares, u optar por la contratación directa del reemplazante, debiendo considerar en forma especial la idoneidad técnica, el nivel educacional, la experiencia y/o cualquier otro factor relevante respecto de la persona que suplirá la vacancia. En caso de ausencia definitiva de algún ejecutivo principal, el Gerente General deberá procurar la pronta contratación de un reemplazante, siguiendo los criterios antes señalados. En la medida que sea posible, se procurará que todo gerente o ejecutivo principal que deje su cargo entregue un informe de todos los asuntos pendientes que estaban a su cuidado, indicando el estado de cada uno, los riesgos asociados, las personas que estén trabajando en el asunto y los pasos futuros recomendados. En el caso del Gerente General lo entregará al Presidente del Directorio, y en el caso de los ejecutivos principales al Gerente General. 

In view of the above, compensation policies for managers and senior executives should not only include goals achieved considering the company's EBITDA and net income, but also the fulfillment of individual objectives defined by senior management, related, for example, to compliance with the assigned budget, accident rate indicators, prevention of occupational accidents and customer service indicators, among others.

The policies and procedures contained in this Compendium are in effect.effective as of March 2023