Risk Management, Compliance and Internal Audit

Risk management

CSN evaluates its strategic, operational, financial and regulatory risks based on methodologies defined by ISO 31000 and the framework of the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The areas and business units are responsible for implementing action plans for the risks, under the supervision of Administration.

Internal Controls

The Company‘s shares are traded on the São Paulo Stock Exchange (BM&FBOVESPA) and on the New York Stock Exchange (NYSE) through Share Deposit Certificates (SDCs), subject to the rules of the established capital market by the Brazilian Securities Commission (CVM), in Brazil, and the Securities and Exchange Commission (SEC), in the United States.

In order to assess and mitigate risks that may impact its financial statements, the Company has an internal control structure that is evaluated and reported to the Audit Committee. This process is performed in accordance with the principles established by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and certified annually by external auditors, in compliance with Sarbanes Oxley Act (SOx).

Compliance

The Company has developed a Compliance Program to regulate the activities carried out by employees or third parties, based on laws, policies and internal rules, seeking to ensure corporate integrity, transparency and ethical conduct.

The Compliance department, reporting to the Board of Directors and the Audit Committee (About Us//Corporate Governance//Corporate Structure), is responsible for promoting compliance of the Group‘s activities regarding the rules issued internally and by regulating bodies. It aims to identify the points of attention and framework and provide the right service to meet market requirements.

The continuous training of employees and monitoring compliance of the Compliance Program are part of this process.

The area has communication channels for reports of misconduct or suspicions. The conduct of complaints, by employees, intermediaries, suppliers, service providers and external public, takes place either anonymously or in an identified manner, maintaining the secrecy, confidentiality and with the guarantee that there will be no retaliations.

The contact details are as follows:

Phone Number: 0800-884-2006
External e-mail: compliance@csn.com.br
Internal e-mail: TIPS CHANNEL
Correspondence:
A/C Diretoria de Riscos e Compliance
Av. Brig. Faria Lima, 3400 - 20º Andar
Itaim Bibi - São Paulo - SP - CEP 04538-132

We also have a channel for questions and further information regarding our compliance policies:

Phone Number: +55 11 3049-7206
Email: compliance@csn.com.br

Internal Audit

CSN has an Internal Audit, an independent body within the organization which advises and reports relevant facts to the Board of Directors, the Audit Committee and the Executive Board. The Internal Audit also analyzes the correct application of resources and prevents risks to the assets of the CSN Group companies, providing support to achieve the planned results, through improvement of internal processes and controls - be it to enchance financial and operational performance of the companies or to prevent risks of losses, fraud and compromising of the corporate image.

Last Update on October 24, 2016

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