Taking social responsibility key to Chinese state power company's success in Brazil

RIO DE JANEIRO - On Avenida Presidente Vargas, one of the most prosperous business streets in Rio de Janeiro, China's State Grid Brazil has become a landmark, thanks to its business success, effective localization and active supports towards local development.

State Grid Corporation of China (SGCC), the Asian country's state-owned electric utilities company and largest power distributor, first entered the Brazilian market via acquisition. It bought 100-percent stakes in 12 local companies, winning a 30-year electricity transmission concession.

Five years after registering in Brazil, the company is now the fourth largest electricity transmission system operator in the South American country. It launched Brazil's first 800 kV ultra-high-voltage (UHV) transmission system in May and won its second UHV project earlier this month.

Localization

"Localization is the key to our development in Brazil," said Cai Hongxian, general manager of State Grid Brazil, adding that the company has around 400 staff and only 34 of them are Chinese.

"We aimed to mix the different cultures ever since we finished the acquisition of the first seven companies," he said.

The company introduced the management structure, human resources practices and financial systems from the Chinese headquarters but established special communication channels so that all employees understand how the company operates and have a sense of belonging.

"We send Brazilian staff to China for communication and training and help them grow with the company," Cai said.

State Grid Brazil attaches great importance to local staff, Cai said. For example, all the 76 employees in a transformer substation in Ribeirao Preto, Sao Paulo State, are Brazilians who are responsible for the operation and maintenance of transmission lines of over 1000 km in south Brazil.

It is a long process to build a corporate cultural melting pot, but so far, localization has helped the company develop efficiently and quickly.

State Grid Brazil is now operating 500 kV transmission lines of 6,000 km, which power the most developed areas including Brasilia, Sao Paulo, and Rio de Janeiro. It has partnered with local companies to build 500 kV transmission lines of 4,000 km.

In 2012 and 2014, State Grid Brazil was twice awarded "The Best Company in Brazil's Electric Power Industry" by Brazil's largest financial newspaper Valor Economico.

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