To further improve Corporate Governance practices, the Fiscal Council became permanent and took on the responsibilities of an Audit Committee to ensure that all the appropriate controls were in place. Internal controls and procedures for disclosing information to the market were also charted and a Disclosure Committee was formed.

VCP's governance structure is as follows:

Board of Directors - The Board of Directors consists of five members, including a chairman and a vice-chairman, elected at shareholder's meetings by shareholders who hold common shares. The Board of Directors is responsible for implementing strategic plans, electing the company's Executive Board and monitoring its performance and activities. It has a two-year mandate and may be reelected. The current Board was elected in April, 2005. The Chief Executive Officer is a member of the Board of Directors, but the Board's chairman position is held by another member. Other than the current CEO of the company, the Board is composed by members of the family who control the Votorantim Group and hold 100% of the common shares. For this reason, there are no independent members on the Board. The Board met ten times during 2005, in 3 ordinary and 7 extraordinary meetings. The directors are not compensated for their activities.

Fiscal Council/Audit Committee - This body is composed of 3 members: a representative of minority shareholders, a specialist in Brazilian accounting standards (BRGAAP) and a specialist in American accounting standards (USGAAP). Meetings are held on a monthly basis. The mandate is for one year with the possibility of reelection during shareholders' meetings. Compensation for members is also decided during shareholders' meetings. Other than its legal responsibilities, the Council is responsible for recommending and dismissing independent auditors as well as evaluating independent and internal auditing. Furthermore, the Council provides opinions on financial statements, management policy, risk management, disagreements between management and the independent auditors regarding financial statements and reports. It monitors the company's compliance to legal and regulatory requirements on financial and accounting matters, expressing opinions on complaints and allegations directed at the company, and recommending appropriate responses.

Executive Board - The Executive Board is composed of a chairman and six directors (Pulp, Paper, Forestry, Technical and Growth, Finance and Investor Relations, and Human and Organization Development). The members are elected by the Board of Directors for a one-year mandate with the possibility of re-election. It is responsible for the daily activities of the business.

Disclosure Committee - The committee is responsible for disclosure of important company information, ensuring the broad distribution and high quality of information disclosed to the market. The committee also oversees disclosure procedures and controls. It is formed by representatives from the following departments: Investor Relations, Accounting, Legal, Finance, Communication and Strategic Planning. VCP has a disclosure policy for important facts and a code of conduct to be followed by all employees with access to privileged information. It also has established restrictions on trading during certain time periods.

Cold Review - Final review conducted by professionals unrelated to the reports preparation - which gives the report greater detail. The following take part in the "Cold Review": Fiscal Council, Risk Management, internal and external auditors.

Investment Committee - The committee's mission is to evaluate the company's portfolio of projects on a quarterly basis. The projects are divided into the following categories: Growth, Modernization, Maintenance and Hygiene, Security, Environment and Social. The committee is formed by the Executive Board, the Investment Management department, general managers and accounting. Its fundamental goal is to examine capital allocation within the Grupo Votorantim's business activities so corporate objectives and goals may be reached in terms of strategy, growth and rate of return for the portfolio.

Independent Auditing - VCP's relationship with independent auditors follows principles of independence. In order to eliminate the possibility of conflict of interests, this policy establishes that the auditor may not audit his own projects, and must not take on a management role nor advocate for the client. The outside auditing company is chosen by the Board of Directors with input from the Fiscal Council/Audit Committee. PricewaterhouseCoopers will continue providing independent auditing services for VCP until the fiscal year of 2006, when its five year rotation period for independent auditors ends.