The rating of corporate governance of IDGC of Centre, PJSC was confirmed at NCGR 7+ "Developed practice of corporate governance"

The Russian Institute of Directors once again confirmed the corporate governance rating of IDGC of Centre at NCGR 7+ "Developed practice of corporate governance". During the monitoring experts carried out an analysis of corporate events that occurred in the Company since August 2014, and noted the following positive aspects.

A new edition of the Articles of Association of IDGC of Centre was approved with extended competence of the Board of Directors in their implementation of control over the effectiveness of the Company’s risk management and internal control, as well as functional control over the activities of the internal audit division.

New editions of Regulations governing the activities of management bodies and payment of remuneration to members of the Company’s management bodies were approved. Thus, in accordance with the new edition of the Regulation on payment of remuneration and compensation to members of the Board of Directors of IDGC of Centre it provides for the payment of a fixed annual remuneration, and the participation in meetings of the Board of Directors is not awarded separately.

The Board of Directors approved the Regulation on the Board of Directors’ Audit Committee in a new version with the Committee’s updated and expanded competence.

These innovations meet the requirements of the Listing Rules of ZAO "MICEX Stock Exchange" and the new recommendations of the Russian Code of Corporate Governance and are positively assessed by the rating agency.

At the Annual General Meeting of Shareholders following the results of 2014, June 25, 2015 new members of the Board of Directors were elected – 11 members, two of whom are independent, one is executive and eight are non-executive directors. At the same time, four members of the Board of Directors are representatives of minority shareholders.

The external auditor of the Company was elected on the results of a tender. It was the company "RSM RUS", which occupies the 11th place in the list of the largest audit and consulting groups in Russia following the results of 2014, prepared by the rating agency "Expert RA".

Five persons were elected to the Audit Commission, who are not members of management bodies or employees of the Company, which ensures the objectivity and independence of judgment of that control body.

In addition to the above-mentioned positive points, the practice of corporate governance of IDGC of Centre still has as follows:

• enhanced powers of the Board of Directors of the Company in terms of decision-making on major transactions;
• created positive dividend history: during the last three years dividends were declared and paid within the statutory period;
• existing comprehensive regulation of conflicts of interest of directors and members of executive bodies;
• developed and implemented disclosure policy, providing, in addition to the mandatory disclosure in accordance with the law, the publication of a significant amount of additional information;
• a variety of implemented social projects for its employees and their family members, service users, active participation in charitable and sponsorship activities.

"Improving the corporate governance practices is a key challenge for us, and the high appreciation of the rating agency confirms that the Company is moving in the right direction," stressed Acting Deputy General Director for Corporate Governance Olga Kharchenko. "We will continue developing the transparency policy, improving the quality of IR-activities."

¹The rating was confirmed under the current NCGR methodology, not taking into account the recommendations of the new Russian Code of Corporate Governance and changes in the Listing Rules. After making changes to the NCGR methodology the rating of IDGC of Centre is to be revised.