Appendices
Information on the Company’s Compliance with the Corporate Behavior Code
DATA ON COMPLIANCE BY THE COMPANY WITH THE CORPORATE CONDUCT CODE.
| Provision of the Corporate Conduct Code | Complied or not complied | Note |
|---|---|---|
| General Meeting of Shareholders
| ||
| Notification of shareholders on carrying out of general meeting of shareholders not less than 30 days prior to the date of its carrying out irrespective of the items included in its agenda, unless a larger term stipulated by the laws | Complied | Stipulated by subclause 11.5., subclause 14.7.4, clause 14.7., Article 14, Article 11 of the Company’s Articles of Association |
| Shareholders' opportunity to examine the list of the persons who have the right to participation in general meeting of shareholders, starting from the day of notification on carrying out of general meeting of shareholders and up to closing the internal general meeting of shareholders, and in case of correspondence general meeting of shareholders - up to the date of voting bulletins obtaining termination
| Complied | Complied by the Company in practice according to clause 4 of Section 51 of the Federal Law “On Joint-Stock Companies”.
|
| Shareholders' opportunity to examine the information (data) which is subject to submission at preparation for carrying out of general meeting of shareholders, by means of electronic communication facility, including by means of the Internet | Complied | Stipulated by clause 11.7. of Article 11 of the Company’s Articles of Association;
Clause 4.1. of the Regulations on the Procedure for Preparation and Conducting of the General Meeting of Shareholders of Joint-Stock Company of Energy Industry and Electrification “Lenenergo” |
| Shareholder's opportunity to submit an item to the agenda of general meeting of shareholders or to demand convocation of general meeting of shareholders without giving an extract from the register of shareholders if the account of his rights to shares is carried out in the system of conducting the register of shareholders and in case his rights to shares are considered on the account of deposit, sufficiency of an extract from the account of deposit in order to exercise the above-stated rights | Complied | Stipulated by clause 13.2. of Article 13 of the Company’s Articles of Association. |
| Requirement on obligatory presence of general director, members of the management board, members of the board of directors, members of the internal audit commission and the auditor of the joint-stock company at the general meeting of shareholders, containing in the articles of association or internal documents of the joint-stock company | Complied | According to subclause 5.2.2. of clause 5.2. of the Corporate Governance Code of JSC "Lenenergo", the Company provides presence of the members of the Board of Directors, executive bodies, the Internal Audit Commission and the auditor of the Company at the General Meeting of Shareholders to the extent possible and authorizes them to answer shareholders’ questions.
The Articles of Association and internal documents of the Company do not contain provisions which provide the obligation of their presence at the General Meeting of Shareholders of the Company; however, according to the developed practice the Company General Director, Chairman of the Board of Directors and members of the Board of Directors are present at the General Meetings of Shareholders. |
| Candidates' obligatory presence at consideration of the items on election of members of the board of directors, general director, members of the management board, members of the internal audit commission, as well as the item on approval of the auditor of the joint-stock company at the general meeting of shareholders | Complied partially | The RF laws do not establish the requirement in respect of obligatory presence of the specified candidates at the general meeting of shareholders. A special norm in the Articles of Association is not stipulated. In practice, invitations to the General Meeting of Shareholders are sent to the candidates in the event of consideration of the items on election of members of the Board of Directors, General Director, members of the Management Board, the Internal Audit Commission.
According to subclause 48 of Clause 15.1. of Article 15. of the Company's Articles of Association, definition of the number of members of the Management Board, election of members to the Management Board and early termination of their powers, including decision-making on early termination of the labor agreement concluded with them is included in the competence of the Company’s Board of Directors. |
| Registration procedure of participants of general meeting of shareholder in internal documents of the joint-stock company | Complied | The order of registration of the persons who have the right to participation in general meeting of shareholders is defined by clause 5.1. of the Regulations on the Procedure for Preparation and Conducting of the General Meeting of Shareholders of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”. |
| Board of directors authority for annual approval of the financial and economic plan of the joint-stock company in the articles of association of the joint-stock company | Complied | According to subclause 17, clause 15.1 Article 15 of the Company’s Articles of Association, approval of the business plan (corrected business plan) and the report on results of its performance is referred to the competence of the Board of Directors of the Company. |
| The procedure of risks management approved by board of directors in the joint-stock company | Complied | The resolution of the Board of Directors of JSC "Lenenergo" approved the Risk Management Policy in JSC "Lenenergo" (minutes #22 dated 18.06.2010. The Risk Management Policy in JSC "Lenenergo" determines the main principles of arrangement, implementation of, and control over the risk management processes in JSC "Lenenergo". The specified internal document determines the prime actions of building the risk management system. |
| Provision of the right of the board of directors to make a decision on abeyance of the powers of general director appointed by general meeting of shareholders in the articles of association of the joint-stock company. | Complied partially | According to subclause 41 of clause 15.1. of Article 15 of the Company’s Articles of Association, election of General Director and the prescheduled termination of his powers, including decision on prescheduled termination of the labor agreement concluded with him, are referred to the competence of the Board of Directors of the Company. |
| Provision of the right of the board of directors to establish requirements to professional skill and amount of remuneration of general director, members of management board, heads of the main structural divisions of the joint-stock company by the articles of association of the joint-stock company | Complied partially | Stipulated by subclauses 21.13, 21.14 in Article 21 of the Company’s Articles of Association. |
| Provision by the articles of association of the joint-stock company of the right of the board of directors to approve terms of agreements with general director and members of management board | Complied | According to clause 21.14. of Article 21 of the Company’s Articles of Association, the terms of the labor agreement with general director and members of the Management Board, including with regard to the term of appointment, are defined by the Board of Directors or another person authorized by the Board of Directors for signing the labor agreement. |
| Provision by the articles of association or internal documents of the joint-stock company of the requirement that votes of members of the board of directors, being general director and members of management board, are not taken into account at calculation of votes at approval of agreement terms with general director (managing organization, managing director) and members of the management board | Not complied | The Articles of Association and internal documents of the Company do not contain such requirements. In JSC “Lenenergo” the terms of the labor agreement with General Director and members of the Management Board are determined by the person authorized by the Board of Directors to sign the labor agreement. As a rule, this person is Chairman of the Board of Directors. |
| Presence of at least 3 independent directors who meet requirements of the Corporate Conduct Code, in the structure of the board of directors of the joint-stock company | Complied | The structure of the Board of Directors of the Company includes at least 3 (three) independent directors. |
| Absence in the structure of the board of directors of the joint-stock company of persons who were accused of crimes in the sphere of economic activities or crimes against the government, interests of public service and service in institutions of local government or who experienced administrative punishments for violations of law in the field of the enterprise activity or in the field of the finance, taxes and tax levies, the securities market. | Complied | There are no such persons in the structure of the Board of Directors of the Company |
| Absence in structure of the joint-stock company’s board of directors of persons, being a participant, general director (managing director), member of regulatory body or employee of the legal entity competing with the joint-stock company | Not complied | The members of Board of Directors A.I. Sergeev and M.E. Oseevsky are members of the Board of Directors of JSC "Saint Petersburg Electric Grids"; M.E. Oseevsky is also a member of the Board of Directors of JSC "Petrodvortsovaya Electric Grid"; they compete with JSC "Lenenergo" in the field of transmission and technological connection of subscribers in the territory of Saint Petersburg. |
| Requirement to election of the board of directors by cumulative voting containing in the articles of association of the joint-stock company | Complied | According to clause 16.2 of Article 16 of the Company’s Articles of Association, elections of members of the Board of Directors shall be carried out by the cumulative voting. |
| Provision by internal documents of the joint-stock company of obligation of members of the board of directors to abstain from actions which will lead or are potentially capable to lead to occurrence of the conflict between their interests and interests of the joint-stock company; obligation of disclosing the information on this conflict to the board of directors in case of occurrence of such a conflict | Complied | According to clause 15.3 of Article 15 of the Company's Articles of Association and clause 3.5. of the Regulations on the Procedure for Convocation and Conducting of the Meetings of the Board of Directors of Joint-Stock Company of Energy Industry and Electrification "Lenenergo", when exercising their rights and discharging their duties, the members of the Board of Directors shall act in the interests of the Company, exercise the rights and discharge their duties in respect of the Company honesty and reasonably. |
| Provision by internal documents of the joint-stock company of the board of directors members' duty to notify the board of directors in writing on intention to make transactions with securities of the joint-stock company, if they are members of the board of directors of this JSC, or its subsidiaries (dependent) entities, as well as to disclose the information on the transactions with such securities accomplished by them | Complied partially | The requirements to provision of information on transactions of insiders are contained in clause 4 of the Inside Information Regulation of JSC "Lenenergo".
The information on all transactions of insiders with the securities of the Company and SDEs according to clause 4.4 of the Inside Information Regulation is revealed and supervised by the special division of the Company, which controls inside information. Besides, according to clause 4.2 of the Regulation, insiders are obliged to provide the division controlling the use of inside information with the written declaration on the transactions with securities of the Company and SDEs accomplished for the reporting month no later than on the 3rd day of the month following the reporting month. |
| Provision by the internal documents of joint-stock company of the requirement to carrying out meetings of the board of directors at least every six weeks
| Complied partially | According to clause 18.1 of the Articles of Association of JSC “Lenenergo”, the meetings of the Board of Directors are held as may be needed, but at least every six months. |
| Meetings of the board of directors of the joint-stock company during the year which is object of the annual report of the joint-stock company, are carried out with periodicity of at least every six weeks | Complied | 22 (Twenty two) meetings of the Board of Directors of the Company were carried out in the reporting year.
The meetings of the Board of Directors of the Company are held at least once a month. |
| Provision by the internal documents of the joint-stock company of the order of carrying out meetings of the board of directors | Complied | The order of carrying out the meeting of the Board of Directors is defined by Article 18 of the Articles of Association of the Company and Regulations on the Procedure for Convocation and Conducting of Meetings of the Board of Directors of JSC “Lenenergo”. |
| Provision by internal documents of the joint-stock company of regulations about necessity of approval by the joint-stock company’s board of directors of transactions for the sum of 10 and more percent of the Company asset value, except for the transactions made during every day economic activities | Complied | According to subclause “a” of the subclause 35, clause 15.1. Article 15 of the Company’s Articles of Association, preliminary approval of decisions on fulfillment by the Company of transactions, the subject matter of which is the Company’s current assets exceeding 10 (ten) percent of the book value of the Company’s non-current assets as at the date of taking a decision on accomplishment of such a transaction, is referred to the competence of the Company’s Board of Directors. |
| Provision by internal documents of the joint-stock company of the right of members of the Board of Directors to receive the information from executive bodies and heads of the main structural divisions of the joint-stock company , which is necessary for implementation of their functions, as well as responsibility for failure to provide such information | Complied partially | According to subclause 1 of clause 3.1., clause 3.2. of Article 3 of the Regulations on the Procedure for Convocation and Conducting of the Meetings of the Board of Directors of JSC “Lenenergo”,
The members of the Board of Directors within the limits of the competence of the Board of Directors have the right: to receive the information on activity of the Company, including that making commercial secret of the Company, to examine all constituent, regulatory, accounting, reporting, contractual and other documents of the Company according to the Russian Federation laws and internal documents of the Company; However, no provisions stipulating the responsibility of executive bodies and heads of the main structural divisions for failure to provide the information to the members of the Company’s Board of Directors are contained in the internal documents of the Company. |
| The committee of the board of directors for strategic planning or giving functions of the specified committee to another committee (except for audit committee and personnel and remuneration committee) | Complied | On 15.10.2007 the resolution of the Board of Directors established the Strategy and Development Committee (minutes #8 of the Board of Directors dated 15.10.2007) |
| The committee of the board of directors (audit committee) which recommends the auditor to board of directors of the joint-stock company and cooperates with it and with the internal audit commission of the joint-stock company | Complied | The resolution of the Board of Directors established the Audit Committee of the Board of Directors of Joint-Stock Company of Energy Industry and Electrification “Lenenergo” (minutes #2 dated 27.08.2008)
The task of the Committee is elaboration and submission of recommendations (opinions) to the Board of Directors and executive body of the Company in the field of audit and reporting of the Company. |
| Presence of only independent and non-executive directors in the audit committee | Complied | All members of the Audit Committee of the Board of Directors of Joint-Stock Company of Energy Industry and Electrification “Lenenergo” are independent and non-executive directors. |
| The audit committee management by independent director | Complied | An independent director is Chairman of the Audit Committee of the Board of Directors of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”. |
| Provision by in internal documents of the joint-stock company of access right of all members of the audit committee to any documents and information of the joint-stock company under the condition of nondisclosure of the confidential information by them | Complied | This is stipulated by subclause 2 of clause 4.1. of Article 4 in the Regulations on the Audit Committee of the Board of Directors of joint-stock company of energy industry and electrification "Lenenergo".
According to clause 12.1., Article 12 of the Regulations on the Audit Committee of the Board of Directors of joint-stock company of energy industry and electrification "Lenenergo", during the period of discharge of duties of members of the Committee, and within one year after the termination of the term of appointment in the Committee, the persons, who are (were) members of the Committee, Secretary of the Committee and third parties involved in the Committee are obliged to observe the requirements of confidentiality in respect of the non-public information received by them in connection with their activity in the Committee. |
| Creation of a committee of the board of directors (the personnel and remuneration committee), the function of which is definition of criteria of candidates choosing for members to board of directors and development of the joint-stock company policy in the field of remuneration | Complied | The resolution of the Board of Directors (minutes 2 dated 27.08.2008) established the Personnel and Remuneration Committee of the Board of Directors of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”.
The task of the Committee is elaboration of the principles and criteria of definition of the remuneration for the members of the Board of Directors, members of the Management Board and General Director of the Companies. |
| The personnel and remuneration committee management by independent director | Complied
| An independent director is Chairman of the Personnel and Remuneration Committee of the Board of Directors of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”. |
| Absence of officials of the joint-stock company in the structure of personnel and remuneration committee | Complied | The Personnel and Remuneration Committee of the Board of Directors of Joint-Stock Company of Energy Industry and Electrification “Lenenergo” does not include officials of the Company. The Committee is represented by the members of the Company’s Board of Directors only. |
| Creation of risks committee of the board of directors or giving functions of the specified committee to another committee (except for the audit committee and the personnel and remuneration committee) | Not complied | Directors was not created in the Company. The functions in respect of risks are not laid on other committees. |
| Creation of corporate conflicts settlement committee of the board of directors or giving functions of the specified committee to another committee (except for the audit committee and the personnel and remuneration committee) | Not complied | The corporate conflicts settlement committee of the Board of Directors was not created in the Company |
| Absence of the joint-stock company officials in the structure of corporate conflicts settlement
| Not complied | The corporate conflicts settlement committee of the Board of Directors was not created in the Company |
| Management by corporate conflicts settlement committee performed by an independent director | Not complied | The corporate conflicts settlement committee of the Board of Directors was not created in the Company |
| Internal documents of the joint-stock company providing the order of formation and work of the board of directors committees approved by board of directors | Complied | The Company’s Board of Directors approved the following regulations:
|
| Provision by the articles of association of the joint-stock company of the order of definition of quorum of the board of directors, allowing to provide obligatory participation of independent directors in meetings of board of directors | Not complied | According to clause 18.9 of the Company’s Articles of Association and clause 7.3. of Article 17 of the Regulations on the Procedure for Convocation and Conducting of the Meeting of the Board of Directors of JSC “Lenenergo”, the quorum for conducting a meeting of the Board of Directors is at least a half of the number of the elected members of the Company’s Board of Directors. |
| Executive Bodies | ||
| The joint executive body (management board) of the joint-stock company | Complied | Clause 9.1., Article 9, Article 21 of the Company’s Articles of Association provides for the presence of the joint executive body – the Management Board |
| Provision by the articles of association or internal documents of the joint-stock company of the regulations about necessity of approval of transactions with the real estate, obtaining of credits by the joint-stock company, if the specified transactions are not referred to large transactions and their fulfillment is not referred to usual economic activities of the joint-stock company | Complied | According to subclause 8, clause 21.6, Article 21 of the Company's Articles of Association, the issues of approval of these transactions may be submitted for consideration of the Management Board by the Company General Director.
According to subclause 7, clause 21.6, Article 21 of the Articles of Association, the competence of the Management Board includes decision-making on accomplishment of transactions, the subject matter of which is the property, works and services valued from 5 to 25 percent of the Company book value determined as at the date of decision-making on accomplishment of the transaction. |
| Coordination procedure of operations in internal documents of the joint-stock company which are beyond the financial and economic plan of the joint-stock company | Complied | The Board of Directors and Management Board consider issues on completion of the operations which are beyond the financial and economic plan, since they are subject to inclusion in undated business plans and cash flow plans, which are considered by the Company's Board of Directors and Management Board accordingly. The Company applies the documents regulating the process of business planning and cash flow management. |
| Absence in structure of executive bodies of persons, being participant, general director (managing director), member of managing body or employee of the legal entity competing with the joint-stock company | Complied | General Director and members of the Management Board of the Company are not members of the management bodies or employee of the legal entity competing with the Company. |
| Absence of persons in the structure of executive bodies of the joint-stock company who were found guilty in fulfillment of crimes in the sphere of economic activities or crimes against the government, interests of public service and service in institutions of local government, or who experienced administrative punishments for violations in the field of enterprise activity or in the field of the finance, taxes and tax levies, the securities market. If functions of the sole executive body are carried out by managing organization or managing director, conformity of general director and members of board of the managing organization or managing director to the requirements made to general director and members of management board of the joint-stock company | Complied | General Director and members of the Management Board of the Company were not found guilty in fulfillment of crimes in the sphere of economic activities or crimes against the government, interests of public service and service in institutions of local government; they did not experience administrative punishments for violations in the field of enterprise activity or in the field of the finance, taxes and tax levies, the securities market. |
| Provision by the articles of association or internal documents of the joint-stock company of the prohibition for the managing organization (managing director) to carry out similar functions in the competing company, as well as to be in any other property relations with the joint-stock company, besides rendering services of the managing organization (managing director) | Not complied | The articles of association and internal documents of the Company do not contain the given requirements to the Managing Organization, or to the managing company. |
| Provision by internal documents of the joint-stock company of executive bodies of the duties to abstain from actions which will lead or are potentially capable to lead to occurrence of the conflict between their interests and interests of the joint-stock company, and duties to inform board of directors on this in case of such conflict occurrence | Not complied | The internal documents of the Company do not provide for such duties for General Director and members of the Management Board of the Company.
However, according to clause 22.21., clause 21.23 of Article 21 of the Company’s Articles of Association: General Director, Acting General Director, members of the Management Board, as well as the managing organization (managing director) at implementation of the rights and discharge of duties should act proceeding from the interests of the Company, exercise their rights and discharge their duties concerning the Company honesty and reasonably. General Director, members of the Management Board, as well as the managing organization (managing director) bear responsibility to the Company for the losses, caused to the Company by their guilty activities (omission), unless other bases and amount of the responsibility established by the federal laws. |
| Provision in the articles of association or internal documents of the joint-stock company of criteria for election of the managing organization (managing director) | Complied | Criteria for election of the managing organization (managing director) are defined in Article 10 of the Regulations on the Procedure for Convocation and Conducting of the Meetings of the Board of Directors of JSC “Lenenergo”. |
| The joint-stock company executive bodies' presentation of monthly reports on their work to board of directors | Complied partially | The Company’s Articles of Association and internal documents do not contain the specified requirements to the Company’s executive bodies.
However, General Director’s reports on implementation of the orders of the Board of Directors in the reporting quarter containing the information on the Company are quarterly submitted to the Company’s Board of Directors. |
| Determination of the responsibility for infringements of provisions about the use of confidential and service information stated in the agreements concluded by the joint-stock company with general director (managing organization, managing director) and members of the managing board | Complied | According to clause 21.23 of Article 21 of the Company’s Articles of Association, General Director, Acting General Director, and managing organization (managing director) bear responsibility to the Company for the losses, caused to the Company by their guilty activities (omission) unless other bases and the amount of the responsibility established by the federal laws.
According to clause 5.1. of Article 5 of the Inside Information Regulation of JSC "Lenenergo", illegal distribution and (or) use of the inside information may lead to the Company insiders’ calling to disciplinary liability and (or) civil liability according to conditions of the agreements with the Company and the current laws; to administrative and criminal liability in conformity with the current laws. These provisions are also included in the labor agreement concluded with General Director of the Company. |
| Secretary of the Company | ||
| Presence of special official (secretary of the company) in the joint-stock company whose task is maintenance of observance by bodies and officials of the joint-stock company of the procedural requirements guaranteeing implementation of the rights and legitimate interests of the company shareholders | Complied | The Corporate Secretary was elected in the Company with a view of appropriate observance in the Company of the order of preparation and conducting of the general meeting of shareholders, the activity of the Board of Directors of the Company |
| The order of appointment (election) of the secretary of the company and duties of the secretary of the company stipulated by the articles of association or internal documents of the joint-stock company | Complied | Clause 20.1, clause 20.5 of Article 20 of the Company’s Articles of Association, Article 3 of the Regulation on the Company Corporate Secretary, Article 4 of the Regulations on the Procedure for Convocation and Conducting of the Meetings of the Board of Directors of JSC "Lenenergo". |
| Requirements to a candidate of the company secretary stipulated in the articles of association of the joint-stock company | Not complied | The Articles of Association do not define requirements to a candidate for the Corporate Secretary. |
| Essential Corporate Actions | ||
| Requirement to approval of the large transaction before its fulfillment in the articles of association or internal documents of the joint-stock company | Complied | According to subclause 23 of clause 15.1 of Article 15 of the Company’s Articles of Association, the competence of the Board of Directors includes the issue of approval of large transactions in the events stipulated by Section X of the Federal Law “On Joint-Stock Companies” |
| Obligatory involving of the independent appraiser for estimation of the market value of the property which is a subject matter of the large transaction | Complied | According to subclause 37 of clause 15.1 of Article 15 of the Company's Articles of Association, the competence of the Board of Directors includes the issue of approval of the candidate of the independent appraiser (appraisers) for definition of the value of the shares, property and other assets of the Company in the cases stipulated by the Federal Law "On Joint-Stock Companies", these Articles of Association, and separate resolutions of the Board of Directors. |
| Presence in the joint-stock company’s articles of association of the interdiction for taking any measures in the event of purchase of large share holdings of the joint-stock company (absorption), which are aimed to protect the interests of executive bodies (members of these bodies) and members of the board of directors of the joint-stock company, as well as measures worsening shareholders' position in comparison with the existing position (in particular, the interdiction for taking the decision by the board of directors before termination of prospective term of purchase, which concerns issue of additional shares, issue of the securities convertible into shares, or the securities giving the right to purchase shares of the Company even if the right of such decision-making is given to it by the articles of association) | Not complied | This interdiction is not stipulated in the Company’s Articles of Association |
| Requirement in the articles of association of the joint-stock company to obligatory involvement of an independent appraiser for estimation of the current market value of shares and possible changes of their market value as a result of absorption | Complied | This requirement is not stipulated in the Company’s Articles of Association. It is exercised by the Company in practice in accordance with the requirements of the Federal Laws “On Joint-Stock Company” |
| Absence in the joint-stock company’s articles of association of the purchaser’s release from the duty of proposing to shareholders to sell ordinary shares of the Company belonging to them (the equity securities convertible into ordinary shares) at absorption | Complied | This provision is not stipulated in the Company’s Articles of Association |
| Presence in the articles of association or internal documents of the joint-stock company of the requirement to obligatory involvement of an independent appraiser for definition of shares converting ratio at reorganization | Not complied | This requirement is not stipulated in the Company’s Articles of Association. It is exercised by the Company in practice in accordance with the requirements of the Federal Laws “On Joint-Stock Company” |
| Information Disclosure | ||
| Presence of the internal document approved by the board of directors which defines rules and approaches of the joint-stock company to information disclosure (Information Policy Regulation) | Complied | The Board of Directors of the Company approved the Information Policy Regulation of Joint-Stock Company of Energy Industry and Electrification “Lenenergo” (Minutes No. 6 dated 9.12.2008). |
| Presence in internal documents of the joint-stock company of the requirement to information disclosure on the purposes of shares placement, on persons who are going to purchase the placed shares, including a large share holding, and on the fact whether the top officials of the joint-stock company will participate in purchase of placed shares of the company | Complied partially | This requirement is not fixed in the internal documents of the Company. However, according to the Federal Law “On Joint-Stock Companies” and the issuance standards this information is subject to obligatory inclusion in the Resolution on Issuance of Securities and the securities prospectus. |
| Presence of the list of the information, documents and data in internal documents of the joint-stock company which should be given to shareholders for solution of the issues submitted to the general meeting of shareholders | Not complied | The provision of the Company’s Articles of Association does not contain this list of the information.
The list of the information, documents and data which should be given to shareholders for solution of the issues submitted to the general meeting of shareholders is defined and approved by the Company’s Board of Directors. The specified information according to clause 11.7. of the Company’s Articles of Association within 20 (twenty) days, and in case of carrying out the General Meeting of Shareholders, the agenda of which contains an issue on reorganization of the Company, within 30 (thirty) days before conduction of the General Meeting of Shareholders, shall be available for the persons entitled to participation in the General Meeting of Shareholders, for examination in the executive body of the Company and other places, the addresses of which are specified in the statement on conducting of the General Meeting of Shareholders. The information (data) concerning the agenda of the General Meeting of Shareholders is placed on the website of the Company in the Internet no later than 10 (ten) days before the date of conducting of the General Meeting of Shareholders. |
| Presence of the joint-stock company website in the Internet and regular disclosure of information on the joint-stock company on this website | Complied | The address of the website of the Company in the Internet: www.lenenergo.ru
The information on the Company is subject to placing on the Company website in the Internet according to clause 11.5., 11.7. Article 11 of the Company’s Articles of Association, clause 5.1.2, 5.2.2. of the Information Policy Regulation of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”. |
| Presence in internal documents of the joint-stock company of the requirement to disclose the information on transactions of the joint-stock company concluded with the persons referred according to the articles of association to the top officials of the joint-stock company, as well as on transactions of the joint-stock company concluded with the organizations, in which the top officials of the joint-stock company directly or indirectly own 20 and more percent of the authorized capital of the joint-stock company or which may be essentially influenced by such persons. | Complied partially | The internal documents of the Company do not provide for this requirement.
However, the company discloses the information on holders of the Company's shares exceeding 1% in the annual reports of the Company. The information whether the members of the management bodies own the Company's shares is disclosed on a quarterly basis in the list of affiliates and in the annual report of the Company. |
| Presence in internal documents of the joint-stock company of the requirement to disclose the information on all transactions which may influence the market value of the joint-stock company shares | Complied | Subclause 4.3.7, clause 4.3., Article 4 of the Information Policy Regulation of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”. |
| Presence of the internal document approved by board of directors on use of the essential information on activity of the joint-stock company, shares and other securities of the company and transactions with them, which is not available to all and disclosure of which may essentially influence the market value of shares and other securities of the joint-stock company. | Complied | The Inside Information Regulation approved by the resolution of the Board of Directors is applied in the Company (minutes 13 dated 28.02.2006). |
| Control over Financial and Economic Activity of the Company | ||
| Presence of the procedures of the internal control over financial and economic activity of the joint-stock company approved by the board of directors | Complied | The Regulations on the Internal Control Procedures of JSC “Lenenergo” are effective in the Company. They were approved by the Company’s Board of Directors on 9.12.2008 (Minutes #6 dated 9.12.2008).
In conformity with Article 22 of the Company’s Articles of Association, the control over financial and economic activity of the Company is performed by the Internal Audit Commission of the Company and the auditor of the Company. |
| Presence of a special division of the joint-stock company providing observance of procedures of the internal control (the control-and-inspection service) | Complied | The Company established the Internal Control and Audit Department, which acts on the basis of the Regulations on the Internal Control Procedures of JSC “Lenenergo” approved by the Company’s Board of Directors on 9.12.2008.
(Minutes #6 dated 9.12.2008). |
| Requirement to definition of structure and membership of control-and-inspection service of the joint-stock company by the board of directors stipulated in internal documents of the joint-stock company | Not complied | The Articles of Association and internal documents of the Company do not contain these requirements. |
| Absence in the structure of control-and-inspection service of persons who were found guilty in commitment of crimes in the sphere of economic activity or crimes against the government, interests of public service and service in institutions of local government, or who experienced administrative punishments for infringements in the field of enterprise activity or in the field of the finance, taxes and tax levies, the securities market | Complied | The employees of the Internal Control and Audit Department were not found guilty in commitment of crimes in the sphere of economic activity or crimes against the government, interests of public service and service in institutions of local government; they did not experience administrative punishments for infringements in the field of enterprise activity or in the field of the finance, taxes and tax levies, the securities market |
| Absence in structure of the control-and-inspection service of the persons who are part of executive bodies of the joint-stock company, and the persons who are participants, general director (managing director), members of managing bodies or employees of the legal entity competing to the joint-stock company | Complied | The Internal Control and Audit Department was established in the Company. Its employees meet these requirements. |
| Presence in internal documents of the joint-stock company of the term of submission of documents and data to control-and-inspection service for estimation of the financial and economic operation held, and responsibility of officials and employees of the joint-stock company for their failure to submit them within the specified term | Complied partially | According to subclause 6.1.2., clause 6.1., Article 6 of the Regulation on the Internal Control Procedures of Joint-Stock Company of Energy Industry and Electrification "Lenenergo", submission of necessary documents for holding inspections is performed by the heads of the Company's divisions, branches and representative offices within a 3 (three-day) period based on the inquiries of the Internal Control and Audit Department.
According to the annual/quarter action plan, the Company General Director (the person authorized by him) publishes the order in respect of the Company on holding an inspection by the Internal Control and Audit Department prior to the beginning of the planned inspection. As a rule, the time limits for provision of the necessary information are established by the Order. |
| Presence in the internal documents of the joint-stock company of the duty of the control-and-inspection service to inform the audit committee on the revealed infringements, and in case of its absence, presence of the duty to inform the board of directors of the joint-stock company on it | Complied | Clause 6.1.4., clause 6.1., Article 6 of the Internal Control Procedures Regulation |
| Presence in the joint-stock company’s articles of association of the requirement to preliminary estimation by the control-and-inspection service of expediency of fulfillment of the operations which are not stipulated by the financial and economic plan of the joint-stock company (non-standard operations) | Not complied | The Articles of Association of the Company do not contain these requirements |
| Presence in the joint-stock company’s internal documents of the order of coordination of a non-standard operation with the board of directors | Not complied | The Articles of Association and internal documents of the Company do not stipulate this order |
| Presence of the internal document approved by the board of directors defining the order of carrying out inspection of financial and economic activity of the joint-stock company by the internal audit commission | Complied | The Company applies the Regulations on the Internal Audit Commission of Joint-Stock Company of Energy Industry and Electrification “Lenenergo” (approved by the annual General Meeting of Shareholders of JSC “Lenenergo” – minutes #1 dated 23 May 2002). |
| Implementation of the auditor opinion assessment by the audit committee before its presentation to shareholders at the general meeting of shareholders | Complied | Clause 10.7, Article 10 of the Regulation on the Audit Committee of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”. |
| Dividends | ||
| Presence of the internal document approved by the board of directors, which the board of directors is guided by at taking recommendations about the amount of dividends (Dividend Policy Regulation) | Complied | The Company applies the Dividend Policy Regulation of Joint-Stock Company of Energy Industry and Electrification “Lenenergo” (approved by the resolution of the Board of Directors JSC “Lenenergo” – minutes #4 dated 31 August 2010). |
| Presence in the Dividend Policy Regulation of the order of definition of the minimum net profit share of the joint-stock company assigned for dividends payment, and conditions of non-payment or incomplete payment of dividends per the preference shares, the amount of dividends per which is defined in the articles of association of the joint-stock company | Complied | According to clause 5.7. of Article 5 of the Dividend Policy Regulation of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”, the total amount paid as the dividend per each preferred share is determined equal to 10 (ten) percent of the Company net profit based on the results of the last financial year determined pro rata to the number of the sold preferred shares of type "A". According to subclause 3.5. of Article 3 of the Dividend Policy Regulation of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”, the Company is not entitled to make a decision (to declare) on payment of dividends per the preferred shares of a certain type (in case of their placement), the amount of the dividend per which is determined by the company's articles of association, if the decision on full payment of dividends (including, on full payment of all accumulated dividends per cumulative preferred shares) on all types of preferred shares giving advantage in the priority of obtaining dividends before the preferred shares of this type (in case of placement of such shares) is not taken. |
| Publication of the data about the dividend policy of the joint-stock company and changes made to it in the periodical edition stipulated by the articles of association of the joint-stock company for publication of statements on holding the general meetings of shareholders, as well as placement of the specified data on the website of the joint-stock company in the Internet | Complied | The Company applies the Dividend Policy Regulation of Joint-Stock Company of Energy Industry and Electrification “Lenenergo”. This regulation is published on the website of the Joint-Stock Company in the Internet.
At the same time, the information of the dividends paid by the Company and the procedure for their payment is placed in the annual report, quarterly reports and on the website of the Company. |