| NYSE Corporate Governance Rules for U.S. Companies |
Our Corporate Governance Practices |
| A majority of directors must be independent, as determined by the board. (Section 303A.01 and 02). |
Russian law does not require that a majority of our directors be independent. Of our nine directors, three have been determined by the board to be independent in accordance with the independence standards set forth in Section 303A.02 of the NYSE Listed Company Manual and SEC Rule 10A-3.. |
| Non-management directors must meet at regularly scheduled executive sessions without management. (Section 303A.03). |
Russian law does not contain this requirement. However, our audit committee and remuneration and appointments committee are comprised of our three independent directors, who meet on a regular basis in connection with their work on these committees. |
| Listed companies must have a nominating/corporate governance committee and a compensation committee, each composed entirely of independent directors and having a written charter specifying the committee’s purpose and responsibilities, as well as annual performance evaluation of the committee. (Section 303A.04 and 05). |
We do not currently have a nominating/corporate governance committee. We have a corporate conduct and ethics committee comprised of directors and members of management that is responsible for developing and implementing standards for corporate governance and ethics and making recommendations to the Board of Directors on developing our strategy in the area of corporate governance and ethics. This committee is also responsible for conducting annual performance evaluations of the Board of Directors.
We have a remuneration and appointments committee comprised of three independent directors. This committee functions pursuant to bylaws approved by the Board of Directors specifying the committee’s purpose, duties and responsibilities. The committee is primarily responsible for recommending appointments to key managerial posts, developing a set of requirements and criteria for directors and management executives and developing a remuneration structure and compensation levels for the board of directors, the audit committee and management executives (including the CEO).
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| Listed companies must have an audit committee that satisfies the requirements of Rule 10A-3 under the Exchange Act. (Section 303A.06). |
We comply with this requirement. |
| Audit committee must have a minimum of three members. (Section 303A,07(a)). |
We comply with this requirement. |
| Audit committee must have a written charter specifying the committee’s purpose, an annual performance evaluation and its duties and responsibilities (Section 303A.07(c)), |
We comply with this requirement. |
| Listed companies must have an internal audit function. (Section 303A.07(d)). |
We comply with this requirement. |
| Shareholders must be given the opportunity to vote on all equity compensation plans and material revisions. (Section 303A.08). |
Under Russian law, such approval from shareholders is not required, and our equity compensation plans and material revisions thereto are currently approved by the Board of Directors. |
| Listed companies must adopt and disclose corporate governance guidelines. (Section 303A.09) |
Our corporate governance guidelines are consistent with what is required under Russian law and are set forth in our Charter, in the bylaw of our Board of Directors and in the bylaws of our various committees. |
| Listed companies must adopt and disclose a code of business conduct and ethics for directors, officers and employees, and promptly disclose any waivers of the code for directors or executive officers. (Section 303A.10) |
We have adopted and post on our website a code of business conduct. We have also adopted a code of ethics for senior officers and employees, but only post on our website the code of ethics for senior officers |