RCS - PJSC Inter RAO UES - Results of the Board of Directors Meeting

INTER RAO Lietuva ABAnnouncement

28/05/2021 16:15

RNS Number : 2507A
  
PJSC Inter RAO UES
  
28 May 2021
  
 

Results of the Board of Directors meeting of Inter RAO
Moscow , May 28, 2021 - Public Joint Stock Company "Inter RAO UES" ("Inter RAO", "Company", ticker on MOEX: IRAO), the largest diversified utilities holding in Russia, announces the results of the Board of Directors meeting of Inter RAO ("Board of Directors") held on May 28, 2021 by absentee voting.
The Board of Directors considered and adopted the following resolutions:
1.   Elect Igor Sechin, Chief Executive Officer, Chairman of the Management Board, Deputy Chairman of the Board of Directors of Rosneft as Chairman of the Board of Directors of Inter RAO.
2.   Elect Dmitry Shugaev, Director of the Federal Service for Military-Technical Cooperation as Deputy Chairman of the Board of Directors of Inter RAO.
3. Elect Elena Sapozhnikova, Partner of Digital Horizon Ventures LLC, as Senior Independent Director.
4.   Elect Alexey Sergeev, Head of Corporate Events, Corporate Relations and Antitust Compliance Department, as Secretary of the Board of Directors of Inter RAO.
5. The Board of Directors, having considered the preliminary assessment of candidates to members of the Board of Directors of PJSC Inter RAO, carried out by the Nominations and Remuneration Committee of the Board of Directors of the Company dated March 31, 2021 (minutes dated March 31, 2021 No. 134) and dated May 18, 2021 (minutes dated May 18, 2021 No. 137), as well as the declarations of independence provided to the Board of Directors by the candidates Andrey Bugrov, Ron Pollett, Alexander Lokshin, Boris Ayuev, has adopted the following resolution.
5.1. To recognize Andrey Bugrov as an independent director, despite the fact that he has formal criteria of affiliation with PJSC Inter RAO (clause 104 of the Corporate Governance Code recommended for use by the Bank of Russia; subparagraph 7 of clause 4 of Appendix No. 4 to the Listing Rules of PJSC Moscow Exchange, hereinafter, the "Listing Rules") due to the following circumstances:
According to the results of the assessment of Andrey Bugrov on compliance with the independence criteria, the Board of Directors does not have information that the specified member of the Board of Directors is a person related to:
- a substantial shareholder of PJSC Inter RAO;
- a substantial counterparty of PJSC Inter RAO;
- a competitor of PJSC Inter RAO;
- the state authorities.
Andrey Bugrov may be considered a person related to the issuer, since after 05/25/2021 he has held the position of a member of the Board of Directors of PJSC Inter RAO for more than 7 (seven) years in aggregate, but less than 12 (twelve) years (in accordance with paragraph 8 of clause 4 of Appendix No. 4 to the Listing Rules).
However, the Board of Directors notes the following:
(1) Andrey Bugrov is a member of the Board of Directors and a member of the Nominations and Remunerations Committee and the Audit and Sustainable Development Committee of the Board of Directors of PJSC Inter RAO.
This member of the Board of Directors actively participates in the work of the Board of Directors and all the above Committees of the Board of Directors, studies the materials in detail and participates in the discussion of agenda items, proposes alternative draft decisions and formulates instructions to management for a more thorough study of matters falling within the competence of the Board of Directors and its committees.
Andrey Bugrov actively attends in-person meetings of the Board of Directors and its committees, as well as meetings of independent directors held both in person and remotely, including to discuss significant corporate actions and assess the activities of the Board of Directors.
(2) Andrey Bugrov is a recognized specialist in the field of corporate governance, sustainable development (ESG) and non-financial reporting, is a member of departmental, exchange and regulatory advisory and advisory bodies (committees, expert councils) in these areas and makes a significant contribution to improving the Company's activities, particularly, in the said areas.
In addition, this member of the Board of Directors has received awards from the professional community in the categories "Independent Director" and "For his contribution to the development of the institution of independent directors", which testifies to the recognition of his contribution to the development of corporate governance among representatives of the professional community, as well as his ability to form an independent expert position based on his professional experience and knowledge.
(3) The long-term membership of A.E. Bugrov in the Board of Directors of PJSC Inter RAO has had a positive effect on the Company's activities, since this director is well aware of the Company's business processes and the history of issues submitted for consideration, including instructions to the Company's management.
Based on the foregoing, the Board of Directors believes that the relationship of A.E. Bugrov with the issuer (PJSC Inter RAO) is purely formal and does not affect the independence of A.E. Bugrov's position on the agenda of the Board of Directors of PJSC Inter RAO, on the ability to make objective and fair judgments, independent of the influence of the executive bodies of the Company, individual groups of shareholders, competitors, counterparties of the Company and the state authorities.
5.2. To recognize Ronald (Ron) James Pollett as an independent director, despite the fact that he has formal criteria of affiliation with PJSC Inter RAO (clause 104 of the Corporate Governance Code recommended for use by the Bank of Russia; subparagraph 7 of clause 4 of Appendix No. 4 to the Listing Rules of PJSC Moscow Exchange, hereinafter, the "Listing Rules") due to the following circumstances:
Based on the results of the assessment of R.D. Pollett's compliance with the independence criteria, the Board of Directors does not have information that the specified member of the Board of Directors is a person related to:
- a substantial shareholder of PJSC Inter RAO;
- a substantial counterparty of PJSC Inter RAO;
- a competitor of PJSC Inter RAO;
- the state authorities.
R. J. Pollett may be considered a person related to the issuer, since he has held the position of a member of the Board of Directors of PJSC Inter RAO for more than 7 (seven) years in aggregate, but less than 12 (twelve) years (in accordance with paragraph 8 of clause 4 of Appendix No. 4 to the Listing Rules).
At the same time, the Board of Directors takes into account the following factors previously noted by the Board of Directors:
(1) Ron Pollett is a member of the Board of Directors, a member of the Nominations and Remunerations Committee and the Audit and Sustainable Development Committee and a member of the Strategy and Investment Committee of the Board of Directors of PJSC Inter RAO.
This member of the Board of Directors takes an active part in the work of the Board of Directors and all the Committees as well, studies the materials carefully and participates in discussions on agenda items, formulates proposals as a part of the evaluation of the Board of Directors, proposes alternative draft resolutions and drafts instructions to management for more detailed study of matters falling within the competence of the Board of Directors and its Committees.
The Board of Directors notes Mr. Pollet's high level of attendance of meetings of the Board of Directors and its committees.
 (2) Mr. Pollett's long term in the Board of Directors of PJSC Inter RAO has had a positive effect on the activities of the Board of Directors and its Committees, as this member of the Board of Directors is deeply involved in the Company's business processes and the history of the matters submitted for consideration by the Company's management bodies.
 (3) Mr. Pollett holds the position of Chairman of GE in Russia and the CIS and has many years of professional experience as Vice President of General Electric (GE), a large international company whose securities are included in the quotation lists of foreign trade organizers in the securities market, and his knowledge and international experience in strategic planning, risk management, personnel management, auditing and best corporate governance practices contribute to the formation of resolutions and instructions of the Board of Directors to management.
(4). This member of the Board of Directors has an impeccable reputation among the professional community, including investors, which testifies to his ability to form a balanced independent position based on his knowledge and expert judgments. Furthermore, Mr. Pollett finds time for interacting with the investment community, including sustainable development issues (ESG).
Based on the foregoing, the Board of Directors believes that the relationship of Ron Pollett with the issuer (PJSC Inter RAO) is purely formal and does not affect the independence of Mr. Pollett in forming his position on the agenda of the Board of Directors of PJSC Inter RAO, the ability to make objective and conscientious judgments, independent of the influence of the executive bodies of the Company, individual groups of shareholders, competitors, counterparties of the Company and the state authorities.
5.3. To recognize Alexander Lokshin as an independent director, despite the fact that he has formal criteria of affiliation with PJSC Inter RAO (subparagraph 7 of clause 4 of Appendix No. 4 to the Listing Rules), with the state authorities (subparagraph 4 of clause 7 of Appendix No. 4 to the Listing Rules) (up to 10/25/2021) [1], as well as with a significant shareholder (subparagraph 3 of clause 5 of Appendix No. 4 to the Listing Rules) due to the following circumstances:
Based on the results of the assessment of A.M. Lokshin's compliance with the independence criteria, the Board of Directors does not have information that the specified member of the Board of Directors is a person related to:
- A substantial counterparty of PJSC Inter RAO;
- a competitor of PJSC Inter RAO.
At the same time, the Board of Directors takes into account the following factors, which were repeatedly noted by the Board of Directors earlier:
(1) The long‑term work of Alexander Lokshin on the Board of Directors of the Company is his advantage, as this member of the Board of Directors has the required professional competences in the area of electric power, electric power building and an extensive knowledge of the business of the Company and Inter RAO Group.
(2) Alexander Lokshin has expert knowledge of the business processes of PJSC Inter RAO and has taken active part in the work of the Audit and Sustainable Development Committee of the Board of Directors.
(3) In practice, no instances of Alexander Lokshin lobbying management positions were noted. The abovementioned member of the Board of Directors always expresses an objective and considered opinion at the meetings of the Board of Directors.
The above factors allow Alexander Lokshin fully and comprehensively consider the issues included in the agenda of meetings of the Board of Directors, and present his expert opinion on them. 
In view of the above, the Board of Directors finds it possible to consider the relationship with the issuer (PJSC Inter RAO) a formal non-compliance with the independence criteria.
Alexander Lokshin is a member of the Management Board and the First Deputy CEO for Operations Management of State Atomic Energy Corporation Rosatom.
In this regard, according to Clause 7 of Appendix No. 4 to the Listing Rules, A. M. Lokshin can be considered a person associated with the state authorities.
Taking into account that Alexander. Lokshin is a member of the Board of Directors of PJSC Inter RAO, a company which has over 20 percent of the statutory funds and voting shares indirectly controlled by the Russian Federation, and that Alexander Lokshin is a Board member of Rosatom State Corporation, President of JSC IC ASE, as well as a member of the Board of Directors of JSC Atomredmetzoloto, JSC Rosenergoatom Concern, i.e. companies subordinated to State Atomic Energy Corporation Rosatom which, in turn, is subordinated to the Russian Federation (due to the fact that its CEO is appointed and dismissed by the President of the Russian Federation upon the suggestion of the Chairman of the Government of the Russian Federation as prescribed by Article 26 of Federal Law No. 317-FZ dated December 1, 2007, "On State Atomic Energy Corporation Rosatom"), Alexander  Lokshin is a member of the Board of directors in more than two legal entities subordinated to the entity (the Russian Federation) which controls the issuer's significant shareholder and, therefore, there is a formal connection of Alexander Lokshin with the Company's significant shareholder (the Russian Federation) along with an affiliation with the state authorities.
At the same time, the Board of Directors shall take into account the following factors:
(i) In real-life terms, when preparing his position on issues from the agenda, A.M. Lokshin votes relying on his professional expertise and knowledge only, the nominee's position on all of the agenda issues is articulated individually, based on the expert judgements of this member of the Board of Directors and is independent.
 (ii) This member of the Board of Directors has not been nominated for election to the Board of Directors of PJSC Inter RAO by the Russian Federation, a constituent entity of the Russian Federation or a municipal formation and does not vote relying on written instructions.
(iii) Alexander Lokshin, while voting on the issues submitted under the instructions, prepared by the Russian Federation, expressed an opinion on a number of issues different from the position in the instructions.
(iv) Having analyzed the work of Alexander Lokshin in the Board of Directors of PJSC Inter RAO, regardless of the formal affiliation with the state authorities and the significant shareholder, this member of the Board of Directors does not take decisions in the interests of any significant shareholder and the state authorities (the Russian Federation) but in favor of the interests of PJSC Inter RAO and all of its interests; this Director's position aims at protecting the interests of the Company, its shareholders and investors.
(v) In this case, two independence criteria overlap and are interconnected: affiliation with a significant shareholder (the Russian Federation) and the state authorities (the Russian Federation); however, according to the Listing Rules of Moscow Exchange, the state is recognized as a significant shareholder only through the position held in the executive body and the Board of Directors by affiliates of Rosatom State Corporation that are not in a Group with PJSC Inter RAO as prescribed by Federal Law No. 135-FZ dated July 26, 2006 "On the Protection of Competition."
Furthermore, Alexander Lokshin was nominated to the Board of Directors of JSC Rosenergoatom Concern by Rosatom State Corporation, and to the Board of Directors of JSC Atomredmetzoloto by the entity subordinated to Rosatom State Corporation which controls (directly or indirectly) both companies and is controlled by the state authorities.
Considering the above, since the affiliation of Alexander Lokshin with the state authorities and the significant shareholder is an affiliation with the same entity (the Russian Federation), the additional basis for affiliation through the significant shareholder is formal in nature and does not affect the independent status of this nominee.
Moreover, A. M. Lokshin has no affiliation with any other significant shareholder of PJSC Inter RAO.
Considering the above, the association of Alexander Lokshin with the issuer (PJSC Inter RAO), with a substantial shareholder (the Russian Federation) and with the state authorities (the Russian Federation) is formal and does not affect the independence of Alexander Lokshin in forming his position on the agenda of the Board of Directors of PJSC Inter RAO, on the ability to make objective and fair judgments, independent of the influence of the executive bodies of the Company, individual groups of shareholders, competitors, counterparties of the Company and the state authorities.
5.4. To recognize Boris Ayuev an independent director, despite the fact that he has formal criteria for being associated with the state authorities (subparagraph 4 of clause 7 of Appendix No. 4 to the Listing Rules), in view of the following circumstances:
The Board of Directors notes that according to the results of the conformity assessment of Boris Ayuev's independence criteria, it does not have information that the member of the Board of Directors is a person related to:
- the issuer;
- a substantial shareholder of PJSC Inter RAO;
- a substantial counterparty of PJSC Inter RAO;
- a competitor of PJSC Inter RAO.
As on April 05, 2021 Boris Ayuev terminated his powers as the Chairman of the Management Board of Joint Stock Company "System Operator of the Unified Energy System" (hereinafter. the JSC SO UES), as well as due to his withdrawal from the Board of Directors of JSC SO UES on April 28, 2021, the actual association of B.I. Ayuev with the state authorities (the Russian Federation) and a substantial shareholder of the Company (through membership in the Board of Directors of more than two legal entities controlled by the person controlling the substantial shareholder of the Company - the Russian Federation) no longer appears.
The Board of Directors takes into account that Boris Ayuev by formal reasons can be considered a person associated with the state authorities, as defined in clause 107 of the Code, and in subparagraph 4 of clause 7 of Appendix No. 4 to the Listing Rules, since within 1 year preceding his election to the Board of Directors of PJSC Inter RAO,  Boris Ayuev was the sole executive body of the organization controlled by the Russian Federation.
However, the Board of Directors notes the following:
 (1)  Boris Ayuev has many years of professional experience in the field of power engineering and is a recognized specialist in this area, has state awards, including the medal "For Merit in the Development of the Fuel and Energy Complex" of the Ist degree, in addition, Boris Ayuev was awarded the title of "Honorary Worker of the Fuel and Energy Complex", which evidences the recognition of his contribution to the development of the industry by the professional community and the deep knowledge in this area.
(2) Boris Ayuev actively participates in meetings of the Board of Directors, including those held in person, ensures a high level of examination of materials for meetings of the Board of Directors of the Company.
(3) Besides, Boris Ayuev is a Doctor of Engineering Science, has competence in the field of digitalization, is a member of the Association of Digital Development Organizations of the Digital Energy Industry and can make a significant contribution to improvement of the activities of PJSC Inter RAO and, in particular, the work of the Board of Directors and its Committees, particularly, in the specified areas.
 (4) Since at the date of this resolution Boris Ayuev has no labor relations with JSC SO UES and is not a member of the Board of Directors of the company, was not nominated by the state authorities to the Board of Directors of PJSC Inter RAO, and also does not vote on the agenda of the Board of Directors in accordance with the directive of the Russian Federation, the constituent entity of the Russian Federation or a municipality, his association with the state authorities is formal.
Based on the foregoing, the Board of Directors believes that the affiliation of Boris Ayuev with the state authorities is purely formal and does not affect the independence of Boris Ayuev when forming his position on the agenda of the Board of Directors of PJSC Inter RAO, on the ability to make objective and fair judgments, independent of the influence of the executive bodies of the Company, individual groups of shareholders, competitors, counterparties of the Company and the state authorities. .
5.5. To determine that as of the date of adopting this resolution the members of the Board of Directors of PJSC Inter RAO Vladimir Milovidov  and Elena  Sapozhnikova fully comply with the independence criteria established by the Listing Rules of PJSC Moscow Exchange.
 [1] For the purposes of determination of independence of the elected member of the Board of Directors, the elected member of the Board of Directors who held the position of a member of the Board of Directors from seven to twelve years in aggregate may not be deemed a person affiliated with the issuer, in case of adoption of the respective resolution by the Board of Directors.
6.1.1. To determine the composition of the Audit and Sustainable Development Committee of the Board of Directors of PJSC Inter RAO consisting of 5 (five) people and elect the following persons thereto:



1.


Boris Ayuyev
(Independent Director)


Member of the Board of Directors of PJSC Inter RAO




2.


Andrey Bugrov
(Independent Director)


Member of the Management Board, Senior Vice President for Sustainable Development of PJSC "Mining and Metallurgical Company Norilsk Nickel"




3.


Vladimir Milovidov
(Independent Director)


Head of the Department of International Finance of the Moscow State Institute of International Relations, Ministry of Foreign Affairs of Russia




4.


Ronald (Ron) James Pollett (Independent Director)


Chairman of GE in Russia and the CIS




5.


Elena Sapozhnikova  (Independent Director)


Partner of Digital Horizon Ventures LLC



6.1.2. To elect Andrey Evgenievich Bugrov as Chairman of the Audit and Sustainable Development Committee of the Board of Directors of PJSC Inter RAO.
 
6.2.1. To determine the composition of the Nominations and Remuneration Committee of the Board of Directors of PJSC Inter RAO consisting of 5 (five) people and elect the following persons thereto:



1.


Boris Ayuyev
(Independent Director)


Member of the Board of Directors of PJSC Inter RAO




2.


Andrey Bugrov  (Independent Director)


Member of the Management Board, Vice President of PJSC "Mining and Metallurgical Company Norilsk Nickel"




3.


Vladimir Milovidov
(Independent Director)


Head of the Department of International Finance of the Moscow State Institute of International Relations, Ministry of Foreign Affairs of Russia




4.


Elena Sapozhnikova
(Independent Director)


Partner of Digital Horizon Ventures LLC




5.


Ronald (Ron) James Pollett (Independent Director)


Chairman of GE in Russia and the CIS



6.2.2. Taking into account clause 3.8 of the Regulations on the Board of Directors of PJSC Inter RAO, to elect Elena Vladimirovna Sapozhnikova as the Chair of the Nominations and Remuneration Committee of the Board of Directors of PJSC Inter RAO.
 
6.3.1. To determine the composition of the Strategy and Investment Committee of the Board of Directors of PJSC Inter RAO consisting of 11 (eleven) people and elect the following candidates thereto:



1.


Viktor Khmarin


Chairman of the Management Board, General Director of RusHydro PJSC




2.


Andrey Marchenko


Partner of SINAI Capital




3.


Vladimir Milovidov
(Independent Director)


Head of the Department of International Finance of the Moscow State Institute of International Relations, Ministry of Foreign Affairs of Russia




4.


Еvgeniy Miroshnichenko 


Member of the Management Board, Head of the Financial and Economic Center of PJSC Inter RAO




5.


Aleksey Molskiy


Deputy General Director for Investments, Capital Construction and Sales of Services of PJSC FGC UES, Member of the Management Board, Deputy General Director for Investments, Capital Construction and Sales of Services of PJSC Rosseti




6.


Vasiliy Nikonov


Director of the Energy Department of Rosneft Oil Company PJSC




7.


Sergey Nikitin


Deputy CEO, Head of the Corporate Control Department of Leader CJSC




8.


Fedor  Opadchiy


Chairman of the Management Board of JSC SO UES




9.


Ronald (Ron) James Pollett (Independent Director)


Chairman of GE in Russia and the CIS




10.


Elena Sapozhnikova
(Independent Director)


Partner of Digital Horizon Ventures LLC




11.


Pavel Snikkars


Deputy Minister of Energy of the Russian Federation



6.3.2. To elect Viktor Viktorovich Khmarin as the Chairman of the Strategy and Investments Committee of the Board of Directors of PJSC Inter RAO
 
The foregoing information is disclosed in compliance with the Securities Act of the Russian Federation.
 
For further information, please contact Inter RAO:
Larisa Sadovnikova                Head of Investor Relations                +7 495 664-88-40 (ext. 2068)
sadovnikova_lv@interrao.ru
Nikolay Gorelov                      Press Secretary                                  +7 495 664-88-40 (ext. 2010)
gorelov_nv@interrao.ru
Svetlana Sidelnikova               Head of Corporate Relations and Antitrust Compliance           
+7 495 664-88-40 (ext.2081)                                                            chuchaeva_sy@interrao.ru 
 
Inter RAO is a diversified energy holding, serving various segments of Russian and international electric power industry. The Group is the leading exporter and importer of electricity in Russia, actively increasing electricity generation and sales, and developing new lines of business. Inter RAO Group owns and operates approximately 31.1 GW of installed power generation capacity. Its share of Russian retail electricity and capacity market is over 18%.
For further information see www.interrao.ru
 

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