- Federal Grid Company – Ten-year results
- Operations overview
- Social responsibility and sustainable development
- Financial performance overview
- Corporate governance report
- Share capital
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APPENDICES
- Information on compliance with the FCSM corporate code of conduct
- Implementation of the assignments of the president and the government of the Russian Federation
- Information on transactions performed by JSC Federal Grid Company in 2012, recognized by russian federation laws as interested party transactions, and which are subject to the approval of the company’s authorized management body
- Audit Commission Conclusion on the Audit of Operational and Financial Activities of Federal Grid Company for 2012
- 2013 investor calendar
Management Bodies’ Remuneration
The Company does not offer remuneration to persons in respect to whom Russian legislation restricts or prohibits the receipt of any payments from commercial organizations.
The Board of Directors
The payment of remuneration to members of the Board of Directors is based on Regulations on Remuneration and Compensation Payments to members of the Board of Directors of JSC Federal Grid Company, as approved by the Annual General Meeting of Shareholders on 29 June 2012 (Meeting Minutes #12 as of 7 July 2012).
The amount of remuneration to each member of the Board of Directors for his/her contribution to the operations of the Board of Directors is calculated given the total number of Board of Directors meetings held during the previous corporate year, the number of Board of Directors meetings attended by the member and corporate revenues for the respective fiscal year. Remuneration for the Chairman of the Board of Directors is increased 30%. Compensation for expenses to members of the Board of Directors is not provided. Allowances are also set for members of the Board for their work in Committees: the Chairman of the Committee receives a 20% bonus, and a Committee member receives 10%.
The total remuneration for each member of the Board of Directors, given all premiums, cannot exceed RUR900 thousand.
Since the Company incurred a loss for the 2012 fiscal year, in accordance with the Regulation, a decision was made not to pay remuneration to the Board of Directors.
Committees of the Board of Directors
The Regulation does not apply to members of the Committee(s) who are members of the Board of Directors, or members of the executive body and/or the sole executive body of the Company (CEO).
On a quarterly basis, Committee members shall be paid remuneration for each time that they participate in a meeting. The amount of remuneration is equal to three minimum monthly wage rates for a first category worker. Remuneration to the Chairman of the Committee increases 50%.
The payment of remuneration to members of the Committees of the Board of Directors is based on a separate Regulation on remuneration to members of the Committees of the Board of Directors of JSC Federal Grid Company, as approved by a decision of the Board of Directors on 16 December 2010 (Meeting Minutes #120).
The Management Board
According to Regulations on Employment Agreements and Compensation and Remuneration to Top Executives of JSC Federal Grid Company, approved by the Board of Directors on 17 June 2010 (Minutes #105), the monthly payroll for the Company’s top executives is set by their employment agreements. This remuneration is based on a fixed rate (salary) and a variable rate (bonus). The bonus depends on the top executives meeting key performance indicators (KPIs). The target KPIs and the methods for calculating and assessing their performance are subject to annual approval by the Company’s Board of Directors. In 2012, the following KPIs were applied to these individuals:
Semi-annual KPIs:
- — Relative number of restrictions on electricity transmission services (in %);
- — No fatal accidents or group accidents, if there is a casualty that results in a serious injury to an individual;
- — Financial stability indicator, i.e. the financial leverage ratio;
- — Meeting schedules for funding and developing the investment program with progressive totals up from the beginning of the year (in %).
Annual KPIs:
- — Cost reduction for the acquisition of goods (work, services) per unit of output of not less than 10% per year within three years in real terms;
- — EBITDA, RUR million;
- — Efficient implementation of the Cost Management Program (CMP),%;
- — No major emergencies;
- — Electric energy losses in the grid used by Federal Grid Company to provide electricity transmission services (in %);
- — Meeting schedules bringing on line power facilities and implementing plans for financing and development (in %).
The approved target semi-annual and annual KPIs for the Company’s top executives in 2012 have been achieved in full.
Details on 2012 remuneration, benefits and expenses
that members of the Management Board, including the
Chief Executive Officer (CEO), received as compensation
(RUR thousand):
Details on 2012 remuneration, benefits and expenses paid to the Chief Executive Officer (CEO) (RUR thousand):
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