REPORT for 2015 year

4.3. Board of Directors Committees

The Committee for Strategy, Investments and Innovations (hereinafter - the Committee) is an advisory and consultative body providing preparing of recommendations and proposals to the Board of Directors aimed at defining of Transneft PJSC long term prospects strategy, the formation of the investment and innovation policies, setting of priorities of Transneft PJSC tariff and dividend policies based on openness and transparency of management decision-making policy within the development of the system of oil and oil products pipeline transportation, improving the efficiency of Transneft PJSC.

The Committee's work is regulated by the Regulation on the Committee for Strategy, Investments and Innovations of Transneft Board of Directors, approved as amended by Transneft PJSC Board of Directors on 28.04.2015 year (Minutes № 11) and by  amendments approved by Transneft PJSC Board of Directors on 18.09.2015 year (Minutes № 23).

The Regulation defines the legal status, main tasks, the purpose of the activities, structure and number of members of the Committee.

Within the reporting period the Committee performed its activity being elected:

  • under Resolution of Transneft PJSC Board of Directors  dated 31.07.2014 (Minutes № 15):
  • by Committee Chairman– Grishankov Mikhail Ignatiyevich;
  • by Committee Member– Tokarev Nickolay Petrovich;
  • by Committee Member– Misharin Alexander Sergeyevich.
  • under Resolution of Transneft PJSC Board of Directors  dated 18.09.2015 (Minutes № 23):
  • by Committee Chairman– Grishankov Mikhail Ignatiyevich;
  • by Committee Member– Varnigue Mattias;
  • by Committee Member– Katkalo Valeriy Sergeyevich;
  • by Committee Member– Tokarev Nickolay Petrovich;
  • by Committee Member– Consumer Council Representative – Shmal Gennadiy Iosifovich.

The Committee developed the following recommendations for the Board of Directors of the Company, as well as discussed the following issues: 

  • implementation within 2014 year of “Transneft PJSC Energy Management Programme  from 2012 till 2015 year”;
  • on development and construction of oil pipeline tapping “TS ESPO – Komsomolsk OR”;
  • on execution of the key performance indicators of the Transneft PJSC business activity within 2014 year;
  • implementation within 2014 year of “Transneft PJSC technical upgrading and revamping programme of  trunk pipelines facilities from 2014 till 2020 years»;
  • implementation within 2014 year of “Transneft PJSC programme of operating costs reduction from 2014 till 2020 years”;
  • implementation within 2014 year of “Transneft PJSC programme of capital investments reduction from 2014 till 2020 years»;
  • implementation within 2014 year of “Transneft PJSC Innovative Development Programme  till 2017 year”;
  • implementation within 2014 year of “Transneft PJSC long-term development programme till 2020 year and opinion of audit of the Transneft PJSC long-term development programme  implementation within 2014 year;
  • discussion and approval of the projects of:
  • Regulations on the Committee for Strategy, Investments and Innovations of Transneft Board of Directors;
  • Plan of activities of Transneft PJSC participation in the Technological platform “Ecological development technologies” within 2015-2017 years;
  • Updated and amended Transneft PJSC long-term development programme  till 2020 year;
  • Regulations on procedure of development and execution of the Transneft PJSC innovative development programmes;
  • Regulations on increase of the investment and operational efficiency and reduce of costs;
  • Regulation on the quality management system;
  • Methods of calculation of key performance indicators of economic activity of Transneft PJSC;
  • System of key performance indicators of economic activity of Transneft PJSC;
  • Planned values of key performance indicators of economic activity of Transneft PJSC  in 2016 year;
  • Terms of Reference for auditing of the Transneft PJSC long-term development programme till 2020 year implementation within 2015 year.

The Committee during the reporting period discussed the results of the audit conducted by the Federal State Educational Institution of Higher Professional Education “Russian State Academy of Intellectual Property” (FSEI HPE RSAIP), on the issue of the effectiveness of implementation in Transneft PJSC  of the Recommendations for the management of rights for the results of intellectual activity (RIA) with the development of the model of intellectual property management in Transneft PJSC  and entities of Transneft system.

The Audit Committee (hereinafter – the Committee) is an advisory and consultative body providing preparing of recommendations and proposals to the Board of Directors on the issues of control of financial and economic activity of Transneft PJSC aimed at the objective and independent informing of the members of the Board of Directors as regards financial and economic activities of the Company and assessment of the internal control systems efficiency.

The Committee's work is regulated by the Regulation on the Audit Committee of Transneft PJSC, approved by the Board of Directors of Transneft PJSC dated 01.12.2008 year (Minutes № 15).

The Regulation defines the legal status, main tasks, the purpose of the activities, structure and number of members of the Committee.

Within the reporting period, the Committee performed its activity being elected:

  • under Resolution of Transneft PJSC Board of Directors   dated 31.07.2014 year (Minutes № 15):
  • by Committee Chairman– Katkalo Valeriy Sergeyevich;
  • by Committee Member– Vyugin Oleg Vyacheslavovich;
  • by Committee Member– Molodtsov Kirill Valentinovich.
  • under Resolution of Transneft PJSC Board of Directors   dated 18.09.2015 year (Minutes № 23):
  • by Committee Chairman– Klebanov Ilya Iosifovich,
  • by Committee Member– Grishankov Mikhail Ignatiyevich,
  • by Committee Member– Chilingarov Arthur Nikolayevich.

The Committee developed the following recommendations for the Board of Directors of the Company on the following issues:

  • on discussion and approval of:
  • Regulations on holding of the open tender for selection of an audit company for the performance of the mandatory annual audit of Transneft PJSC for 2015 year and review of the IFRS consolidated interim financial statements for the Ist quarter of 2016 year;
  • Regulation on the tender committee for the selection of an audit company for the performance of the mandatory annual audit of Transneft PJSC;
  • Members of the tender committee for the selection of an audit company for the performance of the mandatory annual audit of Transneft PJSC.
  • on discussion of Transneft PJSC Auditor opinion  following the results of audit of financial and economic activity of Transneft PJSC for 2014 year and и assessement of the auditor's report to be provided to the persons entitled to participate in the annual General Shareholders’ Meeting of Transneft PJSC;
  • on discussion of annual report of Transneft PJSC, annual accountant report, reports on financial statements, as well as profit distribution for 2014 year;
  • on correction of the Transneft PJSC budget and the Transneft  Group consolidated budget for 2015 year, on the expected Transneft PJSC budget and the Transneft  Group consolidated budget performance for 2015 year, and on the Transneft PJSC budget and the Transneft  Group consolidated budget for 2016 year;
  • on discuss of the Transneft PJSC executive body report on financial and economic performance of Transneft PJSC and Transneft  Group (on a quarterly basis);
  • on Regulation for the internal audit of Transneft PJSC;
  • on Regulation for the Transneft PJSC Risks Management System;
  • on offers of the initial (maximum) contract price for the open tender for selection of an audit company for the performance of the mandatory annual Transneft PJSC audit for 2016 year and review of the IFRS consolidated interim financial statements for the Ist quarter of 2017 year.

The Committee during the reporting period considered the statements of Transneft PJSC on financial and economic activities; volumes and plans of the external audit performing of the annual accounts for the year; heard the report of Transneft PJSC on the observations identified by the auditor for the first 9 months of 2014 year, and measures of their elimination.

The Human Resources and Remunerations Committee (hereinafter – the Committee) is an advisory and consultative body providing preparing of recommendations and proposals to the Board of Directors aiming at the efficiency improvement of the Transneft activities in HR policy, remuneration scheme and rewards.

The Committee's work is regulated by the Regulation on Human Resources and Remunerations Committee approved as amended by the Resolution of Transneft PJSC Board of Directors dated 13.11.2013 year (Minutes № 15).

The Regulation defines the legal status, main tasks, the purpose of the activities, structure and number of members of the Committee.

Within the reporting period, the Committee performed its activity being elected:

  • under Resolution of the Board of Directors Transneft PJSC  dated  31.07.2014 year (Minutes № 15):
  • by Committee Chairman– Katkalo Valeriy Sergeyevich;
  • by Committee Member– Vyugin Oleg Vyacheslavovich;
  • by Committee Member– Grishankov Mikhail Ignatiyevich.
  • under Resolution of the Board of Directors Transneft PJSC  dated  18.09.2015 year (Minutes № 23):
  • by Committee Chairman– Chilingarov Arthur Nikolayevich;
  • by Committee Member– Katkalo Valeriy Sergeyevich;
  • by Committee Member– Klebanov Ilya Iosifovich.

The Committee developed the following recommendations for the Board of Directors of the Company, as well as discussed the following issues:

  • on the payment of rewards to managers and employees of the Company and entities of Transneft  system following the results of 2014 year;
  • on the payment of remuneration to members of the Board of Directors  following the results of Transneft PJSC  business;
  • on members of the Board of Transneft PJSC;
  • on the Regulations for the remuneration to members of the Board of Directors;
  • on the formation of Transneft PJSC personnel reserve;
  • on proposals of the candidates for nomination to the management and control bodies of Transneft PJSC  in 2016 year;
  • on holding concurrently positions of the members of the Transneft PJSC  Board of Directors and other entities executive bodies;
  • on amending of the System of rewards for annual performance of managers and employees of Transneft PJSC  and entities of Transneft  system;
  • on amending of the Regulation on the remuneration to the sole executive body of the Company.
 

1 Dates of the Meetings and number of Minutes of the Committee for Strategy, Investments and Innovations: 11.03.2015 № 1; 31.03.2015 № 2; 09.04.2015 № 3; 19.05.2015 № 4; 24.06.2015 № 5; 29.10.2015 № 6; 09.11.2015 № 7; 08.12.2015 № 8

2 Dates of the Meetings and number of Minutes of the Audit Committee: 29.01.2015 № 1; 08.04.2015 № 2; 11.06.2015 № 3; 24.09.2015 № 4; 15.10.2015 № 5; 10.11.2015 № 6; 26.11.2015 № 7; 07.12.2015 № 8.

3 Dates of the Meetings and number of Minutes of the Human Resources and Remunerations Committee: 08.04.2015 № 1; 12.05.2015 № 2; 11.06.2015 № 3; 12.10.2015 № 4; 26.11.2015 № 5; 18.12.2015 № 6.