In accordance with the  of the article 7 of the Charter of JSC “Samruk-Energy”, the bodies of JSC “Samruk-Energy” are the following:

1) superior body – The sole shareholder; 
2) managerial body – Board of directors;
3) executive body – Management of the JSC;
4) the body that controls financial and economic activities of the Company, evaluates internal control, risk management, execution of documents in the sphere of corporate management and consultancy for the purposes of improvement of the Company’s activities – Internal Auditing Service.

superior body – The sole shareholder

The following main issues are related to exclusive competence of the Shareholders meeting (holder of all voting stocks):

1) introduction of amendments to the charter of the company or approval of its new version; 
2) approval of the corporate management code as well as amendments to it;
3) voluntary reorganization or liquidation of the company; 
4) decision making about the increase in quantity of declared shares of the company or change of the type of unplaced declared shares of the company;
5) determination of the quantitative composition, period of powers of the board of directors, election of its members and early termination of their powers, as well as determination of the sum and conditions of payment of rewards to the board of directors’ members; 
6) determination of an auditing organization that audits the company; 
7) approval of annual financial reports; 
8) approval of the distribution of net income for a reported financial year, decision making on payment of dividends on ordinary shares calculated per ordinary share of the company.

managerial body – Board of directors.

The structure of the Board of Directors was changed by the Resolution of the Board of "Samruk-Kazyna" JSC dated 15 June 2011 (minutes No. 26/11) and as of today the structure is as follows:

Activities of the Board of directors are regulated by theRegulations about the Board of directors of JSC “Samruk-Energy”

The following main issues are related to exclusive competence of the Board of directors:

1) determination of priority directions of activities of the Company; 
2) decision making on convention of an annual or special shareholders meeting; 
3) decision making on placement (realization), including the quantity of placed (realized) shares within the limits of the quantity of declared shares, method and price of its placement (realization);
4) advance approval of annual financial reports of the Company; 
5) determination of the quantitative composition, term of powers of the executive body, election of its head and members (a person solely acting as an executive body), as well as preterm termination of their powers; 
6) determination of the sum of official salaries and the terms of salary payment and rewarding of head and members of the executive body (a person solely acting as an executive body); 
7) determination of the quantitative composition, term of powers of the internal auditing service, election of its head and members, as well as preterm termination of their powers, determination of the order of work of the internal auditing service, sum and terms of salary payment and rewarding of members of the internal auditing service.

executive body – Administration of JSC “Samruk-Energy”.strong>


Administration of JSC “Samruk-Energy” carries out its activities in accordance with the Regulations about the Administration of JSC “Samruk-Energy”.

The following main issues are related to exclusive competence of the Administration:

1) Decision making for achievement of objectives of the Company;
2) Development, approval and submission to the Board of directors of Strategic directions of Company development for 5 (five) years, Plan of Company development (medium-term business-plan for 3 (three) years), budget of the Company (business-plan for 1 (one) year);
3) Realization of the Plan of Company development (medium-term business-plan for 3 (three) years), budget of the Company (business-plan for 1 (one) year);
4) Development and application of procedures of internal control and risk management in the Company;
5) Approval of personnel arrangement and structure of the Company with consideration of the staff numbers of employees of the central machinery of the Company approved by the Board of directors.

the body that carries out control over financial-economic activities of the Company, evaluations in the sphere of internal control, risk management, execution of documents in the sphere of corporate management and consultancy for the purposes of improvement of the Company’s activities – Internal Auditing Service.

The Internal auditing service of JSC “Samruk-Energy” carries out its activities in accordance with the Regulations about the Internal auditing service of JSC “Samruk-Energy”.

The mission of the Internal auditing service consists in rendering necessary assistance to the Board of directors and Administration in fulfillment of their duties for achievement of the strategic objectives of the Company.

The main purpose of activities of the Internal auditing service is to provide independent and impartial information to the Board of directors for efficient management of the Company through application of a system approach in improvement of the systems of risk management, internal control and corporate management.

The main tasks of the Internal auditing service are the following:
1) evaluation of reliability and efficiency of the internal control system; 
2) evaluation of reliability and efficiency of the risk management system;
3) evaluation of trustworthiness, completeness and reliability of financial reports.

The Internal auditing service, in accordance with the entrusted tasks, carries out the following functions in a stated order:

1) carries out evaluation of adequacy and efficiency of the internal control system in the Company;
2) carries out evaluation of completeness of application and efficiency of the methods of risk assessment and procedures of risk management in the Company;
3) carries out verification of fulfillment of requirements of the legislation of the Republic of Kazakhstan, international agreements, internal documents of the Company, as well as fulfillment of instructions of empowered and supervisory authorities, decisions of the bodies of the Company and evaluates systems that had been created for the purposes of meeting those requirements.

Audit Committee of the Board of Directors of the Company

 

The Audit Committee of the Board of Directors of «Samruk-Energy» JSC acts in compliance with the Regulation on the Audit Committee of the Board of Directors of «Samruk-Energy» JSC with changes and additions approved by the decision of the Board of Directors of «Samruk-Energy» JSC on May 25, 2018 (Minutes No. 05/18).

The Audit Committee acts in the interests of the Company's shareholders and its activities are aimed at providing assistance to the Company's Board of Directors by developing the recommendations on:

  1. Establishment of an effective system of control over the financial and economic activities of the Company (including the full and reliable financial statements);
  2. Monitoring of the reliability and efficiency of Internal Control systems and risk management, as well as the execution of documents in the field of corporate governance;
  3. Monitoring of the independence of the external and internal audit, as well as the process of ensuring compliance with the laws of the Republic of Kazakhstan;
  4. Making recommendations on the policy and remuneration structure of the Head and employees of the Internal Audit Service;
  5. Consideration and development of qualification requirements for candidates positions of the Head and / or employees of the Internal Audit Service, represented by the Head of the Internal Audit Service;
  6. Consideration and development of qualification requirements for candidates positions of the Head and / or employees of the Internal Audit Service and the «Compliance» Service;
  7. Submitting recommendations on candidates for the positions of the Head and employees of the Internal Audit Service and the «Compliance» Service;
  8. Risks monitoring in the field of sustainable development and compliance, the quality of non-financial information and reporting;
  9. Activities recommendation to reduce risks while evaluating the effectiveness and transactions approval, as well as investment projects;
  10. Other issues in compliance with the requirements of these Regulations.

The Audit Committee performs the following functions under the established procedure:

  1. on financial reporting;
  2. on issues of Internal Control and risk management;
  3. on external audit issues;
  4. on internal audit issues;
  5. on compliance issues.

Appointment and Remuneration Committee of the Board of Directors of the Company

 

Appointment and Remuneration Committee of the Board of Directors of «Samruk-Energy» JSC acts in compliance with the Regulation on the Appointment and Remunerations Committee of the Board of Directors of «Samruk-Energy» JSC, approved on May 25, 2018 (Minutes No. 05/18).

The Committee competence includes the following issues:

  1. Preparation of qualification requirements for candidates attracted for the positions of an Independent Director, the composition of the Management Board and the Corporate Secretary;
  2. Recommendations on candidates attracted for the positions of an Independent Director, the composition of the Management Board, the Corporate Secretary and other employees in compliance with the Company's internal documents. Candidates for the positions whose election (appointment) is attributed to the exclusive competence of the general meeting of shareholders are considered by the Committee on the basis of the relevant provisions of the Company's internal documents and / or the appeal (instruction) of the shareholders;
  3. Development of the Succession Planning Policy for members of the Board of Directors and the Management Board, Committees of the Board of Directors and the Corporate Secretary of the Company;
  4. Candidates assessment for the Management Board and other executives in compliance with the list approved by the Board of Directors;
  5. Recommendations development regarding the Evaluation Policy and ensuring the succession of the Company's management;
  6. Preliminary consideration of the motivational KPIs of the members of the Management Board of the Company, the Corporate Secretary of the Company, as well as the monitoring of their achievement;
  7. Positions assessment of the members of the Management Board and the Corporate Secretary of the Company. Proposals elaboration for the Board of Directors to approve the Grades of members of the Management Board and the Corporate Secretary of the Company.

Strategic Planning Committee of the Board of Directors of the Company

 

Strategic Planning Committee of the Board of Directors of «Samruk-Energy» JSC acts in compliance with the Regulation on the Strategic Planning Committee of the Board of Directors of «Samruk-Energy» JSC with changes and additions approved by the decision of the Board of Directors of «Samruk-Energy» JSC on May 25 2018 (Minutes No. 05/18).

The Committee competence includes the following issues:

  1. Preliminary consideration of the Development Strategy, including the mission, vision, goals and objectives, as well as their periodic review;
  2. Monitoring of changes in the economic and competitive environment to determine their impact on the existing Development Strategy of the Company and ensuring the revision / reassessment of the Development Strategy taking into account these changes;
  3. Analysis and recommendations provision on strategic decisions development related to the reorganization of the Company in the form of merger, accession, division and separation of the transformation;
  4. Preliminary consideration of the Action Plans for the implementation of the Company's Development Strategy;
  5. Preliminary consideration of the Action Plans for the implementation of the Shareholder expectations of the Company;
  6. Analysis and recommendations provision on the development of strategic decisions regarding methodological aspects in the field of sustainable development, as well as the introduction of best practices in the field of sustainable development, and labor and environmental protection;
  7. Preliminary consideration of investment projects;
  8. Analysis and recommendations provision on the formation of investment projects portfolio and their monitoring;
  9. Preliminary consideration of the Development Plan (Business Plan) of the Company, Reports on the execution of the Development Plan (Business Plan) of the Company for the reporting period, as well as preliminary review of the Company's budget for the first calendar year in the frames of the Development Plan (Business Plan) of the Company.
  10. Effectiveness analysis of the implementation of the Transformation Program of the Company and the Road Maps for it.

Health, Safety, and Environmental Protection Committee

of the Board of Directors

 

Health and Safety and Environmental Protection Committee of the Board of Directors of «Samruk-Energy» JSC acts in compliance with the Regulation on the Health and Safety and Environmental Protection Committee of the Board of Directors of «Samruk-Energy» JSC approved by the decision of the Board of Directors of «Samruk-Energy» JSC dated March 31, 2018 (Minutes No. 03/18).

The Committee competence includes the following issues:

  1. Ensuring the effective work of the Board of Directors regarding the issues related to industrial safety, labor and environment protection of the Company;
  1. Effectiveness assessment of the policies and systems of the Company for identifying and managing risks related to safety, labor and environment protection;
  2. Analysis of the policy and the system of the Company regarding the compliance with legal and regulatory requirements relating to the labor and the environment protection;
  3. Analysis of the Reports from structural divisions of the Company in relation to all fatal accidents, as well as serious incidents occurring within the Company's joint venture and activities undertaken as a result of such cases and incidents;
  4. Promotion of the introduction into production of more advanced technologies, new technic, automation and mechanization of production processes to create healthy and safe working conditions and the elimination of heavy physical work;
  5. Consideration of the issues of sustainable development in terms of safety, labor and environmental protection.
Composition of the committees of the Board of directors of JSC “Samruk-Energy”

The Appointment committee of the Board of directors
Composition of the Committee
The composition of the Appointment and remuneration Committee of the Board of Directors of JSC “Samruk-Energy” on January 1, 2019:
Spitsyn A.T. - independent Director, Chairman of the nominating and remuneration Committee.
Luca Sutera - independent Director, Member of the nominating and remuneration Committee.
Andreas Storzel - independent Director, Member of the nominating and remuneration Committee.
Joaquin Galindo - independent Director, Member of the nominating and remuneration Committee.

The Auditing committee of the Board of directors
Composition of the Committee
Composition of the Audit committee of the Board of Directors of JSC “Samruk-Energy” on January 1, 2019:
Luca Sutera - independent Director, Chairman of the Audit Committee of the Board of Directors;
Spitsyn A.T. - independent Director, member of the Audit Committee of the Board of Directors.
Andreas Storzel - independent Director, member of the Audit Committee of the Board of Directors.
Joaquin Galindo - independent Director, member of the Audit Committee of the Board of Directors.

The Strategic planning Committee of the Board of directors
Composition of the Committee
Composition of the Strategic planning Committee on January 1, 2019:
Andreas Storzel - independent director, the Strategic planning Committee Chairman.
Luca Sutera - independent Director, member of the Strategic planning Committee.
Spitsyn A.T. – independent Director, member of the Strategic planning Committee.
Joaquin Galindo - independent Director, member of the Strategic planning Committee.

The Health, Safety and Environmental Protection Committee
Composition of the Committee
Composition of the Health, Safety and Environmental Protection Committee on January 1, 2019:
Joaquin Galindo - independent director, the Health, Safety and Environmental Protection Committee Chairman.
Luca Sutera - independent Director, member of the Health, Safety and Environmental Protection Committee.
Spitsyn A.T. – independent Director, member of the Health, Safety and Environmental Protection Committee.
Andreas Stoerzel - independent director, member of the Health, Safety and Environmental Protection Committee.

2018 year

In 2018 Board of directors of the Company held 14 meetings, 11 meetings in presentia and 3 meetings in-absentia.

Thus, the percentage of in presentia and in absentia meetings in 2018 is as follows:
In presentia meetings of the Board of Directors - 80%
In absentia Board of Directors meeting - 20%
If we consider the percentage of participation of the members of the Board of Directors in meetings, then:
Aidarbayev A.S., Rakhmetov N.K., Andreas Stoerzel, Spitsyn A.T., Luca Sutera, Joaquin Galindo and Zhulamanov B.T. took part in all meetings of the Board of Directors that is in 100% of attendance.

2016 year

In 2016 Board of directors of the Company held 11 meetings, 7 meetings in presentia and 4 meetings in-absentia.

Thus, the percentage of in presentia and in absentia meetings in 2016 is as follows:
In presentia meetings of the Board of Directors - 60%
In absentia Board of Directors meeting - 40%
If we consider the percentage of participation of the members of the Board of Directors in meetings, then:
Bektemirov K.A., Satkaliyev A.M., Andreas Stoerzel, Spitsyn A.T. and Luca Sutera took part in all meetings of the Board of Directors, that is in 100% of attendance.

2015 year

In 2015, the the Board of directors of the Company held 9 meetings in presentia.

Thus, the percentage of in presentia and in absentia meetings in 2015 is as follows:
In presentia meetings of the Board of Directors - 100%
In absentia Board of Directors meeting - 0%
If we consider the percentage of participation of the members of the Board of Directors in meetings, then:
Bektemirov K.A., Satkaliyev A.M., Ogai A., Spitsyn A.T. and Luca Sutera took part in all meetings of the Board of Directors, that is in 100% of attendance.

Number of meetings and attendance at meetings of committees at the Board of directors of JSC “Samruk-Energy”

2016

Number of meetings and attendance at meetings of Committees at the Board of directors of JSC “Samruk-Energy”

  • Appointment and Remuneration Committee. During the 2016 - 11 in presentia committee meetings were held, which reviewed 37 issues. Participation by members of the Appointment and Remuneration Committee, entitled to vote at meetings of the Committee was 100%.
  • Audit committee meetings.  During the 2016 - 8 in presentia committee meetings were held, which reviewed 43 issues. Participation by members of the Auditing Committee, entitled to vote at meetings of the Committee was 100%.
  • Strategic planning committee meetings. During the 2016 - 6 in presentia committee meetings were held, which reviewed 19 issues. Participation by members of the Strategic planning Committee, entitled to vote at meetings of the Committee was 100%.

2015

Number of meetings and attendance at meetings of committees at the Board of directors of JSC “Samruk-Energy”

  • Nomination and Remuneration Committee. During the 2015 nine in presentia committee meetings were held, which reviewed twenty eight issues. Participation by members of the Nominating  and Remuneration Committee, entitled to vote at meetings of the Committee was 100%.
  • Auditing committee meetings During the 2015 ten in presentia committee meetings were held, which reviewed forty five issues. Participation by members of the Auditing Committee, entitled to vote at meetings of the Committee was 100%.
  • Strategic planning committee meetings. During the 2015 nine in presentia committee meetings were held, which reviewed sixteen issues. Participation by members of the Strategic planning Committee, entitled to vote at meetings of the Committee was 100%.

JSC “National Welfare Fund “Samruk-Kazyna” as a shareholder owning all voting stocks of the Company independently nominates candidates to the Board of directors of JSC “Samruk-Energy”, and its composition is approved by the Administration of JSC “National Welfare Fund “Samruk-Kazyna”.

Chairman of the Board of Directors elected by the decision of the Sole shareholder. If the Sole shareholder`s representative is elected as Chairman, the Board of Directors elects the Senior Independent Director from among the independent directors;

The process of search and selection of candidates for the Board of Directors of the Sole shareholder is carried out jointly with the Chairman of the Board of Directors and the Chairman of the Appointment and Remuneration Committee of the Board of Directors of the Company.

.

Given that Samruk-Kazyna JSC is a shareholder who owns all the voting shares of Samruk-Energy JSC, General Meetings of Shareholders of Samruk-Energy JSC are not held and the decisions referring to the exclusive jurisdiction of the General Meeting of Shareholders of Samruk-Energy JSC , are accepted by the Management Board and Chairman of the Board of Samruk-Kazyna JSC.

The activity of the Management Board and Chairman of the Board of Samruk-Kazyna JSC is defined by the internal documents of Samruk-Kazyna JSC.

More information about Samruk-Kazyna JSC and activity of its agencies and officials can be found at: www.samruk-kazyna.kz.

In accordance with the Charter of Samruk-Kazyna JSC the Authority and the official of Samruk-Kazyna JSC who have the right to make decisions on matters within the exclusive competence of the General Meeting of Shareholders of Samruk-Energy JSC, are the Management Board and the Chairman of the Board of Samruk-Kazyna JSC .

Matters referred to the General Meeting of Shareholders of Samruk-Energy JSC, are submitted for consideration by the Management Board and Chairman of the Board of Samruk-Kazyna JSC in the order determined by the internal documents of Samruk-Kazyna JSC.

More information about Samruk-Kazyna JSC and functions of its agencies can be found at: www.samruk-kazyna.kz.

Board of Directors meeting are held in accordance with the schedule drawn up every year since the beginning of its term, based on the principle of rationality, efficiency and regularity. The Board of Directors shall hold meetings at least six times a year.
The Board of Directors meeting may be convened by its Chairman or executive body or by the request of: 1) any member of the Board of Directors;
2) the Internal Auditing Service of the Company;
3) the auditing firm performing audit of the Company;
4) a major shareholder.
2. The request to convene a meeting of the Board of Directors shall be presented to the Chairman of the Board of Directors by means of a written communication containing a proposed agenda for the meeting of the Board of Directors.
In case of refusal of the Chairman of the Board of Directors in convening of meeting the initiator shall be entitled to send such request to the executive authority, which shall convene a meeting of the Board of Directors.
The Board of Directors meeting is to be convened by the Chairman of the Board of Directors or executive authority no later than ten calendar days after receipt of the request to convene unless other period is established by the company's charter.

Assessment of the work of the Board of Directors of the company are carried out in accordance with the methodology of estimation of activity of the Board of Directors and its committees, the Chairman, members of the Board of Directors and Corporate Secretary JSC "Samruk-Energy".

The Company understands the importance of developing a risk management system and procedures as an essential element of corporate governance which is aimed at timely identification, assessment, monitoring and decreasing the potential events that could adversely affect its financial stability and reputation.
For arranging a risk-oriented management, respond to changes in the external and internal environment in a timely manner as well as reduce possible losses during risks occurrence, the Company and its key subsidiaries and affiliates make sure that the risk management system is introduced and improved: structural units responsible for risk management and internal control have been established, as well as risk committees have been created in order to study and approve the matters related to risk management, reports on key risks management are prepared every quarter, internal regulatory documents on risk management are updated.
The Company’s Board of Directors approved the consolidated risk register and map, quarterly reports on key risk management with a description and analysis of key risks. In order to apply a risk-based approach, the Company’s Board of Directors approved restrictions (risk appetite) for the types of the Company’s activities - investment, operating and financial.
The Company relies on international experience, industry-specific and international benchmarks, expert judgment, statistical data, a database of losses incurred, results of audits and other inspections at risks identification. The identified risks are included in the risk register and risk map of companies for their subsequent evaluation, management and monitoring. The risks included in the register and the risk map are regularly (not less than a year) reviewed to determine the relevance and degree of materiality.
The Company highlights the following risks in line with the risk management policy:
strategic;
operating;
financial;
legal.
Slowdown of economic growth in the Republic of Kazakhstan, weakening of the national currency, changes in the electricity market’s scheme and tariff reduction have a key influence on the operating conditions of the Company. While the presence of large reserves of power generating coal with a low cost of production, efficient energy facilities and government and the sole shareholder’s support provide an opportunity for enhancing the export potential and increasing competitiveness in the domestic market. So, according to the results of work performed on identification of “Samruk-Energy” JSC group of companies’ risks, 33 risks which are available in operations of “Samruk-Energy” JSC group of companies, have been identified and assessed, threshold values of KPI were updated, risk owners updated the risk factors and activities aimed at their lowering. Due to some events occurred in 2018, as well as on the basis of reports on the results of inspections of the Company’s Internal Audit Service, risks from the Risk Register were re-evaluated. Based on the results of the reassessment, 12 risks were included into the key zone of 2019 Risk map (in 2018 - 14 key risks).

JSC “Samruk-Energy” interacts with the state bodies in accordance with the requirements of the legislation of the Republic of Kazakhstan, the Charter and internal documents of JSC “Samruk-Energy”, as well as the Corporate management Code, basing on independence of the parties.
The Company seeks for non-admission of corruption and other unlawful actions from the side of the state bodies as well as officials and employees of JSC “Samruk-Energy”.
The government does not have direct influence on JSC “Samruk-Energy”, activities of the Company are influenced through decisions of the JSC “National Welfare Fund “Samruk-Kazyna” as a holder of all voting stocks of the Company.
JSC “Samruk-Energy” does not make decisions that require endorsement of the state bodies, with the exception of cases when such endorsement is required by the legislation of the RK.

The Code of Business Conduct of Samruk-Energy JSC is approved by the decision of Samruk-Energy JSC Board of Directors dated October 11, 2011.
The hot line and e-mail address, information whereof is published on the website and in the office of Samruk-Energy JSC, are created in order to ensure compliance with requirements of the Code of Business Conduct of Samruk-Energy JSC. A mailbox is provided in the Company for receipt of complaints, appeals and proposals, including issues on compliance with the Code of Business Conduct.
For clarification of the Code’s requirements and/or arisen ethical issues, for violations of the Code’s requirements, corrupt and other illegal actions the Company functionaries and employees, business partners and other parties involved have the right to address:
the direct manager;
the Ombudsman;
the Internal Auditing Service;
the Corporate Secretary Service (violations of business conduct principles are considered by the Board of Directors).
The Ombudsman is appointed by the decision of Samruk-Energy JSC Board of Directors; his/her primary functions are to collect information on non-compliance and/or violations of the Code provisions, the legislative norms of the Republic of Kazakhstan and other internal regulatory documents of the Company, consult the Company employees, the Company officials on the Code provisions, initiate settlement of disputes on violation of the Code provisions and to participate in it.