To achieve the Sustainable Development Goals, we consistently integrate ESG principles into the corporate culture and key processes of the Fund. We are constantly improving the corporate governance system in accordance with the best international practices, being a driver of changes in portfolio companies, setting high standards and requirements.
The Fund’s Corporate Governance Code approved by the Government takes into account the latest global trends in corporate governance and the most relevant provisions of the OECD, in particular, in improving the effectiveness of Boards of Directors and their accountability to shareholders. The Code was developed with the direct participation of OECD experts, Fund management and a pool of independent directors of the group.
The Fund’s Group of Companies strives to comply with the principles of the Corporate Governance Code as much as possible in order to strengthen the confidence of institutional investors. In 2022, an analysis of the main provisions of the Code for their compliance was carried out, in the reporting year, the Fund basically complied with all the principles set out in the Code.
By raising standards in the field of corporate governance, we focus on the requirements of the Premium segment3 of leading stock exchanges, which in turn are based on the strictest requirements of the UK Code of Conduct, the OECD Guidelines for State-Owned Enterprises. As a result, compliance with the requirements of the Premium segment significantly increases the opportunities of companies in the capital markets.
As a responsible investor, the Fund promotes the development of good corporate governance practices in all portfolio companies. The Fund’s representatives are members of the Board of Directors of portfolio companies, which enables the Fund to ensure the functioning of corporate governance at a high level, as well as compliance with the interests of the Fund when making decisions in portfolio companies. The Fund reviews the reports of portfolio companies on the evaluation of the effectiveness of the BoD, reports on the activities of portfolio companies, approves the Strategies of portfolio companies, taking into account the cascading of the strategic goals of the Fund.
We are aware that the risks associated with insufficient disclosure of information become investment risks that affect the long-term sustainability and value of companies. In this regard, we are working to improve the quality and accessibility of disclosed information, including through regular reporting by IFSWF (International Forum of Sovereign Wealth Funds) on Compliance with the Santiago Principles.
The Fund Group implements the preparation of annual non-financial reports (sustainability reports) in accordance with advanced international standards (GRI, TCFD, ISSB, CDP). As a tool for tracking real business changes, the Fund Group has already implemented and will expand the practice of passing an independent assessment by reputable international rating agencies and obtaining ESG ratings.
In 2022, the Charters and Regulations on the Board of Directors have been updated in all portfolio companies in terms of delineating the competencies and powers of the Board of Directors and the Management Board, the procedure for holding meetings and the format of materials for meetings of the Board of Directors have been unified. In 2023, work will continue on integrating the key provisions of the UK Corporate Governance Code into the Fund’s Corporate Governance Code..