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Social responsibility and corporate sustainability report 2015
RU

Statement from the Chairman of the Management Board

Dear colleagues,

Federal Grid Company is one of the largest public electric grid companies in terms of the length of electricity transmission lines and transformer capacity. It is a monopoly operator of the Unified National Electric Grid (UNEG) for the purpose of its maintenance and development. In 2012, the Company was included in the list of strategic entities.

The improvement of effectiveness in Federal Grid Company is coupled with implementation of our policy of corporate social responsibility and sustainable development.

Federal Grid Company’s specific characteristics and the scope of its operations make us highly responsible to a very broad range of counterparties. In the first place, this is responsibility for the quality of services provided by the Company, i.e. the reliable and uninterrupted electricity supply. This is also responsibility to our shareholders, suppliers, employees and many other stakeholders that depend, directly or indirectly, on our performance.

Federal Grid Company’s specific characteristics and the scope of its operations make us highly responsible to a very broad range of counterparties.

The main vector for Federal Grid Company’s team over the past three years has been the improvement of effectiveness in all areas of its operations. It would be wrong to look at it in economic terms alone. The improvement of effectiveness in Federal Grid Company is coupled with implementation of our policy of corporate social responsibility and sustainable development. This is why this topic became a priority in the 2015 Report.

The 2015 results confirm that both the Company and its stakeholders take interest in the improvement of effectiveness. The accident rate in the backbone electric grid complex has been declining for the third year in succession; it went down by 17.3% in 2015. The Company’s investment programme was completed fully and on time. At the same time, indexation of the Company’s tariff for electricity transmission is several times lower than the inflation rate. This means that the largest Russian customers receive the required volume of electricity without interruptions and on favourable terms.

The best financial results in three years were achieved: net profit under RAS increased by 3.5 times in 2015 relative to 2014 and amounted to RUB17.9 billion. Dividends were paid for 2014. All this makes the Company more attractive for shareholders and investors.

As a result of our import substitution programme, the share of procurements from domestic producers increased by almost twofold and reached 75%. We pay particular attention to the strengthening of the Company’s competitive position, development of manufacturing of the Russian electrical equipment, and procurement from small and medium-size businesses.

The target of reducing unit operational and investment costs has been exceeded, as well as the labour productivity targets. The Company increased average wages and reduced managerial staff. It improved the main indicators of impact on the environment and increased spending on environmental protection. In 2015, Federal Grid Company was recognised for its contribution to the development of environmental protection in Russia.

The Company continued implementation of social programmes for its employees and communities. It made a special focus on support of veterans in the year when we celebrated the 70th anniversary of Victory in the Great Patriotic War.

Federal Grid Company’s management and the entire team focus on a result that would meet the highest expectations of our customers, shareholders, employees and other stakeholders.

effectiveness with due regard of priorities of sustainable development and corporate social responsibility, ensure financial viability, increase labour productivity, return on capital and customer satisfaction with the quality of services, and create comfortable conditions at all stages of engagement with the Company.

As for import substitution, the Company’s objective is to develop a competitive market of electrical equipment, build an integrated innovative infrastructure and improve the technologies that we are using. It would be important to pursue the personnel incentives policy, develop employee skills and implement the labour protection and environmental policies.

In other words, Federal Grid Company’s management and the entire team focus on a result that would meet the highest expectations of our customers, shareholders, employees and other stakeholders.

Andrey Murov
Chairman of the Management Board

My Report

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