Message from the Chairman of the Board of Directors

Dear colleagues!

Effective corporate governance is one of the key factors in ensuring that a company remains stable and continues to develop. Being the parent entity of the Group, which consists of 45 of the Company’s subsidiaries and affiliates, and one of Russia’s largest public joint stock companies, PJSC Rosseti has more reason to take this seriously.

Enhancing the corporate governance framework was a top priority for the Board of Directors in 2023. As part of the restructuring, a decision was made to standardise the internal regulatory documents of PJSC Rosseti and its subsidiaries. The Quality Policy, Risk Management and Internal Control Policy, Internal Audit Policy, Anti‑Corruption Policy and Information Policy were all revised and approved.

In keeping with the Bank of Russia’s recommendations, the Board of Directors also had the significant responsibility of implementing advanced ESG principles into the Company’s operationsBank of Russia’s Information Letter No. IN-06-28/96 dated 16 December 2021 «On Recommendations on the Consideration of ESG Factors and Sustainability Issues by the Board of Directors of a Public Joint Stock Company».. This allows for the prompt identification of risks associated with unfavourable events as well as the exploration of fresh opportunities that may be employed in the planning and execution of Rosseti Group’s operations. The Sustainable Development Policy and the Climate Policy, which are foundational documents in this field, were approved in 2023.

Moreover, apart from giving strategic counsel to the Company, the Board of Directors has historically decided on financial, economic and investment activities, as well as HR policy, and evaluated the achievement of set benchmarks in key development areas. There were a total of 36 meetings with 156 items of business on the agenda.

Committees under the Board of Directors made sure that all schedules were followed and that several factors pertaining to the restructuring decisions made by shareholders were considered while making changes to the management structure.

It is worth noting that the Russian Institute of Directors (RID) conducted an independent assessment of PJSC Rosseti’s corporate governance system in December 2023. The four components that the experts examined were disclosure, sustainability, ESG, governance and control bodies, and shareholder rights. They also considered the recent restructuring. Consequently, the Company was granted an NCGR grade of 7++, indicating that it adheres to a notable number of sustainability guidelines and recommendations outlined in the Russian Corporate Governance Code.