The National Corporate Governance Score (NCGS) of OAO NGK Slavneft has been again confirmed at the NCGS 6 level
The Consortium of the Russian Institute of Directors and the Expert RA Rating Agency announced that the corporate governance score earlier given to OAO NGK Slavneft was again confirmed as score “6”. This score means the Developed Corporate Governance Practice.
Score “6” shows that the Company has low corporate governance risks, meets the requirements of the Russian legislation applied to corporate governance, follows most recommendations of the Russian Code of Corporate Conduct and certain recommendations of the advanced international practices of corporate governance.The Consortium experts mentioned the following positive aspects of OAO NGK Slavneft corporate governance practice:
1. The Code of Corporate Conduct which determines the key corporate governance principles and the relevant procedures was approved in the Company.
2. The composition of the Board of Directors is characterized as well-balanced; there is no risk of making decisions in the interests of only one group of shareholders.
3. The Company’s employees are not included into the Revision Commission; it enables to increase the degree of objectivity and independence of opinions made by the Commission’s members when they perform their functions.
OAO NGK Slavneft will proceed with the activities aimed at corporate governance enhancement.For the first time the Company was rated with score “6” in 2007, when the Consortium of the Russian Institute of Directors and the Expert RA Rating Agency introduced the digital scale for assessment of the corporate governance level. This score was confirmed in 2008.Until 2007 the scale of the National Corporate Governance Score reflected three classes of the rating scores and had the letter value. According to that scale OAO NGK Slavneft was rated with B++ score from 2004 to 2006. B++ score meant the medium level of corporate governance. The experts’ decision on shifting to the digital scale was caused by the increased need of Russian companies and investors to have a more precise tool for assessment of corporate governance risks. According to the new scale the maximum score is 10; this scale possess a greater number of levels and allows performing a more detailed analysis of corporate governance practices of various companies.
The Consortium of the Russian Institute of Directors and the Expert RA Rating Agency carries out the assessment of the corporate governance status of more than 150 large Russian companies. The National Corporate Governance Score is given on the basis of the independent expert analysis. The aim of this analysis is to review how Russian companies observe the internationally-accepted key standards applied to the protection of shareholders’ rights, activity of management and control bodies, information disclosure, and consideration for the interests of other related parties. Companies are assessed following the results of the analysis of information public sources, including materials of corporate sites, quarterly and annual reports, data of news agencies and other mass media.