Letter from the Chairman of the Board of Directors, Gazprom Neft PJSCDear shareholders and investors,
Gazprom Neft encountered unprecedented challenges in 2020, all relating to the COVID-19 pandemic. These new realities required the Board of Directors to take decisions fast, with a multitude of internal and external factors being taken into account. All of which served, ultimately, to confirm the effectiveness and reliability of the company’s corporate governance system.
Strategic development, risk management, production and operational continuity planning, and identifying new opportunities for effective business development were all front of mind for the Board of Directors. Areas of critical importance in implementing the company’s long-term business strategy were analysed and assessed. These included developing joint projects with partners; programmes for implementing Arctic and offshore projects – including under long-term risk-operatorship agreements; the refinery modernisation programme; developing the company’s own retail network and product lines; and further reducing environmental impacts.
The ongoing digital transformation of the business, and the deployment of cutting-edge digital tools, has allowed cooperation between various Gazprom Neft’s corporate governance bodies, shareholders and investors to be managed entirely remotely. On that basis, the 2020 General Meeting of Shareholders was held successfully under absentee voting, with shareholders being given access to digital services allowing them to view all materials, and to vote.
The company adopted a new dividend policy in this financial year, setting a target dividend distribution of at least 50% of net profit (IFRS). Changes were made to the company’s financial and operational oversight bodies: the company’s well developed risk management and internal control systems, internal audit service and Board of Directors’ Audit Committee meant we were able to dispense with the company’s Audit Commission. Updated versions of key internal regulations were adopted by the Extraordinary General Meeting of Shareholders, including the company Charter, as well as regulations governing General Meetings of Shareholders, the Board of Directors, the Management Board, and the Chief Executive Officer (CEO). The company’s Corporate Governance Code was also updated.
High standards in disclosing corporate information, the attention paid to environmental, social and corporate governance (ESG) goals, and the quality of the company’s corporate governance were all highly praised by experts, with Gazprom Neft named Russia’s most transparent company in the 2020 Interfax/AK&M ratings agencies’ corporate disclosure awards.
2020’s unprecedented challenges notwithstanding, Gazprom Neft’s oversight bodies continued to prove their high effectiveness – one of the key factors driving the company’s success in further sustainable development.
Chairman of the Board of Directors,
Gazprom Neft PJSC