Board Committees

06

The Committees of the Board of Directors are advisory and consultative bodies. The Board Committees are comprised
of current members of the Board of Directors, having relevant experience and expertise in the area of each Committee’s focus. The Committees can also involve external experts and consultants in their work.The primary role of the Committees is the preliminary consideration of the key issues reserved for the Company’s Board of Directors. The Committees are responsible for ensuring that issues brought before the Board have been subject to sufficient review in order to ensure that the Directors are able to cast their votes based on full and accurate information. In order to achieve this, Committee members seek to maintain a regular dialogue with management, the Company’s external auditor and other advisors on the issues that fall under their remit.

At the end of 2011, the following Committees were functioning:

  • Audit Committee
  • Strategy Committee
  • Remuneration and Human Resources Committee
  • Environmental, Health and Safety Committee
The Audit Committee

The Audit Committee supervises the Company’s financial and accounting activities. It reviews and evaluates the Company’s financial statements, which are prepared by the Company and audited by the Company’s external auditor. According to the Statute of the Audit Committee of PhosAgro, the Audit Committee shall consist of not less than three current members of the Board of Directors, and shall be chaired by an Independent Director.

The Committee’s remit includes:

  • analysis of financial reporting processes, including carrying out regular reviews and making recommendations;
  • recommending the Company’s external auditor to the Board of Directorsand maintaining an ongoing relationship with the external auditor;
  • analysis and support of the internal audit system and risk management procedures, including the drafting of recommendations for their improvement;
  • ensuring compliance with applicable legislation and relevant standards of business conduct.
As of 31 December 2011, the Audit Committee comprised:
  • Marcus Rhodes, Committee Chairman, Independent Non-Executive Director of the Board of Directors
  • Sven Ombudstvedt, Committee Member, Independent Non-Executive Director of the Board of Directors
  • Ivan Rodionov, Committee Member, Independent Non-Executive Director of the Board of Directors
During the reporting period, the Audit Committee held six meetings, in which matters covering all priority areas of the Company’s activity were considered. Considerable focus was placed on improving internal audit procedures.

In 2011 the Audit Committee focused on:
  • drafting of the Statute of the Internal Audit Department;
  • reviewinga new version of the Statute of the Audit Committee and recommending it for approval to the Board of Directors;
  • recommending the Company’s external auditor to the Board of Directors and reviewing the auditor’s performance;
  • analysis of the Company’s interim and annual financial results.
The Strategy Committee

The Strategy Committee assists the Board of Directors in the development of the Company’s strategy and related processes, including the management of the Company’s assets and the review of major innovation and investment programmes and projects. The Committee and its Chairman are appointed by the Board of Directors, which ensures that issues within the remit of the Committee are discussed and analysed thoroughlyfrom all strategic points of view.

The Committee’s responsibilities include:
  • monitoring and updating the Company’s mid-term and long-term strategy, and drafting policy as required;
  • evaluation of the development of the Company’s subsidiaries, including review of their strategies;
  • making recommendations regarding the Company’s M&A projects;
  • analysis and recommendations regarding potential strategic partnerships.
As of 31 December 2011, the Strategy Committee comprised:
  • Vladimir Litvinenko, Committee Chairman, Non-Executive Director of the Board of Directors
  • Igor Antoshin, Committee Member, Non-Executive Director of the Board of Directors
  • Maxim Volkov, Committee Member, Executive Director of the Board of Directors
  • Sven Ombudstvedt, Committee Member, Independent Non-Executive Director of the Board of Directors
In 2011, the Strategy Committee held two meetings. The following topics were covered during those meetings:
  • drafting of the Statute of the Strategy Committee and recommending its approval to the Board of Directors;
  • consideration of the priority developments of the Company in 2012;
  • drafting of the Company’s business strategy;
  • establishing the main areas of focus of the Strategy Committee.
The Remuneration and Human Resources Committee

The Remuneration and Human Resources Committee’s Statute requires that the Committee’s Chairman is an Independent Non-Executive Director on the Company’s Board of Directors, and the Chief Executive Officer cannot be a member of the Committee.

The Committee’s main objectives and responsibilities include:
  • the development of the Company’s policy in relation to organising the activity and motivation of the Board of Directors;
  • the development of the human resources policy in relation to the Company’s senior management, and the supervision of its implementation.
As of 31 December 2011, the Remuneration and Human Resources Committee comprised:
  • Ivan Rodionov, Committee Chairman, Independent Non-Executive Director of the Board of Directors
  • Sven Ombudstvedt, Committee Member, Independent Non-Executive Director of the Board of Directors
  • Igor Antoshin, Committee Member, Non-Executive Director of the Board of Directors
During the reporting period, the Remuneration and Human Resources Committee held two meetings, in which the following issues were covered:
  • the drafting of the Statute of the Remuneration and Human Resources Committee and recommending its approval to the Board of Directors;
  • the identification of the main areas of focus of the Committee;
  • the nomination for the position of the Company’s Chief Executive Officer.
The Environmental, Health and Safety Committee

The Environmental, Health and Safety Committee was formed to oversee the Company’s activities in the areas of environmental protection, the efficient use of natural resources and energy, occupational health and safety for employees, including the avoidance of industrial accidents, and to advise the Board of Directors on such issues. The Committee and its Chairman are appointed by the Board of Directors.

The Committee’s exclusive remit covers the following areas:
  • the Company’s compliance with legal and regulatory requirements relating to environmental and health and safety issues;
  • the Company’s development and enforcement of policies, procedures and practices beneficial to the protection of the environment and the health and safety of employees, contractors, customers and the public;
  • the evaluation of the Company’s efficient use of natural resources and energy, enforcement of energy saving and resource conservation activities in the Company, and providing recommendations for further implementation and improvement of these activities;
  • the prevention of industrial accidents, including plans, programmes and processes established by the Company to evaluate, manage and decrease risks of industrial accidents;
  • the improvement of conditions related to health and safety for the Company’s employees, and the enforcement of policies for decreasing and eliminating occupational injuries.
As of 31 December 2011, the Environmental, Health and Safety Committee was composed of:
  • Igor Antoshin, Committee Chairman, Non-Executive Director of the Board of Directors
  • Maxim Volkov, Committee Member, Executive Director of the Board of Directors
  • Vladimir Litvinenko, Committee Member, Non-Executive Director of the Board of Directors
  • Vasily Loginov, Committee Member, Executive Director of the Board of Directors
During the reporting period, the Environmental, Health and Safety Committee held one meeting, which reviewed andrecommended its approval to the Board of Directors, the new Statute of the Environmental, Health and Safety Committee and identified the main areas of the Committee’s focus.