Board of Directors
In 2019, the Board of Directors held 8 meetings and reviewed 70 matters.
| Full name | Irina Bokova | Andrey A. Guryev | Andrey G. Guryev | Sven | Natalia Pashkevich | James Rogers | Marcus Rhodes | Mikhail | Xavier Rolet | Andrey Sharonov |
|---|---|---|---|---|---|---|---|---|---|---|
| Year of birth | 1952 | 1982 | 1960 | 1966 | 1939 | 1942 | 1961 | 1975 | 1959 | 1964 |
| Board of Directors | 8/8 | 8/8 | 8/8 | 8/8 | 8/8 | 8/8 | 8/8 | 8/8 | 7/8 | 7/8 |
| Audit Committee | 5/5 | 5/5 | 5/5 | 4/5 | ||||||
| Strategy Committee | 2/2 | 2/2 | 2/2 | 2/2 | ||||||
| Remuneration and Human Resources Committee | 4/4 | 4/4 | 3/4 | |||||||
| Risk Management Committee | 3/4 | 2/4 | 2/4 | 4/4 | ||||||
| Environmental, Health and Safety Committee | 2/3 | 2/3 | 3/3 | |||||||
| Sustainable Development Committee | 2/2 | 2/2 | 2/2 | |||||||
| Key competences | ||||||||||
| Strategy | ✓ | ✓ | ✓ | ✓ | ✓ | |||||
| Finance and audit | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | |||
| Chemistry and mining engineering | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ||||
| Environment, health and safety | ✓ | ✓ | ✓ | |||||||
| Human resources | ✓ | ✓ | ✓ | ✓ | ✓ | |||||
| Law and corporate governance | ✓ | ✓ | ✓ | ✓ | ||||||
| Risk management | ✓ | ✓ | ||||||||
In May 2019, Sven Ombudstvedt stepped down as Chairman of the Board of Directors, a role he had held since 2011. Mr Ombudstvedt contributed greatly to the Company’s development, working tirelessly to drive the Company forward and deliver its strategy to 2020. Under his leadership, the Company was able to upgrade its production capacities and make them more efficient and environmentally friendly. Sven Ombudstvedt’s top priority as the Chairman of the Board of Directors was to ensure full compliance with the Board’s key operating principles, including accountability, transparency, responsibility and equality. It is thanks to his efforts that the Company has integrated sustainability principles and goals into its strategy and day-to-day operations.
He passed his chairman’s baton to Xavier Rolet, former CEO of the London Stock Exchange Group. Prior to his appointment Xavier Rolet had chaired the Risk Management Committee of the Board of Directors. Committed to the Company’s values, Xavier Rolet sets great store by improvements made by his predecessor. In his new role, he is going to focus on organic growth, diligent implementation of the investment programme, continued sustainable development and innovations, which are key to adding value to the Company.
Starting from 2011, when the Company established the Board of Directors, the number of independent directors and their authority have been steadily growing. Independent directors make a valuable contribution to the Board’s decision-making as their opinions rely solely on professional skills and expertise, as well as a comprehensive study of the matter. Their position is unbiased, independent and free from the influence of other members of the Board and the Company`s management, and they are primarily focused on improving the Company`s performance. At present, seven of the ten directors are independent, which is well above the average in Russia (38% according to Spenser Stuart research in 2019) and at par with the best global practices. Independent directors chair five of the six Board committees.
They are world-class experts with unique competencies and a track-record in investment and management of major businesses, financial and research organisations and government agencies. They are equipped with a full set of knowledge and skills needed to propel the Company and its Board of Directors forward and foster dialogue with stakeholders at various levels.
Board of Directors nominees and members are assessed against the independence criteria set out in the Regulation on the Board of Directors and the Moscow Exchanges rules. The assessment is performed twice a year by the Remuneration and Human Resources Committee. In 2019, the Board of Directors’ special resolution recognised the independence of two directors, Sven Ombudstvedt and Marcus Rhodes, even though they met the formal criterion of being affiliated with the Company (an 8-year tenure on the Board of Directors).
Despite the fact that there were no changes in the Board composition in 2019, the Remuneration and Human Resources Committee updated the Onboarding Programme for New Board Members. This is done annually to provide them with an effective tool to gain an insight into the Company’s operations. As part of the onboarding programme, newly appointed directors visit the Company’s production sites and meet with functional managers. In August 2019, for example, the members elected to the Board of Directors in 2018 visited PhosAgro sites in Kirovsk and Apatity (Murmansk region) where, apart from learning about the Company’s key asset, they took part in the celebrations of the Miner’s Day.
The Company views commitment to continuous professional growth as a cornerstone of good corporate governance. By expanding their knowledge and skills, directors add value to the Board of Directors and the Company on the whole. An annual performance assessment highlights the need for the qualification upgrade and training of the Board members, with a focus on the following areas:
- industry trends in Russia and abroad;
- risk management;
- current legislative and stock exchange requirements;
- Board operation trends in Russia and abroad.
The assessment held in 2019 identified another focus area for the Board of Directors, which is cyberrisks and cybersecurity. To meet this need, the Company engaged one of most reputable companies in this domain to conduct a training workshop for the Board of Directors and the top management in May 2019. On top of that, the Board of Directors regularly receives newsletters from the Company, including quarterly newsletters on corporate governance and weekly updates on the developments in the chemical and related industries.
An external assessment of the Board’s performance and an annual self-assessment show that its composition is fully balanced. In 2019, there were no changes in the Board of Directors composition. However, there were significant changes to its committees in May 2019, with a new Sustainable Development Committee set up by the Board of Directors. These measures gave a significant boost to the Board of Directors’ performance.
Information on Members of the Board of Directors
KEDGE Business School (France)
Master’s degree in Management Science and Finance
Columbia Business School (USA)
MBA in International Finance
Institute for Higher National Defence Studies (IHEDN) (France)
Post-graduate degree
Credit Suisse
Managing Director
Dresdner Kleinwort
Managing Director
Lehman Brothers (New York and London)
Senior Executive
Banque Lehman Brothers S.A. (France)
CEO
London Stock Exchange Group (LSEG)
CEO
Columbia Business School
Member of the Board of Overseers
HM Treasury
Member of the Financial Services Trade and Investment Board
European Securities and Markets Authority (ESMA)
Member of the Securities and Markets Stakeholder Group
Bank of England
Governor’s Financial Services Forum
London Stock Exchange Group (LSEG)
Advisor
Department for International Trade (London)
Member of the Committee of Expert Advisors
Verseon
Non-executive director
PhosAgro
Chairman of the Risk Management Committee
Shanghai Institute of Finance for the Real Economy — SIFRE
Expert Advisor
CQS Management Ltd.
CEO
PhosAgro
Public Investment Fund — Saudi Stock Exchange (Tadawul)
Member of the Board of Directors
Key competencies:
Degree in Economics and Management of Mining and Exploration Enterprises
Central State Institute for Physical Education
Russian Chemists Union
Vice President
Federation Council of the Federal Assembly of the Russian Federation
Member of the Federation Council of the Russian Federation
PhosAgro
AgroGard-Finance
Member of the Board of Directors
AgroGard-Finance
Chairman of the Board of Directors
Key competencies:
University of Greenwich (UK)
Bachelor’s degree in Economics
Academy of National Economy under the Government of the Russian Federation
PhD in Economics
PhosAgro AG
Deputy CEO for Sales and Logistics
Moscow Rhythmic Gymnastics Federation
President
Andrey Guryev Charitable Foundation
Chairman of the Management Board
Investment Trading Bank
Member of the Board of Directors
PhosAgro-Region
Member of the Management Board
PhosAgro
Member of the Board of Directors
PhosAgro
PhosAgro-Cherepovets
Member of the Management Board
Member of the Board of Trustees
Russian Olympians Foundation
Member of the Council of Trustees
Member of the Management Board
Russian Association of Fertilizer Producers
President
Russian Rhythmic Gymnastics Federation
Member of the Board of Directors
Miners of Russia non-commercial partnership
Deputy Chairman of the Supreme Mining Council
Russian Union of Industrialists and Entrepreneurs
Member of the Management Board Bureau
Key competencies:
Lomonosov Moscow State University
Master’s degree in Economics
PhosAgro-Region
Member of the Management Board
PhosAgro AG
PhosAgro-Cherepovets
CEO
Moscow Exchange
Member of the Board of Directors
Apatit
Member of the Board of Directors
PhosAgro-Cherepovets
Member of the Board of Directors
Chairman of the Management Board
PhosAgro
Member of the Board of Directors
PhosAgro-Region
Member of the Management Board
Apatit
CEO
Chairman of the Management Board
Apatit
Member of the Management Board
Samoilov Scientific Research Institute for Fertilizers and Insectofungicides
Member of the Board of Directors
First Deputy CEO
Apatit
Advisor to the CEO (part-time)
Key competencies:
Pacific Lutheran University (USA)
Bachelor’s degree
Thunderbird School of Global Management
Master’s degree in International Management
Saferoad AS
Member of the Board of Directors
Western Bulk
Member of the Board of Directors
Norske Skogindustrier ASA
CEO
PhosAgro
Chairman of the Board of Directors
PhosAgro
Norske Skogindustrier ASA
Special Advisor
Norske Skog AS
Chairman of the Board of Directors
Norske Skog Norway AS
Member of the Board of Directors
Norske Skog ASA
CEO
Key competencies:
Moscow State Institute of International Relations (Russia)
International Relations
John F. Kennedy School of Government at Harvard University (USA) Leadership and Economic Development
Leadership and Economic Development
University of Maryland School of Public Affairs (USA)
Ford Foundation Fellow
Ministry of Foreign Affairs of the Republic of Bulgaria
National Assembly of the Republic of Bulgaria
Member of the National Assembly
UNESCO
UNESCO
Director-General
Ban Ki-moon Centre for Global Citizens
Member of the Board of Directors
PhosAgro
International Automobile Federation
Member of the Board of Directors
Key competencies:
Yale University (USA)
Bachelor’s degree
Balliol College, University of Oxford (UK)
Bachelor’s / master’s degree in Philosophy, Politics and Economics
Virtus Total Return Fund Inc.
Director
Virtus Global Dividend & Income Fund Inc.
Director
Beeland Interests Inc.
Director
Beeland Enterprises Inc.
Director
Beeland Holdings Pte Ltd.
Director
Spanish Mountain Gold Limited
Director
Geo Energy Resources Limited
Non-executive director
Fab Universal Corp
Independent director
Sinofortune Financial Holdings Limited
Non-executive director
Advisor
Duff & Phelps Select Energy MLP Fund Inc.
Director
Virtus Global Multi-Sector Income Fund
Trustee
Non-executive director
AgroGard-Finance
Independent director
Ocean Capital Advisors LLC
Director
Quantum Digital Asset Management Pte Ltd
Member of the Board of Directors
Sirius International Insurance Group, Ltd
Member of the Board of Directors
Ananti Inc
Director
CQS Cayman Limited Partnership
Advisor
Forbes & Manhattan
Advisor
AgroGard-Finance
Member of the Board of Directors
Santiago Gold Fund
Advisor
Laguna Bay Pastoral Company Pty Ltd
Advisor
Genagro Limited
Advisor
Latitude Technologies Limited
Senior Advisor
Agritrade Resources Ltd
Advisor
ITF Corporation
Advisor
Global Blockchain Technologies Corp
Advisor
Spanish Mountain Gold Limited
Advisor
Nanomedics Co. Ltd
External director
Key competencies:
Loughborough University
Bachelor’s degree in Economics and History of Economics
Institute of Chartered Accountants in England and Wales
Qualified as chartered accountant, member
Rosinter Restaurants Holding
Member of the Board of Directors
Cherkizovo Group
Member of the Board of Directors
Tethys Petroleum Limited
Member of the Board of Directors
PhosAgro
QIWI Group (QIWI plc)
Member of the Board of Directors
Zoltav Resources Inc.
Member of the Board of Directors
SIA Enterprises Limited
Honorary treasurer
Rustranscom Plc
Non-executive director
Key competencies:
Leningrad Mining Institute
PhD in Economics, professor
St. Petersburg Mining University
First Vice Rector
PhosAgro
Key competencies:
Ufa Aviation Institute
Aviation Instrument Making
Russian Academy of Public Administration under the President of the Russian Federation
Law
Government of Moscow
Deputy Mayor for Economic Policy
National Research University Higher School of Economics
Member of the Supervisory Council
National Research University Higher School of Economics
Professor (part-time) at School of Finance of the Faculty of Economic Sciences
Bank of Moscow
Member of the Board of Directors
Moscow School of Management SKOLKOVO
Rector
MC Eko-Sistema
Chairman of the Board of Directors
ALROSA
Member of the Supervisory Board
MC NefteTransService
Chairman of the Board of Directors
Member of the Board of Directors
SKOLKOVO Endowment Fund
Head
Executive director
NOVATEK
Member of the Board of Directors
VTB Bank
Member of the Supervisory Council
Member of the Board of Directors
Moscow Exchange
Member of the Supervisory Board
Moscow School of Management SKOLKOVO
President
PhosAgro
Medicina
Chairman of the Board of Directors
En+ Group
Independent director
Key competencies:
Directors and officers liability for damage caused to third parties by their duties is insured by SOGAZ (contract No. 18 DO 0028 in effect from 1 June 2018 to 31 May 2019, contract No. 19 DO 0020 in effect from 1 June 2019 to 31 May 2020) and is covered up to USD 75 mln (in rouble equivalent) and extended by USD 2 mln for independent directors. Apart from directors liability, the above contracts include the liability of the Company’s officers (since 2012).
According to Section 172 “Duty to promote the success of the company” of the UK Companies Act 2006, PhosAgro’s Board of Directors acts in good faith to promote the success of the Company for the benefit of all shareholders of PJSC PhosAgro, taking into account possible long-term consequences of its decisions for the society and the environment, as well as the interests of the Company’s employees and other stakeholders.
For the members of PhosAgro’s Board of Directors, these standards mean that the Company’s stakeholders should be interacted with responsibly and that their interests should be respected to the maximum extent possible. In 2019, under the guidance of the Board of Directors’ Sustainable Development Committee, stakeholders were identified and surveyed in order to define aspects of the Company’s activities that were significant to them. These aspects have since been given maximum attention, both in terms of information disclosure and intensifying work in the relevant areas. For detailed information on interaction with key stakeholders, recognition and consideration of their interests, see the Stakeholders section of this annual report.
The opinion of our employees is essential for us, which is reflected, in particular, in one of our strategic objectives – increasing the loyalty and satisfaction of our staff. Analysis of employee satisfaction and loyalty surveys is reviewed annually by the Remuneration and Human Resources Committee of PhosAgro’s Board of Directors. Analysis of hotline complaints and respective management response is reviewed by the Audit Committee of PhosAgro’s Board of Directors on a quarterly basis. The said committees are composed solely of independent directors.
Although at the moment we do not apply such practices as appointing directors from among the employees or appointing a non-executive director responsible for interaction with employees for considering their standpoint when managing the Company, we consider it effective and are actively involved in a dialogue on all major management issues with the trade union organisation (Minudobreniya Association), which has historically been an equal partner for the Company’s management and an authorised representative of employees in collective bargaining, review and resolution of labour disputes.
In addition, heads of each production site of the Company regularly (at least twice a year) visit all business units and hold meetings with employees, at which they inform the staff about the Company’s performance, implemented measures, and plans for production and social development. A key component of such meetings is face-to-face conversation between managers and teams. Everyone has an opportunity to ask questions or make a proposal aimed at improving the technology and personnel working conditions. Based on employees’ suggestions and comments, an action plan for improving organisational and technological processes is then developed and implemented.
New strategy
In March 2019, the Board of Directors approved PhosAgro’s Strategy to 2025 taking into account recommendations of the Strategy Committee issued in late 2018 – early 2019. As part of the approval, it determined the metrics subject to monitoring, as well as the frequency and the procedure for such monitoring. This resolution formalised the management duty to submit, twice a year, strategy progress reports to be pre-reviewed by the Strategy Committee and finally reviewed by the Board of Directors.
Sustainability management
In 2019, the Board of Directors placed a special emphasis on sustainability management, which was, first and foremost, incorporated into the Company’s Strategy to 2025 as a standalone section defining goals and initiatives in this domain. The Board of Directors also approved the updated Personnel Management Policy and transparency statement in accordance with the UK Modern Slavery Act 2015, along with the amended Environmental Policy. The said documents were developed by the Company’s management based on the analysis of local corporate documents and procedures needed to ensure PhosAgro’s compliance with the applicable EU laws on human rights in supply chains. Moreover, all Board meetings held following the setup of the Sustainable Development Committee included reports from its chairman on the results and plans in this area.
Strengthened role of committees
In 2019, the Board of Directors also focused on a more in-depth review of matters at committee meetings, followed by chairman reports to the Board summarising key statements, conclusions and proposals. As a result, the reporting year saw an improvement in the quality of materials provided to the
New dividend policy
An important milestone in the Board of Director’s work was the approval of the new dividend policy aimed at boosting the Company’s investment appeal.
Corporate governance assessment and development
In March 2019, the Board of Directors reviewed the report on the corporate governance quality taking into account MSCI and Sustainalytics ratings and the previous year’s self-assessment of compliance with the Corporate Governance Code approved by the Bank of Russia on 21 March 2014. Noting a high level of such compliance, the Board of Directors also analysed the governance quality criteria, which for certain reasons were not met fully or partially, and agreed on an improvement plan.
The early 2019 self-assessment and the subsequent recommendations of the Remuneration and Human Resources Committee were also subject
to review by the Board of Directors in the reporting year. The self-assessment was held in the form of a directors’ survey based on PwC’s methodology approved by the Board of Directors in 2017.
February 2020 saw KPMG conduct an external assessment of the Company’s Board of Directors. The independent consultant recognised the Board’s high efficiency and a strong engagement of its members.
KPMG also highlighted a balanced split between executive and independent directors and confirmed that they have the required skills, competencies and expertise. In terms of independence and the presence of foreign directors, PhosAgro is almost on a par with foreign industry leaders and ahead of the Russian players. The current Board’s composition is fully in line with the Company’s needs, which contributes to well-reasoned decision-making.
The efficiency of the Board’s key functions was also highly rated by the independent consultant. The Board of Directors discusses a wide range of matters to ensure the effective governance of the Company’s operations.
Stakeholder engagement
In 2019, the Board of Directors strengthened its dialogue with stakeholders. In addition to the participation in the Annual General Shareholders’ Meeting and the visit to the sites in Kirovsk and Apatity, the Board’s independent directors took part in the Investor Day held in September in London. As part of it, they presented PhosAgro’s new strategy and dividend policy to the investment community.
Miscellaneous
Apart from the above matters, the Board of Directors reviewed the Company’s amended budget for 2019 and the 2020 budget and approved the Internal Audit Department’s report for 2019 and the 2020 plan. On a quarterly basis, it also discussed a number of other matters such as the approval of the Company’s reports, the progress against the 2019 budget and the results of risk monitoring. Where necessary, the Board of Directors considered matters relating to the approval of significant transactions and interested-party transactions, convening of general shareholders’ meetings and other matters within its remit under the Charter.
In 2019, the Board of Directors continued to foster cooperation with the Company’s functional units by reviewing reports and issuing recommendation for such functions as procurement, project management, IT and global projects. On top of that, it reviewed and provided opinion on the external assessment of the internal audit, risk management and internal control functions.