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Corporate governance principles

The system of corporate governance at JSC Aeroflot has been developed in conformity with the provisions of Russian law and international best practices. The Company seeks to maximise the transparency and efficiency of its governance operations. A key priority in corporate governance at Aeroflot is to take full account of the balance of interests between minority and majority shareholders and to ensure that the balance is maintained.

Corporate governance at JSC Aeroflot is governed by the following documents:

• JSC Aeroflot Charter,
• Statute on the General Meeting of Shareholders of JSC Aeroflot,
• Statute on the Board of Directors of JSC Aeroflot,
• Statute on the Executive Board of JSC Aeroflot,
• Code of Corporate Ethics of JSC Aeroflot.

Aeroflot is working to further develop and improve its corporate governance system. The regular Annual General Meeting of Shareholders (AGM) in 2013 approved amendments to the Company Charter, providing greater control over transactions of JSC Aeroflot subsidiaries and affiliates with stocks and shares of other organisations. Similar changes were made to the Statute on the Board of Directors of JSC Aeroflot.

In 2013, Aeroflot used the services of the Russian Institute of Directors (a non-profit partnership) for an independent audit of the Company’s corporate governance standards. A number of measures to improve corporate governance at the Company were taken on the basis of the audit recommendations, including improvement of the internal control system and preparation and approval of a Code of Corporate Ethics. Information on the membership and competence of Committees of the Board of Directors, as well as the main provisions of the current system of remuneration, compensation and incentives to members of the Board of Directors, have been provided for public scrutiny on the Company website.

JSC Aeroflot also takes an active part in work to improve Russia’s regulatory system in the sphere of corporate governance.

Aeroflot is working to improve the system of corporate governance at all of the airlines in the Group. Aeroflot representatives take part in the functioning of executive management, collegial governance and control bodies at subsidiaries, and specialised committees of the boards of directors of subsidiaries and affiliates have been set up.

As envisaged by current Russian legislation, JSC Aeroflot takes unilateral decisions on the business of subsidiaries in which the Company is the sole shareholder. Responsibility for monitoring the business efficiency of subsidiaries and affiliates is borne by senior management and specialised business units.

The deployment of innovative technologies to enhance the efficiency of various corporate governance functions and processes is an important aspect of corporate governance efforts by JSC Aeroflot and other aviation assets of the Group.