Remuneration payable to members of the Supervisory Board
In accordance with Russian Federal Law No. 208-FZ On Joint Stock Companies dated 26 December 1995, the General Meeting of Shareholders may decide that members of the Supervisory Board should be paid remuneration for their services and/or compensation for expenses related to the execution of their functions as members of the Supervisory Board.
The amount of such remuneration and compensation is determined by the General Meeting of Shareholders.
The current remuneration system for members of the Supervisory Board is underpinned by the interrelated principles of accessibility, transparency and completeness, adequacy, practicability and soundness, as well as the principle of individual remuneration depending on the contribution of each Supervisory Board member.
In accordance with the approved Policy on Remuneration and Compensations to the Members of the Supervisory Board (the “Policy”), the level of remuneration paid to Supervisory Board members should be sufficient to attract, motivate and retain persons having relevant skills and qualifications.
Pursuant to the approved Policy, remuneration of directors for their performance as Supervisory Board members consists of a basic fee and additional remuneration. Remuneration related to performance of the Supervisory Board member functions is not paid to government officials, employees of the Bank of Russia, and employees and managers of the Exchange and its subsidiaries.
The basic fee of a Supervisory Board member depends on whether such member is independent or not. The basic fee of independent Supervisory Board members is higher than that of members who are not independent.
Differentiated additional remuneration is paid to Supervisory Board members for performance of additional duties requiring extra time and effort of the Chairman of the Supervisory Board, the Deputy Chairman of the Supervisory Board, the Chairman of a Supervisory Board Commission or a member of a Supervisory Board Commission. The duties of the Chairman of the Supervisory Board and the Chairman of a Supervisory Board Commission are associated with a higher workload and level of responsibility, and therefore the amount of additional remuneration due for performance of these functions is two times higher than the additional remuneration due to the Deputy Chairman of the Supervisory Board and members of Supervisory Board Commissions, respectively.
The Nomination and Remuneration Commission of the Moscow Exchange Supervisory Board provides recommendations on the level of remuneration payable to Supervisory Board members based on the expert assessment of the levels of remuneration adopted by other Russian companies with similar capitalisation and competitors of the Moscow Exchange. Following the recommendations of the Nomination and Remuneration Commission, the Regulations on Remuneration and Compensation Due to Members of the Supervisory Board (the “Regulations”) are developed to be approved by the General Meeting of Shareholders of the Moscow Exchange.
The amount of the basic fee and additional remuneration due to Supervisory Board members is fixed and reflects the expected time input related to performance of the Supervisory Board member functions; it does not depend on the actual attendance of Supervisory Board / Supervisory Board Commission meetings (including unscheduled ones).
However, in order to motivate members of the Supervisory Board and Supervisory Board Commissions to work diligently and efficiently, the General Meeting of Shareholders may reduce the amount of the basic fee and additional remuneration (as and to the extent provided for in the Regulations) or resolve not to pay any remuneration to the Supervisory Board members.
Apart from the remuneration for their work on the Supervisory Board and in Supervisory Board Commissions, pursuant to the approved Policy, Supervisory Board members are entitled to reimbursement (compensation) of travel expenses related to their participation in Supervisory Board / Supervisory Board Commission meetings and General Meetings of Shareholders held in praesentia, as well as in other events which they attend in their capacity of Supervisory Board members. In addition, Supervisory Board members who need to travel to meetings and other events held outside their place of residence are entitled to reimbursement (compensation) of entertainment expenses.
Supervisory Board members are entitled to the same level of service as members of the Company’s executive bodies in accordance with relevant internal documents on reimbursement of expenses incurred during business trips.
The exhaustive list of reimbursable expenses is defined in the Regulations.
In order to maintain the necessary level of skills of Supervisory Board members, the Nomination and Remuneration Commission of the Moscow Exchange Supervisory Board may recommend paying for their professional training and refresher courses. The amount of remuneration paid in 2016 to the members of the Supervisory Board of the Moscow Exchange for the period from the date of their election in 2015 to the date of termination of their powers in 2016 (a corporate year) was determined in accordance with the Regulations on Remuneration and Compensation Due to Members of the Supervisory Board of the Moscow Exchange approved on 28 April 2015 by the Annual General Meeting of Shareholders (Minutes No. 53).
Prior to that, the amount of remuneration to the Supervisory Board members had been reviewed by the Nomination and Remuneration Commission of Supervisory Board, and by the Supervisory Board of the Moscow Exchange.
The resolution on payment of remuneration to the Supervisory Board members for the execution of their functions during their term of office and on the amount of remuneration payable to each individual director elected on 28 April 2015 was made at the Annual General Meeting of Shareholders held on 27 April 2016.
In 2016, the remuneration (including compensation for expenses) was paid to 15 members of the Supervisory Board:
|Type||Amount, RUB thousand|
|Remuneration for serving in a supervisory body||79,310.47|
|Compensation for expenses||1,621.96|
|No.||Name||Amount (by type)||Total, RUB thousand|
|Remuneration for performance as a supervisory body member, RUB thousand||Compensation for expenses,RUB thousand||Other, RUB thousand|
|1.||Kudrin, Alexey Leonidovich||3,500.00||4,520.00||8,020.00|
|2.||Golikov, Andrey Fedorovich||3,500.00||5,250.00||461.47||9,211.47|
|3.||Beattie, Nicola Jane||4,329.34||1,855.43||46.61||6,231.38|
|4.||Bratanov, Mikhail Valeryevich||5,000.00||3,000.00||8,000.00|
|7.||Denisov, Yury Olegovich||3,500.00||2,000.00||461.48||5,961.48|
|8.||Zlatkis, Bella Ilyinichna||3,500.00||500.00||4,000.00|
|9.||Karachinsky, Anatoly Mikhailovich||5,000.00||1,500.00||6,500.00|
|10.||Lykov, Sergey Petrovich||3,500.00||0.00||3,500.00|
|12.||Sharonov, Andrey Vladimirovich||2,500.00||500.00||3,000.00|
|13.||Shershun, Kirill Yevgenyevich||3,500.00||0.00||3,500.00|
|14.||Gordon, Maria Vladimirovna||0.00||0.00||340.60||340.60|
The existing remuneration and compensation rules contribute to the Moscow Exchange’s long-term success. To increase transparency as regards the variable part of the remuneration, the 2016 AGM reviewed and approved the new version of the Regulations on Remuneration and Compensation Due to Members of the Supervisory Board of the Moscow Exchange.
According to the Regulations, currency risk incurred by non-resident members of the Supervisory Board may be hedged by fixing the exchange rate used to calculate the remuneration as of the election date.