Moscow, 14 November 2000; Sibneft plans to amend its company charter in line with the recommendations of a corporate governance audit carried out by Standard & Poor’s. The decision to amend the charter provides further evidence of Sibneft’s commitment to achieving global best practice in the field of corporate governance.
Sibneft set a new benchmark for corporate governance in Russia when it adopted a Corporate Governance Charter drawn up by a panel of independent European experts in July 1998. The Standard & Poor’s evaluation was conducted as part of a pilot project for a new corporate governance rating service.
The audit recommended restricting the freedom of the board of directors to increase charter capital. The audit also recommended incorporating into the charter a clearer definition of voting procedures at shareholder meetings. Sibneft management plans to recommend that both changes be incorporated into the company’s charter at the next annual shareholder meeting scheduled for June 2001.
The audit praised Sibneft for its high levels of disclosure and transparency, for putting in place procedures to ensure that the rights of minority shareholders are protected and for taking a “proactive approach to corporate governance issues”. In particular, the report commended Sibneft for establishing a consultative committee to look after the rights of minority shareholders. “The strength of governance is also influenced by the strong internal transparency that is created by the control systems in place at Sibneft,” the report added.
Sibneft president Eugene Shvidler noted that the review had given the company valuable feedback. “We are very pleased to have participated in the Standard & Poor’s pilot project, which has helped us to identify strengths and weaknesses in our corporate governance processes. Sound corporate governance is not only good for investor confidence, but fundamentally good for business as well. We have long recognized the essential contribution that good corporate governance makes to our company’s long-term prospects and to building mutually beneficial relationships with all our stakeholders.”