KMG EP website

KAZAKHSTAN CORPORATE GOVERNANCE CODE AND COMPANY’S CORPORATE GOVERNANCE CODE

Corporate governance best practice in Kazakhstan is set out in the Kazakhstan Corporate Governance Code. This Code is based on the best international practices in the area of corporate governance and Recommendations on Application of Corporate Governance by Kazakhstan Joint Stock Companies, approved by the Securities Market Expert Council of the National Bank of the Republic of Kazakhstan in September 2002. The Code was approved by the Financial Institutions’ Association of Kazakhstan in March 2005 and by the Board of Issuers in February 2005.

Throughout 2011 the Company has complied with the provisions of the Code on Corporate Governance of Kazakhstan in all material respects.

The Company has adopted the Code on Corporate Governance of Kazakhstan as its own Code, amended to include certain provisions of the UK Code. The amendments adopted by the Company impose additional obligations on KMG EP in respect of corporate governance. The Company believes that these additional amendments will significantly strengthen the corporate governance practices applied by the Company. KMG EP also takes into consideration other provisions of the UK Code and will seek to improve its standards of corporate governance in the future.

Additional provisions of the Code on Corporate Governance of the Company in addition to the requirements of applicable laws of the Republic of Kazakhstan (namely, the Code on Corporate Governance of the Republic of Kazakhstan) are as follows:

Additional principles of corporate governance were introduced:

  • Principle of independent activities of the Company.
  • The principle of responsibility.

Some of the corporate governance principles are supplemented by various provisions, such as:

  • Social Policy principles.
  • Provisions regarding relationship with shareholders.
  • Division of responsibility between the Chairman of the Board of Directors and the Chief Executive Officer (CEO).
  • The provisions describing the role of the Chairman of the Board of Directors.
  • Requirement of a minimum number of independent directors.
  • Additional provisions governing the criteria for establishing the “independence” of independent directors.
  • Provisions on access to information and professional development for directors of the Company.
  • Provisions governing the principles of directors’ remuneration.
  • Provisions concerning treatment of inside information.

The copy of the Code on Corporate Governance of the Company along with description of the Company’s practices on corporate governance are available on KMG EP’s website.