Shareholders and investors

Memorandum of the controlling shareholder, PJSC Rosseti, on controlled power grid companies

Purpose of ownership and plans for controlled shareholdings

Public Joint Stock Company Federal Grid Company – Rosseti (PJSC ROSSETI) is a public joint stock company with a government share of 77.02% of the outstanding shares.

PJSC ROSSETI owns controlling stakes in 17 electric grid companies: PJSC ROSSETI Lenenergo, PJSC Rosseti Moscow Region, PJSC ROSSETI Volga, PJSC ROSSETI North-West, PJSC ROSSETI North Caucasus, PJSC Rosseti Siberia, PJSC ROSSETI Ural, PJSC Rosseti Center, PJSC Rosseti Center and Volga Region, PJSC Rosseti South, PJSC Rosseti Tomsk, JSC Rosseti Tyumen, JSC Rosseti Yantar, JSC Rosseti Siberia Tyvaenergo, JSC Chechenenergo, JSC RES, JSC "Electromagistral".

PJSC ROSSETI considers these controlled blocks of shares as strategic assets, the disposal of which is not planned.

Key challenges in relation to assets

The key task of PJSC Rosseti in the field of management of these subsidiaries is to coordinate their work within the framework of the implementation of technical, financial and economic policy and investment planning, as well as to control the implementation of the development strategy.

PJSC ROSSETI has identified strategic priorities for the development of the Group's companies:

creation of a unified power grid complex of the Russian Federation by consolidating power grid assets under the management of the Rosseti Group of Companies;
improving the efficiency of the power grid complex;
ensuring the implementation of national projects of the Russian Federation;
ensuring the reliability and availability of electricity supply;
ensuring technological sovereignty.

Principles of Corporate Governance

PJSC ROSSETI manages the Group's companies in accordance with uniform corporate standards aimed at ensuring the efficiency of business processes, quality control, and minimizing all types of corporate risks.

PJSC ROSSETI, as the controlling shareholder, is fully aware of the importance of improving corporate governance in the Group's companies, strives to ensure the openness and transparency of their activities, as well as the implementation of the recommendations of the Corporate Governance Code in their business practices.

PJSC ROSSETI, following the best corporate governance practices, annually ensures that there are sufficient independent directors on the Boards of Directors of ROSSETI Group companies whose shares are traded at organized auctions to comply with listing rules and corporate governance principles. To ensure the independence and objectivity of the work of the Boards of Directors of ROSSETI Group companies, it is planned to maintain the number of independent directors in their composition at least at the current level.

Representatives of PJSC ROSSETI also participate in the annual General Meetings of Shareholders of the Group's companies in order to establish a dialogue with minority shareholders on the company's development prospects.

PJSC ROSSETI guarantees compliance with market principles when the Group's companies carry out financial and economic activities.

PJSC ROSSETI, as a controlling shareholder, supports the initiatives of the Group's companies to protect the rights and interests of minority shareholders.

The dividend policy in the ROSSETI Group of Companies is based on strict observance of shareholders' rights provided for by the legislation of the Russian Federation and is aimed at increasing the investment attractiveness of the Group's companies, whose securities are admitted to organized trading.

The recommended amount of dividends is set by the Boards of Directors of the ROSSETI Group companies on the basis of financial results, including those determined according to the consolidated financial statements under IFRS.