Press release
On July 31, 2009 Standard & Poor’s corporate governance Service rating reaffirmed its corporate governance rating (CGR) for Sibirtelecom at CGR-5.0. At the same time, the company’s rating was confirmed at CGR 5.3 on the Russian scale.
Sibirtelecom’s overall CGR is the result of an evaluation of four analytical components based on the international and Russian system on a scale of 1-10 (the first showing score on the international scale and the second on the national scale):
- Ownership structure and external influence – 5/5.0 (unchanged);
- Shareholder rights and financially interested parties – 7/7.1 (unchanged);
- Financial transparency, information disclosure and audit – 6/6.4 (raised from 6/6.3);
- Composition and efficiency of the Board of Directors — 4+/4.7 (unchanged).
Among the strong points in Sibirtelecom’s corporate governance practice, the following should be noted:
- The procedure for preparing and conducting shareholder meetings are efficient.
- The Company published its audited IFRS reports prior to the annual general shareholders meeting in 2009 (only a preliminary version was released in 2008). Minority shareholders are vested with broad rights in accordance with the Russian legislation and the Company charter.
- The company maintains a high level of information disclosure. In 2008 Sibirtelecom for the first time issued an auditor’s statement on its IFRS 2008 annual financial statement with reservations, and also began to prepare its quarterly financial statement. The company adheres to a policy of active relations with investors.
- Minority shareholders are active; two external members of the Board of Directors represent the interests of minorities and are not exposed to conflicts of interests.
- The Board of Directors possesses extensive powers. The Board’s operations are supported by the operations of four committees which are attached to it; the lineup of each committee includes independent directors. The efficiency of the Audit Committee’s operations has improved since our last review, although independence remains limited.
- The company retained the services of an auditor which has an international reputation and was selected during a public tender.
Following confirmation the above CGRs were withdrawn at the request of Sibirtelecom.
“We would like to express our gratitude to S&P rating agency for our successful collaboration in relation to the assignment and review of our corporate governance rating. The annual analysis and constant monitoring of Sibirtelecom’s corporate governance status has contributed greatly to forming and improving a solid corporate governance track record at the company. We believe that further operations regarding the review of our corporate governance rating will not have much of an impact on the quality of the company’s corporate governance and can be continued by us independently”, the first deputy general director and CFO Alexander Sheifer pointed out.
The full text of Standard & Poor's press release can be found on the Russian website of S&P rating agency and also on the corporate website of Sibirtelecom.
