Untitled - PRIME Gold

108 2005 NORILSK NICKEL • ANNUAL REPORT •NORILSK NICKEL • ANNUAL REPORT •2005109••• Development of corporate cultureCorporate holidays, cultural and sports events organized by theGroup play an important role in the creation of employee corporatesolidarity, loyalty and commitment: pride in the Group'sachievements, as well as contributing to the intellectual andphysical development of the employees. The Company Day celebratedannually is ranked especially high in the hierarchy ofthe Group's corporate events. The best employees of the Groupare invited to take part in the celebration and those that haveachieved outstanding performance are awarded with corporateprizes.In 2005, the Group celebrated the 70th anniversary of the NorilskMining and Metallurgical Combine named after A.P. Zavenyaginfrom which the Polar Division was created. Main anniversaryevents were combined with the Metallurgist Day celebrations.Over 150,000 Group's employees – residents of Norilsk industrialdistrict and invited guests – took part in these celebrations.In recognition of its merits and in connection with the above celebrationMMC Norilsk Nickel was awarded a Certificate of Honorissued by the Ministry of Industry and Energy of the RussianFederation.As the majority of the Group's employees are young people,special attention is paid to the youth creativity development.The Group promotes the development of its Merry Norilsk NickelClub, which includes over 300 young employees. Thousands ofNorilsk residents watch the Group's various teams competing.For the last five years, MMC Norilsk Nickel has organized aChildren's Club for the children of the Group's employees. TheClub's key goals include the demonstration of the principal distinctivefeatures and advantages of the Group's main employmentareas to the young generation, instilling pride for theirparents' work and strengthening the children's involvement inthe Group's business. The corporate children's creativity contestRoad to Tomorrow has become a tradition. About 2,000 childrentook part in it in 2005. Following the contest, a mobile exhibitionwas organized around the majority of the Group's productionsites. The Children's Club activities can be seen on the children'swebsite: www.nickelc‡.ru.••• Socially responsible restructuringIn order to improve production efficiency and attain a leadingposition in the global mining industry, MMC Norilsk Nickel,like many other large Russian enterprises created during theSoviet era, implements a large-scale restructuring process,which provides for rationalization of employment, as well asoptimization of age and professional structure of the staff.Of the utmost importance to the Group are the social consequencesaffecting both retiring employees and local communities.The adverse social consequences of restructuringare minimized primarily through the retraining of redundantemployees and their transfer to jobs in other Group entitiesor external organizations located in the same area. In additionto retraining programs, the Group maintains compensationschemes based on specialized social techniques ensuringeffective social adaptation and defending the interests ofredundant target employee groups.When implementing socially acceptable restructuring, theGroup focused particularly on corporate pension plans, stimulatingvoluntary retirement of employees upon reaching thestatutory age limit, namely:• Six Pensions;• Lifelong Professional Pension (for most distinguishedemployees);• Additional Corporate Pension; and• Additional Pension Payment (introduced in 2005).Designed to foster personnel rotation, the Lump SumRetirement Payment program was implemented encouragingthe voluntary retirement of employees in all age categories.This program was primarily intended for employees that weremade redundant due to the disposal of non-core businesses.As a result of these social adaptation programs, in 2005 over1,400 of retirement age employees retired from the Group andmoved to areas with a better climate. This ensured more efficientpersonnel rotation due to internal staff mobility andrecruitment of younger employees and professionals.••• Local community assistanceAfter the changes in the system of housing and utility complexmanagement and the transfer of the social sphere assetsto the municipal authorities, the Group continues to provideassistance to the social infrastructure in Norilsk. It performs capitalrepairs of housing facilities and reconstructs social infrastructurefacilities (such as pre-school institutions, the children'slibrary, city hospital, etc). The Group strives to prevent thedeterioration of the social infrastructure in the conditions oflimited government financing. During 2005, the Group, inconjunction with the Administration of Norilsk city, continuedits active efforts to improve the housing facility managementmodel and increase the effectiveness and transparencyof expenditure for the maintenance of the housingand social assets of the city. As part of the agreements withNorilsk Administration, the Group has made capital repairs tothe gyms in schools and has supported social programs initiatedby the Administration including those aimed at stabilizingsocial processes in the course of the city's utility complexreform.The Group provides extensive charitable support to the populationin the areas of its operations on a systematic basis, inthe framework of charitable programs, in close cooperationwith regional government authorities, municipal authoritiesand public organizations.In its charitable activities, the Group gives priority to workwith young people and implements a number of programsaimed at the development of youths and children, whichaccount for almost half of Norilsk's population. The programof sponsorship support to educational institutions is based onthe Group's contacts with schools and kindergartens and isaimed at the creation of and improvement in conditions,which promote effective education and the development ofthe children's potential and their labor nurturing. The Group'semployees are directly involved in on-going vocational guidancework with school students. The Group arranges meetingsfor school children with employee teams and excursionsto the production entities. Staff from the Group also makesvisits to schools to describe and explain the operations of theGroup's entities.The Group provides assistance to pensioners, war veterans, disabledpersons, low-income families, children from large families,orphans and other socially vulnerable people to complementthe benefits provided by the government's socialsecurity system. Over the last several years, the Group hasbeen implementing in Norilsk a special program Social Supportto Disabled Persons and Disability Prevention. In 2005, theGroup sponsored the Norilsk orphanage and other specializedinstitutions for children.Another direction of the Group's charitable activity is its participationin the development of the Taimyr Peninsula. TheGroup has a long-standing tradition of providing assistance andhelp to the Far North indigenous peoples inhabiting the Taimyr(Dolgan-Nenetz) Autonomous District. The Group renders regularassistance to residential settlements of the Far Northindigenous peoples, supports health care institutions, schoolsand kindergartens in the district, implements measures aimedat the preservation and restoration of the cultural traditionsof the Far North peoples and the protection of the unique floraand fauna of Taimyr. The Group provides assistance to theindigenous settlements on a regular basis. The sponsorship programsare discussed and agreed upon with the heads of thesettlements and regions and with the district administration.OVERVIEW OF HUMAN RESOURCESAND SOCIAL POLICIES10Physical training and sports facilitation among the Group's employees,as well as the promotion of a healthy lifestyle and physicalfitness as a way to increase labor potential and productivity playa significant role in strengthening the corporate culture. Thistrend is especially vital for the Group's employees living in the harshweather conditions of the Far North. In 2005, almost all of theGroup's employees participated in fitness and sports events heldat the Group's entities. Every fourth employee takes regular sportingand physical exercises.