Annual report 2011 - VTB

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VTB Annual Report 20115. Corporate governance802010 2011Number of meetings in presentia 5 7Number of meetings conducted by postal ballots 14 10drafting proposals for their improvement. The AuditCommittee is chaired by an independent member ofthe Supervisory Council.Regular consolidated financial reporting incompliance with International Financial ReportingStandards (IFRS);81Setting the agenda for the annual GeneralShareholders Meeting, preliminary approval of theAnnual Report, determining the auditor’s fee andrecommendations on the level of dividends;Review and approval of quarterly reports byinspectors of the Bank’s professional activity in thesecurities market and specialised depositary;Review of activity reports and approval of the plans ofthe Bank’s Internal Control Department;Approval of interested party transactions;Election of members of the Supervisory Council;Approval of directorship positions for the Presidentand Chairman of the Management Board andmembers of the Management Board of VTB Bankwithin other organisations;Committees of the Supervisory CouncilThe Supervisory Council has three standingcommittees, which support the effectiveimplementation of the Council’s managerial andsupervisory functions and provide preliminarydetailed analysis and recommendations regardingthe issues that the Council deems most important.As at 31 December 2011, these were:Audit CommitteeStaff and Remuneration CommitteeStrategy and Corporate Governance CommitteeThe Supervisory Council committees are notgoverning bodies of the Bank, and cannot act in thename of the Supervisory Council.Audit CommitteeThe Audit Committee performs an analysis andsupport function to ensure that the Bank’s internalcontrol system works adequately and effectively. TheCommittee’s exclusive remit includes the appraisal ofcandidates for VTB Bank’s external audit team, reviewof the audit report, assessment of the effectivenessof the Bank’s internal control procedures andAs of 31 December 2011, the Audit Committeecomprised the following members:Matthias A. Warnig, Committee Chairman, independentmember of the Supervisory Council of VTB BankAlexei L. Savatyugin, Committee Member, member ofthe Supervisory Council of VTB BankAleksey V. Ulyukaev, Committee Member, member ofthe Supervisory Council of VTB BankDuring the reporting period, a total of three meetingsand nine postal ballots were organised by the AuditCommittee in which matters covering all priority areasof the Bank’s activity were considered. Considerablefocus was placed on improving internal controlprocedures within the Bank and VTB Group and ondeveloping the risk management system. The workof the Committee was based on the approved actionplan, in accordance with the established roles of theCommittee, as well as global good practice regardingthe work of audit committees.Within the area of internal control, the following topicswere addressed:Regular reports by VTB Group’s independentauditor on the results of the audit of VTB Group’sconsolidated IFRS reporting;The status and prospects for development andperformance of the investment and retail business ofVTB Group;Strategic development and risk management ofindividual member companies of VTB Group.The Supervisory Council considered the followingmatters in 2011:Supervisory Council memberNumber of meetings / postal ballots attended bySupervisory Council membersAlexei L. Kudrin (left office on 03.06.2011) 9Sergey K. Dubinin (elected on 03.06.2011) 8David Bonderman (elected on 03.06.2011) 8Matthias Warnig 15Grigory Y. Glazkov 16Arkady V. Dvorkovich (left office on 03.06.2011) 9Andrey L. Kostin 14Nikolay M. Kropachev 17Ivan V. Oskolkov (elected on 03.06.2011) 7Anna V. Popova (left office on 03.06.2011) 9Alexey L. Savatyugin 17Pavel M. Teplukhin 17Alexey V. Ulyukaev 17Muhadin A. Eskindarov 17Results of the tender for an external auditor;Plan and activity report of the Bank’s Internal ControlDepartment;Review of regular reports by the Bank’s internalcontrol units on significant violations, errors andshortcomings that had been detected at VTB Bankand its subsidiaries, and on measures taken toaddress those violations.The Committee looked into the following aspects ofthe Bank’s and VTB Group’s activity in the area offinancial oversight and risk management:Corporate governance and procedural matters (26%)Approval of transactions (32%)Review of reports, business planning (16%)Debt write-off (10%)Personnel-related matters (8%)Reorganisation of the branch network (5%)Development of VTB Group’s companies (3%)
VTB Annual Report 20115. Corporate governance82Members of the Audit Committeeof the Supervisory CouncilNumber of meetings / postal ballots attended by membersof the Audit Committee of the Supervisory CouncilMembers of the Staff and RemunerationCommittee of the Supervisory CouncilNumber of meetings / postal ballots attended by member ofthe Staff and Remuneration Committee of the Supervisory Council83Matthias A. Warnig 12Alexey L. Savatyugin 11Alexey V. Ulyukaev 12Nikolai M. Kropachev 5Ivan V. Oskolkov 5Pavel M. Teplukhin 5Muhadin A. Eskindarov 5Staff and Remuneration CommitteeThe Staff and Remuneration Committee’s role is to assistthe Supervisory Council in the sphere of appointmentsand remuneration for members of the Bank’s governingbodies and the Statutory Audit Commission.The Committee is comprised of members of theSupervisory Council who have relevant expertise andexperience in this area. The Staff and RemunerationCommittee is chaired by an independent member ofthe Supervisory Council.As at 31 December 2011, the Staff and RemunerationCommittee comprised the following members:Nikolai M. Kropachev, Committee Chairman,independent member of the Supervisory Council;Ivan V. Oskolkov, Committee member, member of theSupervisory Council;Pavel M. Teplukhin, Committee member, member ofthe Supervisory Council;Muhadin A. Eskindarov, Committee member,independent member of the Supervisory Council.In 2011, a total of five postal ballots were organisedby the Staff and Remuneration Committee, inwhich matters concerning the composition andremuneration of the members of the ManagementBoard were considered. The Committee also maderecommendations to the Supervisory Councilregarding candidates for the position of VTBCorporate Secretary.Strategy and Corporate Governance CommitteeOn 5 March 2012, the Strategy and CorporateGovernance Committee was established to optimisethe decision-making process of the SupervisoryCouncil on issues of strategic development and theimprovement of corporate governance at VTB.The Committee’s main tasks are the determinationof strategic objectives and priorities for the Bank’sdevelopment; the support and improvement of thecorporate governance system of VTB; and puttingforward suggestions for the strategic management ofthe Bank’s stock.The Committee comprises members of theSupervisory Council who have relevant expertiseand experience in the area. The Committee isrequired to include at least one Independent Director.As at 31 December 2011, the Strategy and CorporateGovernance Committee was composed of thefollowing members:Sergey K. Dubinin, Committee Chairman,Chairman of the Supervisory Council;David Bonderman, Committee member,member of the Supervisory Council;Grigory Y. Glazkov, Committee member,independent member of the Supervisory Council;Andrey L. Kostin, Committee member, VTB BankPresident and Chairman of the Management Board;Ivan V. Oskolkov, Committee member,member of the Supervisory Council;Alexey L. Savatyugin, Committee member,member of the Supervisory Council;Pavel M. Teplukhin, Committee member,member of the Supervisory Council;Alexey V. Ulyukaev, Committee member,member of the Supervisory Council.Since its creation, the Committee has held a total offour meetings, during which it has considered mattersincluding the strategic development of companieswithin the VTB Group, reports on the implementationof VTB Group strategy, the development of corporategovernance and the internal documents that regulate it.Corporate SecretaryIn 2011, VTB Bank approved the creation of theposition of Corporate Secretary as part of measuresundertaken by the Bank to improve its corporategovernance. The Bank also approved a Regulationon the Corporate Secretary, which was developed inaccordance with the relevant recommendations of theFederal Financial Markets Service Code of CorporateMembers of the Strategy and CorporateGovernance Committee of theSupervisory CouncilConduct. The Corporate Secretary of VTB Bankensures that the rules and procedures of corporategovernance, which guarantee the rights and interestsof shareholders of the Bank and cooperation betweenthe Bank and its shareholders, are followed by theBank and its employees.The Corporate Secretary of VTB Bank is elected by, andreports on a functional basis to, the Supervisory Council.In relation to administrative procedures, the CorporateSecretary also reports to the President and Chairman ofthe Management Board of VTB Bank. The SupervisoryCouncil’s Strategy and Corporate Governance Committeereviews the candidates for the position of CorporateSecretary, and provides recommendations to themembers of the Supervisory Council.The main responsibilities of the Corporate Secretary are:Supervision over the preparations for andproceedings of General Shareholders Meetings,and their compliance with the requirements of theapplicable Russian legislation, the Bank’s Charterand its other internal regulations;Number of meetings / postal ballots attended by membersof the Strategy and Corporate Governance Committee of theSupervisory CouncilSergey K. Dubinin 3David Bonderman 3Grigory Y. Glazkov 4Andrey L. Kostin 4Ivan V. Oskolkov 3Alexey L. Savatyugin 4Pavel M. Teplukhin 4Alexey V. Ulyukaev 4Anna V. Popova 1
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Annual report 2011 - VTB

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