.
.

To Shareholders and Investors

In implementing the development strategy IDGC of Centre aims to increase the shareholder value of the Company and achieve high standards of corporate governance. The Company follows the principles of respect for the rights of minority shareholders and transparency, which allows raising the investment attractiveness of IDGC of Centre. The compliance with these principles is aimed to support the credibility of the investment community and ensures our shareholders to receive the maximum return on investment for a long term period.

Transparency in financial reporting is another important element of corporate governance and effective interaction with the investment community. IDGC of Centre discloses on the basis of quarterly, semiannual and annual reports in accordance with Russian Accounting Standards (RAS), as well as on the basis of semiannual and annual financial statements in accordance with International Financial Reporting Standards (IFRS). The Company intends in future to follow this practice and to expand the volume of information provided.

The corporate governance system of IDGC of Centre is made in accordance with applicable legislation and internal regulations, including the Corporate Governance Code of IDGC of Centre, and is constantly improved in accordance with the best Russian and international practice.

One of the most compelling evidence of the practical application of the principles of strong corporate governance can be named the formation of five committees under the Board of Directors, whose members include representatives of minority shareholders. The Company has adopted and implemented the Regulations on Information Policy and Dividend Policy. The Company has created and efficiently applies the system of internal control, which consists of the Board of Directors, the Audit Committee and Internal Audit and Risk Management Department. The internal control system is governed by the Internal Control Policy and the Risk Management Policy of IDGC of Centre.

Another indication is also the level of national corporate governance rating of IDGC of Centre 7+ “Developed corporate governance practice”.

The Company will continue to follow the highest standards of corporate governance, transparency and efficient communication with the investment community and shareholders. We strive to develop our business and we follow the principles of transparent and responsible management.