Mobile TeleSystems PJSC

Another confirmation of our commitment to adopt and develop the best world practices is our activity in the field of sustainable development and ESG. We perceive the improvement of the quality and safety of human life and society as one of the fundamental strategic objectives. Systematization and management of our projects and actions in this area at the level of operational management are handled by a dedicated ESG Center. Strategic control is performed by the Corporate Governance, Environmental and Social Responsibility Committee (ESG Committee) of MTS Board of Directors You will learn more about our activity in this area in the special sections of the report. In my address, I just want to emphasize that as a large stable company, as a supplier of advanced, massively demanded services, we are aware of our direct impact on people's perception of their standard of living, on companies' perception of confidence in current and future economic well-being. We understand our own responsibility in this regard, and in conditions of environmental pressure, uncertainty and stress, we strive to become a stabilizing factor for society, employees, partners and investors." [...] "In the past year, the Board of Directors focused on issues related to sustainable development and ESG practices. The bulk of the work was carried out by a combination of the Corporate Governance, ESG Committee (Environmental and Social Responsibility Committee) of the Board of Directors and the MTS ESG Center and the MTS ESG Center, responsible for systematization and expansion of the company's activities in this area. Particularly important decisions were made directly at the level of the Board of Directors." [...] "Compliance programs that support our ESG strategy allows us to develop our ecosystem based on business ethics principles, strictly following the requirements of the regulatory authorities, investing in sustainable development of society while observing the balance of stakeholders' interests. Since 2016, the Company has been actively developing the Unified Compliance System (hereinafter — UCS) on the basis of the norms of the applicable law, recommendations of regulatory authorities, the specific nature of the industry and best practices in this sphere. UCS allows us to to develop our ecosystem based on business ethics principles, strictly following the requirements of the regulatory authorities, investing in sustainable development of society while observing the balance of stakeholders' interests.

В 2021 году Комитет по корпоративному управлению был преобразован в Комитет по корпоративному управлению, экологической и социальной ответственности (ESG Комитет), а сфера его компетенции была расширена. Это позволило комплексно рассматривать на одной площадке вопросы корпоративного управления, экологической и социальной ответственности Группы. ESG Комитет контролирует внедрение и соблюдение принципов устойчивого развития, а также участвует в разработке общей стратегии МТС в области устойчивого развития, экологической и социальной ответственности, рассмотрении итогов ее реализации.\n\nКомитет курирует вопросы, касающиеся устойчивого развития компании и ее вклада в устойчивое развитие общества, в том числе:\n\n**>** создания устойчивой экосистемы внутри и вокруг компании за счет консолидации и эффективного использования ресурсов кросс-функциональных проектов;\n\n**>** интеграции в бизнес компании новых идей и проектов в области устойчивого развития и КСО, соответствующих лучшим российским и мировым практикам;\n\n**>** создания устойчивой бизнес-среды в России и в странах присутствия компании за счет разработки партнерских программ и проектов, содействующих ответственному ведению бизнеса и направленных на достижение целей устойчивого развития.\n\nВ своей деятельности комитет руководствуется рекомендациями и требованиями действующего законодательства, Уставом и внутренними документами компании, Кодексом делового поведения и этики, решениями органов управления компании, Положением о комитете и лучшими глобальными практиками управления ESG‑повестки.\n\n**Комитет по стратегии Совета директоров совместно с Правлением** пересматривают технологическую стратегию, которая включает программы энергосбережения и повышения энергоэффективности, использование энергоэффективного оборудования и внедрение альтернативных источников энергии.\n\nОсновной задачей Комитета по вознаграждениям **и назначениям** является подготовка для Совета директоров рекомендаций относительно приоритетных направлений деятельности компании по вопросам выработки и реализации кадровой политики и вознаграждений.\n\n**Комитет по аудиту содействует эффективному выполнению** функций Совета директоров в части контроля за финансовохозяйственной деятельностью. Комитет рассматривает вопросы обеспечения контроля эффективности функционирования системы управления рисками и внутреннего контроля, системы комплаенс\n\nф й\n\nНезависимые\n\nНеисполнительные\n\nИсполнительные\n\nПредставители менеджмента / представители акционера\n\n2019 2020 2021\n\nС 2019 года в ПАО «МТС» также действует Специальный комитет **по комплаенс, который рассматривает вопросы, связанные** с реализуемыми МТС мероприятиями по надзору в сфере комплаенс.\n\n**Комитеты и рабочие группы при президенте**\n\n**Комитет по устойчивому развитию и корпоративно-** **социальной ответственности до июня 2021 года занимался** координацией деятельности МТС в данных направлениях, включая интеграцию в бизнес компании новых идей и проектов в области устойчивого развития и КСО. Далее функционал был передан новому подразделению — ​Центру ESG, а Комитет был упразднен в апреле 2022 года.\n\n**Комитет по рискам, который возглавляет президент МТС, обсуждает** ключевые риски компании, включая экологические и социальные, и принимает коллегиальные решения о выработке планов по их снижению.\n\nС 2016 года в МТС действует Комитет по комплаенс, в состав которого входят глава компании и руководители прямого подчинения. Комитет принимает решения по вопросам формирования и реализации программ, составляющих Единую систему комплаенс.\n\n**Рабочая группа по финансам и инвестициям разрабатывает** и реализует план мероприятий по выпуску социальных / «зеленых» облигаций, утверждает процедуры ESG-финансирования и списки / б\n\nПо итогам 2021 года МТС шестой год подряд входит в Топ‑10 компаний Национального индекса корпоративного управления\n\nПодробнее о работе Совета директоров [см. в разделе](https://mts.ru/upload/contents/10677/mts-annual-report-2021.pdf) «Корпоративное управление» Годового отчета ПАО «МТС» за 2021 год\n\nПодробнее см. в разделе «Управление рисками в области устойчивого развития»\n\nСовет директоров, Правление и президент ПАО «МТС» принимают активное участие в управлении устойчивым развитием и обсуждении вопросов ESG в МТС. Они участвуют в определении ESG-стратегии и стратегий, касающихся устойчивого развития, системно оценивают достижения Группы по целевым показателям социальных программ и проектов, инициатив в области охраны окружающей среды. Правление и Совет директоров ежегодно рассматривают Отчет об устойчивом развитии. Совет директоров и президент утверждают локальные нормативные документы, которые способствуют устойчивому развитию компании.\n\nВ 2021 году среди вопросов, связанных с тематикой устойчивого развития, Совет директоров проанализировал работу системы антикоррупционного комплаенс Группы, а также оценил уровень деловой этики и культуры. 17 % вопросов, рассмотренных на заседаниях Совета директоров в 2021 году, касались тематики кадровых назначений и кадровой политики. Совет директоров также рассмотрел и принял программу мотивации и долгосрочного материального поощрения сотрудников МТС, в том числе оценил выполнение ключевых показателей эффективности президента и членов Правления МТС, а также утвердил ключевые показатели эффективности для них, часть из которых охватывают ряд социальных и экологических аспектов деятельности компании.\n\nДля того чтобы обеспечить большую прозрачность и непредвзятый подход к принятию управленческих решений, Совет директоров в большей степени состоит из независимых директоров. На 31 декабря 2021 года в состав Совета директоров МТС входили девять человек: две женщины и семеро мужчин, в состав Правления — ​две женщины и двенадцать мужчин.

Another confirmation of our commitment to adopt and develop the best world practices is our activity in the field of sustainable development and ESG. We perceive the improvement of the quality and safety of human life and society as one of the fundamental strategic objectives. Systematization and management of our projects and actions in this area at the level of operational management are handled by a dedicated ESG Center. Strategic control is performed by the Corporate Governance, Environmental and Social Responsibility Committee (ESG Committee) of MTS Board of Directors You will learn more about our activity in this area in the special sections of the report. In my address, I just want to emphasize that as a large stable company, as a supplier of advanced, massively demanded services, we are aware of our direct impact on people's perception of their standard of living, on companies' perception of confidence in current and future economic well-being. We understand our own responsibility in this regard, and in conditions of environmental pressure, uncertainty and stress, we strive to become a stabilizing factor for society, employees, partners and investors." [...] "In the past year, the Board of Directors focused on issues related to sustainable development and ESG practices. The bulk of the work was carried out by a combination of the Corporate Governance, ESG Committee (Environmental and Social Responsibility Committee) of the Board of Directors and the MTS ESG Center and the MTS ESG Center, responsible for systematization and expansion of the company's activities in this area. Particularly important decisions were made directly at the level of the Board of Directors." [...] "Compliance programs that support our ESG strategy allows us to develop our ecosystem based on business ethics principles, strictly following the requirements of the regulatory authorities, investing in sustainable development of society while observing the balance of stakeholders' interests. Since 2016, the Company has been actively developing the Unified Compliance System (hereinafter — UCS) on the basis of the norms of the applicable law, recommendations of regulatory authorities, the specific nature of the industry and best practices in this sphere. UCS allows us to to develop our ecosystem based on business ethics principles, strictly following the requirements of the regulatory authorities, investing in sustainable development of society while observing the balance of stakeholders' interests.

For MTS, the past year of 2021 was a year of significant changes in ESG agenda management at the level of both operational management and the Board of Directors. In March 2021, the Corporate Governance Committee of the Board of Directors was transformed into the ESG Committee, which, among other things, brought in experts with experience in international ESG issues. With the involvement of international consultants, the Committee participated in developing the Company's ESG strategy, whose key elements were included in MTS's overall business strategy. Using the world's best practices, the ESG Committee paid considerable attention to the development of MTS's Diversity, Equity, and Inclusion Policy. [...] The activities of the ESG Committee have significantly developed within the Company, reinforced by international expertise, which has enabled MTS to scale ESG strategies, policies, processes, and competencies across its business units. [...] Regular interaction and communication between companies within the ecosystem helps strengthen and emphasise the importance of integrating various ESG aspects. In October 2021, MTS held its annual online conference 'Sustainable Development and ESG: The Social Aspect' for all companies within the ecosystem. It was attended by over 1,500 people, including both Company employees and external participants. The event has already become an effective means of communicating the 'tone from above', allowing Company management to demonstrate their commitment to solving urgent issues to create a united, more sustainable future. [...] In 2021, the Corporate Governance Committee was transformed into the Corporate Governance, Environmental, and Social Responsibility Committee (the ESG Committee), and its scope of competence was expanded. This made it possible to comprehensively consider the Group's issues of corporate governance, environmental, and social responsibility on one platform. The ESG Committee controls the implementation and observance of the principles of sustainable development. It also participates in the development of MTS general strategy in the field of sustainable development, environmental, and social responsibility. Additionally, the Committee takes part in reviewing the results of its implementation. [...] The Committee oversees issues related to the sustainable development of the Company and its contribution to the sustainable development of society, including: **>** creating a sustainable ecosystem within and around the Company through the consolidation and efficient use of resources of cross-functional projects; **>** integrating new ideas and projects in the field of sustainable development and CSR — corresponding to the best Russian and world practices — into the Company's business; and **>** creating a sustainable business environment in Russia and countries where the Company operates through the development of partnership programmes and projects that promote responsible business conduct and are aimed at achieving sustainable development goals. [...] In its activities, the Committee is guided by the recommendations and requirements of current legislation, the Charter and internal Company documents, the Code of Business Conduct and Ethics, decisions of the Company's management bodies, the Regulations on the Committee, and the best global management practices of the ESG agenda.

For MTS, the past year of 2021 was a year of significant changes in ESG agenda management at the level of both operational management and the Board of Directors. In March 2021, the Corporate Governance Committee of the Board of Directors was transformed into the ESG Committee, which, among other things, brought in experts with experience in international ESG issues. With the involvement of international consultants, the Committee participated in developing the Company's ESG strategy, whose key elements were included in MTS's overall business strategy. Using the world's best practices, the ESG Committee paid considerable attention to the development of MTS's Diversity, Equity, and Inclusion Policy. The activities of the ESG Committee have significantly developed within the Company, reinforced by international expertise, which has enabled MTS to scale ESG strategies, policies, processes, and competencies across its business units. [...] In its activities, the Committee is guided by the recommendations and requirements of current legislation, the Charter and internal Company documents, the Code of Business Conduct and Ethics, decisions of the Company's management bodies, the Regulations on the Committee, and the best global management practices of the ESG agenda.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]In order to ensure that all of MTS direct and indirect activities that influence policy are consistent with overall ESG and Climate Change strategy, in 2021 MTS established ESG Committee of the MTS Board of Directors. The aim of the Committee is to strengthen the Board's oversight role across corporate governance, environmental initiatives, and corporate social responsibility. ESG Committee is chaired by MTS Board's Independent Director and also includes 3 other Board members. Overall, 3 members of the ESG Committee are independent directors. The Committee's responsibilities are: to develop a forward-looking ESG strategy; to participate in the development of MTS sustainable initiatives and policies and oversee internal regulations in the field of sustainable development; to monitor implementation of sustainable development principles in MTS. The Committee reviews MTS 2022 CDP response.

The activities of the ESG Committee, reinforced by international expertise, have received a large-scale development in the company, and also made it possible to create a favourable environment for adopting ESG strategies, policies, processes and competencies into MTS business processes.

In 2021, we systematized the ongoing ESG initiatives, the result was the approval of MTS ESG strategy. The ESG strategy determined the main directions for optimizing business processes and launching initiatives that contribute to sustainable development of both MTS Group itself and all areas of life with which it comes into contact.

In order to effectively and consistently integrate the ESG agenda, including Climate Change, into business processes, the Company created the ESG Center at the beginning of 2022, which is responsible for the development, implementation and replication of significant initiatives and practices in various business verticals of the ecosystem, and also for the development of a portfolio of projects aimed at reducing current social and environmental risks.

MTS is distinguished by a long-term strategic approach to the implementation of social and environmentally significant projects, as well as the active implementation of the best practices for responsible business conduct. The integration of ESG principles into business processes allows the company not only to successfully fulfil strategic objectives, but also ensures proper consideration of interests and responsible behaviour towards all stakeholders.