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In its operations, Kazatomprom implements the world's best practices of corporate governance. Regular independent assessment and annual action plans developed and implemented to improve the corporate governance system enhance the quality of internal documents and compliance with the Corporate Governance Code and methodology, as well as help the Company upgrade its corporate governance rating.

The methodology in place provides for a new rating system with seven levels: C, B, BB, BBB, A, AA, and AAA, with C being the lowest rating and AAA being the highest.

PricewaterhouseCoopers LLP rated our corporate governance rating for 2021 at A. The growth of Kazatomprom's corporate governance rating since 2009 demonstrates the effectiveness of measures taken to implement the best practices in the Company's internal regulations.

According to the assessment carried out by independent consultants for 2021, our corporate governance system complies with the vast majority of the established criteria and works effectively.

Given Kazatomprom's ongoing efforts to implement ESG principles, corporate governance objectives are integrated in the Company's action plans for the development and implementation of ESG principles in line with the best practices.

Kazbek Shaimerdinov
Managing Director for Legal Support and Risks

Corporate Governance System

The Company's corporate governance system seeks to ensure proper management and control, growth of longterm value, and sustainable development. Corporate governance rests on three pillars: efficiency, effectiveness, and transparency. The Company continues improving its corporate governance system, ensuring the rights of shareholders and all stakeholders.

Kazatomprom's corporate governance structure

Kazatomprom's key corporate governance policies

Document name Effective date of the latest version
Charter 20 May 202168
Regulations on the General Meeting of Shareholders 27 May 2022
Regulations on the Board of Directors 27 May 2022
Regulations on the Management Board 26 June 2019
Regulations on Committees 30 April 2019
Corporate Governance Code 27 May 2015
Management policy for Kazatomprom's subsidiaries and affiliates 22 September 2022

Key improvements in 2022

Corporate Governance Code

The Corporate Governance Code of the Company has been developed in accordance with the laws of the Republic of Kazakhstan, internal documents of Samruk- Kazyna JSC, and the Transformation Programme of Samruk-Kazyna JSC. The Code takes into account the corporate governance practices adopted in Kazakhstan and globally and sets out the principles lying at the core of the Company's corporate governance system.

Kazatomprom states that its corporate governance system complies with the key listing rules of major stock exchanges and the basic corporate governance principles recognised by the global economic community (e.g., the OECD Principles of Corporate Governance).

Compliance with the Corporate Governance Code

With the principles and provisions of the Code across the Company in 2022. According to its findings, 89.5% of the provisions of the Code were fully complied with, 0.4% were partially complied with69, and 10.1% of the provisions of the Code are not applicable to the Company.

Compliance with the Corporate Governance Code

Section In compliance Partly in compliance Non-compliant Not applicable
Shareholders' rights and fair treatment of shareholders 91 - - 9
Efficiency of the Board of Directors and Executive Body 91 - - 9
Risk management, internal control and audit 97 - - 3
Transparency 97 - - 3
Adherence to the AIX corporate governance principles

AIX has the general principles of corporate governance in place for listed companies. Kazatomprom's Corporate Governance Code is largely consistent with these principles. Moreover, the Company's Code contains certain provisions ensuring compliance with Samruk-Kazyna's goals and projections. Any Group's initiatives that relate to its non-core business are subject to review and verification by the Board of Directors chaired by an independent director.

Compliance with KASE’s corporate governance principles

In 2013, KASE adapted the International Finance Corporation's (IFC) corporate governance scorecard, allowing joint stock companies listed on KASE to use this tool for assessing their level of corporate governance. Assessed against the six categories, the Company mostly meets the criteria set out in the scorecard.

Differences between the Company’s Corporate Governance Code and the UK Corporate Governance Code70
UK Corporate Governance Code Kazatomprom’s Corporate Governance Code
Under the UK Corporate Governance Code, when 20% or more of votes have been cast against the board recommendation for a resolution, the company should explain, when announcing voting results, what actions it intends to take to consult shareholders to understand the reasons behind the result. An update on the views received from the shareholders and actions taken should be published no later than six months after the shareholder meeting. The board of directors should then provide a final summary in the annual report and, if applicable, in the explanatory notes to resolutions at the next shareholder meeting, on the impact the feedback has had on the decisions the board has taken. Kazatomprom's Corporate Governance Code obliges the Chair of the Board of Directors to build a constructive dialogue between Board members, major shareholders, and the Company’s executive body. At the same time, the Chair of the General Meeting of Shareholders should strive to ensure that shareholders receive answers to questions directly at meetings. If a question is too complicated to allow for an immediate answer, the individual (s) to whom the question was addressed should provide a written answer as soon as possible after the conclusion of the General Meeting. In addition, major shareholders may hold meetings with the Chair and Board members to discuss development strategy issues, elect the head of the executive body, and address other elements that impact any growth of the long-term value and the sustainable development of the Company. Such meetings are pre-planned and held in accordance with approved procedures.
The UK Corporate Governance Code states that non-executive directors have a prime role in appointing and removing executive directors. Non-executive directors should scrutinise and hold to account the performance of management and individual executive directors against agreed performance objectives. The chair should hold meetings with the non-executive directors without the executive directors present. Kazatomprom's Corporate Governance Code states that candidates for the Company's head must be approved by the President or the Presidential Administration of the Republic of Kazakhstan (if the Company is on a list approved by a Decree of the President of the Republic of Kazakhstan), the Management Board of Samruk-Kazyna JSC, the Nomination and Remuneration Committee of the Board of Directors of Samruk-Kazyna, and the Chairman of the Board of Directors of Samruk-Kazyna.
The UK Corporate Governance Code sets forth the main responsibilities of the company’s nomination and remuneration and audit committees and also states that a description of the main activities of these committees should be included in the company’s annual report. Kazatomprom's Corporate Governance Code contains no such requirement.
The UK Corporate Governance Code prohibits the chair of the board from being a member of the audit committee. Kazatomprom's Corporate Governance Code contains no such restriction.
Under the UK Corporate Governance Code, in annual and halfyearly financial statements, the board should state whether it considers it appropriate to adopt the going concern basis of accounting in preparing them, and identify any material uncertainties to the company’s ability to continue to do so over a period of at least twelve months from the date of approval of the financial statements. Kazatomprom's Corporate Governance Code contains no such requirement.
Under the UK Corporate Governance Code, where a remuneration consultant is appointed, this should be the responsibility of the remuneration committee. The consultant should be identified in the annual report alongside a statement about any other connection it has with the company or individual directors. Independent judgement should be exercised when evaluating the advice of external third parties and when receiving views from executive directors and senior management. Kazatomprom's Corporate Governance Code contains no such requirement.
The UK Corporate Governance Code stipulates that remuneration schemes should promote long-term shareholdings by executive directors that support alignment with long-term shareholder interests. In addition, there are clarifications regarding the terms of contracts concluded with the directors of the company. Kazatomprom's Corporate Governance Code contains no such requirement.

General Meetings of Shareholders

The Company treats and communicates to all shareholders equally, including minority shareholders, regardless of their shareholdings.

The General Meeting of Shareholders is the highest governing body of the Company. On 27 May 2022, Kazatomprom held an annual General Meeting of Shareholders in absentia and considered the following agenda items:

On 4 October 2022, the Company held an Extraordinary General Meeting of Shareholders in absentia initiated by the Board of Directors and considered the following agenda items:

On 1 November 2022, Kazatomprom held another Extraordinary General Meetings in absentia. The meetings were convened by the Board of Directors of the Company at the initiative of its major shareholder, Samruk-Kazyna JSC. The composition of Kazatomprom's Board of Directors was the only agenda item.

Board of Directors

GRI 2-10

Members of the Board of Directors and the Chairman of the Board of Directors are elected in accordance with the procedures prescribed by the Joint-Stock Companies Act and the Company's Charter.

Candidates are recruited and selected according to objective criteria and needs for diversity in the Board of Directors. Only an individual can be selected as a member of the Board of Directors. The Board members shall be elected from among:

Individuals nominated as the Board member candidates must have the knowledge, skills, and expertise needed for the Board of Directors to perform its functions effectively and ensure long-term value growth and sustainable development of the Company, as well as an impeccable business and personal reputation.

When selecting Board member candidates, Kazatomprom takes the following criteria into account:

Members of the Management Board, except for the Chairman of the Management Board, may not be elected members of the Board of Directors. Members of the Government of the Republic of Kazakhstan, and officials of government authorities may not sit on the Board of Directors.

GRI 2-17
Training and development of members of the Boards of Directors

In accordance with the Policy on Advanced Training for the Members of Kazatomprom’s Board of Directors and Engagement of External Experts, the Board decides on advanced training either for all members in general or for its individual members based on:

The training of the BoD members also rests on the recommendations received during the general assessment of the Company's corporate governance.

In 2022, the Company held training "A Powerful Tool for Measuring ESG Compliance. Trend Analysis and Benchmarking" organized by International Compliance Association. The training programme covered ESG risk analysis, the ESG implications for the compliance function, an overview of global best practices of sustainability, and the identification of metrics, key performance indicators and statistical trends for effective analysis of environmental, social and corporate governance programmes.

Members of the Board of Directors

GRI 2-9

As of 31 December 2022, the Board of Directors consisted of seven directors, including three independent directors71. The Board of Directors is chaired by an independent director72. This guarantees the respect for rights of minority shareholders.

Independence of the Board of Directors:

The composition of the Board of Directors of the Company is balanced in terms of members' qualifications, expertise, knowledge, business qualities, and diversity. Board members have an impeccable business reputation, and expertise in the nuclear industry, finance and investment, corporate governance, as well as in other areas important for the management of the Company.

GRI 405-1

Members of the Board of Directors have extensive experience in senior roles, as partners and members of the governing bodies of big international companies, and an impeccable reputation in the business community. The diversity of the composition and the quota of independent directors are in the limelight. The Board is represented by both men and women, as well as citizens of various countries, which ensures gender and socio- cultural diversity.

Age diversity within the Board, %

30-50 years old 57
50 + 43

Gender diversity, %

Men 86
Women 14

The Board members do not hold any shares in the Company or equity interests in affiliates, nor do they hold any shares/equity interests in the Company's suppliers and competitors.

There were no refusals or any agreements on the refusal by members of the Board of Directors from remuneration or future remuneration.

GRI 2-9, GRI 2-11
Constitution of the Board of Directors
NEIL LONGFELLOW
Chairman of the Board of Directors (independent, non-executive)
Participation in committees
  • Audit Committee
  • HSE Committee
  • Strategic Planning and Investment Committee
  • Nomination and Remuneration Committee
Year of election

201773

Year of birth

1958

Citizenship

United Kingdom

Educational background

A chartered electrical engineer and a Fellow of the Nuclear Institute and the Institute of Measurement and Control.

Professional experience

Since 2015 - An independent consultant to the international nuclear sector.

2013 - Director of Major Projects for the nuclear, oil and gas sectors, Costain PLC, the UK.

2009 - Managing Director of Springfields Fuels Limited and Vice President of the European Fuel Business, Westinghouse Electric Company.

2007 - Deputy Managing Director, British Nuclear Fuels Limited.

1991 - Head of Processing, Sellafield nuclear reprocessing plant in West Cumbria, British Nuclear Fuels Limited.

He started his career in electrical engineering in the UK.

RUSSELL BANHAM
Member of the Board of Directors (Senior independent, non-executive)
Participation in committees
  • HSE Committee
  • Chairman of the Audit Committee
  • Strategic Planning and Investment Committee
Year of election

201874

Year of birth

1954

Citizenship

Australia

Educational background

A Bachelor of Commerce degree from the University of New South Wales, a fellow of the Institute of Chartered Accountants Australia and New Zealand, and a graduate of the Australian Institute of Company Directors.

Professional experience

2018 - A member of the Board of Directors of NAC Kazatomprom JSC.

2011-2014 - Energy and Resources Industry Group Leader of Deloitte CIS, Moscow, Russia.

2007 - Audit Function Leader and Executive Committee member of Deloitte CIS, Almaty, Kazakhstan.

2002 - 2007 - Advisory Services Practice Leader of Ernst & Young, Brisbane, Australia.

2002 - Audit Partner, Andersen, Australia.

1974 - an auditor, Andersen, Australia.

MARC KASHER
Member of the Board of Directors (independent, non-executive)
Participation in committees
  • Audit Committee
  • Nomination and Remuneration Committee
Year of election

202075

Year of birth

1970

Citizenship

United States

Educational background

1997 - A Master of Business Administration from Georgetown University.

1992 - A Bachelor of Science in Soviet Studies, Tufts University.

Professional experience

2022 - A Member of the Board of Directors and Chairman of the Audit Committee, Noventiq.

2018 - 2021 - An independent director, National Investment Corporation of the National Bank of Kazakhstan.

2013 - 2019 - An independent director of Luxoft, chairman of three committees: Audit Committee, M&A Committee, and Compensation Committee.

2013 - The founder of Sapiens Advisors.

2010-2015 - Managing Director and Chairman of the Board, PineBridge Investments Russia.

1997 - An associate private equity officer, AIG Capital Partners (later renamed PineBridge Investments).

YERNAT BERDIGULOV
Member of the Board of Directors (non-executive)
Participation in committees
  • Production Safety (HSE) Committee)
Year of election

202276

Year of birth

1987

Citizenship

Republic of Kazakhstan

Educational background

2018 - Master's Degree in Business Administration, University of Warwick.

2010 - Bachelor's Degree in Public Policy and International Relations, University of Toronto.

Professional experience

2022 - Managing Director for Strategy and Asset Management, Samruk-Kazyna JSC.

2021 - 2022 - Co-Managing Director for Strategy, Sustainability, and Digital Transformation, Samruk-Kazyna JSC.

2019 - 2021 - Project Manager, Whiteshield Partners international consulting company.

2018 - 2019 - Analyst of the Asset Management Directorate, Samruk- Kazyna JSC.

2013-2018 - Finance and Economy Advisor to the Chairman of the Board, Director of the Analytical Support Department, Director of the Strategic Development Department, Director of the Project Management Department, Samruk-Energy JSC.

2011 - 2012 - Project Manager, Project Office for the Implementation of the Management Reporting System, Samruk-Kazyna JSC.

2010 - 2011 - Chief Specialist of the Business Administration Department, Semizbay-U LLP, a subsidiary of NAC Kazatomprom JSC.

YERNAR ZHANADIL
Member of the Board of Directors (non-executive)
Participation in committees
  • Strategic Planning and Investment Committee
Year of election

202177

Year of birth

1984

Citizenship

Republic of Kazakhstan

Educational background

2009 - Master's degree from the University of Manchester.

2006 - Bachelor's Degree, Accounting and Finance Department, KIMEP University, Almaty.

Professional experience

2022 - Managing Director for Investment, Privatisation, and International Cooperation, Samruk-Kazyna JSC.

2018 - 2021 - Co-Managing Director for Economics and Finance, Samruk-Kazyna JSC.

2017 - Managing Director for Economics and Finance, Samruk- Kazyna JSC.

2016 - A financial controller, Samruk-Kazyna JSC.

2010 - 2016 - Head of the Internal Audit Service.

2006 - A senior consultant, PricewaterhouseCoopers.

NAZIRA NURBAEVA
Member of the Board of Directors (non-executive)
Participation in committees
  • Nomination and Remuneration Committee
Year of election

202178

Year of birth

1975

Citizenship

Republic of Kazakhstan

Educational background

2000 - A graduate of Kazakh State Academy of Management in Almaty, majoring in finance and credit.

1997 - An assistant, Tax Department, PricewaterhouseCoopers Kazakhstan.

1996 - A degree in Business Administration from the University of Wisconsin-Platteville Richland.

1994 - 1998 - Studies at Kazakh State University of International Relations and World Languages.

Professional experience

2021 - Managing Director for Economics and Finance, Samruk- Kazyna JSC.

2020 - A partner of Deloitte TFC, Tax and Legal Services Department.

2017 - Executive MBA from KIMEP in Almaty.

2014 - Director of Tax and Legal Services Department, PricewaterhouseCoopers.

2004 - 2014 - A senior manager, Tax and Legal Services Department, PricewaterhouseCoopers.

2003 - A senior tax consultant, LUKOIL Overseas Service.

1998 - 2003 Tax and Legal Services Department, Pricewaterhouse- Coopers.

YERZHAN MUKANOV
Member of the Board of Directors, Chairman of the Management Board (executive)
Participation in committees
  • -
Year of election

202279

Year of birth

1977

Citizenship

Republic of Kazakhstan

Educational background

Currently studies at the University of Science and Technology MISIS, Doctor in Business Administration programme.

2021 - Executive MBA - Strategic Management and Leadership Programme of Almaty Management University and St. Petersburg State University.

2009 - Ecole Nationale Superieure des Mines de Paris, majoring in Economic Evaluation of Mining Projects.

2003 - Postgraduate course at the Institute of Metallurgy and Concentration, majoring in Metallurgy of Ferrous, Non-ferrous and Rare Metals.

1999 - Satbayev University, majoring in Metallurgy of Non-ferrous Metals.

Professional experience

September 2022 - Chairman of the Management Board, NAC Kazatomprom JSC.

March 2022 - Chief Production Officer, Kazatomprom

2014 - 2022 - held senior roles in Kazatomprom's subsidiaries and affiliates: JV Katco LLP, Kazatomprom-SaUran LLP, Karatau LLP, and Semizbay-U LLP.

2012 - 2014 - Production Development Coordinator at AREVAMines.

2006 - 2012 - Process Engineer, Head of Chemical Engineering Department at JV Katco LLP.

2004 - 2006 - Technologist Inspector, Almaty Heavy Engineering Plant.

1999 - 2000 - Engineer of the Laboratory of Special Concentration Methods and Hydrometallurgy at the Institute of Metallurgy and Concentration of the Academy of Sciences of Kazakhstan.

Changes in the Board of Directors in 2022

On 27 May 2022, the Annual General Meeting of Shareholders adopted a decision to terminate early the powers of Bolat Akchulakov, a BoD member representing Samruk-Kazyna, and appoint Yernat Berdigulov a member of the Board of Directors of the Company. The Extraordinary General Meeting of Shareholders held on 1 November 2022 terminated the authorities of Mazhit Sharipov, a member of the Board of Directors of the Company (with effect from 4 July 2022) and appointed Yerzhan Mukanov a member of the Board of Directors. There were no waivers or any arrangements on the waiver by members of the Board of Directors of remuneration or future remuneration.

Activities of the Board of Directors

In 2022, the Board of Directors met 14 times (14 in-person meetings) to consider 239 issues.

The attendance of meetings by Board members was 94.4% on average in 2022.

Attendance of meetings by members of the Board of Directors

Name
17.02.2022
15.03.2022
11.04.2022
27.05.2022
21.06.2022
30.06.2022
18.08.2022
22.09.2022
14.09.2022
06.10.2022
27.10.2022
10.11.2022
24.11.2022
15.12.2022
%
Neil Longfellow + + + + + + + + + + + + + + 100
Russell Banham + + + + + + + + + + + + + + 100
Marc Kasher + + + + + + + + + + + + + + 100
Assem Mamutova + + - - - - - - - - - - - - 100
Yernat Berdigulov - - - + + + + + + + + + + + 100
Yernar Zhanadil + + + + + + + + + - + - - - 71
Nazira Nurbaeva + + + + + + + - + - - + + + 79
Mazhit Sharipov + + + + + - - - - - - - - - 100
Yerzhan Mukanov - - - - - - - - - - - + + + 100
GRI 2-14

The most pressing matters considered by the Board of Directors in 2022

Reports
  • Quarterly Management Board Report (CEO Report)
  • Quarterly Statement of Financial Performance (CFO Report)
  • Quarterly Financial Statements (IFRS Overview)
  • Semi-annual Financial Statements (IFRS Overview)
  • Annual Financial Statements 2021 (IFRS Overview)
Strategic matters
  • Consideration of Kazatomprom development strategy implementation status and strategic initiatives
  • Approval of the Succession Management at Kazatomprom JSC
  • Approval of the Integrated Annual Report
  • Approval of Kazatomprom's Consolidated Business Plan 2023-2027
  • Approval of key performance indicators for the Chairman and members of the Board
  • Approval of the organizational structure of Kazatomprom's corporate centre
Corporate governance
  • Approval of the Board of Directors’ Work Plan
  • Changes in the composition of the Board committees
  • Approval of the corporate governance improvement plan and review of the plan performance reports
Transactional matters
  • Conclusion of related-party transactions
  • Conclusion of transactions interrelated with previously concluded transactions
  • Conclusion of transactions or a series of interrelated transactions resulting in the alienation of property worth more than 10% of the total asset value
Subsidiaries and affiliates
  • HR issues
  • Approval of internal regulations
  • Conclusion of material transactions
  • Increase in statutory capital
  • Election of members of supervisory boards/board of directors
  • Approval of annual financial statements of subsidiaries and affiliates, distribution of net profit of subsidiaries and affiliates
Approval of internal regulations
  • Approval and recognition of loss effect of internal documents of NAC Kazatomprom JSC and its structural divisions
Other issues
  • Overview of capital markets
  • Consideration of an investor and stakeholder communication and engagement plan
Issues of Board’s subdivisions
  • Reports of Compliance Service, Ombudsman, and Internal Audit
  • Approval of internal regulations

Evaluation of the Activities of the Board of Directors

GRI 2-18

The activities of the Board of Directors are subject to an external independent evaluation every three years. In 2023, an external independent consultant from among international audit and consulting companies was engaged to evaluate the performance of the Board of Directors for the period from 2020 to 2022 according to the criteria and approaches formulated by the UK Financial Reporting Council in the Guidance on Board Effectiveness.

The efficiency level of the Board of Directors in terms of applicable key parameters was 79%. The highest performance indicators were noted in the following areas:

Performance indicators that require significant improvement are noted in the following areas:

An independent consultant has prepared an action plan to improve the efficiency of the Board of Directors, which provides for the following key tasks:

Monitoring by shareholders and members of the Board of Directors of the timely and proper execution of the tasks reflected in the action plan will be the key to further improving the efficiency of the Board of Directors.

Plans for 2023

Election of a new Board of Directors
Quality of documents submitted to the Board

Committees of the Board of Directors

GRI 2-9, GRI 2-12

The Board of Directors has four committees:

The Committees80 are accountable to the Board of Directors in line with their mandate granted by the Board of Directors and the relevant Regulations on the Committees. Members of the Committees are elected by the Board of Directors in line with the Law On Joint Stock Companies, the Code of Corporate Governance of Samruk-Kazyna JSC, and Kazatomprom's Charter.

Performance of the Board Committees in 2022

Report of the HSE Committee

Composition of the Committee and quantity of meetings

Name Attendance, % Reasons for absence
Neil Longfellow, Chair-man 100
Russell Banham 100
Yernat Berdigulov 0 Appointed to the Committee on 27 June 2022
Assem Mamutova 100 Excluded from the Committee on 1 May 2022
6
in-person meetings in 2022
28
matters considered
Matters considered by the Committee in 2022:
Report of the Audit Committee

Composition of the Committee and quantity of meetings

Name Attendance, % Reasons for absence
Russell Banham, Chairman 100
Neil Longfellow 100 Appointed to the Committee on 27 June 2022
Marc Kasher 100
Assem Mamutova 100 Withdrew from the Board of Directors on 1 April 2022
1
in absentia and
12
in-person
meetings in 2022
104
matters considered
Matters considered by the Committee in 2022:

Reporting:

Risk management:

Corporate governance:

Other matters:

Report of Strategic Planning and Investment Committee

Composition of the Committee and quantity of meetings

Name Attendance, % Reasons for absence
Neil Longfellow, Chair-man 100
Russell Banham 100
Yernar Zhanadil 25 for personal reasons
8
in-person meetings in 2022
36
matters considered
Matters considered by the Committee in 2022:

In 2022, the Committee considered quarterly Kazatomprom Management Board Reports on the implementation of major investment projects and the Reports on the Implementation of Strategic Initiatives selected by the Strategic Session held on 6 October 2021.

Report of Nomination and Remuneration Committee

Composition of the Committee and quantity of meetings

Name Attendance, % Reasons for absence
Marc Kasher, Chairman 100
Neil Longfellow 100
Nazira Nurbaeva 57 Appointed to the Committee on 27 May 2022
Assem Mamutova 100 Withdrew from the Board of Directors on 1 April 2022
Bolat Akchulakov - Resigned from the Board on 11 January 2022
11
in-person meetings in 2022
69
matters considered
Matters considered by the Committee in 2022

HR matters:

Bonuses:

Management Board

The Management Board is Kazatomprom's executive body acting in line with the laws of the Republic of Kazakhstan, the Articles of Association, the Corporate Governance Code, and the Regulations on the Management Board. These documents outline the role and accountability of the Management Board, as well as the rights and responsibilities of the Management Board members.

Matters reserved for the Management Board are:

Changes in the Management Board

The Management Board saw changes in the reporting period.

On 24 September 2021, the Board of Directors decided (Minutes No. 11/21) to establish an 8-strong Management Board including the following members.

Name Position Year of joining
Mazhit Sharipov Chairman of the Management Board 2015
Aslan Bulekbay Chief Production Officer 2021
Dosbolat Sarymsakov Chief NFC Officer 2011
Kamila Syzdykova Chief Economic and Financial Officer 2009
Askar Batyrbaev Chief Commerce Officer 2006
Yerlan Tuleugozhin Chief Strategy and Development Officer 2018
Alibek Aldongarov Chief HR and Transformation Officer 2017
Marat Yelemesov Managing Director for Legal Support and Risks 2018

The Company's Board of Directors re-elected the Chief Production Officer, a member of the Management Board, with effect from 1 June 2022 (Resolution No 4/22, Minutes dated 27 May 2022).

Name Position Year of joining
Yerzhan Mukanov Chief Production Officer 2006

The following executive officer was appointed acting Chairman of the Management Board of the Company with effect from 4 July 2022 pursuant to Resolution No. 6/22 of the Board of Directors of the Company (Minutes dd. 30 June 2022).

Name Position Year of joining
Yerzhan Mukanov Chief Production Officer 2006

On 18 September 2022, the Board of Directors decided (Minutes No. 7/22) to establish a 7-strong Management Board including the following members.

Name Position Year of joining
Yerzhan Mukanov Acting Chairman of the Management Board, Chief Production Officer81 2006
Dosbolat Sarymsakov Chief NFC Officer 2011
Kamila Syzdykova Chief Economic and Financial Officer 2009
Askar Batyrbaev Chief Commerce Officer 2006
Alibek Aldongarov Chief HR and Transformation Officer 2017
Marat Yelemesov Managing Director for Legal Support and Risks 2018

On 14 September 2022, the Board of Directors elected him the Chairman of the Management Board (Minutes No. 9/22).

Name Position Year of joining
Yerzhan Mukanov Chairman of the Management Board 2006

Management Board

(as of 31 December 2022)

YERZHAN MUKANOV
Chairman of the Management Board
Year of birth

1977

Nationality

Republic of Kazakhstan

Educational background

A degree in Metallurgy of Non-Ferrous Metals from Satbayev University, a degree in Metallurgy of Ferrous, Non-Ferrous and Rare Metals from the Institute of Metallurgy and Concentration, a degree in Economic Assessment of Mining Projects from Ecole Nationale Superieure des Mines de Paris, Executive MBA programme in Strategic Management and Leadership from Almaty Management University and St. Petersburg State University. Studies at the University of Science and Technology MISIS, Doctor in Business Administration programme (present). An author of research papers and patents on hydrometallurgy of precious metals.

Professional experience

September 2022 - Chairman of the Management Board, NAC Kazatomprom JSC.

March 2022 - Chief Production Officer, Kazatomprom

Senior roles in Kazatomprom's subsidiaries and affiliates: JV Katco LLP, Kazatomprom-SaUran LLP, Karatau LLP, and Semizbay-U LLP.

2012 - 2014 - Production Development Coordinator at AREVA Mines.

June 2006 - Process Engineer at JV Katco LLP.

2004 - 2006 - Technologist Inspector, Almaty Heavy Engineering Plant.

1999 - Engineer of the Laboratory of Special Concentration Methods and Hydrometallurgy at the Institute of Metallurgy and Concentration of the Academy of Sciences of Kazakhstan.

DOSBOLAT SARYMSAKOV
Chief NFC Officer
Year of birth

1971

Nationality

Republic of Kazakhstan

Educational background

A degree in Physics from Al-Farabi Kazakh National University, a degree in International Relations from the Diplomatic Academy of the Ministry of Foreign Affairs of the Republic of Kazakhstan.

Professional experience

2021 - Chief NFC Officer.

2017 - 2021 - Director of Nuclear Fuel Cycle Projects, Kazatomprom.

2011 - 2017 - Manager of Nuclear Fuel Cycle Projects, Kazatomprom.

2008 - 2011 - Executive Director of Nonproliferation Centre.

1996 - 2011 - An engineer at the Institute of Atomic Energy of the National Nuclear Centre of the Republic of Kazakhstan; a manager at the Institute for Nonproliferation (later renamed Nonproliferation Centre).

May 1995 - December 1995 - A Lead Specialist, the Ministry of Industry and New Technologies of the Republic of Kazakhstan.

KAMILA SYZDYKOVA
Chief Economic and Financial Officer
Year of birth

1981

Nationality

Republic of Kazakhstan

Educational background

Bachelor's degree in business administration from KIMEP University, Executive MBA from Nazarbayev University.

Professional experience

2020 - present - Chief Economic and Financial Officer.

2018 - 2020 - Managing Director for Economics and Finance, Kazatomprom.

2012 - 2018 - Various positions in Kazatomprom's partner companies, Cameco LLP and UrAsia Energy Holding Ltd, a subsidiary of UraniumOne Uranium Holding.

Kamila Syzdykova held senior roles in Halyk Bank of Kazakhstan and Kyzylkum, a subsidiary of NAC Kazatomprom JSC. She started her career in 2002 as a business valuation consultant at Rice Group Central Asia.

ASKAR BATYRBAEV
Chief Commerce Officer
Year of birth

1983

Nationality

Republic of Kazakhstan

Educational background

Master's degree in Physics from Al-Farabi Kazakh National University Currently, he is taking an Executive MBA course at Nazarbayev University.

Professional experience

April 2021 - present - Chief Commerce Officer, Kazatomprom.

January 2021 - Chief Marketing Officer.

2019 - 2021 - Managing Director for Marketing and Sales, Kazatomprom.

2017 - 2019 - Various senior roles at Kazatomprom.

2006 - 2017 - Various positions in marketing, sales and logistics at APPAK LLP and JV Inkai LLP, subsidiaries of Kazatomprom.

2001 - 2004 Laboratory assistant at the Institute of Nuclear Physics of the Republic of Kazakhstan.

ALIBEK ALDONGAROV
Chief HR and Transformation Officer
Year of birth

1983

Nationality

Republic of Kazakhstan

Educational background

A degree in Computer Science, Communication Networks and Switching Systems from Almaty College of Communications, Kazakh- American University; a degree in Multichannel Telecommunication Systems from Satbayev University.

Professional experience

September 2021 - present - Chief HR and Transformation Officer.

May 2021 - Chief Transformation Officer, Kazatomprom

Prior to his appointment, he was the CEO of KAP Technology LLP.

He has seven years of experience in the nuclear industry in senior positions at Bailanys-NAK LLP and KAP Technology LLP.

He has extensive experience in telecoms system design for the representative office of Iskratel LLC, as well as in support and development of information systems as the Director of the Technical Support and Deputy Chairman of the Board at NBK Banking Service Bureau JSC.

2004 - Start of career at Kazakhtelecom JSC as an electrician of linear structures.

MARAT YELEMESOV
Managing Director for Legal Support and Risks
Year of birth

1985

Nationality

Republic of Kazakhstan

Educational background

A degree in International Law from Al-Farabi Kazakh National University; Department of Public Policy and Administration, New York State University.

Professional experience

2020 - present - Managing Director for Legal Support and Risks.

2019 - Managing Director for Legal Support and Risks, Kazatomprom.

2018 - Legal Department Director, Kazatomprom.

2013-2018 - An expert, Chief Expert, Head of the Arbitration Department, Deputy Director of the Department, Ministry of Justice of the Republic of Kazakhstan.

2012 - 2013 - Work in the Akimat of West Kazakhstan Region, Uralsk.

2009 - Start of career as a GR specialist, British American Tobacco.

GRI 405-1

Age diversity within the Management Board, %

30-50 years old 83
50+ 17

Gender diversity, %

Men 83
Women 17
GRI 202-2

All top managers hired in 2022 were from among the local community representatives82.

Management Board Performance Report

1
in absentia
48
in-person
meetings held in 2022
747
matters considered
Key matters considered by the Management Board
GRI 2-15

The Management Board members had no conflict of interests in 2022.

Attendance of meetings by Management Board members

Management Board Members Attendance Time of sitting on the Management Board
Yerzhan Mukanov 31 1 Jun - 31 Dec 2022
Mazhit Sharipov 24 1 Jan - 4 Jul 2022
Aslan Bulekbay 4 1 Jan - 5 March 2022
Dosbolat Sarymsakov 45 1 Jan - 31 Dec 2022
Kamila Syzdykova 32 1 Jan - 31 Dec 2022
Yerlan Tuleugozhin 18 1 Jan - 18 Aug 2022
Alibek Aldongarov 47 1 Jan - 31 Dec 2022
Askar Batyrbaev 42 1 Jan - 31 Dec 2022
Marat Yelemesov.* 0 1 Jan - 31 Dec 2022

Remuneration

GRI 2-19, GRI 2-20

According to the Company's Charter, the remuneration of the Board of Directors’ members is set by the General Meeting of Shareholders, while the remuneration of the Chairman and members of the Management Board is set by the Board of Directors, with no engagement of consultants in this.

On 28 June 2017, the Company's Board of Directors approved the Management Remuneration, Bonus and Social Support Policy, which outlines the procedures, terms, and conditions for payment of remuneration to the Chairman and members of the Company's Management Board. The executive pay and bonus system as now in effect has been developed in line with the recommendations of Samruk-Kazyna JSC, which was the sole shareholder of the Company in 2017.

The procedures and terms of remuneration for the Chairman and members of the Company's Management Board are outlined in their employment contracts and based on a decision made by the Company's Board of Directors in line with Kazatomprom's Management Remuneration, Bonus and Social Support Policy. The size of the salaries of the Chairman and members of the Management Board of the Company shall be set by the Board of Directors of the Company in accordance with the Pay Grid.

The remuneration of the Chairman and members of the Management Board of the Company relies on a time-bonus system and consists of a fixed part (official salary) and a variable part (bonuses linked to the annual performance). Performancebased bonus for a year depends on the percentage of achievement of corporate and functional KPIs, which are developed by cascading the strategic KPIs approved by the Company's Board of Directors for the relevant period. Bonuses of the Chairman of the Management Board are 100% linked to the achievement of corporate KPIs and those of the members of the Management Board are 70% linked to the achievement of corporate KPIs and 30%, to the achievement of functional (individual) KPIs over the year.

The Corporate KPI map for a reporting year is approved annually by the Board of Directors and includes financial, H&S, operational and other metrics, including those related to the licence to operate in the regions of presence. The map is well balanced, taking into account all strategic goals of the Company.

List of corporate KPIs for the Company

2022
Enhancing the culture of safety The KPI aims to enhance safety culture across NAC Kazatomprom JSC group and consists of the following metrics: greenhouse gas emissions, average personnel exposure dose, and lost time injury frequency rate (LTIFR)
Return on capital employed The KPI reflects the return on capital employed to improve the efficiency of investment per capital employed
Shareholder returns The KPI is used to show the return on investment made by shareholders and aims to increase shareholder return and consists of the following metrics: total shareholder return (TSR), and the price of NAC Kazatomprom JSC's GDRs at the end of the year
Share of local content in goods, works and services The KPI aims to support domestic producers and increase the share of local content in goods, works and services procured by NAC Kazatomprom JSC and its subsidiaries
Extent of implementation of the Extended Roadmap to comply with the Guidelines of the President of Kazakhstan on reforming Samruk-Kazyna JSC The KPI focuses on the effectiveness of the implementation of the Guidelines of the President of the Republic of Kazakhstan on the modernisation of Samruk-Kazyna JSC as part of the objectives assigned to NAC Kazatomprom JSC
2023
Unit production cost of U3O8 The KPI seeks to reduce production costs per kilogram of natural uranium oxide (U3O8) at NAC Kazatomprom JSC and mining companies
Enhancing the culture of safety The KPI aims to improve the overall level and culture of occupational safety and consists of the following metrics: Lost Time Injury Frequency Rate (LTIFR), and number of Behavioural Safety Audits (BSAs) conducted
Shareholder returns The KPI is used to show the return on investment made by shareholders and aims to increase shareholder return and consists of the following metrics: total shareholder return (TSR), and the price of NAC Kazatomprom JSC's GDRs at the end of the year
Share of local content in goods, works and services The KPI aims to support domestic producers and increase the share of local content in goods, works and services procured by NAC Kazatomprom JSC and its subsidiaries
ESG rating The KPI shows an independent predictive opinion on Kazatomprom’s ability to manage future risks and opportunities related to environmental impact, social factors and corporate governance (ESG). The indicator aimed at improving Kazatomprom's sustainability performance

Total remuneration paid to members of the Management Board and the Board of Directors, KZT billion

In addition, a consolidated net profit earned by the Company in a reporting year is key to payment of the annual performance-based bonuses.

The pension arrangements for the Chairman and members of the Management Board are regulated by the Law On Pensions in the Republic of Kazakhstan (the Law). The Company acts as an agent for mandatory pension contributions and transfers a statutory percentage of the earned income to the Unified Accumulative Pension Fund. If the Chairman or a member of the Management Board terminate their employment contracts due to retirement, he/she shall be paid allowance as established by the Collective Bargaining Agreement.

In 2022, members of the Management Board and independent directors of the Board of Directors at Kazatomprom received a total of KZT 982.7 in pre-tax remuneration.

Risk Management and Internal Control

Risk Management System

Key international standards and practices in risk management and internal control applied by the Company:

Established in 2010, the Company's risk management system has played a fundamental role in the Company's operations and development. The Company's management is confident that accurate and timely risk identification, assessment, monitoring and response enable effective decision-making at all levels of management and the achievement of the Company's strategic goals and key performance indicators.

The Risk Management Department is a focal point for the system, responsible for methodological guidance and coordination of all risk management efforts. The Risk Management Committee of the Management Board provides operational guidance by reviewing, agreeing and approving key issues. The Company's subsidiaries and affiliates have the role of Risk and Compliance Officers responsible for risk management.

Risk management system

Relying on international standards and best practices in risk management, Kazatomprom Risk Management Policy was updated in 2022 (by a decision of the Board of Directors of NAC Kazatomprom JSC dd. 27 October 2022).

The purpose of the Risk Management Policy is to improve the risk management system, which helps us effectively manage and prioritise resources to ensure an acceptable level of risk for the Company and obtain the highest return on such investments by identifying, assessing, managing and monitoring risks. It also seeks to instil a risk culture, which determines how risks are identified, assessed and managed from strategy development through to implementation and performance monitoring, and how the risk management system is closely linked to the internal control system.

Established through the engagement of all key departments and stakeholders, as well as the effective exchange of information in the risk management process between the Company's Board of Directors, the Management Board, and divisions, the risk culture lies a the core of the Company's risk management system.

To improve continuously the quality of the risk management system, the Company holds corporate training on risk management and internal control for heads of departments and other employees who are risk owners. Kazatomprom also holds an annual roundtable discussion on topical issues with employees responsible for enterprise risk management.

Risk management and internal control system rests on the three lines model.

As part of ongoing insurance activities, the Company added eleven mining SDCs and Trade and KAP Logistics LLP to its corporate property insurance programme in 2022.

According to the guidelines for uranium sale counterparty risk management, the Company's Management Board approved a list of counterparties and limits for counterparties in relation to uranium sale contracts»83. The Risk Management Department conducts an independent risk assessment of counterparties and informs the Board of Directors of the Company as part of its quarterly risk management reports.

In addition, the Company and its subsidiaries and affiliates have a business continuity management system in place, and test business continuity plans on a regular basis.

The Business Continuity Rules were updated in June 2022 in view of the crisis that took place in January 2022, the Russian Federation/Ukraine conflict, extensive sanctions, the update of ISO 22301-2020, and the implementation of instructions from the Chairman of the Board and the Fund. The Rules now include a financial and economic crisis, a formalised option of a Reserve Office, and the concept of priority activities, regulate types of reserves, and expand the Crisis Centre, etc. During the year, the Company tested its business continuity plans and held meetings of the Crisis Centre.

Plans for 2023:

Risks of NAC Kazatomprom JSC

Under the COSO methodology, all of the Company's identified risks fall into five main categories: strategic, financial, operational, investment, and legal risks.

Risk registers and maps of subsidiaries and affiliates are developed and approved on an annual basis. Kazatomprom’s risk map is divided into zones of impact and likelihood.

According to the Company's Risk Register, we identified 27 risks for 2022, including four red-zone risks:

A risk is assessed according to its position on the Risk Map. The areas of risk zones are allocated according to damage, pegged to the risk appetite.





Strategic risks (S)
S-1 Decrease in uranium sales price below target
S-2 Higher social tensions
S-3 Failure to deliver on the Company’s asset restructuring plan
S-4 Reputation risk
S-5 Failure to perform on subsoil contracts
Оperational risks (О)
О-1 Failure to meet the uranium product sales plan
О-2 Failure to meet the planned uranium mining and/or uranium product output (U3O8)
О-3 Increase in the cost of products and services above target
О-4 Shortage of skilled staff or low qualifications
О-5 Compliance risk (non-compliance with internal or external regulatory require-ments/standards)
О-6 Occupational injuries
О-7 Intentional damage to the Company's group of companies
О-8 Reduced information security
О-9 Failure to meet planned production/sales of beryllium, tantalum, niobium and other UMP products
О-10 Environmental risk
О-11 Risk of a pandemic
Legal risks (L)
L-1 The occurrence of legal consequences of non-compliance/different interpretations of legislation
Financial risks (F)
F-1 Liquidity deficit
F-2 Credit risk vis-à-vis counterparty banks
F-3 Failure to perform on issued guarantees and obligations that do not have the legal form of a guarantee
F-4 Currency risk
F-5 Interest rate risk
F-6 Non-compliance with covenants under loan and guarantee agreements
F-7 Counterparty default risk
F-8 Country risk
Investment risks (I)
I-1 Failure to meet the planned targets for the implementation of the FA project in Kazakhstan
I-2 Untimely implementation/non-implementation of Kazatomprom Digitalisation and Transformation Strategy/Digital Transformation
I-3 Untimely implementation of CDW project (Stage 1)
I-4 Failure to achieve targets of the Building 600. Reconstruction. Uranium Refining. Ulba Metallurgical Plant JSC. North Site project
Key changes in the Risk Map in 2022:
In Q1, seven risks migrated, and one risk was excluded:

1. 1S-2 Higher social tension: impact grew from 3 to 4;

2. О-2 “Failure to meet the planned uranium mining and/or uranium product output (U3O8): impact grew from 3 to 4;

3. О-4 Shortage of skilled staff or low qualifications; probability grew from 3 to 4, and impact grew from 1 to 2;

4. О-8 Reduced information security: probability grew from 3 to 4;

5. О-5 Compliance risk: impact grew from 2 to 4;

6. О-11 Risk of a pandemic: impact dropped from 4 to 3;

7. I-4 Failure to achieve targets of Building 600. Reconstruction. Uranium Refining. Ulba Metallurgical Plant JSC. North Site project: impact dropped from 3 to 2.

In Q2, one risk migrated, and one risk was excluded:

1. О-7 Intentional damage to the Company's group of companies: impact grew from 1 to 2;

2. I-2 risk was excluded, Untimely implementation/ non-implementation of Kazatomprom Digitalisation and Transformation Strategy/ Digital Transformation.

In Q3:

1. A new risk was out on the map: S-5 Failure to perform on subsoil contracts.

In Q4, two risks migrated:

1. F-2 Credit risk vis-à-vis counterparty banks: probability grew from 2 to 3;

2. I-3 Untimely implementation of CDW project (Stage 1): probability grew from 3 to 4.

Risks and mitigation

Risk Description Mitigation measures
S-1 Decrease in uranium sales price below target
  • Fixating quotas of contracts.
  • Exploring the opportunity to hedge uranium prices through transactions with TH KazakAtom AG subject to provision of the necessary funding:
    • Participating in tenders and conclusion of new medium-term and long-term contracts at fixed and partially indexed prices.
  • Analysing the market, projecting the uranium price trend.
  • Media monitoring of incidents, accidents and their consequences at nuclear and uranium facilities.
  • Control of uranium production by Kazatomprom's subsidiaries and affiliates in line with Kazatomprom's strategic decisions.
S-2 Increasing social tensions
  • Allocating funds to support the socio-economic development in the regions of operations under subsoil use contracts.
  • Local government relations and cooperation.
  • Reaching out to workers through online platforms, retreats and/or roundtables.
  • Developing and monitoring an action plan for social partnership and enhancement of social stability at Kazatomprom's enterprises.
  • Overseeing compliance with labour laws through the reporting of subsidiaries and affiliates.
  • Improving the financial literacy of employees (training).
  • Monitoring of media coverage.
S-4 Reputation risk
  • Professional and timely communication and disclosure management.
  • Building effective internal communications in the central office, subsidiaries and affiliates.
  • Building and maintaining relations with local and international media.
  • Conventional and social networks monitoring.
  • Actions in line with the Crisis Communications Plan.
  • Control over the fulfilment of Kazatomprom's obligations under the agreements signed between Kazakhstan and the IAEA in terms of the competence of the parent company, subsidiaries and affiliates.
S-5 Failure to perform on subsoil contracts
  • Monitoring of Kazakhstan's laws regulating the Company's operations.
  • Ensuring that the Company's subsidiaries and affiliates hold all necessary permits (licences) in line with the Subsoil and Subsoil Use Code of the Republic of Kazakhstan.
  • Participating in discussions on draft/amended legislation. Developing proposals to amend and supplement the laws of Kazakhstan.
  • Attending workshops explaining certain laws of Kazakhstan. Seeking explanations of complicated issues from government authorities.
  • Monitoring the compliance of the production figures in TO-25 reports with the contractual obligations of the subsidiaries and affiliates.
  • Raising the issue of risks associated with subsoil use contractual obligations with the Strategic Planning and Investment Committee of the Company's Board of Directors.
  • Monitoring subsoil use contract renewal deadlines.
О-1 Failure to meet the uranium product sales plan
  • Exploring the uranium market environment and needs in the current year, using up-to-date information to assess the possibility to sell the output made available in the current year from the Uranium Sales Plan, because existing buyers refused to purchase natural uranium in view of the reduced demand for uranium products.
  • Entering into long-, short- and medium-term contracts for the sales of finished products (including contracts with KazakAtomTHAG).
  • Monitoring the performance of the contracts by the counterparties.
  • Insuring goods in transit against loss or damage.
  • Monitoring the media for prompt identification of intentions to impose sanctions and/or counter-sanctions affecting the uranium industry.
  • Selecting counterparties carefully, analysing and negotiating contract terms and conditions with the concerned structural units, etc.
  • Controlling compliance with the process parameters of finished uranium production.
  • Quality control of packaging of finished uranium products for compliance with standards.
  • Developing alternative uranium export routes.
О-2 Failure to meet the planned uranium mining and/or uranium product output (U3O8)
  • Adjusting production (changes in unit commissioning schedule).
  • Strict adherence to subsoil use licences and contracts.
  • Supervising the execution of planned well construction and production.
  • Implementing the 2016-2027 Prospecting Programme for the replenishment of mineral resources.
  • Taking corrective actions (shutting down wells with low uranium content, launching blocks with the richest uranium content, adjusting the acid feed, etc.).
  • Quality control of finished uranium products received for compliance with standards.
  • Weekly and monthly control of compliance with standards of well construction, mine preparation works and uranium mining, and technological regulations.
  • Controlling compliance with the process parameters of finished uranium production.
  • Overseeing the fulfilment of schedules for well preparation, repair and renewal operations.
  • Acquiring additional drilling rigs, outsourcing some of the drilling works.
  • Proper planning of requests for raw materials, inventories, energy, etc.
  • Monitoring the timely launch of fields, sites, and blocks.
  • Continuing the Corporate Property Insurance Programme for subsidiaries and affiliates.
  • Overseeing maintenance and repair works to be performed by uranium mining companies in line with the approved schedules.
  • Planning spring and autumn preparations, winter preparations and flood prevention measures. Overseeing the timing of actions, analysing the outcomes and, if necessary, adjusting the Action Plan for future periods.
О-5 Compliance risk (noncompliance with internal or external regulatory requirements/standards)
  • Training and regular testing of employees in line with the Code of Ethics and Compliance, awareness-raising about the insider information.
  • Updating the list of insiders up to date, collecting insider's notices of insider trading liability under applicable laws, including transactions with the Company's securities on the basis of insider information.
  • Notifying employees of the Company in advance about closed/open periods.
  • Timely informing stock exchanges and regulators about transactions made by PDMRs.
  • Monitoring changes in the stock exchange rules.
  • Informing the management and employees of the Company about changes in listing requirements.
  • Monitoring compliance with disclosure rules.
  • Organising handling of hotline calls and ensuring timely handling.
  • Conducting training sessions for employees.
  • Seeking approval by the Compliance Service of foreign exchange payments to check if sanctions were imposed on non-resident counterparties and/or their banks.
О-6 Occupational injuries
  • Monitoring compliance with the HSE laws of the Republic of Kazakhstan and corporate regulatory documents.
  • Conducting scheduled audits of operations of subsidiaries and affiliates to ensure compliance with HSE regulations.
  • Monitoring timely training, briefing and checking personnel's knowledge of HSE.
  • Preparing and sending an information statement on findings of the analysis of occupational injuries and accidents at enterprises and prevention proposals to subsidiaries and affiliates.
  • Controlling the provision of employees of subsidiaries and affiliates with overalls and PPE.
  • Supervising regular radiation and contamination monitoring by subsidiaries and affiliates.
  • Supervising pre-shift medical examinations and briefings conducted by subsidiaries and affiliates.
  • Overseeing timely certification of workplaces by the Company's subsidiaries and affiliates.
  • Conducting and analysing behavioural safety audits, identifying near-misses.
  • Imposing disciplinary sanctions on responsible officers for occupational safety violations.
О-8 Reduced information security
  • Continuous monitoring of compliance with the Information Security Policy.
  • Entering into NDAs with the counterparties of the Company's group of companies.
  • Raising cyber security awareness and improving cyber security skills of employees. Conducting briefings and testing. Mailing out.
  • Testing the Business Continuity and Disaster Recovery Plans.
  • Conducting IS audits at the Company, its subsidiaries and affiliates.
  • Connection of all subsidiaries and affiliates under Kazatomprom's umbrella to the IS Operations Centre and a single Internet access gateway.
  • Making a list of facilities identified as critical information and communication infrastructure.
  • Considering the establishment of a Cyber Security Centre on the site of KAPTechnology LLP (with connection to the ISOC and further to the National Cyber Security Coordination Centre).
  • Supervising the connection of all subsidiaries and affiliates under Kazatomprom's umbrella to the Integrated Information Security System (IISS).
  • Entry testing. Developing an action plan to eliminate identified IS threats and shortcomings.
  • Implementing IS tools to ensure and enhance IS maturity.
  • Protecting information by means of a confidential data leakage prevention system (DLP), Cryptographic Information Protection System (CIPS), and Comprehensive Information Security System (CISS).
  • Ongoing monitoring and analysis of changes in the information security laws of the Republic of Kazakhstan.
  • Preventing unwarranted access and disclosure of restricted information.
  • Identifying and closing potential channels used for leaking restricted business information in the course of the Company's operations.
  • Making a List of Confidential Information and Commercial Secrets of NAC Kazatomprom JSC.
  • Resolving power segregation conflicts in SAPGRCAC on the Procurement process.
О-9 Failure to meet planned production/sales of beryllium, tantalum, niobium and other UMP products
  • Controlling the execution of the Production Plan.
  • Carrying out preventive maintenance and overhauls to prevent breakdowns.
  • Conducting ongoing negotiations with suppliers of raw materials (beryllium, tantalum).
  • Controlling the availability of standard stock (raw materials).
  • Controlling the sales of beryllium, tantalum and niobium products against targets.
  • Making contracts with consumers of beryllium, tantalum and niobium products.
  • Analysing the beryllium, tantalum and niobium market (by segment, region, product, competitor, and consumer) on an ongoing basis.
О-11 Risk of a pandemic
  • COVID-19 vaccination and revaccination.
  • Supporting employees' families affected by coronavirus/pneumonia.

The management is confident that Kazatomprom has an effective risk management system in place, implementing measures to prevent the materialisation of risks and reduce the consequences of the risk materialisation. Reports on the implementation of preventive measures are generated on a regular basis as part of the risk register.

Risk limitation practices are in place. The level of risk appetite is determined and approved by the Board of Directors on an annual basis. Kazatomprom has introduced tolerance levels to control processes preventing from potential negative financial consequences and reduction of the Company's value.

Kazatomprom has the Rules in place for setting limits for second-tier banks84. The Rules establish and ensure control over the level of credit risk arising in relation to the Company's counterparty banks.

The Group's limits on counterparty banks are approved at least annually by the Company's Management Board. Based on the limits approved by the Company's Management Board, the Risk Management Department assigns the counterparty bank limits to the Company and its subsidiaries.

In addition, Kazatomprom has introduced the routine analysis and assessment of risks in investment projects, as well as in other initiatives submitted by the Company's enterprises for consideration by their governing bodies.

The Company's senior management is directly engaged in risk management on an ongoing basis. In particular, the Risk Management Department prepares quarterly risk management reports for the Management Board and the BoD Audit Committee and annual reports for the Board of Directors, disclosing information on materialised risks, preventive and reactive measures taken to reduce risks, projected risks, and financial risks.

Sustainability Risk Management

Kazatomprom strives to factor in the risks and opportunities in the area of sustainable development in its operations and make informed and ethical decisions related to sustainable development. The Company works to improve its risk management and internal control system and align it with ESG factors and the climate change agenda to meet the expectations of socially responsible investors, sustainability promoting communities, and other stakeholders.

Internal control

Our internal control system focuses on risk prevention in three key areas, including financial and management reporting, compliance with legal and internal regulations, and improving the operational efficiency.

The Company's internal control system seeks to build a management system capable of responding quickly to process risks, controlling core and supporting processes and day-to-day operations, and is built according to the COSO Internal Control - Integrated Framework and consists of five interdependent components:

The Company has Kazatomprom Internal Control System Policy (ICS Policy) in place, which outlines key medium-term aspirations and focus areas for the development of the internal control system at Kazatomprom (approved by the Board of Directors on 18 November 2021).

In line with the ICS Policy, we developed Regulations on Management Reporting on Internal Control System (approved by the Management Board on 9 June 2022).

The Regulations establish the procedures, frequency, and content of management reporting on the internal control system on a consolidated basis, as well as the deadlines for submission to NAC Kazatomprom JSC's respective collegial bodies.

The reports made according to the approved forms are based on self-assessments of process risks and internal controls of a structural unit for a reporting period.

The forms of management reports on internal control include information on:

As part of the internal control system, the Company regularly implements the following measures:

To implement and promote the principles of segregation of duties (SoD) within SAP Governance, Risk and Compliance, Access Control (SAP GRC AC), we developed rules for segregation of duties and configured SAP GRC AC solutions for the Procurement process in subsidiaries and affiliates covered by SAP in 2022. The Company will continue working on access management in 2023-2024 as part of the Information Protection Department's Access Management project.

To improve the internal control procedures undertaken to assure financial reporting in the Company, the structural units involved in the preparation of the financial statements updated their risk and process control matrices in 2022.

Our Risk Management Department updated the descriptions of controls in the risk and control matrix and assessed the effectiveness of the control design. The assessment showed that the control procedures were appropriately designed and implemented to mitigate the risks in the preparation of the financial statements, and were adequate to the respective risks.

Internal Audit

The Company has an independent Internal Audit Service (the IAS) accountable directly to the Board of Directors. The Board of Directors determines the composition of the Service, the remuneration of its staff, and approves the internal audit policies and procedures, as well as the annual audit plan and budget.

IAS performance in 2022:

External Audit

GRI 2-5

Every year, Kazatomprom’s Consolidated Financial Statements and the Integrated Annual Report are independently assured by an auditor, which results in an Independent Auditor's Report and the Auditor's Report on the Independent Limited Assurance Review.

In 2022 at the Extraordinary General Meeting of Shareholders PricewaterhouseCoopers LLP was appointed as the auditor to perform audit of NAC Kazatomprom JSC's consolidated and separate financial statements under IFRS for the years 2023 and 2024. Remuneration for audit of NAC Kazatomprom JSC's consolidated and separate financial statements under the International Financial Reporting Standards for 2023 and 2024 amounts to KZT 679,938,766 (six hundred seventy-nine million nine hundred thirty-eight thousand seven hundred sixty-six tenge), including VAT.

The Group's total non-audit fees for 2022 were KZT 74,309,000 (seventy-four million three hundred and nine thousand) excluding VAT.

Shareholder Engagement

Share capital

Kazatomprom's total issued shares, including global depositary receipts (GDRs), is 259,356,608, with 64,839,152 shares/ GDRs currently on free float, which makes 25%. Samruk-Kazyna JSC holds 75% of the issued capital, or 194,517,456 shares.

In 2022, Kazatomprom did not participate in any placements. There was no disclosure of the existence and compliance with the terms of any agreement with the controlling shareholder.

Listing information

As of 31 December 2022, the Company's securities, i.e., shares, GDRs and bonds were traded on the Kazakhstan and international stock exchanges with a listing on the Kazakhstan Stock Exchange (KASE), Astana International Exchange (AIX), and London Stock Exchange (LSE).

Percentage of issued shares issued and free float

Share of NWE Samruk-Kazyna JSC shares

Free float/GDR share

Instrument Currency ISIN AIX LSE KASE
Ordinary shares KZT KZ1C00001619 KAP - -
GDRs USD US63253R2013 KAP.Y KAP -
Bonds KZT ISIN KZ2C00006153 - - KZAPb2
Commercial bonds USD KZ2C00009199 - - KZAPb3

Outreach policy

Kazatomprom works consistently to build a positive image and business reputation of the Company, as well as to inform stakeholders about the Company's operations through external and internal channels.

Kazatomprom has the Information Disclosure Council, the Information Disclosure Policy and Rules, communications risks, and other internal regulations in place.

Pursuing the Policy, Kazatomprom follows fundamental principles:

In 2022, the Company:

Official channels for shareholder engagement

To ensure the exercise of equity rights and the effective shareholder engagement, the Company operates several communication channels:

Tax Transparency

GRI 3-3, GRI 207-1

Since its foundation, NAC Kazatomprom JSC has taken a responsible approach to compliance with applicable tax legislation, taking into account the provisions of laws and regulations, international treaties and other recommendations of state authorities in its activities, while ensuring proper control over tax accounting and tax reporting. Our responsible approach to taxation is based on our corporate tax policy and internal regulations and aims to ensure full and timely payment of all required taxes.

NAC Kazatomprom JSC's tax policy seeks to maintain the highest standards of tax accounting and the Group's management is responsible for compliance with the tax policy. NAC Kazatomprom JSC applies the group tax policy in accordance with the Company's overall business strategy and approach to corporate governance, ethics and risk management. The Company's tax policy is implemented using specific approaches and measures adopted and developed by the Group. These include proactive identification, prevention and mitigation of potential risks and result in accurate and timely fulfilment of the Company's tax obligations.

By making all applicable tax payments to local authorities, Kazatomprom makes a significant contribution to the sustainable social and economic development of the regions where it operates. Wherever possible, the Company seeks to engage in constructive dialogue on tax matters with government authorities, independent associations and business groups in order to make a meaningful contribution to the development of a fair, efficient and stable tax system.

GRI 207-2, GRI 207-3

The Director of Accounting and Reporting is responsible for the maintenance, control and management of tax risk and ensures that appropriate processes and systems are in place to control these risks. The Group is committed to minimising tax risks and always builds its business on sound principles, consistent with the tax legislation of Kazakhstan. The Company monitors tax changes on a regular basis and updates processes as necessary.

The Group believes tax risks are extremely important and discloses them in the financial statements if they exist. The Group prepares quarterly reports on tax risks for internal and external users. NAC Kazatomprom JSC seeks external advice if there is complexity or uncertainty regarding tax risk and works very closely with the tax authority represented by the State Revenue Committee of the Republic of Kazakhstan. The Company seeks to resolve any contentious issues through proactive and transparent discussion and negotiation. Since the tax system of the Republic of Kazakhstan is evolving, we consider different interpretations of tax laws and provisions, as well as the application of transfer pricing to be the most significant tax risks for the Group.

The Group widely participates in various pilot projects of the tax authorities aimed at continuous interaction between the parties in order to promptly identify and respond to potential risks. Our employees regularly participate in seminars and training sessions on tax matters to stay up-to-date on trends and changes in tax legislation. Significant tax issues are regularly reviewed by external auditors as part of the audit of the Company's financial statements.

Corporate Ethics and Compliance

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Kazatomprom believes that doing business ethically is key to its long-term success, and therefore maintains the highest standard of ethical behaviour in its daily operations, which is an essential part of its approach to doing business.

The Company's Code of Ethics and Compliance approved by the Board of Directors is a pillar for achieving strategic goals and a guide for all Company employees in building relationships with stakeholders.

In addition to the Company's Code of Ethics and Compliance, the key documents governing anti-corruption compliance procedures are:
GRI 205-2

The Anti-Corruption and Anti- Fraud Policy covers 100% of employees of Kazatomprom Group, including management. Staff outreach and training are conducted on a regular basis, including annual compliance testing.

The Anti-Corruption and Anti-Fraud Policy is the key document that defines major anti-corruption measures, goals, and principles of NAC Kazatomprom JSC.

Basic principles of combating corruption and fraud:

Kazatomprom has Regulations on the settlement of corporate conflicts and conflicts of interest in place. The document outlines the causes of corporate conflicts and conflicts of interest, prevention procedures, as well as regulates conflict settlement actions of the Company's bodies.

In line with the ESG principles, Kazatomprom focuses on the development and further promotion of a compliance culture among its business partners as well.

In 2022, the Compliance Service held workshops to explain the Code of Ethics for Suppliers and Contractors to eight major and systemic contractors of the Kazatomprom Group. The work will continue in 2023.

Throughout 2022, NAC Kazatomprom JSC's compliance specialists conducted anti-corruption training events for the Group's employees on various compliance topics, including anti-corruption issues.

In addition, a number of training and awareness-raising events were held with the invitation of civil servants from the anti-corruption regulator of Kazakhstan, the Agency for Counteraction of Corruption of the Republic of Kazakhstan.

In general, the Company aims to cover at least 90% of the full-time employees when conducting anti-corruption training.

100% of suppliers have been made aware of the Group's anti-corruption policies and procedures.

Ethics and doing business principles

All our employees are committed to high standards of behaviour socially accepted and consistent with the responsibilities and traditions of the Company. High standards of personal conduct imply that employees of the Company adhere to the principles of honesty, integrity, impartiality, and respect not only at work and in communication with colleagues, partners, suppliers, customers, and other stakeholders of the Company, but also in their everyday life.

The general principles of employees' conduct in relations with other team members, business partners, shareholders, government agencies and other stakeholders are enshrined in the Kazatomprom Code of Ethics and Compliance. Corporate values lie at the heart of the Code. As the backbone of the Group's corporate culture and employees' unity of views and actions, the values contribute to the effective achievement of the Company's goals.

In 2022, we updated our Code of Ethics and Compliance, extending some of our commitments. In particular, we added provisions on dealing with insider information, the dress code in the Company, corporate fraud and expanded the list of grounds on which no discrimination is allowed (such as beliefs, participation in associations, etc.).

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Kazatomprom's corporate values:
Safety
  • Safety is our habit
  • Each of us is personally responsible for safety
  • We promote the culture of safety through standards and conduct
  • We take care of the environment
Professionalism
  • We are an industry leader
  • We have and share unique knowledge and practices
  • We achieve our goals effectively
  • We make informed decisions
Responsibility
  • Each of us is personally responsible for his or her work product
  • We care about the future and take responsibility for the decisions we make
  • We care about our reputation
  • We are honest with each other, partners, suppliers, and customers
Development
  • Developing ourselves, we develop the company
  • We pioneer innovations
  • Relying the best practices we have, we are developing new business areas
  • We improve technologies
Team
  • We respect other opinions and value everyone's input
  • We help each other
  • We work towards our common cause
  • Generational knowledge and energy help build an effective team

Every employee of the Company must adherence to the Code of Ethics and Compliance, regardless of their position. This Code is binding on the management and third parties related to the Company. All employees of the Company get familiar with the Code of Ethics and Compliance when they are hiring and when the Code is amended.

All group companies have also introduced a Supplier Code of Ethics (as an annex to a model procurement contract), which outlines Kazatomprom Group's ethical principles and obliges suppliers to follow them.

Anti-corruption management

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As a law-abiding and public organisation, the Company supports anti-corruption and anti-bribery measures in Kazakhstan and globally. Corruption causes significant damage to the economic security of a country and society, has a devastating effect on the national economy, destabilises public life and work, and undermines public trust. The Company's anticorruption commitments are enshrined in its Code of Ethics and Compliance.

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To ensure effective anti-corruption management, we have implemented all necessary measures and procedures. Responsibilities are assigned depending on the level of decision-making:

In addition, the Company strives to cascade down these ethical business principles to suppliers and contractors. Thus, from mid-2021, an annex, the Supplier and Contractor Code, was introduced into the model procurement contracts. Suppliers must adhere to the Code. The Code incorporates seven core principles in line with the ESG (Environmental, Social & Governance) principles. Since 2022, Kazatomprom has held outreach meetings and workshops with the group's regular and major suppliers to discuss the Code.

Anti-corruption training

To raise employees’ awareness about compliance and the latest changes in anti-corruption laws, NAC Kazatomprom JSC conducts regular compliance and anti-corruption training sessions.

In 2022, the Company held two meetings with compliance and risk officers of subsidiaries and affiliates (12-13 April 2022 and 13-15 June 2022). The meetings discussed key developments in the risk management and compliance environment and gave presentations on practices and lessons learned.

In March 2022, the Compliance Service held an introductory lecture on the differences between sanctions programmes, given the new sanctions risks.

Throughout 2022, the Compliance Service held five master classes for the Company's employees, covering:

In October 2022, the Compliance Service staff prepared and presented a report to Kazatomprom's compliance officers to discuss Samruk-Kazyna's Corporate Compliance Standard.

In October-December 2022, we held an anti-corruption creative competition. The works submitted by 12 subsidiaries and the headquarters were of two categories: drawings and videos. The competition sought to engage a wider group of employees in the discussion of anti-corruption issues.

In addition, the Head of Compliance Service delivered three presentations to the compliance officers of the Kazatomprom Group:

The Company writes a monthly compliance column in the QazatomNews corporate magazine.

Whistleblowing channels

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Kazatomprom has the Hotline in place that is designed to receive reports from the Company's employees and third parties on corruption and fraud-related issues, violations of the Code of Ethics and Compliance, and other non-compliance with the laws regulating the Group's operations. The Hotline details can be found on the Company's official website.

The Hotline received 88 reports in 2022, of which 81 were handled, and 7 were rejected (because the whistleblowers filed the same reports to government authorities or the reports had been dealt with previously and the new ones did not provide any substantive information. All the reports were reviewed within the time established by internal documents of the Company.

Topics raised in reports, %

Topics 2020 2021 2022
Procurement 49 25 40
HR issues 38 53 45
Other 13 22 15

Ombudsman

Kazatomprom has the Office of the Ombudsman responsible for consulting employees on the Code of Corporate Ethics, initiating procedures to consider disputes over violations of the Code, participating in their settlement, and promoting compliance with business ethics by employees. In line with the Company's internal documents, the Ombudsman shall follow the principles of independence, neutrality, impartiality, confidentiality, and informality.

Every employee can contact the Ombudsman through special communication channels: the helpline, internal communication channels at subsidiaries and affiliates, WhatsApp mobile application, or the Ombudsman's email.

In 2022, the Ombudsman considered 41 complaints and provided explanations and follow-up recommendations to rectify the violations.

All the complaints were handled in line with the Company's internal documents and the laws of the Republic of Kazakhstan, including the Administrative Procedure Code of the Republic of Kazakhstan.

Breakdown of the hotline reports by topic, q-ty

Topics 2022
Violations of ethics 9
Workplace management 4
Interpersonal conflicts 4
Salary 3
Welfare and living conditions 3
Dismissals 3
Benefits 2
Other conflicts with the management 2
Bonuses and other rewards 2
Other 9

In H2 2022, the Ombudsman's Service conducted an annual anonymous survey among employees of subsidiaries and affiliates. The anonymous survey was structured into three main blocks, which diagnose knowledge of the Code of Ethics and Compliance, the state of the moral and ethical climate within a team and awareness of the possibility of resolving conflicts at work.

The survey also helped identify the level of employees' awareness of the possibility to protect their rights and interests, anxiety in the team, discrimination, and the existing issues in communication with managers. The survey found that 98% believed that the Company's management behaved respectfully and courteously with staff.

94% of respondents were confident that the Ombudsman acted in line with the principles of independence and neutrality in dealing with complaints. In total, 93% of survey participants said they were aware of the possibility to report unethical behaviour of a colleague or supervisor using the whistleblowers’ hotline.

INTERNAL COMMUNICATIONS FOR OMBUDSMEN

In 2022, Kazakhstan Nuclear University held training for Ombudsmen of subsidiaries and affiliates. The training covered methods of personality psychotyping, prevention of tensions in the team, tactics-behaviour during collective bargaining, tools for constructive dialogue and the procedure for working with collective appeals, and technology for achieving consensus in group complaints.

Managing conflicts of interest

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Kazatomprom's Code of Ethics and Compliance obliges employees report a conflict of interest, if any, according to procedures established by internal documents. All potential and/or actual conflicts of interest are carefully analysed and measures are developed to minimise the risks arising from the conflict of interest.

Regulations on the settlement of corporate conflicts and conflicts of interest are also in place in the Company. The document outlines the causes of corporate conflicts and conflicts of interest, prevention procedures, as well as regulates conflict settlement actions of the Company's bodies.

Government relations and sponsorship

The Company’s approach to stakeholder communications excludes any form of bribery or corruption and applies to relations with both private entities and government authorities.

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As per the Code of Ethics and Compliance, Kazatomprom does not make any payments to political parties, organisations, or their representatives, nor does it participate in political activities. Acting privately, employees may support and make contributions to political parties.

No valuables, products, services, or benefits may be received or provided to influence decision-making, as prescribed by the Regulations on giving and receiving gifts and branded souvenirs, as well as the Law of the Republic of Kazakhstan On the Civil Service of the Republic of Kazakhstan and the Law On Combating Corruption.

Kazatomprom is engaged in philanthropy and charity through the Samruk-Kazyna Trust Social Development Foundation, which implements socially significant projects through competitive selection.