Supervisory Board

The Supervisory Board is a collegiate governing body that exercises strategic and general management of the bank’s operations, sets out basic principles and approaches to the bank’s corporate governance system, including risk management and internal control systems, and monitors the activities of executive bodies.

The Supervisory Board reports to the General Shareholders’ Meeting.

Members of the Supervisory Board are elected at the General Shareholders’ Meeting until the next annual meeting and may be re-elected any number of times. In June 2014, the General Shareholders’ Meeting approved amendments to the bank’s Charter and resolved to reduce the Supervisory Board from 17 to 14 people, which the bank considers to be an optimal and sufficient number to meet business needs and ensure the Supervisory Board’s productivity.

The Supervisory Board is governed by the Regulation on the Supervisory Board of OJSC Sberbank of Russia.

The Supervisory Board comprises executive, non-executive and independent directors.

Executive directors are members of the Supervisory Board employed by the bank.

Non-executive directors are members of the Supervisory Board who are not employed by the bank and are not independent directors.

Independent directors are those who are qualified, experienced and independent enough to have their own vision and who are able to make objective and honest judgements independently from the bank’s executive bodies, groups of shareholders or other stakeholders.

Members of Sberbank’s Supervisory Board
Members of the Supervisory Board elected at General Shareholders Meeting on May 31, 2013 Members of the Supervisory Board elected at General Shareholders Meeting on June 6, 2014
Non-Executive Directors
1 Sergey Ignatiev 1 Sergey Ignatiev
2 Nadezhda Ivanova 2 Nadezhda Ivanova
3 Georgy Luntovskiy 3 Georgy Luntovskiy
4 Alexei Moiseev 4 Alexei Kudrin
5 Alessandro Profumo 5 Alessandro Profumo
6 Alexei Ulyukaev 6 Valery Goreglyad
7 Sergei Shvetsov 7 Sergei Shvetsov

Executive Directors

8 Herman Gref 8 Herman Gref
9 Bella Zlatkis 9 Bella Zlatkis

Independent Directors

10 Sergei Guriev 10 Martin Grant Gilman
11 Alexei Kudrin 11 Evsey Gurvich
12 Ilya Lomakin-Rumyantsev 12 Peter Kraljic
13 Vladimir Mau 13 Vladimir Mau
14 Sergei Sinelnikov-Murylev 14 Sergei Sinelnikov-Murylev
15 Dmitry Tulin 15 Dmitry Tulinlost his status as an independent director on January 21, 2015.
16 Ronald Freeman 16 Gennady Melikyan
17 Elgimez Ahmet Mahfi 17 Nadia Wells
Status of Members of Sberbank’s Supervisory Board
Full name of Member
of the Supervisory Board
Chairman of the Supervisory Board Deputy Chairman of the Supervisory Board Chairman of the Audit Committee Chairman of the Committee for Personnel and Remuneration Chairman of the Committee for Strategic Planning Member of the Audit Committee Member of the Committee for Personnel and Remuneration Member of the Committee for Strategic Planning
Sergey Ignatiev

+

Georgy Luntovskiy

+

+

Alexei Kudrin

+

+

Martin Grant Gilman

+

Valery Goreglyad

+

Herman Gref

+

Evsey Gurvich

+

Bella Zlatkis
Nadezhda Ivanova

+

Peter Kraljic

+

Vladimir Mau

+

+

Alessandro Profumo

+

Gennady Melikyan

+

Sergei Sinelnikov-Murylev

+

+

Dmitry Tulin

+

+

Nadia Wells

+

Sergei Shvetsov

+

Supervisory Board Meetings

Supervisory Board meetings are held in accordance with the Working Plan of the Supervisory Board, additional meetings can be held, if needed.

In 2014, the Supervisory Board held seven meetings in presentio where the bank’s core business issues were discussed, including those to be approved by the bank’s General Shareholders Meeting, such as issues related to preparation for the Annual Shareholders Meeting, resolutions on membership in the Executive Board and appointment of the Head of the Internal Audit Service and the bank’s Corporate Secretary, and the approval of the bank’s internal documents.

All members of the Supervisory Board elected at the Annual Shareholders Meeting on June 6, 2014, attended more than 75% of the meetings of the Supervisory Board and its committees in 2014.

Remuneration of Supervisory Board Members

Remuneration to members of the Supervisory Board and compensation of expenses related to their participation in the work of the Supervisory Board are paid in the amount and manner prescribed by the bank’s in-house document entitled Regulation on Remuneration and Compensation for Members of Supervisory Board of OJSC Sberbank of Russia, approved at the Annual Shareholders Meeting on May 31, 2013.

The remuneration consists of basic remuneration paid to Supervisory Board members if they participate in at least half of the meetings of the Supervisory Board in a payroll period, and additional remuneration for work in the committees, chairmanship of the committees and chairmanship of the Supervisory Board.

Basic remuneration of RUB 4.2 mn was determined by the resolution of the General Shareholders Meeting on May 31, 2013.

Depending on participation in the work of the Supervisory Board, its members are paid the following types of additional remuneration:

  • 10% of basic remuneration — for performing duties as a member of any Supervisory Board committee;
  • 20% of basic remuneration — for performing duties as a Chairman of any Supervisory Board committee;
  • 30% of basic remuneration — for performing duties as a Chairman of the Supervisory Board.

Should members of the Supervisory Board perform extra duties, amounts of additional remuneration for each of such duties are summarised, but the total remuneration may not exceed 30% of basic remuneration.

A payroll period is the period from the date of election to the Supervisory Board until the date of termination of office of the Supervisory Board member.

The Bank has no long-term incentive programmes and employee stock option plans for Supervisory Board members.

Eleven members of the Supervisory Board received basic remuneration in the amount of RUB 46.2 mn in 2014 (2013 — RUB 58.8 mn for 14 members). Payment to two chairmen of the committees equalled RUB 1.7 mn (RUB 840,000 each), and payment to members of the committees totalled RUB 4.2 mn (RUB 420,000 for each of the ten members). Three members of the Supervisory Board received compensation in the amount of RUB 879,000 for their duty-related target expenses.

Total remuneration in the amount of RUB 53 mn was paid to the members of the Supervisory Board for their membership in the Supervisory Board in 2014 (2013 — RUB 61.3 mn).

Conflict of interest

Supervisory Board members shall refrain from actions that will or may potentially lead to a conflict of interest, and should such a conflict arise, they shall promptly notify the Supervisory Board thereof, as well as notify the bank of actual ownership and each purchase and/or disposal of the bank’s securities.

Members of the Supervisory Board refrain from voting on matters exposed to potential conflict of interest.

The bank has never granted loans to Supervisory Board members.

Direct Bank Share Ownership by Members of the Supervisory Board
Full name Participatory interest in the share capital, % Ordinary shares, % Transactions with the bank’s shares in 2014
Sergey Ignatiev - - No transactions
Georgy Luntovskiy - - No transactions
Alexei Kudrin - - No transactions
Martin Grant Gilman 0.00018 0.00019 Two acquisition transactions ADR of ordinary shares (22.09.2014 and 01.10.2014)
Valery Goreglyad - - No transactions
Herman Gref 0.0031 0.003 No transactions
Evsey Gurvich - - No transactions
Bella Zlatkis 0.0004 0.0005 No transactions
Nadezhda Ivanova - - No transactions
Peter Kraljic - - No transactions
Vladimir Mau - - No transactions
Alessandro Profumo - - No transactions
Gennady Melikyan 0.0001 0.0001 No transactions
Sergei Sinelnikov-Murylev - - No transactions
Dmitry Tulin - - No transactions
Nadia Wells - - No transactions
Sergei Shvetsov - - No transactions
TOTAL (cumulative ownership of the bank’s shares by Supervisory Board members): 0.00378 0.00379 -

Liability Insurance

The liability of all members of the Supervisory Board is insured under the Liability Insurance Contract of the bank and its subsidiaries, members of the Supervisory Board and officials of the bank and its subsidiaries (Insurance Contract), signed between the bank and Ingosstrakh Insurance Company Ltd.

Supervisory Board members’ actions covered by the Insurance Contract include only those erroneous actions committed by them as part of their official duties. The Insurance Contract does not cover any other actions or omissions committed by Supervisory Board members in any other capacity, as well as deliberate wrongdoing.

Liability insurance for collegial bodies is prescribed by the Corporate Governance Code recommended for use by letter of the Bank of Russia dated April 10, 2014, for the purpose of guaranteeing protection of shareholders’ interests and compensation for damages in the event of negative consequences caused by the actions of members of the management bodies.

Evaluating the Effectiveness of the Supervisory Board and Its Committees

In order to detect additional focuses in the work of the Supervisory Board and its committees, and identify areas for improvement and development, the Supervisory Board annually assesses its performance.

Periodically, the bank hires an independent external consultant to conduct such an assessment (at least once in three years), as well as conducts an independent assessment of its operational effectiveness (self-assessment).

In 2014, the Supervisory Board performed a self-assessment for the second time. The self-assessment showed a high level of work organisation and efficiency of interaction between the Supervisory Board and the bank. In particular, Supervisory Board members highly appreciated the performance of the Supervisory Board Chairman, noting that the atmosphere of Supervisory Board meetings encouraged an open exchange of views and efficient settlement of disputes. The self-assessment resulted in identifying a few areas for improvement on which the Supervisory Board should focus in the future.

The Supervisory Board intends to continue the assessment of its operational effectiveness both independently and with the assistance of an external consultant.

Supervisory Board Committees

The bank has an Audit Committee, a Committee for Personnel and Remuneration and a Committee for Strategic Planning.

The committees are advisory bodies of the Supervisory Board, established for preliminary consideration of the bank’s key business issues that fall within the competence of the Supervisory Board, as well as for preparing recommendations on such issues to the Supervisory Board.

Responsibilities of Sberbank’s Supervisory Board Committees
Audit Committee Committee for Personnel and Remuneration Committee for Strategic Planning
Preliminary consideration of issues related to:
  • financial statements of the bank;
  • risk management;
  • internal control;
  • corporate governance;
  • internal and external audit;
  • remedying the consequences of unscrupulous actions of bank employees and third parties;
  • consideration of the Statutory Audit Commission’s report on the audit results of the bank’s financial and business operations.
Preliminary consideration of issues related to:
  • planning succession and developing an HR structure for the Supervisory Board, executive bodies and other key executives14 Other key executives refer to managers who should comply with the bank’s qualification criteria and requirements for business reputation in accordance with Art. 60, Federal Law No. 86-FZ dated July 10, 2002, On Central Bank of Russia (Bank of Russia).;
  • creating an effective system of remuneration for members of the Supervisory Board, executive bodies, and other bank employees.
Preliminary consideration of issues related to:
  • determining the bank’s strategic business objectives (jointly with the bank’s executive bodies);
  • implementing the bank’s Development Strategy and preparing recommendations thereof to the Supervisory Board;
  • the bank’s Risk and Capital Management Strategy,
  • assessment of the bank’s operational efficiency in the long term.
Members of the Committees:16
Audit Committee Committee for Personnel and Remuneration Committee for Strategic Planning
Committee Chairman: Vladimir Mau

Committee members: Valery Goreglyad, Nadezhda Ivanova, Evsey Gurvich, Dmitry Tulin

Committee Chairman: Georgy Luntovskiy

Committee members: Vladimir Mau, Sergei Sinelnikov-Murylev, Dmitry Tulin

Committee Chairman: Alexei Kudrin

Committee members: Herman Gref, Martin Grant Gilman, Peter Kraljic, Gennady Melikyan, Alessandro Profumo, Sergei Sinelnikov-Murylev, Nadia Wells, Sergei Shvetsov

Supervisory Board Committees’ Performance in 2014

The Audit Committee previously considered the candidacy of the bank’s auditor for 2014 and Q1 2015, and heard the auditor’s interim performance report in 2014. Moreover, the Committee discussed the auditor’s report on the bank’s annual financial statements of 2013 as well as the results of audits conducted by the bank’s Internal Audit Service.

In 2014, the Committee for Personnel and Remuneration considered approaches to the selection of candidates for the Supervisory Board and changes in the membership of the Executive Board, as well as conducted preliminary year-end evaluation of the Corporate Secretary.

The Committee for Strategic Planning addressed issues related to the implementation of Sberbank Group Strategy 2014-2018 during 2014.

Corporate Secretary

The bank introduced the position of the Corporate Secretary in order to ensure that the bank’s governing bodies and officials comply with corporate governance procedures, applicable law, the bank’s Charter and in-house documents guaranteeing the rights and legitimate interests of shareholders. The Supervisory Board is responsible for appointing the Corporate Secretary, who is accountable to the Supervisory Board and administratively reports to the CEO and Chairman of the Executive Board. The Corporate Secretary is the Head of the Corporate Secretary Service, the bank’s structural unit.

Oleg Tsvetkov is the Corporate Secretary of OJSC Sberbank of Russia.

The Corporate Secretary’s work is governed by the Regulation on Corporate Secretary of OJSC Sberbank of Russia.