X5 Group (Пятерочка). Годовой отчет за 2021 год - часть 18

STRATEGIC REPORT

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SUSTAINABLE DEVELOPMENT

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OCCUPATIONAL HEALTH AND SAFETY

138

Our main OHS-related activities include:

monitoring employees’ rights and legally protected 
interests in the field of OHS 

planning OHS-related activities and developing 
measures to improve working conditions in order 
to prevent workplace injuries and occupational 
diseases

organising OHS-related activities in accordance with 
Russian legislation 

inspecting working conditions and workplace safety 

assessing work-related risks and informing 
employees about any identified risks 

providing compensation for work in harmful 
or hazardous conditions 

providing employees with personal protective 
equipment

providing OSH training

operating and improving the OHS management 
system

Protecting the health of employees 

Since a healthy workforce is an important prerequisite 
for household incomes, productivity and economic 
development, restoring and maintaining the capacity 
to work is an important function. Maintaining the health 
of employees is an integral part of X5’s OHS Policy. 

The main measures that X5 takes to protect the health 
of its employees include arranging safe working  
conditions, conducting regular medical examinations, 
providing first-aid training and developing 
a health-conscious culture in the workplace.

Managing occupational risks

Occupational risk management is at the foundation 
of our OHS management system. Identifying 
occupational risk factors, determining safe and harmful 
exposure levels related to such risk factors, monitoring 
workplace health and safety, analysing the causes 
of accidents and occupational diseases. 

and a number of other issues are included in the range 
of tasks involved in assessing and managing 
occupational risks. Our policy, which is aimed 
at improving working conditions, establishes a risk 
register and stipulates analysis (assessment) of the 
risks inherent in employees’ work.

Improving OHS qualifications

We have a duty to arrange OHS training in order 
to improve the relevant qualifications of our 
employees. Training employees in OHS standards 
is one of our strategic preventive measures aimed 
at avoiding workplace injuries and occupational 
diseases. 

Upon being hired, every employee receives an e-mail 
about the need to take part in OHS training, along with 
a link to an interactive training course.

Monitoring compliance

Continuous preventive monitoring of working 
conditions and compliance with OHS standards 
in the workplace – one of the most effective means 
of preventing accidents, workplace injuries and 
occupational diseases – is carried out through internal 
audits, as a result of which deviations from OHS 

regulations are identified, and the necessary measures 
to address those deviations are promptly taken.  

Periodic assessments of OHS compliance with state 
regulations is carried out to improve the effectiveness 
of OHS management within our subsidiaries and 
business units.

Safety management for external contractors

The main goals of OHS management in relations with 
external contractors are to coordinate efforts and 
achieve consistent results based on trust, while 
systematically monitoring the implementation of OHS 
requirements on the part of the contractor’s personnel. 

All employees of contractors working on X5 property 
take part in a mandatory briefing on occupational 
health and safety for third-party organisations.

Preventing workplace injuries

It is crucial that measures be put in place to avoid 
workplace injuries.  

X5’s Occupational Safety Department has identified 
the following priorities for the prevention of workplace 
injuries:

1. Identifying and preventing possible hazardous 

situations in the workplace and ensuring that 
employees know how to avoid and address such 
situations. 

2 Carrying out campaigns and outreach work to raise 

employees’ awareness.

3. Continuously training employees at all levels 

on workplace safety rules.

4. Investigating the causes of workplace accidents 

and occupational diseases, and developing and 
implementing measures to prevent their recurrence.

Measures to prevent workplace injuries are not limited 
to the general measures described above; every retail 
network and business unit – depending on its 
particular needs – takes additional measures to avoid 
workplace injuries. 

STRATEGIC REPORT

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SUSTAINABLE DEVELOPMENT

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OCCUPATIONAL HEALTH AND SAFETY

139

2021 OHS highlights

The successful functioning 
of the OHS management system, 
including the following:  

A special assessment of working 
conditions was conducted covering 
100% of positions in accordance with 
approved schedules.

OHS briefings were carried out 
in accordance with the approved 
procedure for OHS training and 
at the established intervals. 

OHS training was provided at licensed 
training centres and business 
commissions in accordance with 
the established schedule and at the 
established intervals. 

Internal audits (including gemba walks) 
were completed in order to identify 
and prevent OHS violations 
in accordance with the approved 
schedules.

X5’s business divisions took part 
in a programme to cover injury 
prevention expenses through 
the Social Insurance Fund, which 
helped the Company save about 
RUB 18 million in 2021. 

Thanks to X5’s compliance with 
OHS requirements and health 
standards, no cases of occupational 
diseases were reported. 

Key OHS managers at X5’s business 
divisions took part in an OHS 
exhibition in Moscow, which enabled 
them to improve their knowledge 
and exchange experiences 
in resolving pressing issues 
with counterparts from other 
organisations. 

A number of functions were 
updated and improved as part 
of an automated programme 
to ensure that employees 
undergo medical examinations. 

Pyaterochka

Pyaterochka launched a visualisation 
tool to assess the quality of goods 
delivered to stores, which reduced 
injuries caused by pallets that 
are not properly stacked. 

As part of a questionnaire in the 
system, employees evaluated the 
quality of wrapping and packaging; 
feedback is sent to logistics, where 
corrective actions are taken. 

Perekrestok

Routine OHS processes 
were transferred to the shared 
services centre, which made 
it possible to improve them 
and reduce the time needed 
for their implementation. 

STRATEGIC REPORT

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SUSTAINABLE DEVELOPMENT

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OCCUPATIONAL HEALTH AND SAFETY

140

OHS priorities for 2022

1.

Development of leadership 
and a culture of safety

3.

Dissemination of best Russian 
and international practices 
in terms of improving working 
conditions and occupational 
health and safety 

5.

Transition to electronic 
document management in the 
following areas of 
occupational health and 
safety: OHS training and 
special assessments of 
working conditions 

7.

Launch of a project to 
automate record-keeping 
concerning the issuance of 
protective clothing at 
Pyaterochka and 5Post

2.

Prevention of workplace 
injuries and occupational 
diseases 

4.

Review of by-laws in 
connection with amendments 
to the Labour Code of the 
Russian Federation and 
amendments to OHS laws 

6.

Implementation of a project 
to automate record-keeping 
related to medical 
examinations (a medical 
examinations portal) for all X5 
business units (four business 
units planned for 2022) 

8.

Implementation of action 
plans to improve OHS 
conditions within business 
units 

9.

Plans to describe OHS 
processes within Pyaterochka 
working groups in an effort 
to optimise them

Perekrestok

The introduction of the 
fundamental rules on 
occupational health and safety 
at distribution centres and a focus 
on safe operations at distribution 
centres 

(a number of events are planned 
to train the management 
of distribution centres 
on the fundamental rules and 
to ensure that workers are familiar 
with them) 

Governance structure

142

How we manage risk

150

Supervisory and Management Boards

159

Report of the Supervisory Board

161

Remuneration Report

167

Corporate 

governance

CORPORATE GOVERNANCE

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GOVERNANCE STRUCTURE

142

Governance 

structure

The Company has a two-tier 
board structure, comprising 
a Management Board and 
a Supervisory Board. 

The Management Board and the Supervisory Board 
are independent of one another and accountable to 
the General Meeting of Shareholders. The overview 
below shows the governance structure of X5.

General Meeting of Shareholders

Supervisory Board

Management Board

Executive Board

Audit and Risk Committee

Sustainable Development and Innovation Committtee

¹

Nomination and Remuneration Committee

Pyaterochka

Karusel

Chizhik

X5 Retail Group N.V. is a public limited-liability company 
incorporated under the laws of the Netherlands, with global 
depositary receipts listed on the London Stock Exchange. 
The Company is required to comply with, among other 
regulations, the Dutch Corporate Governance Code 
(the “Code”). The full text of the Code can be viewed on 
X5’s website at www.x5.ru.  

In accordance with the Code, a broad outline of the 
Company’s corporate governance structure is presented 
in this section, including any deviations from the Code’s 
principles and best practices. X5 aspires to high standards 
of corporate governance and is committed to a corporate 
governance structure that best supports its business, meets 
the needs of its stakeholders and is in compliance with 
applicable rules and regulations.  

Following Brexit, X5 Retail Group N.V., as a Dutch company 
whose shares are listed on the London Stock Exchange, 
is as of 1 January 2021 no longer considered to be a listed 
company whose securities are admitted to trading on an 
EU-regulated market. This report will reflect the changes in 
our regulatory framework following Brexit.  

Corporate 

governance 

report

Digital 

businesses

Perekrestok

1 Given the composition of the Supervisory Board following recent events, the duties and responsibilities of the Sustainable Development and Innovation Committee

will be included in the remit of the full Supervisory Board as of 16 March 2022.

CORPORATE GOVERNANCE

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GOVERNANCE STRUCTURE

143

Management Board

The Management Board has ultimate responsibility for 
the overall management of the Company and oversees 
all corporate governance activities. It is accountable for 
the Company’s pursuit and achievement of corporate 
goals and objectives, its strategies and policies. 
The Management Board is responsible for complying 
with all relevant laws and regulations, for managing 
the risks associated with the Company’s activities and 
for financing and external communication.  

In managing X5’s general affairs and its day-to-day 
operations, the Management Board is supported by the 
Executive Board, which was established to provide for a 
leadership team at the level of the Company’s operating 
subsidiaries in Russia in order to best support X5’s 
strategy and businesses at the local operating level. 

The current members of the statutory Management 
Board and the Executive Board (the broader 
management team that handles day-to-day strategic, 
operational and financial issues), including their 
biographies, are presented on pages 48–50 and 161.  

In 2021, the Management Board conducted a self-
assessment by means of a questionnaire. Items that 
were assessed and discussed included the 
composition of the Management Board, its role versus 
that of the Supervisory Board and Executive Board, its 
tasks and duties as well as remuneration. The results of 
the evaluation will be taken into account in 2022.  

Supervisory Board

NAME

YEAR 

OF BIRTH

YEAR OF FIRST 

APPOINTMENT

YEAR OF POSSIBLE 

REAPPOINTMENT

Peter Demchenkov 
(Chairman)

1973

2015

2023

Nadia Shouraboura¹ 

1970

2018

2022

Marat Atnashev

1977

2020

2023

Alexander Tynkovan² 

1967

2021

2024

Karl-Heinz Holland³ 

1967

2018

−

Stephan DuCharme³ 

1964

2015

−

Mikhail Fridman 

1964

2006

−

Richard Brasher  

1961

2021

−

³

Geoff King 

1965

2015

−

Michael Kuchment³ 

1973

2015

−

NAME

YEAR 

OF BIRTH

YEAR OF FIRST 

APPOINTMENT

END OF

CURRENT TERM 

OF APPOINTMENT

Igor Shekhterman

1970

2015

2023

Frank Lho

ë

st

1962

2007

2023

Quinten Peer

1974

2019

2023

The Supervisory Board is responsible for supervising 
and advising the Management Board and overseeing 
the general course of affairs, strategy and operational 
performance of X5 and its businesses. It ensures that 
external experience and knowledge are embedded in 
the Company’s operations. In performing its duties, the 
Supervisory Board takes into account the relevant 
interests of the Company and all its stakeholders, and, 
to that end, considers all appropriate interests 
associated with the Company and its affiliated 
businesses, including corporate responsibility issues 
that are relevant to the Company. Major business 
decisions require the approval of the Supervisory Board. 
The Supervisory Board is responsible for monitoring 
and assessing its own performance.   

The Supervisory Board determines the number of its 
members. X5’s Supervisory Board currently consists 
of four members, with a majority of three independent 
members. The current members, including their 
biographies, are presented on page 159. 

The Supervisory Board has prepared a profile of its size 
and composition, taking account of the nature of the 
Company’s business and its activities and the desired 
expertise and background of the members of the 
Supervisory Board. The Supervisory Board evaluates its 
profile and composition annually. The results of the 
evaluation in 2021, along with the Board’s profile and 
skill matrix, will be taken into account in future Board 
nominations. For further details, please refer to the 
Supervisory Board Report on pages 161–166.  

Starting in 2020, the Supervisory Board resolved to 
reduce the term of (re-)appointment for Supervisory 
Board members to a maximum of three years, to 
promote agility and diversity and to create more 
flexibility in view of rapidly changing skill requirements 
at the Supervisory Board level. The total term of office 
may not exceed 12 years. The Supervisory Board has 
prepared a retirement and reappointment schedule to, 
as far as possible, prevent simultaneous reappoint-
ments. The Supervisory Board’s profile and rotation 
plan can be viewed on the Company’s website.  

Composition and reappointment schedule
of the Management Board 

Composition and reappointment schedule of the Supervisory Board 

1 The terms of Nadia Shouraboura will expire 

in 2022. 

2 Richard Brasher and Alexander Tynkovan 

were appointed on 12 May 2021.

3 Karl-Heinz Holland stepped down 

as of 12 May 2021. Stephan DuCharme 
and Mikhail Fridman stepped down 
as of 1 March 2022. Richard Brasher 
stepped down as of 4 March 2022. Geoff 
King stepped down as of 11 March 2022. 
Michael Kuchment stepped down as 
of 25 March 2022.

4 In accordance with the Supervisory Board’s 

Rules of Procedure, a Supervisory Board 
member who directly or indirectly holds 
at least 10% of the shares in the issued 
share capital of the Company may hold 
office for more than 12 years and is eligible 
for reappointment after that term (see 
“Compliance with the Dutch Corporate 
Governance Code” in this report). 

2, 3

3, 4

CORPORATE GOVERNANCE

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GOVERNANCE STRUCTURE

144

Committees of the Supervisory Board

Audit and Risk Committee

Nomination and 
Remuneration Committee 

Sustainable Development 
and Innovation Committee

Composition of the Supervisory Board Committees

The Audit and Risk Committee assists the Supervisory Board in overseeing 
the integrity of X5’s financial statements, system of internal business 
controls and risk management, financing and finance-related strategies, 
taxation, the Company’s compliance with legal and regulatory requirements, 
as well as the qualifications, performance and independence of the external 
auditor and the performance of the internal audit function. Furthermore, the 
Audit and Risk Committee advises the Supervisory Board on handling and 
deciding on reported (potential) conflicts of interest and/or related party 
transactions involving members of the Supervisory Board and members 
of the Management Board.

The Nomination and Remuneration Committee recommends the 
remuneration policy for the Management Board to be adopted by the 
General Meeting of Shareholders, prepares proposals for the Supervisory 
Board for remuneration of the individual members of the Management 
Board in line with the remuneration policy and advises the Management 
Board on the level and structure of compensation for other senior 
personnel. The Nomination and Remuneration Committee also advises in 
respect of the selection and appointment of members of the Supervisory 
Board, the Management Board and the Executive Board. 

The Sustainable Development and Innovation Committee assists the 
Supervisory Board in its responsibility to advise on the Company’s 
long-term vision on sustainability, strategy and target setting, monitor the 
Company’s performance on sustainability targets and oversee X5’s
e-commerce activities and initiatives in the area of technical and 
commercial innovation.

The Supervisory Board currently has three standing 
committees: the Audit and Risk Committee, the 
Nomination and Remuneration Committee and the 
Sustainable Development and Innovation Committee. 
The members of each committee are appointed by the 
Supervisory Board and from among its members. Each 
committee has a charter describing its role and 
responsibilities and the manner in which it discharges 
its duties and reports to the full Supervisory Board. 

These charters are included in the Rules of Procedure 
of the Supervisory Board, which can be viewed on X5’s 
website. In September 2021, the Innovation and 
Technology Committee was renamed the Sustainable 
Development and Innovation Committee to strengthen 
the focus of the Supervisory Board on ESG matters.

NAME

AUDIT AND RISK 
COMMITTEE

NOMINATION AND 
REMUNERATION 
COMMITTEE

SUSTAINABLE 
DEVELOPMENT AND 
INNOVATION COMMITTEE ¹

Peter Demchenkov

Member

Chairman

Nadia Shouraboura

Chair

Marat Atnashev

Member

Member

Alexander Tynkovan

Member

Member

1 Given the composition of the Supervisory Board following recent events, the duties and responsibilities of the Sustainable Development and Innovation 

Committee will be included in the remit of the full Supervisory Board as of 16 March 2022. 

CORPORATE GOVERNANCE

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GOVERNANCE STRUCTURE

145

Diversity

The Supervisory Board operates a Leadership Diversity 
Policy that aims for a diverse composition of both the 
Management Board and the Supervisory Board in 
particular areas of relevance for X5. This includes 
diversity of experience, nationality and background. 
Appointments to the Management Board and 
Supervisory Board are evaluated against the relevant 
profile; the existing balance of skills, knowledge and 
experience on the respective board; and the need for 
the relevant board to be prepared for disruption and 
change. Management Board and Supervisory Board 
members are prompted to be mindful of diversity, 
inclusiveness and meritocracy considerations when 
examining and proposing nominations to the 
Management Board and Supervisory Board. In the 
selection and appointment of new Management Board 
or Supervisory Board members, the Supervisory Board 
will consider a diverse range of candidates. This will 
also include diversity of gender and age so that, when 
the final appointment is made, the Supervisory Board 
can be confident that the most effective candidate 
has been selected.  

 

Each year, the Supervisory Board conducts an 
evaluation of its functioning and the functioning of the 
Management Board. In this context, the Supervisory 
Board gives careful consideration to the diversity of its 
own composition, as well as that of the Management 
Board, so as to be effective in performing its role. The 
results of the 2021 evaluation of the Supervisory Board 
and the Management Board are described in the 
Supervisory Board Report on page 163.  

While the Management and Supervisory Boards are 
currently not balanced with regard to gender, X5 
recognises the benefits of gender diversity and of the 
importance that is attached to achieving this. We feel 
that gender is only one part of diversity, and future 
members of the Management Board and Supervisory 
Board will continue to be selected on the basis of 
specific experience, background, skills, knowledge and 
insights. X5 recognises the importance of diversity, 
including gender, at all levels of the Group and has a 
very strong track record of developing a critical 
executive layer of female business leaders. Across all of 
the Group’s operations, specific diversity targets are 
taken into account in recruitment, talent development, 
appointments, retention of employees, mentoring and 
coaching programmes, succession planning, training 
and development.

Appointment, suspension and dismissal

Remuneration

The General Meeting of Shareholders appoints the 
members of the Management Board and Supervisory 
Board based on binding nominations made by the 
Supervisory Board. The recommended candidate is 
appointed by the General Meeting of Shareholders 
unless the nomination is deprived of its binding 
character by a qualified majority vote of at least 
two-thirds of the votes cast, representing more than 
one-half of the issued share capital of the Company. 

Members of the Supervisory Board may in principle 
serve for a maximum term of four years from the date 
of their appointment or a shorter period if determined 
upon their appointment by the General Meeting of 
Shareholders or as per the Supervisory Board’s 
rotation schedule. A Supervisory Board member can 
be reappointed after their first term of four years for 
one additional term of four years, followed by two 
additional terms of two years. Starting in 2020, the 
Supervisory Board resolved to reduce the term of 
(re-)appointment for Supervisory Board members to 
a maximum of three years, to promote agility and 
diversity and to create more flexibility in view of rapidly 
changing skill requirements at the Supervisory Board 
level. 

A Supervisory Board member may not serve more 
than 12 years. A Supervisory Board member who 
directly or indirectly holds at least 10% of the shares 
in the issued share capital of the Company may hold 
office for more than 12 years and is eligible for 
reappointment after that term (see “Compliance with 
the Dutch Corporate Governance Code” in this 
report). 

Members of the Management Board are elected for 
a period of four years or a shorter period if 
determined upon their nomination for appointment 
by the General Meeting of Shareholders. Neither the 
Articles of Association nor the Code limits the total 
term of office for Management Board members.  

Each member of the Supervisory Board and 
Management Board may, at any time, be dismissed 
or suspended by the General Meeting of 
Shareholders. A member of the Management Board 
may, at any time, be suspended by the Supervisory 
Board. Such suspension may be discontinued by the 
General Meeting of Shareholders at any time.  

In line with the current remuneration policy, as 
adopted by the 2021 Annual General Meeting of 
Shareholders, the remuneration of the individual 
members of the Management Board will be decided 
by the Supervisory Board upon the recommendation 
of its Nomination and Remuneration Committee. 

The remuneration policy for the members of the 
Supervisory Board was adopted by the 2020 Annual 
General Meeting of Shareholders. The remuneration 
policies can be found on the Company’s website.