UC RUSAL Sustainability report 2016

Sustainable Development Aspects Management

Management of the aspects of sustainable development

Management approach

The work of UC RUSAL in the area of sustainable development and corporate social responsibility is based on best practices, international and Russian standards and principles, including:

          10 principles of the Global Compact;

          provisions of the Social Charter of Russian business;

          the concept of the Global Reporting Initiative (GRI) and international SASB standards;

          provisions of the International Standard ISO 26000:2010.

The Company's activities cover the main areas of corporate social responsibility and sustainable development in accordance with standard ISO 26000.

Governance structure

The management of the sustainable development aspects is coordinated by the Board of Directors, the President, the Executive Committee, the functional units of the managing company and the relevant business units of the subsidiaries. G4-35

Health, industrial safety and environmental issues are dealt with directly at the level of the Board of Directors in the context of the work of the relevant Committee.

The management bodies and the business units of the management company and subsidiaries are responsible for the development and implementation of policies and action plans on sustainable development aspects in accordance with their functions. Policies and major corporate documents are approved by UC RUSAL Executive Committee. HKEx Appendix 27 KPI 10

The responsibility for addressing economic, social and environmental aspects of sustainable development, as well as consultation with stakeholders, is exercised within the functions of the employees of the relevant services; the results are brought to the attention of top management under the existing corporate governance procedures. G4-36 G4-37

During 2016, nine meetings of the Board of Directors were held to decide on the strategic development of the Company, as well as on staff motivation, health and industrial safety, environmental protection and the development of the regions of operation. G4-50, HKEx Appendix 27 KPI para10

The Business Partner Code establishes the principles observed by the Company in interaction with supply chain organisations.HKEx Appendix 27 KPI para10

Global sustainable development goals

On January 1, 2016, the official recording of the actions was launched to achieve the 17 sustainable development goals set out in the UN document 'Transforming Our World: the 2030 Agenda for Sustainable Development' (SDGs), supported by 193 countries of the world. Private business, from which considerable investments and meaningful actions are expected not only in its own business, but also at the international level, is important in ensuring the effectiveness of collective efforts. G4-15

UC RUSAL implements approaches compliant with SDGs-2030 in its management of Company operations, as well as its participation in a number of international initiatives. HKEx Appendix 27 KPI 10


Global sustainable development goals - 2030

Content of activities

1. No poverty

The Company promotes the employment of the able to work population in significant regions of its operation. The international training programme for Jamaican students gives graduates the opportunity to get well-paid jobs.

Taxes paid by the production facilities of UC RUSAL raise the revenues of local budgets.

In the areas of residence of indigenous peoples, the Company's social investments improve the quality of life by providing access to water, electricity, health care and social services. The social infrastructure of towns and rural settlements is being developed

2. Zero hunger

3. Good health and well-being

The Company implements health and well-being programmes for staff members and their families, invests in the health infrastructure in the regions of its operation and enhances the availability of modern health care for the local population. A large-scale international project is the Medical Centre in Guinea, which ensures research, diagnosis, treatment and prevention of infectious diseases, including high-risk quarantine

4. Quality education

A variety of training programmes are available to the employees of the Company to help them continue their lifelong education. Programmes of interaction with schools and specialised universities and the UC RUSAL to Russian Schools project help to make the content of education more modern, and schools are provided with modern teaching aids

5. Gender equality

The Company provides equal rights to men and women with regard to access to employment, remuneration, opportunities to hold managerial positions, etc. The Social Entrepreneurship programme for Russian regions supports business projects developed by women

6. Clean water and sanitation

The Company operates in a limited number of regions with arid climates or uneven distribution of drinking water supplies. Being aware that water is a valuable resource and its accessibility affects the health and social well-being of the residents, the Company finances the solution of these issues through social investment programmes. Programmes for local communities in Guinea, Guyana and Jamaica include the construction of water pipes and water treatment equipment. The creation of closed water supply systems at production capacities is one of the Company's strategic objectives

7. Affordable and clean energy

The largest investment of the Company was the BEMO project (together with RusHydro), which includes the construction of Boguchanskaya HPP, a source of clean energy. Jamaica is implementing a solar-powered irrigation system project.

More than 90% of the aluminium production of UC RUSAL is covered of clean renewable hydropower

8. Decent work and economic growth

The Company carries out a responsible social policy with regard to its employees: their rights are protected by collective bargain agreements and agreements of the administrations of production facilities with trade unions. The wage system is transparent and exceeds the corresponding indicators in the regions of operation and the social package contains benefits and guarantees that are important for workers and their families. Special attention is paid to the safety and health of workers.

The Company's activity contributes to the development of regions of operation through the procurement system and social investment programmes

9. Industry, innovation and infrastructure

The Company has considerable scientific and research potential and implements new technology solutions

10. Reduced inequalities

The Company provides equal opportunities for local residents in obtaining employment at its production facilities, and trains those willing to be employed

11. Sustainable cities and communities

Within the social investment programmes, projects have been implemented that are supported by the residents of nearby cities and towns

12. Responsible consumption and production

The Company works with the consumers of its products to increase the use of clean aluminium products. Aluminium can be 100% reprocessed without losing its unique properties. In addition, the Company strives to increase the share of recycled or reused waste

13. Climate action

The programme to reduce greenhouse gas emissions at the production facilities of the Company has quantified objectives. UC RUSAL is one of the initiators of the Climate Partnership of Russia, as well as a number of international projects and initiatives

14. Life below water

The production of the Company does not adversely affect marine ecosystems. Sea water is used only at KUBAL for cooling in the casthouses

15. Life on land

The Company works on long-term programmes aimed at the maintenance and conservation of biological diversity, cooperates with environmental organisations, including in environmental monitoring (including biodiversity monitoring) in specially protected natural areas within the affected zone of individual production facilities

17. Partnerships for the goals

The Company participates in several international projects and initiatives