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About the report

This “Samruk-Energy” JSC Annual report (hereinafter – the Report), which contains the Report in sustainable development, was prepared on the basis of “Samruk-Energy” JSC group’s operating results for 2021.

The content of this Report has been defined in accordance with the principles recommended by the GRI Standards. The Company applied the following approaches and principles in preparation of the Report.

Stakeholder Engagement and materiality

Identification of stakeholders that considerably influence the Company and the degree of stakeholders’ dependence on the Company, creation of materiality matrix, a Stakeholder Engagement Plan and a Stakeholder Communication Plan serve as the basis for “Samruk-Energy” JSC stakeholders engagement.

“Samruk-Energy” JSC stakeholder engagement is based on the principle of "Inclusion" and is based on the Company's readiness to invest in the development, in the future of its customers and employees, partners and suppliers, ensuring sustainable development of both the Company and local communities, making social investments in areas significant for the territory of the Company's presence, readiness to develop interaction with all persons for an appropriate and flexible response to external and internal challenges (for more details, see the section "Sustainable Development").

Considering the principle of "transparency" as part of stakeholder engagement, every year, the Company checks the balance and completeness of the information disclosed in the annual report after the release of the annual report, and also identifies topics and aspects that have a significant impact on the Company’s operations and its stakeholders, and which should be taken into account when building the structure of the annual report for the next reporting cycle, which includes: determination of a list of significant topics; survey of external and internal stakeholders; creation of a materiality matrix based on annual results.

Changes in Reporting

To make a list of relevant topics and aspects, internal stakeholders were interviewed, general trends of foreign and Kazakhstani companies, GRI standards, the Company's Development Strategy for 2022–2031, features of the Company's operations and other significant aspects that may be important, were examined.

The list of substantial topics in 2021

“SAMRUK-ENERGY” JSC MATERIALITY MATRIX

The analysis shows that as previously the topics related to tariff regulation and financial stability of the company, the company's contribution to the country's economy, effective investment activity, innovation and transformation, investments in renewable energy sources, information security, prevention and elimination of natural disasters and emergencies, principles and approaches to interaction with subsidiaries and affiliates, improving the occupational safety management system, etc. remain relevant for the Company and its stakeholders.

The evaluation of these aspects by stakeholders remains high, as in 2020.

Furthermore, considering the tasks on transition to clean technologies, technological transformation with a focus on low-carbon development assigned to the Company in 2021, important topics related to decarbonization at the Company's group, financial aspects and other risks, and opportunities for the company's operations associated with climate change, were included, and highlighted in the draft Materiality Matrix.

In accordance with the updated Development Strategy, the Company focuses on compliance of production activities with the principles of sustainable development, the consistency of its economic, environmental and social goals for sustainable development and the creation of economic value in the long term. In this regard, the draft Materiality Matrix also includes topics related to the development of ESG principles, the company's contribution to 17 sustainable development goals, and the provision of social guarantees and social stability at the Company’s group, etc.

In comparison with the Materiality Matrix for 2020, the Company and its stakeholders also noted the importance of issues related to waste management, compliance risks and the company's compliance culture.

These and other topics raised by stakeholders, are included in this Report.

The Context of Sustainable Development

The report provides information on the Company's contribution to the economic, environmental, social aspects. The information on the degree of “Samruk-Energy” JSC contribution to 17 sustainable development goals according to the results of 2021 was disclosed.

Completeness

The indicators and content of the Report are sufficient to reflect the significant impact of the Company on the economy, the environment and society during the reporting period.

Balance

This Report shows the positive and negative aspects of the Company's results for the reporting year. Certain indictors were disclosed in 3-year dynamics.

Comparability

Stakeholders using this Report can compare the information provided on the Company's financial and operating performance with the results for previous periods and its objectives.

The report was prepared in accordance with GRI Standards, which allows stakeholders to compare the Company's operations with those of other companies.

In order to constantly improve the quality of the annual report, the Company annually conducts a comparative analysis and evaluates the progress (regression) achieved in comparison with the previous period.

Benchmarking covers: analysis of information disclosure (aspects, content structure, etc.); principles of information presentation (design, concept); approaches to disclosure and choice of materiality of topics. Comparative analysis was carried out on the basis of the annual report for the previous year with similar companies.

The comparative analysis of the annual reports for 2021 includes "KEGOC" JSC, "InterRAO" PJSC, "Kazatomprom" JSC. Based on the results of benchmarking, this Annual Report includes additional disclosure indicators, including within the framework of the ESG principles, and the analysis also showed the need to disclose activities through the prism of strategic goals, which is implemented in this Report.

At the same time, the integrated Annual Report of Samruk-Energy JSC for 2020 became the winner in the nomination "The Best Annual Report for 2020 in the non-financial sector" and the winner in the nomination "The Best Design of the Annual Report for 2020" in the competition of annual reports organized by JSC " Kazakhstan Stock Exchange (KASE).

When determining the winners in the nomination "Best Annual Report for 2020 in the non-financial sector", the expert commission and the jury of the competition analyzed the annual reports issued in Kazakhstan, with the main focus on content with the most complete and high-quality disclosure of information.

Accuracy

The information provided in the Report is accurate enough and detailed so that stakeholders can evaluate the results of the Company's operations for the reporting period. Information is expressed both in quality descriptions and in figures.

Timeliness

The report is provided on an annual basis within the shortest possible time after the approval of the audited financial statements and no later than July 30, which allows assuming that the information reflected in this Report is relevant. The report is posted on the company’s website in Kazakh, Russian and English, simultaneously for all stakeholders.

Clarity

The information in the Report is set out in an understandable and accessible form to the interested parties.

Reliability

In preparing this Report, the information provided was preliminarily analyzed and disclosed in such a way that stakeholders could check this report and assess the degree of reliability of its content.

Data sources are official reporting forms, which are submitted to government agencies every year. A few indicators are collected and calculated in accordance with the forms of internal reporting, which are checked by responsible representatives of companies during internal audit procedures.

Production, social and environmental indicators presented in the Company Report were calculated, collected, and consolidated in accordance with principles of reporting and recommendations of Sustainability Reporting Guidelines and the Company's corporate governance procedures. The probability of an error in figures for each category of indicators in sustainable development is minimized. Ratios and specific values are supplemented by absolute values. Figures were indicated by using generally accepted system of measurement units and are calculated using standard coefficients.

There were no significant changes in the format of information presentation in this Report compared to last year. There were no restatements in the reporting period.

The report provides all stakeholders with an overview of operations results and achievements of “Samruk-Energy” group of companies from January 1 to December 31, 2021, in electronic, paper form or online. The date of publication of previous Integrated Annual Report of the Company – 27^th of July 2021.

Limitation of the scope and boundaries of the Report

The audited consolidated financial statements of the Company for 2020 as of December 31, 2021, and as of 31 December 31, 2020, specified in this Report are the result of an independent audit of “PricewaterhouseCoopers” LLP (“PwC”).

This Report provides information on financial and operating results and sustainable development. Qualitative and quantitative information were presented for 2021, to compare and analyze information in indicators, data for 2020 and 2019 were used, where applicable.

The Company determined the Report scope in accordance with GRI Standards: “Basic version”.

For the purpose of a unified approach, when compiling a report on the results of financial and economic activities, the Group of Companies of Samruk-Energy JSC uses the equity method in consolidation. In addition, in accordance with the current accounting policy, fixed assets and intangible assets are recorded at their original cost, that is, without revaluation. Subsidiaries are included in the consolidated financial statements using the acquisition method. Identifiable assets acquired and liabilities and contingent liabilities acquired in a business combination are measured at their fair value at the acquisition date, irrespective of the extent of any non-controlling interest.

Based on the above, when using the method equity participation in the consolidated balance sheet excludes the turnover of such large companies as JSC Station "Ekibastuz SDPP-2", coal assets company "ForumMuiderB.V", the share of ownership in which by "Samruk-Energy" JSC is 50%.

When forming the consolidated financial result of Samruk-Energy JSC, the share of profit for these companies is reflected in the item “share of profit / loss of organizations accounted for using the equity method and impairment of investment.

The indicators of the following subsidiaries and affiliates of “Samruk-Energy” JSC were used in the audited consolidated financial statements of the Company for 2021: 

Statement of responsibility

Based on all available information, “Samruk-Energy” JSC confirms that this Report fairly presents information on the results and changes in operations of “Samruk-Energy” JSC group, its current position, as well as the main risks and factors associated with operations of "Samruk-Energy" JSC group.

The report contains forecast statements regarding production, financial, economic, and social indicators that describe further development of the Company. The implementation of plans and intentions is tied to political, economic, social and legal situation in Kazakhstan and in the world. In this regard, the actual results of the Company's operations in the future may differ from those forecasted.

Contact person for any queries regarding this Report or its contents

Aisariyeva Madina Bekaydarovna, Director of the Corporate Governance and Sustainable Development Department.

Phone: +7 (7172) 55-30-20

E-mail: m.aisarieva@samruk-energy.kz

Feedback

The Company is interested in receiving feedback for further improvement of the integrated Annual Report, and quality disclosure of information to stakeholders. The Company will be thankful for completing the online questionnaire posted on “Samruk-Energy” JSC website in the interactive version of this Report.