ERMIC efficiency assessment
At PJSC Inter RAO, ERMIC efficiency is assessed:
- With regard to annual reports on ERMIC, the management informs the Board of Directors on an annual basis of the achieved results in risk management and internal control within the reporting period.
- Each year, the Internal Audit Unit carries out an audit of ERMIC, the results of which are reviewed by the Board of Directors
- The efficiency of ERMIC periodically undergoes external assessment involving an independent organization.
Role of the Board of Directors and its Committees in the assessment of risk management and internal control efficiency
Risk management and internal control issues are regularly examined by the Board of Directors and the Audit Committee, whereby the priorities and activities for the next period are determined:
- The Audit Committee of the Board of Directors carries out control over the reliability and performance ofrisk management and Internal Control Frameworks, provides preliminary consideration, analysis and formulation of recommendations on the competencies of the Board of Directors in terms of risk management results in the reporting period (including in terms of ERMIC Report), and adopts methodologies for efficiency assessment of risk management and internal control frameworks.
- The Board of Directors analyzes reports on the risk management and internal control frameworks, as well as reports on efficiency assessment of ERMIC.
Reports on the Enterprise Risk Management Framework and Internal Control Framework (ERMIC) and efficiency assessment of ERMIC for 2017
The following Reports are preliminarily considered by the Audit Committee and approved by the Board of Directors on an annual basis:
- Reports on ERMIC;
- Report on adoption, control, and efficiency of the procedures aimed at the organization of risk management and Internal Control Frameworks in order to prevent and combat corruption;
- Reports of the Internal Audit Unit on the efficiency assessment of the Internal Control Framework, the risk management and corporate governance system, as well as on the efficiency assessment of the risk management and Internal Control Framework in the sphere of preventing and combating corruption in PJSC Inter RAO.
Based on the results of ERMIC performance assessment in 2017, the Internal Audit Unit confirms that:
- The existing ERMIC ensure reasonable confidence in the achievement of goals set by PJSC Inter RAO's Board of Directors;
- The system is well developed, as there are no critical drawbacks and breaches of ERMIC procedures.
The Internal Audit Unit has made recommendations on further improvement of ERMIC.
After assessing the efficiency of risk management and internal control in terms of preventing and combating corruption the auditor stated that the process is integrated into ERMIC and it is organized and functions in accordance with the Methodical Recommendations of the Federal Agency for State Property Management.
Corporate governance efficiency assessment has shown that the principles and recommendations of the Code of Corporate Conduct form part of the Company's practice to the extent allowing it to ensure effective corporate governance.