On December 9, the Standard & Poor’s corporate governance rating service raised the corporate governance score (CGS) of North-West Telecom from CGS 5.6 to CGS 5.7 by the Russian scale. The corporate governance score of North-West Telecom by the international scale was confirmed at the level of 5+.

In the opinion of Standard & Poor’s analysts, “the increase of North-West Telecom’s corporate governance score reflects: the increased board representation of minority shareholders and improvements in the timing of annual IFRS accounts release and improvement in company’s transparency.”

After the score revision, North-West Telecom was assigned the following scores by component:

- Ownership structure and external influence: 5 / 5,1 (unchanged);

- Shareholders’ rights and stakeholders relations: 7/ 7,3 (score raised from the 6+/ 6.9 level);

- Transparency, disclosure and audit: 6+/ 6,7 (score raised from the 6+/ 6.5 level);

- Board structure and effectiveness: 5 / 5,3 (score raised from the 5/ 5.2 level).

- Among the strong sides of the corporate governance practice of North-West Telecom that served as a basis for the score increase, the S&P analysts note the following:

- Efficient procedures of preparation and conduct of meetings of shareholders;

- The annual report by IFRS for 2007 was prepared before the annual general meeting of shareholders;

- North-West Telecom maintains the active investor relations policy;

- Minority shareholders enjoy ample rights and play an active role in the management of the company;

- Independent directors hold a majority on the Auditing Committee list;

- The Board of Directors has considerable authority, and the Board process is supported by the four committees;

- North-West Telecom employs an internationally acknowledged auditor chosen via an open tender.

This, the Standard & Poor’s analysts believe that the corporate governance practice level is the highest among similar companies in the sector. 

Noted Ella Tomilina, Deputy General director – Corporate Affairs officer of N.W.Telecom, “The improved corporate governance score of North-West Telecom is our another success related to corporate governance. Over the recent years, we achieved impressive progress in that sector: improve the reported procedures and decline the period of financial statements release, increase company’s transparency, set the efficient dialog with investment community and set the efficient conversation between the Executive Board and the Board of Directors. We are going to further improve our corporate governance activity, thus bringing the Company’s corporate governance practice closer to the world’s best models.”

For the full report on the rating, visit Standard & Poor’s website www.governance.standardandpoors.com,  and their Russian-language website www.standardandpoors.ru