MOEX Group’s focus areas

Genuine corporate governance and business ethics

Moscow Exchange Group adheres to best practices and standards in corporate governance, ethics, and business conduct. The Group is also developing a system for internal control and risk management. Sustainability principles are reflected in the activities of the Group’s corporate governance bodies. The scope of issues considered at Supervisory Board meetings is expanding. Moscow Exchange continues to develop policies to regulate the management of sustainability-related issues, implementing best practices in business conduct among the Group’s companies, in the supply chain, and also among issuing companies and other financial market participants.

Moscow Exchange Group’s objectives and the UN Sustainable Development Goals:

• SDG 5.5 Ensure gender balance at the Company
• SDG 5.5 Promote gender equality in the business environment
• SDG 12.6, 13.3 Raise companies’ awareness of sustainability-related trends, standards, and practices
• SDG 4.7 Ensure the Group’s personnel have the competencies they need to manage sustainability issues effectively

Corporate governance

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The corporate governance structure of Moscow Exchange consists of the General Shareholders Meeting, the Supervisory Board, the Executive Board, and Chairman of the Executive Board, who is the sole executive body.

General Shareholders Meeting

Moscow Exchange strives to balance its shareholders’ interests; it performs its infrastructural function on the financial market effectively.

According to the Charter of Moscow Exchange, each share entitles the holder to one vote at the General Shareholders Meeting. See the official website for more details on the decisions made at general shareholders meetings.

Supervisory Board

In order to comply with the corporate governance requirements established by the Listing Rules, as well as to ensure the fullest compliance with the Corporate Governance Code of the Central Bank of the Russian Federation, the following measures were taken in 2024

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• 12 non-executive directors were elected to the 12-member Supervisory Board of which 8 are independent directors;
• all independent directors meet the independence criteria set by the Listing Rules;
• the Audit Committee and the Nomination and Remuneration Committee consist of independent members of the Supervisory;
• a non-executive director was appointed as Chairman of the Supervisory Board;
• in accordance with clause 12.2 of the Articles of Association of Moscow Exchange, the members of the Supervisory Board are elected by the General Meeting of Shareholders for a term until the next Annual General Meeting of Shareholders and may be re-elected an unlimited number of times;
• the proportion of women on the Supervisory Board is 8%;
• the principle of forming the Supervisory Board and the Executive Board is based on the professional competences of the members of the Supervisory Board or the Executive Board, respectively;
• the Exchange seeks to ensure that different age groups are represented on the governing bodies; to date, these include those aged 40+, 50+, 60+ and 70+;
• the Supervisory Board brings together professionals with diverse profiles (entrepreneurial, functional, country-specific) and international competencies (in the area of the exchange industry, digital products and finance), which enables the Supervisory Board to address issues comprehensively and engage in meaningful discussions from different perspectives. Two members of the Supervisory Board hold positions in higher education institutions and are representatives of the academic and student communities.

The Supervisory Board includes representatives of the following stakeholders of the Moscow Exchange Group:

• Regulators;
• Shareholders and Investors of Moscow Exchange;
• Market participants and their clients;
• Issuers.

In 2024, two strategy sessions were held to dive into the specifics of the Group’s business, discussing various aspects of Moscow Exchange’s business development, including areas such as technology development, the Sustainability Sector, the carbon unit market and risk management.

Further work on these issues is planned in the Group companies.

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The Supervisory Board keeps abreast of critical issues through a specialized system for supporting the governing bodies’ activities. Once information on critical issues is received, all Supervisory Board members are sent a special notification. In the reporting year there were no critical issues that would require the involvement of members of the Supervisory Board.

In 2024, the following committees operated under the Supervisory Board, carrying out preliminary consideration of issues and preparing decision-making recommendations:

• Strategic Planning Committee;
• Audit Committee;
• Nomination and Remuneration Committee;
• Risk Management Committee;
• Technical Policy Committee.

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The Supervisory Board approves risk appetite and risk management policies (including by topic), reviews reports on the risk management system, and decides on corrective measures based on those reports.

The Supervisory Board has a Risk Management Committee that also involves other companies of the Group in its activities.

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The system of remuneration of Supervisory Board members is set out in the Regulation on Remuneration and Compensation of Expenses, approved by resolution of the Annual General Shareholders Meeting. Each Supervisory Board member is paid a fixed amount, depending on

• the Supervisory Board member’s status (compliance with the independence criteria);
• additional functions performed (as chairman or deputy chairman of the Supervisory Board);
• contribution to the work of the committees under the Supervisory Board (as committee chairman or member);
• attendance at meetings of the Supervisory Board.

Evaluation of the effectiveness of the Supervisory Board and its committees

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Prerequisites and grounds for the evaluation

In accordance with the recommendations of the Corporate Governance Code and international best practices, Moscow Exchange annually evaluates the effectiveness of the Supervisory Board. Pursuant to internal regulations, the Nomination and Remuneration Committee of the Supervisory Board engages external consultants regularly (once every three years) to conduct an independent evaluation. In other periods, the Supervisory Board undergoes the self-assessment procedure. In 2024, a self-assessment of the Supervisory Board was carried out.

Evaluation objectives and purposes

The objectives of the evaluation are to monitor the dynamics of changes in the work of the Supervisory Board and the commissions and to identify areas for improving the effectiveness of the Supervisory Board and its individual members. Moreover, special attention was given during the 2024 assessment to the updated practices of the Supervisory Board in the context of ongoing changes in business conduct against the backdrop of geopolitical changes.

The self-assessment process involves the directors answering questions focusing on analysing the Supervisory Board’s effectiveness on the following key components:

• Formation and membership of the Supervisory Board;
• Organization of Supervisory Board meetings;
• Proper attention given by the Supervisory Board to relevant and essential matters;
• Level of directors’ involvement and preparation
• Director development;
• Leadership and strategic goal setting;
• Succession planning, remuneration and working with management;
• Risk management;
• Role of the Chairman and independent directors.
• understanding and following compliance requirements by directors.

Due to operational changes, the self-assessment took place not in the spring, as it usually happens, but in the fall of 2024.

Evaluation methodology

The self-assessment process takes the form of an electronic questionnaire filled in anonymously by the members of the Supervisory Board. The specified questionnaire was optimized and included 32 questions in 2024, including five compliance questions. Assessment was well representative, with 8 out of 12 directors participating, exceeding the participation rate of 2023. The overall average score remains at a high level (6.1 out of 7 points, the same as in 2022 and 2023).

Evaluation results

The Supervisory Board of the Exchange has conducted a comprehensive self-assessment in 2023, identifying key areas for improvement. In 2024, significant strides have been made to enhance their effectiveness, focusing on strategic planning, operational and financial monitoring, management efficiency, and risk management. The Board has addressed development areas such as balancing powers with management, succession planning for the Chairman and Board members, maintaining a balance between discussions and reports during meetings, and actively involving all directors in discussions and idea generation. In 2024, the Supervisory Board has implemented several strategic initiatives, including revising their charter to clarify their powers, conducting training sessions, and adopting a new performance evaluation system. They have also held additional meetings to thoroughly discuss key issues and longer face-to-face meetings to ensure quality discussions on complex topics, with all board members actively participating and presenting their views.

Remuneration of executives at Moscow Exchange

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The main elements of remuneration paid to the members of the Executive Board in 2024

The main elements of remuneration paid to the members of the Executive Board in 2024 were the following:

• Fixed Component of Remuneration:
  • Base Salary (Position-Based Salary): The base salary is determined based on the employee’s position within the company.
  • Additional Payments and Allowances: These include compensatory and stimulating additions to the base salary, such as bonuses, allowances, and other benefits.
• Non-Fixed (Variable) Component of Remuneration:
  • Short-Term Remuneration: This includes bonuses based on annual work results (referred to as the annual bonus or annual incentive) and one-time bonuses.
  • Long-Term Remuneration: This encompasses remuneration within the framework of long-term motivation programs, including those based on the shares of the Public Joint Stock Company Moscow Exchange (PJSC Moscow Exchange).
• Non-Standard Payments and Benefits: These are additional payments and benefits that are not part of the standard remuneration package.

The structure of remuneration elements and their ratio is established individually as a percentage of the target annual income and differentiated depending on the degree of influence of a member of the executive body on the financial performance of the Company.

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Due to existing market practices and high sanctions risks, it was decided not to disclose information about the remuneration of the most highest-paid official of Moscow Exchange Group and the ratio of his remuneration to the median remuneration of the Group’s employees.

The Moscow Exchange Council and user committees

To effectively interact with market participants and clients, a special consultative collegiate body – the Exchange Council – has been established. Its purpose is to develop the financial market, improve the activities of Moscow Exchange (MOEX) in the interests of its users, and ensure fair relations among all participants of the financial market.

The Exchange Council is elected every two years by the Exchange’s Executive Board. The current members of the Exchange Council were approved by the Executive Board in December 2024.

In 2023-2024, changes were made to the Regulations of the Exchange Council, concerning the numerical composition of the Exchange Council and the principles of its formation:

• The numerical composition of the Exchange Council was increased from 26 members to 31;
• The categories of organizations whose representatives may join the Exchange Council were expanded.

To ensure maximum consideration of the interests of all market participants, representatives of corporate participants (enterprises), associations, unions, non-commercial organizations related to the financial market, issuers of shares, bonds, CFDs, and other instruments, development institutions, government agencies, venture companies and funds, rating agencies, other companies in the financial and exchange infrastructure, and independent experts were provided the opportunity to be included in the composition of the Exchange Council.

In 2024, two meetings of the Exchange Council and a working meeting were held, during which the following issues were considered:

• On the results of the work of the Moscow Exchange;
• On the current status of the time synchronization for the unblocking of assets;
• On the development of the DATA-business directions of the Group “New Approaches in Working with Clients of the Moscow Exchange”;
• On the processes of internalisation and disintermediation in the Russian financial market;
• Work under the conditions of sanctions restrictions imposed against the Group;
• On the results of the development of the instruction of the Exchange Council on the possibility of organising trading on weekends and holidays.

At the Exchange and NRD, there are 24 user committees whose meetings discuss issues concerning all aspects of exchange activities, including the regulation of public turnover and the issuance of securities, corporate governance, applied technologies, and others.

Compliance system

Compliance is a crucial aspect of good corporate governance. The Group has built a compliance management system with developed business processes, procedures, corporate policies, and local regulations; risk assessments are carried out regularly (at least once a year) in all compliance areas.

Developing a corporate compliance culture, developing a unified approach to compliance risk management, as well as quality support for business processes in the face of a significant number of new regulatory requirements became one of the main areas of focus for corporate governance in 2024.

In 2024, the “Moscow Exchange” Group underwent re-certification and obtained a certificate confirming compliance with the international ISO 37301:2021 standard for a “Compliance Management System” at the Group level.

An independent audit was conducted at the Exchange to confirm the compliance of the corporate control system with the international standard ISO 37301:2021 “Compliance Management System.” The audit focused on the following areas:

• Internal Control of Licensed Activities.
• Countering Money Laundering, Terrorist Financing, and Proliferation Financing (AML/CFT/CFP): Measures to prevent the legalization of proceeds from crime, terrorist financing, and the financing of the proliferation of weapons of mass destruction.
• Preventing Insider Information Misuse and Market Manipulation.
• Tax Compliance (FATCA/CRS): Ensuring compliance with the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS).
• Anti-Corruption Measures.
• Conflict of Interest Management.
• Economic Restrictions.

“Compliance: Key Trends 2024” conference was held for market participants in 2024. The event looked at trends and modern compliance technologies to improve the quality of compliance risk management (including solutions based on artificial intelligence).

The auditors from “Bureau Veritas Certification Rus” assessed the effectiveness of the compliance management system in line with the standard and noted the unified methodologies and processes within the “Moscow Exchange” Group, particularly in the areas of conflict of interest management and anti-corruption efforts.

• The compliance activities of Moscow Exchange Group are organised into two areas: internal and external:
• Internal compliance involves ensuring that the activities of the Group’s companies comply with mandatory and voluntary requirements;

1. External consists relates the following directions:
2. Formalizing requirements for counterparties, issuers, and market participants in the compliance field;
3. Informing counterparties, issuers, and market participants about best practices and applied approaches;

Creating compliance products for market participants. “Compliance: Key Trends 2024” conference was held for market participants in 2024. The event looked at trends and modern compliance technologies to improve the quality of compliance risk management (including solutions based on artificial intelligence).

The Group’s compliance practices

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In accordance with the “Three Lines of Defence” model, the Supervisory Board of Moscow Exchange approves the Code of Professional Ethics, reviews reports, and assists in developing the ethics function. The managing director for compliance and business ethics is responsible for ethics and compliance-related issues; he/she is directly subordinate to the chairman of the Executive Board of Moscow Exchange.

The leader of the compliance function may take part in meetings of Moscow Exchange’s management bodies and committees, in risk assessments of new processes and products, and in procurement procedures.

The self-assessment of the Exchange’s compliance system is conducted twice a year, with the results and current outcomes being mandatory reported to the Board of the Exchange. External checks are carried out as part of the annual audit.

Failure by employees to comply with the Code of Professional Ethics and to complete mandatory compliance training affects the results of their annual evaluation.

The Group adheres to the open-door principle: employees are always welcome to ask for clarification, submit questions, or use the compliance portal. Moscow Exchange has an initiative to designate active employees who are interested in self-development and refinement of the Company’s compliance procedures ‘Compliance Ambassadors’. They attend training sessions on topics related to compliance culture, and their initiatives in the field of compliance and ethical behaviour are reviewed and may be accepted.

The Group has designed technological solutions, including a communications channel (the anonymous SpeakUp! hotline—Moscow Exchange own creation) that can be used to report possible instances of corruption or violations of ethical business conduct and law. All employees are welcome to submit anonymous reports via the hotline and receive a response (applicants are sent a link to a web page where they can check the reaction of the Group’s companies). The “Moscow Exchange” Group adheres to the principles of mandatory response to inquiries within the time frames set by internal documents, maintaining the anonymity of those who have contacted, and not pursuing employees who have reported issues.

In addition to the internal channel for employees, the Group has set up an external one for reports of corruption-related issues. Interested parties are welcome to use the hotline on the Moscow Exchange website.

Data on the number of applications received regularly reflected in the Sustainability Report.

In 2024, 119 appeals were received, including 22 from exchange employees regarding potential violations of professional ethics, and two from counterparties about possible issues during procurement procedures. All situations were thoroughly investigated within the set timeframes, necessary corrective measures were taken, and feedback was provided to the appellants regarding the results of the checks.

The remaining appeals were of a general nature, containing information about potential new unethical practices in financial markets, as well as recommendations for improving processes in group companies. All received appeals were handled by the Internal Control and Compliance Department, and responses were provided within the required time.

Significant fines and breaches of the law

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In 2024, the “Moscow Exchange” Group did not incur significant fines or non-financial sanctions, including those related to non-compliance with legislation and regulatory requirements.

The “Moscow Exchange” Group has no pending or completed lawsuits during the reporting period filed in connection with anti-competitive behavior or violations of anti-monopoly legislation by companies within the Group. There are also no confirmed cases of violations of business ethics or corruption over the past three years.

Business ethics and anti-corruption

Corporate ethics and anti-corruption measures are important elements of the compliance system, and they are included in Moscow Exchange’s Compliance Programme. These measures are constantly being improved in order to enhance the efficiency of operational processes, including by preparing reliable reporting, ensuring compliance with applicable laws, and developing a culture of trust in relations with employees and counterparties.

The Group adheres to the principles of staff involvement in achieving zero tolerance of corruption, avoiding conflicts of interest, and ensuring that actions and procedures are proportional to the level of risks identified during periodic risk assessments.

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In line with the principle of zero tolerance to corruption, the “Moscow Exchange” Group implements measures to prevent corruption, targeting both internal and external stakeholders. These measures include employee awareness and training, developing mechanisms to obtain information about events involving corruption risks, incorporating anti-corruption conditions into contracts with counterparties, including information about applied approaches, as well as contact information for reporting violations in procurement documentation.

By the end of 2024, 99.1% of employees successfully completed anti-corruption training. Each employee received at least one hour of training through the internal system of electronic courses on anti-corruption and conflict of interest management. Additionally, employees had the opportunity to participate in an online broadcast on anti-corruption and conflict of interest management during the Group’s internal “Compliance Day 2024”.

In 2024, all members of the Supervisory Board were familiarised with the Policy aimed at preventing corruption offences and the Moscow Exchange Code of Ethics.

The Anti-corruption Policy is publicly available; all partners and counterparties are informed of the Group’s stance and the availability of the corruption hotline. All counterparties undergo mandatory checks. Compliance experts are involved in negotiating contracts that may entail corruption risks, including at the procurement stage, as well as in sponsorship and charitable activities.

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The companies of the Group monitor the effectiveness of and control over anti-corruption procedures. Self-assessments of the quality of corruption risk management are carried out regularly; reports are compiled for the Executive Board and the Audit Committee under the Supervisory Board of Moscow Exchange. Corruption risk assessments are conducted at all 100% of the Group’s companies. In 2024, no incidents of corruption or violations of the Code of Professional Ethics were registered. No significant corruption risks were identified, either.

In the field of business ethics and anti-corruption, the “Moscow Exchange” Group will continue to implement the Compliance Development Roadmap in 2025. This roadmap includes strengthening procedures, automating risk management processes, and disseminating best practices. Additionally, the Group will conduct the annual conference “Compliance: Main Trends 2025” to further promote these objectives.

Interaction with suppliers

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The Group’s companies have transparent conditions for suppliers and contractors who wish to participate in the procurement process through bids and transactions. Guided by internal regulations such as the regulations on procurement, the Group’s companies guarantee the fulfilment of their contractual obligations. All contracts with suppliers and contractors include an anti-corruption clause, so it can be stated that 100% of business partners are informed about the organisation’s anti-corruption policies and methods.

To improve the business environment and reduce risks in the supply chain in 2024, organizational and methodological measures were implemented: frequent changes were made to the Regulation on Procurement Activities of Public Joint Stock Company Moscow Exchange (PJSC Moscow Exchange) to accelerate procurement procedures, incorporate recommendations from the Internal Audit Service (IAS), and clearly establish the rules for controlling procurement by related departments and their areas of responsibility. In 2024, the procurement process was automated using the electronic document management system (EDMS) MOEX Process Garden. Starting from July 1, 2024, procurement activities across Group companies were carried out in accordance with unified rules set forth in the Regulation on Procurement Activities of PJSC Moscow Exchange, enabling the unification of rules and optimization of the procurement process overall. A Supplier Code of Conduct was also adopted and implemented. Suppliers participating in procurement activities of Group companies have the opportunity to familiarize themselves with it and confirm their readiness to comply with the Exchange’s requirements.

Plans for 2025:

• Continue working to enhance the procedures for planning, consolidating, and automating procurement across the “Moscow Exchange” Group.
• Transition to the conclusion of contracts in electronic form after procurement.