Public Positions Concerning Sustainable Development ¹¹

The Company understands sustainable development as a system of successive social, economic and environmental activities making a contribution to achievement of the Company’s strategic goal together with far-sighted use of resources, workforce capacity development, and focus on scientific and technical growth.

The Integrated Company introduces principles of sustainable development into its activity taking into account current world nuclear power challenges.

The Company’s Management outlines 7 directions forming the Company’s public position in the field of sustainable development:

• Safety and quality;
• Staff development;
• Innovative activity;
• Contribution to economic development of regions of operation;
• Social responsibility;
• Environmental protection;
• Transparency and accountability.

Safety and Quality

Safety and quality are the main characteristics of facilities built by the Integrated Company. In its activity the Company strictly complies with all regulatory requirements for safety established at international, national and industrial levels.

Operational safety of NPP and other facilities depends on quality of work performance at all stages of construction. The Company guarantees high level of quality, reliability and safety of the facilities constructed by it. The Company applies the Quality Management System based on the principles of the Overall Quality Management reflected in the international ISO 9000 standards. NIAEP imposes the highest requirements for the necessary level of safety to its suppliers and contractors and strictly controls the quality of work, equipment and materials.

Detailed information is specified in Chapter 7.4.5. Nuclear and Radiological Safety of Nuclear Power Facilities.

Staff Development

The Company operates in an innovative high-tech market imposing higher requirements for the level of competence of the professional team. Due to this it is important to involve the best specialist of the industry and constantly improve knowledge and skills in all key aspects necessary for implementation of our projects.

The Company provides high level of remuneration and invests significant funds in staff development. The main principles in the field of staff management of the Company include impartial assessment of professional contribution of each employee, opportunity of advancement and interdependency of remuneration level with the employee’s performance results.

Information on the Company’s effectiveness in the field of staff development is given in Chapter 7.3. Human Capital.

Innovative Activity

Technical development of the Company is based on innovative approaches to management of NPP generating units designing and construction by means of modern information technologies.

The Company attaches equal importance to the level of technological and innovative development of its partners. Aiming at collaborative innovative development with its partners, the Company established the Innovative Designing Association.

Information about innovative projects is given in Section 6. Introduction of Innovations.

Contribution to Economic Development

Implementing large-scale projects important for the economy of the regions of operation, the Company realizes its responsibility for establishment of conditions for social and economic development of these regions.

The Company’s activity leads to creation of new jobs in the regions of its operation both for suppliers, and for equipment and materials manufacturers.

Information about the Company’s effectiveness in the field of contribution to economic development is given in Chapter 7.5. Social and Economic Capital.

Social Responsibility

Sustainable development of the Integrated Company directly depends on public acceptance of the activity on construction of nuclear power facilities. The Company lays special emphasis on social stability factor and sees social responsibility as one of the key principles of its activity.

Social influence of the Company is brought both at the internal (staff), and internal levels (local communities).

The collective agreement specified the NIAEP obligations as an employer in the field of social guarantees and benefits to employees.

Information on social responsibility of the Company is given in Chapter 7.3.3. Social Policy and Chapter 7.5. Social and Economic Capital.

Environmental Protection

The maximum impact of the Company’s activity on the environment is exerted during construction of generating units.

In order to control the environmental impact of the Company’s production activity, we elaborate the necessary documents on environmental safety, plans of activities on reduction of waste generation and disposal.

NIAEP complies with the regulations of the environmental legislation, hence, is not subject to punitive sanctions.

Information about the Company’s environmental impact is given in Chapter 7.4. Natural Capital.

Transparency and accountability

Within the frames of its core activity the Company is responsible to its shareholders for performance of investment obligations. In addition, different requirements are imposed to the Integrated Company by the key interested parties, including regional authorities, local self-governing authorities, business partners and local communities. Effective cooperation with the interested parties includes assessment of their expectations and definition of the Company’s reciprocal position, as well as taking their expectations into account in corporate policies, development strategy and current activity whenever reasonable.

The Company strives to establish long-lasting and mutually beneficial relations with interested parties, respects their opinion, guarantees fulfillment of its obligations, and demands the same from the interested parties.

The Company undertakes to inform the interested parties on all aspects of its activity important for them, including public reporting mechanism.

Information on fulfillment of the transparency and accountability principles in the Company’s activity is given in Chapter 7.6. Relations with Interested Parties.

¹¹ The Company’s public position in the field of sustainable development is described in detail in the JSC NIAEP 2011 Annual Report.