Nostrum Oil & Gas Plc ABOUT OPERATIONS SUSTAINABILITY INVESTORS CAREERS MEDIA CONTACT Governance Framework The Board The Board is chaired by Atul Gupta and meets a minimum of four times a year. The Board is collectively responsible to shareholders for the long-term success of the Group. This is achieved by reviewing trading performances, budgets and funding, setting and monitoring the Groups strategic objectives, reviewing acquisition opportunities and engaging with stakeholders. The Board is supported by a number of committees whose Terms of reference (TORs) are available on our website. Chairman Responsible for leadership of the Board and for ensuring its effectiveness in all aspects of its role. Chief Executive Officer Responsible for the successful planning and execution of the objectives and strategies agreed by the Board. Non-executive directors Responsible for bringing an external perspective, sound judgement and objectivity to the Board’s decision-making. Scrutinise management performance and constructively challenge strategy. Senior Independent Director Provides a sounding board for the Chairman and a trusted intermediary for the other directors. Audit Committee Responsible for oversight of the Group’s financial reporting processes. Scrutinises the work of the external auditor and regularly reviews the risk management framework and the work of internal audit. Chairman: Sir Christopher Codrington Nomination and Governance Committee Reviews the structure, size and composition of the Board and its committees and makes recommendations to the Board accordingly, and leads the process for new Board appointments. Chairman: Sir Christopher Codrington, Bt. Remuneration Committee Reviews and recommends to the Board the executive remuneration policy and determines the remuneration packages of the directors. Chairman: Kaat Van Hecke Health, Safety, Environment and Communities Committee Assists the Board to fulfil its responsibilities in relation to health, safety, environment and communities matters arising out of the activities of the Group and in overseeing and providing stewardship of relevant material HSEC matters for the Company. Chairwoman: Kaat Van Hecke Company Secretary Responsible for advising the Board, through the Chairman, on all governance matters and for ensuring that Board procedures are complied with and there is a good flow of information between the Board and its committees. The appointment of the Company Secretary is a matter reserved to the Board as a whole. Company Secretary: Thomas Hartnett Senior management team The senior management team supports the Chief Executive Officer in making important decisions regarding the overall management of the Group in respect of all Group matters that are not reserved for the Board and ensuring that operational activities and performance are aligned with the overarching strategy of the Group. Each member of the team reports directly to the Chief Executive Officer, who then directly reports to the Board. The functional responsibilities of the senior management team members in their respective area include but are not limited to implementing Chief Executive Officer and Board decisions, allocating resources, managing risk, maximising efficiencies, guiding and developing employees, reviewing performance and supporting cross-functional integration. Finance Responsible for supporting the Group and the Board in matters relating to: (i) corporate finance (ii) investor relations (iii) economic analysis (iv) public relations (v) external communications (vi) accounting & reporting (vii) tax (viii) budget and control (ix) insurance (x) treasury and cash management (xi) liaison with internal audit (xii) risk management (xiii) ICT (xiv) company administration (accounting & tax matters) and (xv) capital markets analysis. Head: Shane Drader Business Development Responsible for supporting the Group and the Board in matters relating to: (i) licensing (ii) preparation and implementation of E&P strategy (iii) geological exploration and analysis (iv) asset portfolio management (v) market intelligence (vi) transaction management and (vii) peer analysis. Head: Anil Sultan Operations Responsible for supporting the Group and the Board in matters relating to: (i) production engineering and reservoir management (ii) drilling and workover management production (iii) production (iv) engineering and construction field operations (v) relations with governmental authorities (vi) procurement (vii) security and (viii) administration. Head: Robert Tinkhof Legal Responsible for supporting the Group and the Board in matters relating to: (i) all legal matters (ii) compliance (iii) corporate governance (iv) company administration (Legal and Governance Matters). Head: Thomas Hartnett Sales and Marketing Responsible for supporting the Group and the Board in matters relating to: (i) sales of oil and gas products (ii) marketing and (iii) logistics and transportation. Head: Arkadi Epifanov QHSE Responsible for supporting the Group and the Board in matters relating to: (i) product quality, (ii) personnel and community, health and safety and (iii) environmental protection. Head: Daulet Tulegenov Human Resources Responsible for supporting the Group and the Board in matters relating to: (i) personnel and the workforce matters generally (ii) training and (iii) remuneration. Acting Head: Thomas Hartnett Board policies and governance arrangements Nostrum recognises the important role that good corporate governance plays in the success of the Company. As a result, the Board promotes high standards of corporate governance as a key component of its activities. Clearly defined roles and responsibilities, non-executive independence, boardroom and workplace diversity, an open and transparent culture and the work of our committees in implementing the Company’s values and policies throughout the Group are all vital ingredients to get this right for our stakeholders. In order to ensure that it is involved in making important decisions for the Group and to ensure there is a clear division of responsibilities between the Board and executive management, the Board has identified certain ‘reserved matters’ that are subject to its approval. Other matters, responsibilities and authorities have been delegated to its committees and the senior management team as set out in the governance framework. The schedule of matters reserved for the Board is reviewed annually and is available here. Division of responsibilities On 27 November 2018 the Board resolved to expand the role of the Company’s Chairman, Atul Gupta, to give him certain executive responsibilities, in particular in relation to business development, strategic initiatives and investor relations. Notwithstanding this, in accordance with the Code, the roles of Chairman and Chief Executive remain separate, with each having distinct and clearly defined responsibilities, as summarized in the Board structure diagram. Mr Gupta’s role as executive Chairman is to guide, advise, counsel and assist the Chief Executive Officer in overseeing the Company’s implementation of its strategy. The Chief Executive Officer remains responsible for line-management of his direct reports and implementation of the Company’s strategy. The Chairman’s overarching role in leading an effective Board is supported by the Senior Independent Director, while the Chief Executive’s Officer’s strategic capabilities are strengthened by the Senior Management Team. Independence Robust oversight is crucial for strong corporate governance and the Board is committed to securing this through the appropriate balance of independent Non-Executive Directors. The Board considers all of its Non-Executive Directors to be independent within the meaning of this term as defined in the Code. Equality and diversity The Board has due regard for the importance of, and benefits from, diversity in its membership, including gender diversity, and strives to maintain an appropriate balance on the Board. The Board is comprised of individuals with diverse sectoral experience, ages, geographic and ethnic origin and gender. The Company has 20% female representation on its Board. The Nomination and Governance Committee remains satisfied that the Board has the right mix of skills and experience to operate effectively. However, the skills and experience mix will be revisited following the successful restructuring of the Notes. The Nomination and Governance Committee remains committed to monitoring diversity closely as part of future succession planning In November 2017 the Board approved its Equality and Diversity Policy, to which the Company continued to adhere throughout 2020. In accordance with the policy, the Group is committed to eliminating discrimination and encouraging equality and diversity in all of our business activities, including the provision of employment. The policy applies to all who work for the Group, including directors, together with the managerial, supervisory and administrative bodies of all entities within the Group. The policy also applies equally to the treatment of our supply chain, applicants and visitors by our staff and the treatment of our staff by these third parties. The objective of the policy is to promote equality of opportunity and to ensure that no individual suffers unlawful discrimination, directly or indirectly, on the grounds of race, colour, ethnicity, religion, sex, gender identity or expression, gender reassignment, national origin, age, marital status, disability or sexual orientation. The Group aims to ensure the objective of the policy is met by: Ensuring all recruitment advertising and publicity aims to encourage applications from any individual who has appropriate qualifications and/or experience; Not offering discriminatory conditions of employment; Ensuring all promotions are made strictly on the basis of the ability to do the job and no such decision is made on a discriminatory basis; Considering requests for part-time work or job-sharing opportunities wherever appropriate and practicable and aiming to ensure that part-time employees receive fair treatment; Ensuring that the demands of religion (e.g. prayer time and religious holidays), culture (e.g. traditional dress) and special dietary needs are accommodated where possible; and Taking reasonable steps to assist employees with domestic responsibilities (e.g. young children and dependent elderly relatives). The following are the steps that have been taken in 2020 to implement this policy: Despite the challenging trading environment and a significant reduction in recruitment activities, where recruitment has been required we have continued to focus on attracting more female candidates across all levels throughout the Group and are assessing our performance in attracting female employees at junior management levels in Kazakhstan and reviewing our current training, retention and promotion schemes to encourage the promotion of more women into senior management positions; Our Human Resources team reported regularly to the HSEC Committee on diversity. In conjunction with the HSEC Committee a gender diversity action plan has been established which aims to increase the percentage of female employees across all levels within the Group to 25% by 2022; An analysis of any gender pay gap issues is being conducted; and We continue to look into cross-company mentor schemes to achieve our goals in this area. Conflict of interest A Director has a duty to avoid a situation in which they have, or may have, a direct or indirect interest that conflicts or may conflict with the interests of the Company. Formal procedures are in place to ensure that the Board’s powers of authorisation of conflicts or potential conflicts of interest of Directors are operated effectively. The Board is satisfied that during 2020 these procedures were enforced and adhered to appropriately. Appointment and tenure All Executive Directors have service agreements with the Company with the exception that the interim Chief Financial Officer is engaged through a consultancy agreement that expires currently on 30 April 2021. All Non-Executive Directors have letters of appointment with the Company. For all Executive Directors engaged through service agreements, there is no term limit on their services, as the Company proposes all Executive Directors for annual re-election at each subsequent Annual General Meeting of the Company. Each Non-Executive Director appointment is for an initial term of three years, subject to being re-elected at each subsequent Annual General Meeting. Bribery, corruption and Whistle-blowing Bribery and corruption are significant risks in the oil and gas industry and, as such, the Company operates a Group-wide Anti-Corruption and Bribery Policy, which applies to all Group employees and contractor staff. The policy requires: annual bribery and corruption risk assessments; risk-based due diligence on all parties with whom the Company does business; appropriate anti-bribery and corruption clauses in contracts; and the training of personnel in anti-bribery and corruption measures. In addition, the Company’s Code of Conduct requires that employees or others working on behalf of the Company do not engage in bribery or corruption in any form. Corruption-related risks are evaluated on a Group-wide basis (not in respect of divisions). No confirmed corruption cases were identified in 2020. No employees were trained on anti-corruption policies in 2020. The Company has also adopted a Whistleblowing Policy that takes account of the Whistleblowing Arrangements Code of Practice issued by the British Standards Institute and Public Concern at Work. Further information can be found in our Annual Report. No matters were raised under the Company’s Whistleblowing Policy in 2020. Both policies were reviewed by the Audit Committee in 2020 and no updates recommended to the Board. Anti-facilitation of tax evasion Further to the new rules under the Criminal Finances Act 2017 (“CFA”) in the UK, in 2018 the Board approved a new Anti-Facilitation of Tax Evasion Policy applicable to the Group and its associated persons. In connection with the preparation of this policy, the Company commissioned an independent bespoke risk assessment and incorporated findings from such assessment in the policy. Strategy Board Management Governance Governance Framework Committees History 9th Floor 20 Eastbourne Terrace London W2 6LG United Kingdom +44 20 3740 7430 Modern Slavery and Transparency Statement Privacy & Cookies Policy Disclaimer © 2021 Nostrum Oil & Gas Plc Website by BRIGHTER*IR follow us on linked in