Sustainability Development Management

In order to conduct business responsibly and give special attention to sustainable development issues, JSC FPC complies with environmental laws, makes sure that its employees have the best working conditions, enhances its corporate governance system, and considers stakeholder interests in decision-making.

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In December 2024, the Board of Directors of JSC FPC resolvedMinutes No. 15 dated 27 June 2024. to join the  Sustainable Development Policy of OJSC Russian Railways. In accordance with the provisions of the Policy, JSC FPC recognises its responsibility to a wide range of stakeholders to build a competitive and sustainable business in the regions where it operates that meets the principles of corporate, social and environmental responsibility and creates value for them in the long term. The Company recognises that sustainable development is an integral element of its operations and one of its long-term priorities.

In terms of sustainable development, JSC FPC's primary goal is to support the Holding Company's strategy to establish a dominant position in the market, guarantee the Russian Federation's energy security and efficient use of resources by positively influencing socioeconomic development and adhering to strict environmental and technological safety standards, corporate governance and social responsibility, and protection requirements against both natural and man-made threats.

The policy sets out the following sustainable development objectives:

  • Lessening the harm that human activity causes to the environment and to aid in the battle against climate change
  • Making efficient and rational use of natural resources
  • Respecting and honouring human rights in all business processes
  • Ensuring the health, safety, and well-being of internal and external stakeholders while conducting its operations, as well as the safety of production processes and working conditions
  • Promoting professional, career and personal growth of employees
  • Improving the quality of life and well-being of communities living in the territories of the regions of operations and having a positive impact on their social and economic development
  • Creating an effective and transparent system of stakeholder engagement
  • Ensuring innovative development in all business dimensions
  • Developing and improving internal processes to upgrade the organisation of sustainable development activities
  • Combating fraud and corruption, as well as adhering to the principles of fair and ethical business conduct

One key way to put the Policy into practice is by incorporating sustainable development principles into JSC FPC's day-to-day operations.

The sustainable development management system of JSC FPC is an essential component of the Company’s general corporate management system, and the decision-making process and operational activities successfully incorporate sustainable development concepts.

JSC FPC's sustainable development management structure

Strategic tier

Determination of priority business areas, strategies and key policies by the Board of Directors, approval of the budget and investment programme, KPIs, risk monitoring with preliminary review by the relevant committees

Management tier

Development of key policies/documents in the field of sustainable development to embed sustainable development principles into the Company's operational activities
Identification of responsible business units

Operational tier

Implementation of sustainable development solutions, preparation of reports

Role of the Board of Directors in sustainable development management

The Board of Directors of JSC FPC is responsible for overseeing the Company's sustainable growth within the parameters of its Articles of Association.

The Board of Directors approves the Company's core and functional strategies, monitors their implementation, and approves adjustments if necessary. For example, in the reporting year, the Board of Directors updated JSC FPC's Digital Transformation Strategy until 2024.

The Board of Directors is responsible for approving high‑level regulations in such areas as ethics, risks, anti‑corruption efforts, and KPI achievement. On an annual basis, the Board of Directors approves the acceptable amount of risks (risk appetite), the register of key risks for the year, and reviews risk monitoring reports.

The Board of Directors annually reviews a set of KPIs for management and sets their target values for the year, with interim monitoring and approval of an annual report on their achievement.

The Board of Directors regularly reviewed the approval of the budget, investment programme, operational efficiency and cost optimisation programme, as well as their progress reports are regularly. If necessary, the Board of Directors decides to amend these documents.

In order to develop a systematic approach to managing the ESG agenda and taking into account JSC FPC's positioning as a socially orientated and socially responsible Company, the Board of Directors decided to expand the scope of functions of the Human Resources, Remuneration and Corporate Governance Committee of the Board of Directors and to give it functions in the area of sustainable development in the following areas:

  • Preparation of recommendations to the Board of Directors on defining the Company's sustainable development activities and reviewing reports on the achievement of such goals
  • Preparation of recommendations to the Board of Directors on the development of functional KPIs in terms of sustainable development and their integration into the motivation system for the Company's managers
  • Preliminary approval of internal documents of JSC FPC related to sustainable development
  • Definition of the format of the sustainable development report and the annual report in terms of sustainable development, preparation of recommendations on the approval of the sustainable development report
  • Participation in the process of selecting an independent auditor to certify the sustainable development report and preparation of recommendations of the Company on engaging such an auditor
Key sustainable development decisions taken by the Board of Directors in 2024
Decision taken Impact on the Company's sustainable development UN SDGs National goals
JSC FPC Investment Programme for 2024–2026 was approved
  • Projects to renew the fleet and modernise existing rolling stock will improve safety performance on the railways. This will be possible due to upgrade of obsolete and less reliable carriage units in order to eliminate equipment failures en route, improve the workflow process of passenger carriage repair and maintenance, introduce more modern and efficient technologies and technical means.
  • Digital HR Project, which will increase employee satisfaction with the Company’s HR services and improve HR management efficiency by implementing modern IT solutions.
  • The Automated Route Network Management System (ARNMS) will improve the efficiency of the route network.
  • The efficiency of rolling stock operation and other essential business procedures will be supported by projects targeted at maintaining the infrastructure that supports the company's operations.

Goal No. 3 Сcomfortable and safe environment for living:

j) To increase the share of public transport fleets in agglomerations and cities with a service life not exceeding the standard one to at least 85% by 2030

Goal No. 7 Digital transformation of state and municipal administration, the economy and the social sphere:

a) To achieve digital maturity by 2030 of state and municipal administration, key sectors of the economy and the social sphere, including healthcare and education, involving the automation of most transactions within unified sectoral digital platforms and a data‑driven management model, taking into account the accelerated introduction of big data processing technologies, machine learning and artificial intelligence

Operational efficiency improvement programme for 2024–2026 was approved
  • The Company will be able to increase its operational efficiency by involving members of the Russian Student Squads for summer and winter service, as well as through measures to improve energy efficiency and reduce the energy intensity of production activities.

Goal No. 5 Resilient and dynamic economy:

i) To establish by 2030 an effective system for training, retraining and upgrading the skills of personnel for priority sectors of the economy, based on projected needs

Goal No. 4 Environmental well‑being:

b) To gradually halve by 2036 emissions of hazardous pollutants with the most significant negative impact on the environment and human health in cities with high and very high levels of air pollution

A number of corporate governance documents were approved
  • Resolution was taken to join Russian Railways Holding's Sustainable Development Policy.
  • In order to improve corporate governance and integrate sustainable development principles, a decision was made to include sustainability and ESG functionality in the Regulations on the Human Resources, Remuneration and Corporate Governance Committee of the Board of Directors.

Goal No. 5 Resilient and dynamic economy

Risk appetite for 2024 is approved and key risk register for 2024 is reviewed
  • The perimeter of the Company's key risks was expanded to include corruption risk, traffic accidents and other events related to violation of railway transport safety and operation rules, decrease in passenger satisfaction with service quality and failure to deliver investment projects. The risk of decrease in passenger satisfaction with service quality has zero deviation from the target value, the other listed risks have zero tolerance.

Goal No. 5 Resilient and dynamic economy:

c) To increase investment in fixed capital by at least 60% by 2030 compared to 2020 levels through continuous improvement of the investment climate

KPIs for the Company's operations and management are approved
  • Corporate ESG‑related KPIs include passenger satisfaction index, safe travel, dispatched passengers.
  • Ensuring Good Corporate Governance Practice is a functional KPI of General Director.

Goal No. 5 Resilient and dynamic economy:

a) To ensure that the country's gross domestic product growth rate exceeds the world average and that it ranks fourth in the world in terms of gross domestic product calculated at purchasing power parity by 2030, including through labour productivity growth, while maintaining macroeconomic stability, low unemployment and a reduction in structural unemployment

Structure of sustainable development management at JSC FPC

Strategic tier

Board of Directors

Approval of key policies/documents in the area of sustainable development and control over their implementation: determination of approaches to organisation of the risk management system, reporting on risk monitoring, approval of core and functional strategies, determination of KPIs, approval of budget and investment programme, and operational efficiency and cost optimisation programme

Committee on Strategic Planning, Digital Transformation and Information Technology handles the following issues:

  • Definition of strategic goals
  • Budget approval
  • KPI definition

Human Resources, Remuneration and Corporate Governance Committee handles the following issues

  • Identification of areas for sustainable development
  • KPIs, reporting and internal documents in the field of sustainable development
  • Ethics
  • Human capital
  • Occupational safety

Audit and Risk Committee handles the following issues:

  • Anti‑corruption
  • Risk management reporting
  • Supply chain management
  • Operational efficiency improvement and cost optimisation

Management tier

General Director

Deputy General Director, Head of the Security Block (en route passenger safety issues)

Deputy General Director, Head of the Human Resources and Social Affairs Block (issues related to ethics, human resources and social affairs)

Deputy General Director, Head of the Quality Block (issues of building a corporate quality management system)

First Deputy General Director, Head of the Production Block

Deputy General Director, Head of the Passenger Service and Quality of Service Block (service quality issues)

Deputy General Director – Chief Engineer, Head of the Production Development Block (environmental, sustainable development and labour protection issues)

First Deputy General Director, Head of the Economics and Finance Block

Deputy General Director, Head of the Marketing Block (customer satisfaction with the quality of services provided)

Operational tier

Functional areas and divisions

Ethics and anti‑corruption

Corporate Security Centre

Anti‑Corruption Committee hotline_bz@ fpc.ru

Commission for Management of Conflict of Interest

Office of Personnel and Social Development

Officer‑in‑Charge of Business Ethics in JSC FPC
ethics@fpc.ru

Human capital

Office of Personnel and Social Development

Personnel Development Centre

Youth Council

Coordination Council on Improving Working Conditions, Recreation and Social Support for Women

Occupational safety and industrial safety

Occupational Safety Department

Transport Safety Authority

Chief Supervisor for Rail Traffic Safety

Environmental responsibility

Industrial, Fire and Environmental Safety Department

Risk Management Department

Lean Production Department

Supply chain management

Procurement and Contractual Work Department

Internal Control Centre

Customer relations

Passenger Services Department

Process Monitoring and Quality Management Centre

Stakeholder engagement

Department of Communications and Engagement with Authorities

Carrier Relationship Development and Corporate Sales Organisation Department

Stakeholder engagement

JSC FPC is aware of its high responsibilities to all stakeholders and strives to maintain an ongoing constructive dialogue with them. The Company is focused on meeting the expectations of all stakeholders in its integrated sustained economic, social and environmental development.

Stakeholders Engagement approaches and mechanisms Key communication channels Description of engagement activities in 2024 Results of engagement in 2024
Internal stakeholders
Staff
  • Labour relations under the Collective Bargaining Agreement
  • Management functions
  • Social partnership
  • Personnel development
  • Corporate surveys
  • Reporting to a stakeholder
  • Procedure for dispute settlement
  • Employee recognition and commendation
  • Intra‑corporate events for employees
  • Address es from top management
  • E‑mail
  • Corporate publications
  • Corporate website
  • Social networks, Telegram channels
  • By‑laws
  • FPC INFO corporate portal
  • Awareness Day for employees of common vocations with the participation of the General Director of JSC FPC
  • Unified employee engagement survey
  • XIV Youth Meeting
  • Defence of the Fatherland Day celebrations for family members of JSC FPC's employees who are engaged in the SMO
  • Corporate Spartakiad
  • Empowering JSC FPC's Women Forum
  • JSC FPC's Businesswoman Contest, etc.
  • Recognition of the Company's employees with corporate awards, development and improvement of the non‑material motivation system as part of the implementation of the Collective Bargaining Agreement of JSC FPC
  • Boosting of loyalty, satisfaction and involvement of personnel, satisfaction with individual factors of work life (interaction with management +4 p.p., internal communications +4 p.p., training and development +6 p.p.)
  • Promotion and preservation of traditional family values, comprehensive support for families of JSC FPC's employees engaged in the SMO
  • Improvement of physical fitness of employees and involving them in regular sports activities
  • Company's branding through social activity
  • Development of the professional and managerial competences of JSC FPC's women
  • Growth in the number of Company employees recognised with corporate awards (+1,870 people by 2023), increase in the individual social benefits package per employee (+RUB 13,300)
Governance and control bodies

Descriptions of governance and control bodies, as well as interaction principles and governance procedures, are set forth in JSC FPC’s Articles of Association and other internal documents of the Company.

For more details, please see the Corporate Governance Model and Practice section

  • Management reporting and financial statements
  • Ongoing interaction within business processes
  • Quarterly review of the General Director's report on the Company's performance by the Board of Directors
  • Provision of the Auditing Commission with all information required to perform an audit of the Company's operations
  • Review of reports submitted by JSC FPC's Internal Audit Department by the Audit and Risk Committee of the Board of Directors and the Board of Directors in accordance with the Company's internal by‑laws
Fulfilment of the Company's obligations to all stakeholders within the reporting framework
External stakeholders
Shareholders
  • Open communication during general meetings of shareholders
  • Reporting to a stakeholder
  • Disclosure of material facts of the Company’s operations
  • Mandatory disclosure, including issuer reports, RAS and IFRS financial statements, statements of material facts, registers of affiliates through an authorised disclosure agency
  • Voluntary disclosure of additional information on the Company’s website
  • Meetings of the parent company's management with JSC FPC's management
  • Timely disclosure of all necessary information in accordance with the requirements of the legislation of the Russian Federation
  • Timely disclosure of information on upcoming corporate events (announcement of the General Meeting of Shareholders) in order for the Company to respect the rights of shareholders
  • Timely dispatch of all necessary materials and information for such events
The Company was awarded a National Corporate Governance Quality Rating of 6++, which confirms a high level of interaction with shareholders and observance of their rights under the Articles of Association of JSC FPC and the laws of the Russian Federation
Government authorities and public organisations
  • Performance of cooperation agreements with constituent entities of the Russian Federation in the transportation of passengers, baggage and unaccompanied baggage on long‑distance trains
  • Joint participation in image‑building ceremonies and business events at the federal and regional levels
  • Responding to enquiries, preparation of proposals to government authorities on the development of railway passenger service
  • Submission of financial, statistical and environmental reports to regulatory authorities
  • Publication of reports on the Company's operations
  • Preparation of official letters stating the Company's position to government authorities on passenger service issues
  • Participation of the Company's representatives as experts in advisory bodies under ministries and agencies, meetings on passenger transportation issues
  • Participation in the XXVII St. Petersburg International Economic Forum and XVII International Forum and Exhibition “Transport of Russia”
  • Processing of incoming requests from the deputy corps on passenger transportation issues
  • Conclusion of information support agreements with regional public authorities
  • Organisation of round tables with the participation of representatives of key public organisations in the field of transportation and public authorities
  • Participation in joint meetings of the Commission on Passenger Transportation Organisation of the Public Council under the Federal Railway Transport Agency, the Commission on Passenger Transportation Development of the Public Council under the Russian Ministry of Transport and the Expert Council of the Association Zheldorrazvitie, as well as joint meetings of the Union of Transport Workers of Russia and the Ministry of Transport of the Russian Federation
  • Regular reporting on the Company's financial and economic situation via the portal of the Ministry of Industry and Trade of Russia, notification of information disclosure as a natural monopoly to the FAS of Russia
  • Conclusion of cooperation agreements with regional and federal government bodies and subordinate organisations
  • Awareness promotion among the general public about JSC FPC's activities
  • Development of joint decisions with public transport organisations and government authorities to promote the Company's legislative initiatives aimed at improving the safety and comfort of passenger travel on long‑distance trains
  • Fulfilment of the requirements of legislation and regulatory legal acts of the Russian Federation
Business partnerships
  • Contractual relations
  • Development and signing of co‑operation agreements
  • Regular working meetings
  • Joint working groups with Russian and foreign project partners
  • Participation in conferences and forums
  • Publication of information on the Company's operations on the corporate website and dedicated procurement sites
  • Mass media
  • Participation in the XXVII St. Petersburg International Economic Forum and XVII International Forum and Exhibition “Transport of Russia”
  • Organisation of working meetings with foreign partner railways, participation in the work of relevant international railway organisations (Organisation for Cooperation between Railways, Railway Transport Council of the Commonwealth member states)
  • Development of measures aimed at improving the economic efficiency of passenger rail transport and the quality of passenger service, development of optimal tariffs, approval of train schedules, coordination of rolling stock operation requirements
  • Conclusion of cooperation agreements with such organisations as Transmashholding, T1, C7 Group and X5 Corporate Centre
Customers and consumers
  • Passenger service
  • Catering on trains
  • Passenger satisfaction surveys
  • Marketing campaigns
  • Informing on the Company’s operations
  • Charity events
  • Volunteer events
  • Gathering feedback through questionnaires, the Unified Information and Reference Centre, a mobile app, the Company's website and social media
  • Public reporting by the Company
  • Poputchik infotainment system
  • Data collection to assess levels of passenger satisfaction and loyalty through an online survey
  • Targeted marketing mailings (clear audience segmentation allows us to send information of interest to a specific person, e.g., when a new train is launched, the mailing is sent to residents of the regions through which its route passes, or to those who travel from stations located along the route)
  • Questionnaire survey and subsequent quality evaluation of services provided to passengers along the entire customer journey
  • As part of the development of the Poputchik infotainment system: increasing the number of trains featuring this service, improving the quality and expanding the multimedia content of the infotainment system, updating the design of the system
  • Participation in charity and volunteer activities
  • Collection of 1.2 million questionnaires for the passenger satisfaction survey
  • Issuance of 19,000 travel documents for RUB 67 million as a result of marketing mailings
  • Over 40 studies were conducted, the results of which help to debottleneck and make managerial decisions depending on the tasks at hand
  • 9.3 million passengers used the Poputchik access service, with a passenger satisfaction index of 83.5 in 2024
  • Realisation of many charity and volunteer activities
Media and public organisations
  • Press releases and other materials with information on JSC FPC’s activities
  • Responding to requests from the media
  • Media assistance during filming at infrastructure facilities
  • Company’s website
  • Mass media
  • Industry‑specific media
  • Social networks, Telegram channels
  • Events for external audiences
Effective co‑operation with the media, processing journalists' requests within the deadlines established by the media law
  • Issuance of approximately 500 official press releases and messages in the Company's official Telegram channel
  • Preparation of over 200 clarifications, comments and answers to journalists' questions
  • Publication of 10 interviews with JSC FPC's executives
  • Integrations with 10 bloggers
  • 110 events involving the media and representatives of the blogging community
  • Publication of over 100,000 materials in the media related to JSC FPC's activities, including about 21,000 with direct mention of the Company
Educational institutions
  • Targeted admission of students
  • Guidance counselling
  • Benefits for children of JSC FPC's employees
  • Joint research and cultural initiatives
  • Participation of JSC FPC's employees in school activities
  • Company’s website
  • Mass media
  • Social networks of the Company and educational institutions
  • Large‑scale promotional work among 1 to 5‑year students of railway universities and colleges: JSC FPC's participation in job fairs as an employer, meetings with students
  • “FPC Shkolnik” vocational guidance event on the basis of the Personnel Development Centre
  • Approval of the schedule of open lessons by Company executives at railway transport educational organisations, hub schools of OJSC Russian Railways and Children's Railways of OJSC Russian Railways to attract, popularise and promote JSC FPC among high‑potential young employees
  • Expansion of cooperation with specialised railway universities on targeted training, with a focus on creating a system of career guidance activities to attract young people to work with JSC FPC
  • 81 people enrolled in railway institutions for targeted training from JSC FPC
  • 160 open classes were held at universities, hub schools of OJSC Russian Railways and Children's Railways of OJSC Russian Railways and attended by over 3,000 people
  • Conclusion of nine co‑operation agreements with higher education institutions of railway transport
  • Participation of the Company's employees in 107 job fairs across Russia
  • Opening of an individual training group at the Russian University of Transport (MIIT), allowing to combine training and work at JSC FPC
  • 981 schoolchildren participated in the FPC Shkolnik event, 41 candidates were selected for the Shkolnik talent pool
Social partnership actors Engagement with trade unions in the social protection of employees and non‑working retirees
  • Meetings
  • Corporate events
  • E‑mail
  • Joint meetings of the Company's management, trade union committee and commission for regulation of social and labour relations
  • Mini‑football tournament of JSC FPC's Russian Professional Union of Railway Workers and Transport Builders (Rosprofzhel), Healthy Lifestyle Month at JSC FPC, etc.
  • Sum‑up of the results of the fulfilment of the Collective Bargaining Agreement within the framework of joint meetings of the Company's management, the Trade Union Committee and the Commission for the Regulation of Social and Labour Relations
  • Upgrade of physical fitness of employees and involving them in regular sports activities, popularisation of a healthy lifestyle in the workforce
Sustainability Development Management