About the Report
GRI G4-4, G4-9, G4-15, G4-17, G4-18, G4-19, G4-20, G4-21, G4-22, 23, G4-28, G4-29, G4-30, G4-32

This Annual Report (hereinafter referred to as “the Report”) covers performance of TVEL JSC and its subsidiary companies (hereinafter together referred to as TVEL Fuel Company, TVEL FC, the Company) in 2015.

The purpose of this Report is to present comprehensive
account of:

  • performance of TVEL Fuel Company over the reporting year;
  • strategic directions and development potential;
  • the inherent risks and risk mitigation procedures;
  • management philosophy.

This Report is prepared in compliance with the following regulatory documents:

  • Federal Law No. 208-FZ d/d December 26, 1995 “On Joint-Stock Companies”;
  • Federal Law No. 402-FZ d/d December 6, 2012 “On Accounting”;
  • RF Government Regulation No. 1214 d/d December 31, 2010 (as revised on November 10, 2015) “On improving management procedure of open joint stock companies, the shares of which are under federal ownership and owned by federal state unitary enterprises”.
  • The Policy of ROSATOM applicable to public reporting and Public Annual Reporting Standard of the Key Organizations included into ROSATOM;
  • Provision of the Bank of Russia No. 454-P d/d December 30, 2014 “On Disclosure of Information by the Issuers of Equity Securities”;
  • Corporate Governance Code (recommended by letter of the Central Bank of the Russian Federation d/d April 10, 2014);
  • Global Reporting Initiative Sustainability Reporting Guidelines, version G4;
  • Standard AA1000 APS 2008 of Accountability;
  • International Integrated Reporting Framework, version 1.0.

The integrated format of the Report provides detailed description of the Company’s performance in the context of the external environment and shows the impact it makes on the stakeholders.

The Report discloses material information, which is important to those who use this Report to assess the performance of the Company. Survey of internal and external stakeholders was conducted, the map of material matters was drawn up while preparing this Report (for details refer to the Appendices to interaction version of the Report at www.tvel.ru the Section “Finance”, “Annual Report”).

Aspect boundaries and content of the Report were determined by the Committee on Public Annual Reporting involving the Committee of Stakeholders, and agreed on by TVEL JSC subdivisions. Disclosed matters (aspects) are material for all subsidiaries from the Report profile, unless otherwise is specified herein. As compared to the previous reports, certain changes covered disclosure limits for industrial injuries rates (see p. 148). Moreover, KhMZ JSC was withdrawn from the Company’s management profile due to its shares sale.

Reporting cycle Annual
Format Integrated
Comparative indicators For 3 years
Targets Are shown for 2016 and the reporting year, where the approved plans are available
Report Profile TVEL JSC, MSZ JSC, ChMP JSC, NCCP JSC, MZP JSC, VNIINM JSC, UEIP JSC, SGChE JSC, AECC JSC, PA ECP JSC, VPA Tochmash JSC, KMZ JSC, EC RGC JSC, EC RGC JSC, UGCMP LLC, NRDC LLC, EDB-Nizhniy Novgorod, Centrotech-SPb JSC, Uralpribor LLC*
Priority theme of the Report Efficiency Based Development Strategy of the Fuel Company
GRI Disclosure Level GRI G4 Comprehensive Option**
Date of the previous Report publication June 2015

** Conforms to management accounting profile.

** Performance indicators and standard elements are generated and presented in the Report in accordance with Russian Accounting Standards. Financial report data pursuant to the International Financial Reporting Standards (IFRS) are not presented due to later date of generation thereof.

GRI aspects to be disclosed in the report:

1. Economic Performance

2. Market Presence

3. Indirect Economic Impacts

4. Procurement Practices

5. Energy

6. Water

7. Biodiversity

8. Emissions

9. Effluents and Waste

10. Products and Services

11. Compliance

12. General Information (Ecology)

13. Supplier and Contractor Environmental Assessment

14. Environmental Grievance Mechanisms

15. Employment

16. Labor/Management Relations

17. Occupational Health and Safety

18. Training and Education

19. Supplier and Contractor Assessment for Labor Practices

20. Labor Practices Grievance Mechanisms

21. Local Communities

22. Anti-Corruption

23. Public Policy (Political Contributions)

24. Anti-Competitive Behavior

25. Supplier Assessment for Impacts on Society

26. Grievance Mechanisms for Impacts on Society

27. Customer Health and Safety

28. Freedom of Association and Collective Bargaining for Employees

29. Security Assurance Practices

Material Aspects Matrix

Specific aspects of TVEL JSC that were not assessed in survey but were automatically included into the list of aspects to be disclosed in the Report:

1. Meeting the Demand of Power Grids of the Russian Federation

2. Business Continuity

3. Position in the Global Market

4. International Cooperation in the Field of Peaceful Use of Nuclear Energy

5. Nuclear and Radiation Safety Systems Management

6. Compliance with Requirements of Nuclear and Radiation Safety

7. Decommissioning of Nuclear Facilities

8. RW and SNF Treatment, Rehabilitation of Contaminated Areas

9. Intellectual Capital

10. Innovative Activities

11. Support for Innovative and Technological Potential Development

12. Improvement of Control Mechanisms

13. Enhancement of Information Transparency of Nuclear Industry

14. Public Acceptance of Construction Projects of ROSATOM and its Organizations

15. Improvement of Regulatory Framework in the Sphere of Nuclear Power

16. Implementation of Certain Functions of the State Administration within Specified Activities

17. Provision of Qualified Personnel

18. Social Welfare of Workers

19. Radiation Impact on the Environment

The scope of matters (aspects) had no changes as compared to the previous periods No significant reformulations of the indicators given in previous reports were done. Occupational Health and Safety aspect is important not only for the Company, but also for contractor organizations rendering capital construction services at the Company’s facilities.

Materiality Determination Process

Taking into account the surveys in March and November, 2014 among representatives of internal and external stakeholders of TVEL Fuel Company, the map of significant aspects (issues) under GRI G4 Guidelines was prepared. Within the framework of the distance dialogue under the Report concept the new survey among the stakeholders was carried out in November and December 2015, which confirmed the relevance of the chosen essential aspects.

The map was prepared in axes of “materiality for TVEL FC” (average assessment made by managers of the Fuel Company who took part in survey) and “materiality for stakeholders” (external stakeholders’ assessments). Materiality threshold at which an aspect becomes sufficiently important (material) to be disclosed in Annual Report is “above-average”. The proposed rating scale included “high”, “average”, “low” (materiality), “not meaningful”. In figures these stand for “3”, “2”, “1”, “0”. “Above-average” stands for “above 2”.

Rationale for choosing priority matters of the Report

The priority theme in this Report is the Efficiency Based Development Strategy of the Fuel Company. Under the conditions of market threats and increased competition and in order to perform most important tasks assigned by ROSATOM, TVEL Fuel Company sets itself the long-term and operational goals to improve the efficiency.

Under current conditions on the markets of the front end NFC, as well as with restricted investment resources, the continuous efficiency improvement is a key condition of leadership positions maintenance by TVEL Fuel Company in the international field.

In 2015 the Company started the systematic work to improve the efficiency, which will allow achieving its goals. Details of this work are given in Section “Performance Management “, the results are given in Chapter 4 “Effeciency in Results 2015”.

Stakeholder Engagement

Stakeholders engagement is an integral element of public reports preparation and day-to-day activity of the Fuel Company. The Stakeholders Commission was established by the Company in 2013 to promote regular feedback on the matters pertaining to the activity of the Company and its public position on specific matters.

  • Stakeholders’ suggestions were taken into account while preparing the Report, as well as the analysis of the best Russian and international practices of disclosure in annual reports.
  • Following the 2015 reporting campaign 40 suggestions of stakeholders were received: 26 of them have been taken into account while preparing the Report, 5 — partially considered, 8 — will be taken into account while preparing the nextreports; 1 suggestion pertaining to the Company’s activities is submitted to the department in charge.

Reliability of the information contained in the Report has been confirmed by:

  • The Statement of the Director for Internal Control and Audit of TVEL JSC (with respect to efficiency of the internal control system applicable to generation of the Report and compliance of the generation procedure with the requirements of laws, internal regulations of ROSATOM and TVEL JSC in the sphere of public reporting);
  • The Statement of the audit organization FAC LLC, confirming reliability of 2015 Financial Statement of TVEL JSC;
  • The Statement of the audit organization NP Consult CJSC confirming reliability of non-financial data published in the Report.

The Organization that renders services of independent assurance of non-financial data of the Report was selected through competitive procurement practices.

The Report was approved by the Board of Directors of TVEL JSC.

This Report covers the year of 2015. All prior and future periods are mentioned herein in description of corporate strategy, collation of performance indicators and results, forecasts and risk assessments. In addition to factual information, this Report describes and assesses potential and probable events. Any statements herein other than statement of facts shall be construed as forecasts. Forecasts of this kind are relevant only at the time of publishing. TVEL JSC (unless otherwise specifically provided for by applicable legislation) is not obliged to review or update the said forecasts or factors in any new pieces of information. Actual performance results may differ from the forecasted ones.

The Company appreciates the employees who took part in preparation of this Report, and all participants of public consultations and dialogues. We hope you will find this Report interesting and informative in terms of the new information about TVEL Fuel Company. Our working team is open to your feedback and suggestions on the matters and issues that you would like to see in the next annual report. Please refer to Feedback form in interactive version of the Report at http://tvel.ru/wps/wcm/connect/tvel/tvelsite/finance/annual_report/.