Board of Directors

The Board of Directors is a governing body accountable to the General Meeting of Shareholders and bears overall responsibility for the Company’s strategic oversight and supervision of the Management Board’s activities.

The exclusive powers of the Board of Directors include the authority to:

1. Define the Company’s strategic priorities, development goals, and major projects; monitor their implementation; and approve the Company’s development plan.
2. Approve Company policies and other key internal documents, unless responsibility for them lies with other governing bodies.
3. Convene annual and extraordinary General Meetings of Shareholders.
4. Approve the issuance (placement) of shares within the limits of authorised shares, including quantity, method, and price, in compliance with applicable law.
5. Approve the repurchase of issued shares or other securities by the Company and determine the repurchase price.
6. Preliminarily approve the Company’s annual financial statements.
7. Approve the Company’s annual report.
8. Establish committees of the Board of Directors, appoint their members, and approve the terms of reference for each committee.
9. Approve the terms for issuing bonds and derivative securities, and resolve on their issuance.
10. Determine the number of members and the term of office of the Management Board, elect the Chairperson and members of the Management Board, and terminate their powers early if necessary.
11. Set the base salaries, compensation terms, and bonus arrangements for the Chairperson and members of the Management Board.
12. Approve the Regulations governing the activities of the Management Board.
13. Approve standard employment contract templates to be used for the Chairperson and members of the Management Board.
14. Approve succession planning programmes for members of the Management Board and other key employees, as defined by the Board of Directors.
15. Determine the composition and term of office of the Internal Audit Department, appoint its head and members, terminate their powers early, define its operational procedures, set salaries and bonus terms for its employees, and approve its governing Regulations.
16. Appoint the Corporate Secretary, define the term of appointment, terminate the appointment early if needed, set the salary and remuneration conditions, and approve the Corporate Secretary’s Regulations
17. Determine the remuneration for audit services related to the Company’s financial statements, as well as for valuation services involving assets contributed in exchange for shares or subject to major transactions.
18. Approve internal documents regulating the Company’s operations (except those adopted by the Management Board for day-to-day operations), including rules for conducting securities auctions and subscriptions.
19. Approve the establishment and closure of branches and representative offices, and approve their internal regulations.
20. Approve the acquisition or disposal by the Company of 10 % or more of shares (or equity interests) in other legal entities.
21. Make decisions related to the activities of any legal entity in which the Company holds 10 % or more of the shares (or equity interests), including matters typically reserved for that entity’s own general meeting of shareholders or participants
22. Approve transactions that would increase the Company’s liabilities by 10 % or more of its equity capital.
23. Determine which Company-related information constitutes official, commercial, or other legally protected confidentiality.
24. Approve major transactions, except where such approval falls under the authority of the General Meeting of Shareholders, as stipulated by law and the Charter.
25. Approve related-party transactions, except those which, under law or the Charter, are within the remit of other governing bodies.
26. Approve the Company’s annual budget and accounting policy.
27. Approve the Company’s organisational structure.
28. Approve the Company’s key performance indicators (KPIs), as well as the individual KPIs of the Chairperson and members of the Management Board.
29. Approve the issuance of guarantees by the Company for the obligations of any other legal entity.
30. Approve decisions regarding the raising of external financing.
31. Review in advance draft versions of the Company’s Charter, Corporate Governance Code, and Dividend Policy (including any amendments), as well as any changes to the valuation methodology for share buybacks on the over-the-counter market, prior to submission to the General Meeting of Shareholders at the Company’s initiative
32. Decide on other matters as provided by the legislation of the Republic of Kazakhstan and/or the Charter, except for those that fall under the exclusive competence of the General Meeting of Shareholders.
33. Determine the composition and term of office of the Compliance Control Service, including the number of members; appoint its head and members; terminate their powers early if necessary; define the service’s operating procedures, as well as the level and conditions of remuneration and bonuses for its staff; and approve the Regulation on the Compliance Control Service.

To support the effective performance of its duties, the Board of Directors establishes committees focused on the following areas:

• Strategic Planning;
• Personnek and Remuneration;
• Internal Audit;
• Sustainable Development;

Other areas as defined by the Company’s internal documents.

Kcell JSC utilizes a dedicated platform that ensures comprehensive security in the management and operational processes of the Board. This platform also enhances information exchange and contributes to the overall efficiency of the Board’s work. In accordance with the provisions of the Company’s Charter, members of the Board of Directors or any of its committees, as well as external experts, may participate in meetings via teleconference or other means of communication that allow all participants to hear and speak to one another in real time.

Principles for Appointment to the Board of Directors

Candidates for election to the Company’s Board of Directors may be nominated from among the following:

Shareholders who are natural persons;

Individuals nominated to represent shareholders on the Board;

Individuals who are neither shareholders nor nominated as shareholder representatives.

Candidates and current members of the Board must possess relevant professional experience, expertise, qualifications, a record of positive achievements, and an impeccable reputation within the business and industry community. These attributes are essential for fulfilling their duties and ensuring the Board operates effectively in the interests of both shareholders and the Company. At least 30 % of the total Board membership must be composed of independent directors.

Members of the Board of Directors

During 2024, the following changes occurred in the composition of the Board of Directors:

• On 27 May 2024, the Annual General Meeting of Shareholders resolved to early terminate the powers of independent director and Board member Pietari Kivikko.
• On 26 September 2024, the Extraordinary General Meeting of Shareholders resolved to early terminate the powers of Board member and Kazakhtelecom JSC representative A.V. Lezgovko.
• On 26 September 2024, the Extraordinary General Meeting of Shareholders resolved to early terminate the powers of Board member and Kazakhtelecom JSC representative A.B. Kishkimbayeva.
• On 27 May 2024, the Annual General Meeting of Shareholders elected A.K. Abdualiev as an independent director and member of the Board of Directors of Kcell JSC.
• On 26 September 2024, the Extraordinary General Meeting of Shareholders elected the following individuals to the Board of Directors:
  1. Alibek Beybitovich Indykbaev – member of the Board of Directors of Kcell JSC, representative of major shareholder Kazakhtelecom JSC;
  2. Yerzhan Bolatovich Meiramov – member of the Board of Directors of Kcell JSC, representative of major shareholder Kazakhtelecom JSC.

As of 31 December 2024, the Board comprised seven members, including four independent directors.

Performance Evaluation of the Board of Directors

The Board of Directors is required to conduct a comprehensive evaluation of its performance – including that of its committees and individual directors – at least once every three years. The results of the evaluation are discussed at a meeting of the Board, and recommendations are developed to improve the Board’s effectiveness.

On 17 February 2022, the Board of Directors approved the Rules for Evaluating the Performance of the Board of Directors, Its Committees, the Chairperson, Individual Board Members, and the Corporate Secretary of Kcell JSC (hereinafter, the Rules). It also resolved to conduct a self-assessment of the Board’s performance based on these Rules.

The results of the self-assessment were reviewed at the meeting of the Board of Directors held on 15 April 2022. Based on the findings, recommendations were provided to enhance the Board’s functioning.

In 2024, no evaluation of the performance of the Company’s Board of Directors was conducted.

The primary objective of the evaluation is to improve the quality and efficiency of the work of the Board, its Committees, their Chairpersons, each Board member, and the Corporate Secretary – thereby increasing the Board’s contribution to the Company’s long-term value creation and sustainable development.

The evaluation produced the following key findings:

• The activities of the Board of Directors, its members, committees, Chairperson, and Corporate Secretary are, in all material respects, aligned with the majority of established criteria and international best practices in corporate governance.
• Board members actively participate in the work of the Board, collaborate effectively as a team, and make individual contributions to improving the Board’s performance.
• Board members possess the necessary knowledge and professional experience and have a solid understanding of the industry.
• The performance of the Chairperson of the Board received a positive assessment.
• The performance of the Corporate Secretary also received a positive assessment.
• The Board Committees were found to be effective in fulfilling their assigned responsibilities.
• The composition of the Committees is well-balanced and aligned with their respective goals and objectives.

Board Activities in the Reporting Year

In 2024, the Board of Directors held 13 meetings – 11 in-person and 2 in absentia. During these meetings, the Board reviewed and made decisions on a range of key matters, including:

• Approval of the Company’s development plan;
• Approval of major transactions;
• Appointment and early termination of Management Board members;
• Preliminary approval of the 2024 annual financial statements;
• Convening of the Annual and Extraordinary General Meetings of Shareholders in 2024, including the preparation of dividend proposals;
• Appointment and early termination of employees of the Internal Audit and Compliance Control functions;
• Approval of the Company’s internal documents.

In addition, the Board considered various business, commercial, operational, and legal matters related to the Company’s activities.

Remuneration of Board of Directors

Matters related to the remuneration of directors are subject to approval by the General Meeting of Shareholders. The level of remuneration must be sufficient to attract, retain, and motivate directors and to ensure the effective performance of their duties. It should also reflect the time and effort required from each director, as well as the quality of their contributions.

The Company discloses information on director remuneration in accordance with applicable laws. Details of remuneration paid to directors during the reporting period are disclosed in the Annual Report.

Under the current Remuneration Policy, the Company pays its independent directors an annual fee consisting of two components: a fixed annual remuneration and an additional annual remuneration. Directors are also reimbursed for expenses incurred in the course of fulfilling their duties.

In 2019, the General Meeting of Shareholders approved the following pre-tax annual fees for independent directors: a fixed annual fee of USD 75,000; an additional annual fee of USD 25,000 for the Chair of the Board of Directors; an additional annual fee of USD 15,000 for the Chair of any Board Committee. Fifty percent of the fixed annual remuneration and any additional remuneration for serving as Chair of the Board or a Committee is paid six months after the director assumes office, with the remaining 50 percent paid one year after appointment.

The total remuneration accrued to members of the Board of Directors for the reporting period, including withheld taxes and contributions, amounted to USD 381,322.25, which, at the exchange rate on the payment date, equates to KZT 180,696,645.38.