Santiago Principles Self-Assessment

JSC Samruk-Kazyna

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  • Pillar 1: Legal
  • Pillar 2: Institutional
  • Pillar 3: Investment
Principle 1

1. The legal framework for the SWF should be sound and support its effective operation and the achievement of its stated objective(s).

1.1. The legal framework for the SWF should ensure legal soundness of the SWF and its transactions.

1.2. The key features of the SWF’s legal basis and structure, as well as the legal relationship between the SWF and other state bodies, should be publicly disclosed.

Joint Stock Company Sovereign Wealth Fund «Samruk-Kazyna» (hereinafter – S-K) was founded in accordance with the Decree of President of the Republic of Kazakhstan dated 13 October 2008, № 669 «Оn some measures on competitiveness and sustainability of national economy» and by the Decree of the Government of the Republic of Kazakhstan dated 17 October 2008 № 962 «Оn measures on realization of the Decree of President of the Republic of Kazakhstan № 669»; by merging two joint stock companies Kazakhstan Holding for the Management of State Assets SAMRUK and KAZYNA Sustainable Development Fund.

It performs its functions according to the Law of RoK "On Sovereign Wealth Fund" (hereinafter -Law on SWF), "On Joint Stock Companies" (hereinafter – Law on JSC), S-K Charter, and other respective laws of Republic of Kazakhstan (RoK).

S-K fulfils its activities in accordance with laws of the Republic of Kazakhstan, Law on SWF, S-K Charter and internal documents of S-K.

The Government segregates its powers of the Sole Shareholder of the S-K from its powers related to state regulatory functions.

Legal relationships between the S-K and the Government are specified in the Law on SWF, S-K Charter, Agreement between Government and the S-K approved by Decree of the Government dated 14 December 2012 №1599 and S-K Corporate Governance Code and relevant industry legal acts. The key features of the SWF's legal basis and structure are specified in the Law on SWF.

The S-K Charter, Law on SWF, Agreement between Government and the S-K, CG Code are publicly disclosed.

Principle 6

6. The governance framework for the SWF should be sound and establish a clear and effective division of roles and responsibilities in order to facilitate accountability and operational independence in the management of the SWF to pursue its objectives.

The Law on SWF sets up the following governance framework in S-K where each level of governance has clear competencies and responsibilities:

Superior Body – Sole Shareholder

Governing Body – Board of Directors (hereinafter – BoD)

Executive Body – Management Board (hereinafter – MB).

According to the Law on SWF, one of the key principles of interaction between owner and S-K is that interference by the public authorities to the operational activities of the S-K or its portfolio companies is not permitted, except for cases provided by the laws of the Republic of Kazakhstan.

Principle 18

18. The SWF’s investment policy should be clear and consistent with its defined objectives, risk tolerance, and investment strategy, as set by the owner or the governing body(ies), and be based on sound portfolio management principles.

18.1. The investment policy should guide the SWF’s financial risk exposures and the possible use of leverage.

18.2. The investment policy should address the extent to which internal and/or external investment managers are used, the range of their activities and authority, and the process by which they are selected and their performance monitored.

18.3. A description of the investment policy of the SWF should be publicly disclosed.

SK's Investment Policy establishes the uniform requirements for investment operations of the fund. The Investment Policy was approved by the BoD in 2014. The policy has a clear objective: SK's investment operations are aimed at increasing the value of the portfolio companies over the long term, in compliance with the Law on SWF. S-K has implemented appropriate risk management regulated by internal documents. The Investment Policy does not provide an investment strategy per se but outlines the key approaches in the implementation of investment activities that takes into account the following activities: strategic planning, corporate governance, the medium term planning, risk management, investor relations, and monitoring.

The Investment Policy describes the process of how S-K will analyse and monitor the risks of investment projects for risk management. S-K and its portfolio companies may undertake socially significant and industrially innovative projects that promote sustainable economic development in line with state policy. This is decreed as one of the objectives of the S-K according to the Law on SWF. 

S-K does not delegate its investment decisions to external institutions. Investment decisions are mainly taken by the Corporate Bodies/Authorities of S-K.

The investment policy of S-K is not a public document. However, the main principles and guidelines of the policy are disclosed in S-K's Strategy document which can be downloaded on S-K's website.