Annual Report 2015



Approach to Sustainability

Sustainable development is an integral part of MegaFon’s business strategy. This principle shapes our approach to innovation, development and launch of new products. MegaFon’s Chief Executive Officer, Board of Directors and Management Board collectively guide the strategic leadership behind our approach to sustainability, while selected employees take responsibility for implementing specific programmes and initiatives.

In line with international best practice, our social and environmental programmes, along with corporate governance initiatives, form an integral part of the Company’s general sustainability strategy. Being a responsible business means for MegaFon harmonising commercial, social, and environmental interests.


MegaFon’s rating for its corporate social responsibility policies and performance

Our sustainability goals complement our social mission to overcome communication barriers, unite people across Russia, and provide quick access to information in any situation.

MegaFon acknowledges the supremacy of law and complies with all Russian legal requirements. We adhere to generally accepted moral and ethical standards, endorse business transparency, respect human rights and support environmental initiatives. Our sustainability activities are guided by international regulations and standards, including the United Nations Global Compact and the Social Charter of Russian Business. Our reporting on sustainability makes part of the Company’s annual report, but takes into account specific standards: the Guidelines on Social Responsibility (ISO 26000) and the Global Reporting Initiative (GRI) recommendations.

Our awards

  • In 2015, the Reputation rating agency reaffirmed for the second year running MegaFon’s AA(s) (“very high”) rating for its corporate social responsibility policies and performance.
  • In the Corporate Charity Leaders ranking, MegaFon took the second place among mobile operators and was included in the top 20 Russian companies from different sectors.
  • MegaFon won the No. 1 Brand in Russia 2015 award in the Mobile Operator category.
  • MegaFon was recognised as the best operator of 2015 by thousands of Russians who took part in the open vote on the Hi-Tech Mail.Ru expert portal.
  • MegaFon was the winner of the prestigious Customer Rights and Quality of Service award in the Communications and Telecoms sub-category within the Retail Services category.
  • The MEGAFONLIVE music festival received the high-profile Innovations Time 2015 award in the Best Innovation Implementation Project / Event Initiative of the Year / Technological Innovation of the Year category, was named as the Best Event of the Year in the Eventiada Awards 2015 competition and was included in the list of the most spectacular events on the Moscow scene, according to
  • MegaFon was the winner of the Competitive Procurement Leader competition, having been awarded the first place in the Cost Efficiency of Procurement Operations category established for purchasers.
  • Two of MegaFon’s projects were included in the catalogue of the Best Social Projects of Russia programme: the 10th open Russian football championship among children from orphanages and boarding schools “The Future Depends on You”, and the establishment of Communication and Art Clubs in ten Russian cities. The Communication and Art Clubs project was also the winner in the Projects to Support Socially Vulnerable Social Groups category.
  • The Dobro (Kindness) conference, organised by MegaFon together with and Metalloinvest, won second place in the Best Programme Implemented in Cooperation with Another Business category of the Corporate Charity Leaders contest.
  • The MegaFon Helps programme, launched in April 2015 in cooperation with a crowdfunding platform, was recognised at the Digital Communications Awards 2016 ceremony as the best in the Projects & Strategies (CSR Communication) category.
  • MegaFon was among the winners of Customer eXperience Awards Russia 2015. The Company was recognised in two categories: the Most Customer-Oriented Company in Russia and the Best Multi-Channel Customer Experience.
  • MegaFon was a runner-up in the Website of a Telecommunications Company (B2C) category of the annual Russian Golden Site awards. We also took silver in the Website of a Charitable Organisation/Project category for our internet portal “The Future Depends on You”.


Efficient stakeholder interaction is a prerequisite for the implementation of a successful sustainability strategy. We need to know how the Company is perceived by stakeholders, what their needs are and what they expect from MegaFon’s business and its social, environmental and charity initiatives.

Our interaction with stakeholders is based on the principles of partnership, equality and respect.


MegaFon’s customers represent the largest group of stakeholders, and the Company’s prosperity and long-term reputation depend on them. We are not only responsible for the quality of our services, but also for compliance with the highest international standards of consumer relations.

MegaFon pays special attention to confidentiality, reliability of information about our products and services underpinned by the principle of responsible marketing, guaranteed security, and prompt response to requests and complaints and their amicable resolution.


MegaFon’s employee relations are based on respect and trust. We do all we can to encourage employees to realise their potential, ensure fair remuneration and equal rights, and guarantee their health and safety. Through ongoing dialogue, we study the level of staff engagement and loyalty and adjust our policies accordingly. Our employee engagement survey is the most important and efficient tool to explore employee expectations and motivation.

Local communities

MegaFon operates across all Russian regions, so good communication with local communities is essential for us. Our policy of interaction with local communities is rooted in the principle of corporate citizenship. In addition to providing access to new technologies, we help improve the quality of life in the regions where the Company operates through social investments targeted at developing the education system, preserving cultural heritage and endorsing sustainability.


We are committed to continuous development of our business and growth of shareholder value. MegaFon adheres to best practices in corporate governance and cares for its reputation. We provide all our shareholders with equal access to information about the Company and its financial position, and we ensure absolute equality of shareholder rights. The main sources of information are mandatory disclosure documents, annual reports, financial statements, our corporate website and a dedicated website for investors.

The state

We are aware of our responsibility to the state and society, and we strive to make the greatest possible contribution to the development of the Russian Federation in close coordination with federal and regional authorities and in line with the interests of society. MegaFon is actively involved in modernisation of Russia’s telecommunications infrastructure and development of an information space, as well as protection of public safety including support in national emergencies. The Company is a member of working groups and commissions dealing with regulation in the telecoms industry. We do not support any political parties or political figures; at the same time the Company’s voluntary contribution to the prosperity of Russia goes beyond the minimum legal requirements and includes large-scale charity and sponsorship initiatives.

Business partners

As a reliable and responsible partner, MegaFon aims to ensure timely performance of its obligations to counterparties. We support transparency, fair competition and anti-corruption efforts. We do not tolerate unfair competition and do not get involved in collusive practices. The Company is committed to establishing long-term business relationships and provides its partners with all relevant information, while always remaining open to dialogue and willing to consider its counterparty’s position.

Industry community

As a member of a number of industry associations and unions, MegaFon is actively involved in the development of the Russian telecoms industry. We engage in the elaboration of telecommunications standards, and through our own example aim to encourage increased investment in sustainability among our corporate partners.


Since 2013

MegaFon has followed the Code of Business Conduct and Ethics

In its operations, MegaFon is governed by generally accepted standards of business ethics and the principles of legal compliance, fairness and integrity in business operations. MegaFon highly values its reputation and strictly adheres to Russian anti-corruption regulations, such as the Federal Law On Countering Corruption and the Methodical Recommendations of the Ministry of Labour and Social Protection adopted in 2013. In 2014, we also joined the Anti-Corruption Charter of Russian Business.

Since 2013 MegaFon has followed the Code of Business Conduct and Ethics, which was approved by the Board of Directors as a fundamental document defining the Company’s standards and principles and rules of business conduct for our employees and members of the Board of Directors. The Code of Business Conduct and Ethics equally applies to subsidiaries in which MegaFon has a 100% interest.

The Code details the general principles of interaction with key stakeholders and specific requirements for employees. The Code determines the Company’s position in countering corruption, discrimination and misbehaviour, and proclaims the need to ensure legal compliance, integrity, equal rights, and informational transparency.

“We do not tolerate any form of bribery or corruption, and in addition we expect our partners to follow the same principles. Company employees should not promise, allow or give bribes of any kind, nor should they request, agree to receive or accept them.”
Code of Business Conduct and Ethics

In addition, MegaFon has in place an Anti-Corruption Policy, the document that defines our policy on corruption and corruption risks. This Policy provides, inter alia, guidance to be followed by all MegaFon employees before accepting gifts from, or making gifts to, suppliers or other third parties. This guidance is set out in more detail in MegaFon’s Gifts and Hospitality Policy.

We provide training sessions to employees for them to clearly understand the Anti-Corruption Policy and adopt appropriate behaviour in controversial and potentially risky situations connected with gifts, conflicts of interest, etc.

We have in place a “Direct Line” through which MegaFon employees and other stakeholders can receive guidance as to whether a particular action is deemed corrupt, or can discreetly (and, if required, anonymously) report violations. Through this “Direct Line” employees can also get advice on the terms of the Code of Business Conduct and Ethics. The Direct Line usage statistics and information on the most important issues are communicated to the Audit Committee. The “Direct Line” is available 24/7.