Social responsibility

Human capital is as important as our physical asset base, whether in the form of young professionals or the local community. Take people away from EuroChem and we do not have a business, and so our relationships with employees, communities and other stakeholders are vitally important.

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Engaging with stakeholders

Employees, including young professionals

All employees are trained and certified according to their environmental responsibilities and specific management routines.

Local community representatives

Informal and formal meetings and site visits relating to investment projects and environmental monitoring.

Environmental organisations

Consultation in relation to site operations and the results from environmental monitoring stations.

Universities and education institutions

E-generation programme provides chemistry and engineering tuition for school pupils, students and teachers.

Local authorities

Consultation and partnership to develop sports arenas, support health and education institutions and report on environmental monitoring activities.

Non-profit organisations

Identifying those organisations that would benefit from financial support and volunteering input.

Media

Providing access to company spokespersons to inform community investments and environmental monitoring activity.

Training and education

Aspect

Why it is important

Who has a stake

Indicator

Training and education

The sustainable growth of our business is predicated on our ability to attract and retain talent, particularly our cohort of young professionals.

The Board, employees, education institutions

Investment in training centres

Training partnerships

Teaching standards

Policies and guidelines

Human Resource Policy

E-generation programme

Employment laws in countries of operation

Industry best practice

Aspect boundary
Internal and external

We are working with external educational institutions to enhance opportunities for potential recruits and our employees.

How we manage training and education

All training programmes are co-ordinated by the Human Resources Departments in our companies and they report into our Head of Human Resources in Moscow.

They all work to a Human Resources policy that is aligned with the business strategy and operates over a 16-year cycle. It determines key indicators and priorities and sets quantitative and qualitative targets. The policy applies to all our operating companies and focuses on recruitment, incentivisation, remuneration, bonus structure, training, development and social support.

All training and professional development programmes are managed by our Administrative Director, Heads of Human Resources and Communications and their teams. All national and regional media are used to promote the programmes and competitions to students and their parents in key regions, and we also communicate with schools and universities.

Developing talent and enhancing skills

As we have accelerated our investment in new capacity and expanded internationally we have faced a shortage of the kind of engineering and technical talent that we need to support this growth. We know that fewer young people are opting to study technical and engineering subjects; this is reflected in the low levels of teacher competence and lack of high quality facilities in schools. This reduces the intake of motivated and informed students into universities.

The latter are also under-resourced and have not been pro-active in developing links into schools and into businesses that are prospective employers.

There are several big changes being implemented at the moment in HR strategy. Organisational design is being reformed so that people have more responsibility. Working with students and graduates has become a key strategic HR goal.

Consequently we made a strategic decision to invest in the employee ‘value chain’ from early intervention in schools through university education, enhancing teachers’ capabilities (professional competence incubation) and developing the skills of our recruits and employees (career lift). This programme is called ‘E-generation: leaders of the new industrialisation’ and has led to the recruitment of 1,300 young engineers since 2003.

Between 2014-2016 we are accelerating the programme and will recruit a further 1,000 engineers. This is necessary to meet our projected demand for skilled personnel; for example, our two potash projects require an on-site employee base of 6,000, of which 2,000 are chemical and mining engineers. It is these ‘young professionals’ who will underpin a sustainable future for our business.

In 2013, the budget for the programme was more than RUB 100m and its reach expanded beyond Russia into new territories such as Belgium, through the launch of EuroChem Antwerpen.

The programme is designed to fill gaps in four areas of education and training:

  • Chemistry at school is characterised by declining interest, poor provision, inadequately qualified teachers, lack of facilities and poor links with higher education.
  • Chemistry at university is characterised by weak research, lack of facilities and poor links with industry.
  • Scientific research is characterised by the growing use of imported process solutions and technology transfer and generally a short term view taken by both government and business.
  • Work experience in smaller enterprises is characterised by difficulties in recruiting graduates with relevant qualifications and giving them a solid grounding in an industrial environment.

There are limited government policies in Russia and in our other countries of operation that promote chemistry and other technical/scientific pathways. This has left a vacuum that EuroChem is filling with its E-generation programme.

The programme in action

The programme has three main elements:

  1. Pre-university training, motivation of pupils and identification of talented individuals.
  2. Long term collaboration with higher education institutions on relevant education, corporate scholarships and practical training.
  3. EuroChem’s network of professional training centres.

Working with schools

We fund a network of 29 laboratories in schools and technical colleges that focus on chemistry, natural sciences and environmental studies. Operating across seven Russian regions, the laboratories provide a pathway for school students to enrol on university chemistry courses under a scholarship scheme. Over 120 students benefited from the programme in 2013.

We organise annual workshops for chemistry and natural sciences teachers that allow them to explore new methodologies in order to enthuse and engage their students. These are tutored by senior staff from our partner universities, in particular the Moscow State Mining University and the Chemical Faculty of M.V. Lomonosov Moscow State University.

Working with universities

We have teamed up with seven Russian universities to offer scholarships and specialist engineering training to students with a view to them joining EuroChem after graduating. These institutions are Moscow State University, D. Mendeleev University of Chemical Technology of Russia, Moscow State University of Environmental Engineering, Moscow State Mining University, South-Russian State Technical University, Ivanovo State University of Chemistry and Technology and Perm State Technical University.

In 2013, 68 students were studying under the scholarship programme, with plans to involve a further 200 students. In 2013, we also sponsored 120 students through specialist training at one of the partner universities, which – with the intake from previous years – means that there are over 300 young people currently involved.

Recruiting motivated graduates

Graduates from these training programmes join EuroChem on a three year ‘Young Employee’ programme that offers them support from professional tutors, a fast track to careers across the company and the chance to network with their peers at meetings. Three hundred graduates benefited from the programme in 2013, with seven attending meetings.

Developing employee capabilities

We operate seven professional training centres which provide access to courses on a wide range of topics. In 2013, 63% of all employees benefited from training at these centres.

Our succession planning programme provides ongoing up-skilling of employees that will fill senior positions when they become available. There are currently more than 250 employees fully trained and ready to fill senior positions.

Plans for 2014-15

Over the next two years we intend to:

  • Extend the scale and scope of the programmes, involving new institutions and academics from other disciplines.
  • Enhance the levels of co-operation between the universities and with EuroChem.
  • Enhance teachers’ professional development workshops and promote greater interaction between schools and universities.

Employee relations

Aspect

Why it is important

Who has a stake

Indicator

Employee relations

As we grow internationally this is crucial, given we have over 22,000 employees.

The Board, employees, suppliers, national and local government, utilities, communities

Management to employee ratio

Employee turnover

Revenues per employee

Production per person

Personnel costs

Diversity and equality

Diversity and equality

We employ more than 22,000 people, representing more than 50 different nationalities, working in 19 countries. The work is demanding and requires a high level of co-operation and communication.

The Board, employees, national and local government, communities, education institutions

Level of investment

Employee numbers

Percentage of women in management positions

Remuneration

Remuneration

In order to attract and retain the best people, we aim to pay wages that are above average for the sector in each operational territory.

The Board, employees

Variable remuneration

Fixed remuneration

Average full-time equivalent wage

Changes in average monthly wage

Policies and guidelines

Human Resource Policy

Employment laws in countries of operation

Industry best practice

Aspect boundary
Internal

Employee relations, diversity and equality and remuneration are important measures of management competence and success.

We employ more than 22,000 people at 18 operational sites in Russia, Lithuania, Belgium and Kazakhstan, with sales and distribution sites in a further 12 countries. In 2013 we began new developments in Kazakhstan and China, with a further site in the USA at the planning stage. This growing geographic reach and continued need for skilled people means that we need to create an excellent working environment for our employees.

Our approach to employee relations, diversity, equality and remuneration

Our Head of Human Resources based in Moscow oversees the work of Human Resources managers in all our subsidiary companies.

We comply with all relevant labour laws upholding the rights of employees, including the Labour Code of the Russian Federation and international labour conventions. We do not use forced, compulsory, child or agency labour and respect all human rights under those laws and conventions.

2012

2013

Full-time equivalent employee numbers (people)

22,119

22,327

Management to staff ratio (%)

12.6

12.9

Staff turnover at production facilities (%)

5.0

4.6

Group revenues per employee (RUB m/person)

7.5

7.9

Productivity per main type of product per person, average (tonnes)

1,471

1,603

Number of employees receiving professional training

12,607

14,280

Number of participants in ‘Young Specialists’ programme

300

325

Personnel costs (RUB m)

16,499

19,017

Women in management positions (%)

39

41

Gender diversity (%)

30

30

Variable remuneration (RUB m)

3,562.7

4,796.2

Fixed remuneration (RUB m)

12,936.3

14,220.8

Average full-time equivalent wage (RUB/month)

41,068

48,283

Changes in average monthly wage (%)

17.0

17.6

Aspect

Why it is important

Who has a stake

Indicator

Local communities

EuroChem is a significant employer and its operations can have a significant impact on local environments and local economies.

The Board, employees, national and local government, educational institutions, communities, suppliers

Levels of community investment

Level and type of partnerships with government and communities

Policies and guidelines

Human Resource Policy

Employment laws in countries of operation

Industry best practice

Aspect boundary
External

The relationship with communities and development of local infrastructure and services is a strategic issue for EuroChem.

Our approach to working with communities

Social responsibility in the form of developing health and housing facilities for local communities is a key part of our business strategy. Our operations are crucial to the viability of most of the towns where we have a presence. We therefore undertake not only to provide stable employment, but also meet all local tax obligations, pay industry leading salaries and work closely with local government and community representatives to identify investment projects.

Given their strategic importance, such investments and associated projects are under the control of the Board of Directors. Individual projects are co-ordinated by our Administrative Director, based in Moscow, who liaises with corporate and plant management teams in contact with community representatives.

Investments are made on a co-financing basis (public-private and private-NGO) and projects are completed and ongoing in 11 towns and cities in Russia, Lithuania and Belgium, with a combined population of more than one million people.

Where we have created recreation, sports and rehabilitation facilities for our employees, these are also made available to local residents. In some cases, for example, at Lifosa, excess heat from the on-site power plant is fed into a district heating scheme.

All decisions that we make in conjunction with local community partners are open to scrutiny from within and outside the company, including relevant stakeholders, international experts/academics and all relevant government authorities.

RUB 3.8bn has been invested in communities, associated projects and charities since 2001, with RUB 889m (more than US$ 25m) invested in 2013.

Investment in communities, associated projects and charities (RUBm)

2006

2007

2008

2009

2010

2011

2012

2013

356

470

449

203

418

455

516

889*

*including more than RUB 300m (>US$ 10m) to construct multi-sports facilities in Kedainiai and Belorechensk plus ice sport arenas in Nevinnomyssk and Kingisepp.