People development

Our key asset is talented, professional, and committed employees that share our corporate goals and values. The Company’s entire HR framework is geared towards recruiting, supporting and motivating employees to achieve the most ambitious goals. To this end, we provide a wealth of opportunities to enhance skills and knowledge, take consistent efforts to foster a culture of safety, equality and respect, and offer competitive salaries and social benefits.

We rely on a robust performance management system that covers all levels – from individual employees to the Company as a whole – to ensure PhosAgro's sustainable growth in line with its goals.

New-generation employees are aware of how important personal and professional growth is as it is a key to success and self-fulfilment in the constantly changing world. For many, high remuneration is no longer the main incentive, with self-fulfilment coming to the forefront if the Company invests heavily in developing the skills and competencies which will be in demand going forward. This is why we place a strategic emphasis on supporting our people's drive for self-improvement. We seek to create the right environment for them to fully unlock their potential.

HR management principles

The reporting year saw a new version of the UK Modern Slavery Act Transparency Statement approved, which discloses contributions towards the UN SDGs and the Company's social projects to combat violations of human rights. Over the last three years, over 19,000 employees received additional training in human rights and corporate ethics.

All relations between PhosAgro and its employees are regulated by the Labour Code of the Russian Federation and comply with the requirement to provide employees with a timely notice of material changes in employment terms, thus respecting human rights.

GRI 2–30

We negotiate collective bargaining agreements with trade unions that address issues such as working conditions and compensation for employees at each of our production sites (usually for a three-year period, covering 100% of the employees of Apatit, its branches and standalone business units).

Non-discrimination policy and human rights

PhosAgro is committed to respecting employees' rights as required by the International Bill of Human Rights and the ILO Declaration on Fundamental Principles and Rights at Work, including zero discrimination, not using child or forced labour, respecting their right to exercise freedom of association and collective bargaining, and creating a safe and favourable working environment for both its own employees and the employees of its contractors, which are also expected to comply with such requirements and regulations.

PhosAgro Group appreciates and encourages diversity among its employees. We provide equal opportunities for them to unlock their potential and do not tolerate any restriction of a person's or a group's natural rights and freedoms or any conduct violating privacy of our employees.

Any decisions regarding promotion, hiring, remuneration, benefits or compensations are based solely on the employee’s qualifications, performance, skills and experience assessed impartially and fairly.

We expect our employees to treat their colleagues and everybody else, including customers, suppliers and other stakeholders, with due professionalism, respect and fairness.

We consider unacceptable any restriction of employee rights or freedoms, whether at workplace or in any other job-related environment.

Since 2013, we have conducted annual employee surveys enabling each employee to give feedback on the performance of the Company and its management. Throughout the history of such surveys, we have not received any negative feedback or reports of violations of human rights. This clearly indicates that all obligations to PhosAgro’s staff are respected and met.

The Code of Ethics
In our operations, we seek to maintain an impeccable reputation and comply with ethical business practices. PhosAgro adopted a Code of Ethics in 2014 and updated it in 2021. It applies to all employees and is the Company’s primary document that clearly defines our corporate culture, rules and regulations for collective behaviour within the Company, business and social relationships, and interactions with other stakeholders. When agreeing and concluding contracts with external contractors, it is an imperative for us to cover arrangements and commitments related to mutual respect of human rights and compliance with the Company's Code of Ethics.

The Code outlines our common values and underpins our success, helping us avoid unjustified risks, maintain long-term business growth, strengthen our position in the Russian and foreign markets, and increase the Company’s value for shareholders and other stakeholders.

In 2022, the Group employed 88 employees with disabilities (according to the average headcount). We believe we must exercise an individual approach when hiring people with special needs, and we are aware of our responsibility to create an inclusive environment for them.

The Company honours all its obligations related to the employment of the disabled as required by applicable laws. In addition, we rely on job quotas in hiring the disabled, support and provide an expert opinion at Abilympics, a competition for the promotion of disabled people’s professional expertise, take an active part in job fairs for the disabled, and sign workplace lease agreements with other companies. Going forward we plan to expand our practices of building an inclusive space.

The Company’s key production sites are located in the Murmansk, Vologda, Leningrad, and Saratov regions. As a major contributor to the local economy and one of the largest employers in these regions, PhosAgro has a significant positive impact on social development and welfare across its geography.

In developing our production and creating new jobs, we seek to prioritise local residents when filling our vacancies.

> 90 %

of on-site employees are hired locally.

The following strategic risks affect our HR management objectives:

The Company develops corrective measures as necessary and unlocks opportunities to mitigate those risks. Below you can find more information about what we do on this front.

Risk areas specific to HR management

As part of its comprehensive recruitment approach, PhosAgro continuously monitors the labour market in Russia to attract skilled staff and efficient managers with work experience at leading national and global companies, always determined to be one step ahead of the curve.

Our recruitment efforts are underpinned by a consistent career guidance model, which prioritises engagement with school and university students.

The Company works continuously to improve its recruitment processes. In 2022, we completed the first stage of recruitment automation to ensure faster communication with candidates and customers, while also reducing the time it takes to fill vacancies and minimising the labour inputs along the way.

We also set up a recruitment centre to enhance the process across all our sites.

1

PhosAgro Schools

The PhosAgro Schools projects focuses on cooperation with schools across our footprint. By creating the right environment at schools, we help guide graduates in their career choices. In 2022, we engaged with six schools across our geography.

2

Collaboration with secondary vocational institutions

As part of our collaboration with secondary vocational institutions, we seek to create a pipeline of skilled employees with relevant competencies who are competitive in the labour market, acquainted with allied professions, and have what it takes to pursue career opportunities for their further employment with the Company.

3

Cooperation with universities

Cooperation with universities serves to fill the most relevant jobs by attracting and retaining talented graduates. Today, the Company actively collaborates with 24 universities that offer courses relevant to its core activities.

1

PhosAgro Schools

The PhosAgro Schools projects focuses on cooperation with schools across our footprint. By creating the right environment at schools, we help guide graduates in their career choices. In 2022, we engaged with six schools across our geography.

2

Collaboration with secondary vocational institutions

As part of our collaboration with secondary vocational institutions, we seek to create a pipeline of skilled employees with relevant competencies who are competitive in the labour market, acquainted with allied professions, and have what it takes to pursue career opportunities for their further employment with the Company.

3

Cooperation with universities

Cooperation with universities serves to fill the most relevant jobs by attracting and retaining talented graduates. Today, the Company actively collaborates with 24 universities that offer courses relevant to its core activities.

To enhance women’s social security in accordance with the applicable laws, the Company:

• does not use female labour for manual lifting or carrying weights exceeding maximum allowable limits;
• releases pregnant women from their job duties and transfers them, subject to their medical reports, from production sites to lighter-duty positions;
• provides women, at their request, with a parental leave until the child reaches the age of three;
• prohibits business trips, overtime or night work, work on weekends and public holidays for pregnant women, except when there are a written consent and no contraindications;
• safeguards employment of pregnant women, with their employment contracts terminated only in the event of liquidation of the facility, as well as that of women having children up to three years of age and single mothers having children up to 18 years of age.

The decrease in productivity due to the growth of the Company's headcount as a result of bringing equipment repair and maintenance functions back in-house, with a view to improving the quality and efficiency of the work.

Annual employee survey

For ten years now, the Company has been conducting annual Growth Area employee surveys which serve as a basis for subsequent remedial action plans designed to address employee concerns. In 2022, the Company collected 13,773 completed survey questionnaires (with the headcount standing at approximately 19,800 employees). The employee satisfaction and loyalty index came in at 69% (up 12 p.p. y-o-y). This is a very good result for a chemical and mining company with a complex organisational structure. The engagement level came in at 70% (up 11 p.p. y-o-y due to the high assessment of the Company’s stability and social benefits offered), with 87% of employees appraising the management’s decisions.

These results reflect positive changes in the Company and the effectiveness of corrective actions based on the outcomes of the annual Growth Area surveys. We plan to continue surveying our employees on an annual basis going forward, while also arranging pulse survey on dedicated subjects more frequently.

The aggregate satisfaction and loyalty index demonstrated significant growth to reach its all time high (since 2013 when the Company’s first started measuring these metrics).

Training and evaluation

PhosAgro’s management seeks to attract highly skilled professionals and young talents, with heavy emphasis placed on providing professional development opportunities, promoting professional growth and encouraging production initiatives and in-house expertise.

We offer a wide range of training formats for our people, including in-person training, on-the-job training, internships and online education. The COVID-19 pandemic came as a challenge from the perspective of ensuring employee training, development and assessment continuity, but also as a growth driver. The use of remote training capabilities became possible due to the implementation of new automated solutions and services which facilitate qualitative employee assessment, prompt identification of personnel management risks, and enactment of management initiatives for improving process efficiency.

In 2022, we continued to enhance the expertise of professionals responsible for the assessment of candidates and employees as part of recruitment and development processes. We actively use psychometric assessment tools by leveraging the potential of new automated solutions and services introduced in 2021. These tools are applied in full compliance with the regulations on their use approved by the Company.

In 2022, the number of employees who completed various types of training programmes reached

11.551 employees +16.4% to 2021

The average annual number of training hours per employee exceeded

99.8 hours +4.9% to 2021

In 2022, we continued to improve our corporate training programme by rolling out remote educational and development tools introduced during the pandemic, leveraging digital technologies and creating mixed training formats. The Company promotes a remote training system, creates online courses and upgrades technical capabilities by introducing computer simulators, and implementing VR technologies to support the learning process. The remote training system counts over 250 courses, while the VR library offers 12 programmes on occupational health and safety, and repairs of rotating equipment. We also provide our employees with opportunities for self-development by giving them access to our corporate electronic library and online training platform. In 2022, the Company partnered with Eduson, an educational platform, enabling its employees to complete over 17,000 courses and more than 2,600 tests. PhosAgro’s staff can also read and download business, professional and fiction books from Alpina’s online library.

The Company seeks to promote the greatest possible number of internal candidates from the talent pool to PhosAgro’s executive roles. Our programmes aim to identify employees who have proved their efficiency in current positions and have what it takes to expand the scope of responsibilities and move up to executive roles. The Company offers a wide range of training and development opportunities to help such employees achieve these goals.

The talent pool programmes include a variety of training options for talent pool members helping them to develop managerial and professional competencies, and to boost personal and business skills (analysis and decision-making, leadership, workflow management, motivation and delegation of powers, conflict settlement, project management, effective communications, etc.).

In 2021, the Company started to use mentoring as a vehicle for promoting participants of the Top 40 Talent Pool programme. Senior managers (mentors) share their experience and knowledge with the participants in an attempt to build a next-level management culture, while talent pool members get a chance to learn the secrets of successful management from executives.

The Top 40 Talent Pool programme offers opportunities to develop managerial competencies, pursue individual training at leading business schools, and benefit from mentoring support and personalised assistance. The main objective of training is to prepare the next generation of top-notch managers.

We are creating an environment conducive to an active experience and knowledge sharing by promoting the culture of coaching and mentorship. In 2022, a number of Top 40 Talent Pool participants took on the role of mentors themselves to coach middle and line managers from the talent pool.

Both talent pool development programmes and employee training initiatives seek to develop competencies required for progress against the Company’s goals and strategic projects and preventing personnel shortages. In 2023, we will continue our efforts to expand the talent pool.

Virtual teaching package

In 2022, we kept rolling out a virtual teaching package and a distance learning system to automate training and development processes.

This was needed because of:

• transition to remote work;
• demand for a specific range of professions;
• a large number of employees to be trained in various jobs;
• employees’ aspirations for self-learning and keeping their knowledge up to date.

The virtual teaching package includes:

1. A matrix of 24 corporate, job-agnostic and job-specific competencies;
2. Teaching packages for 15 corporate and job-agnostic competencies;
3. Ten distance learning courses for corporate and job-agnostic competencies.

In addition to the earlier developed capabilities, in 2022 the Company unveiled:

A tool to create online courses for nine job-specific competencies, including guidelines on developing the teaching package, a template of terms of reference for creating a programme, a template course presentation, didactic materials for teaching in-house developers, and recommendations on incentives for in-house developers;

100% of content required for distance learning theoretical courses on job-specific competencies covering four pilot professions.

Furthermore, during 2022 a personal account developed for the distance learning system was available for pilot running at all sites. The personal account features:

• mandatory multi-sectioned courses;
• courses to develop additional competencies;
• process flowcharts;
• student atlases, etc.

Lessons learned from the operation of the personal account will be used to automate HR management processes.

Going forward, we plan to roll out the project and achieve 100% coverage of the 59 most popular professions by theoretical courses in the distance learning format by 2026.

Incentives and rewards

Our robust system of rewards is aligned with the Company’s performance and motivates all employees to improve their performance in order to achieve our business goals. The purpose of the incentives and rewards system is to incentivise staff in order to increase productivity and deliver strong operating results, as well as to retain qualified talent.

Due to the nature of our operations, there are generally more male employees than female ones. At PhosAgro, we believe that professionalism, sustainably strong performance and adherence to corporate values are prerequisites for and the only guarantee of career growth.

Our regulations on labour relations, remuneration and social benefits cover all employees and underpin the principle of equitable remuneration and rewards. We comply with the principle by implementing a remuneration framework that offers equal pay to employees in equivalent positions, regardless of their gender.

Social benefits and employee guarantees

We provide comprehensive social support to our employees, and every year we increase funding for voluntary health insurance, financial assistance and corporate housing programmes.

Collective Bargaining Agreements provide for a range of relevant benefits as part of the government programme to support families, mothers, and children. Recreational summer health resorts and specialised excursions are organised for employees' children on an annual basis. All children of employees between the ages of 0 and 14 receive New Year presents.

PhosAgro provides employees with vouchers to local and southern health resorts and corporate health resorts. Employees and their family members, as well as veterans, have access to corporate health resorts at a reduced price.

A range of social support measures and leisure activities are available to the Company’s veterans, and a corporate retirement plan is in place.

Employees can also seek psychological, financial, and legal assistance and receive advice on an active lifestyle, including the use of telemedicine. Healthy eating programmes are being introduced and a nutritionist is available to employees.

In 2022, we implemented major projects worth over RUB 300 mln to improve working conditions at our facilities. For example, repairs were carried out on lounge, shower and meeting rooms, staircases, and corridors in administrative and production facilities.