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Alrosa has published its Corporate Social Responsibility Report for 2013, stressing its position as the largest diamond producer in the world.
In 2013, the Alrosa Group fully delivered on its targets in implementing the company’s production development program, the firm said. Having mined 36.9 million carats of rough diamonds, a 7 percent increase year-on-year, the firm is the world’s leading rough diamond producer by volume.
Sales of diamonds in 2013 broke the company’s all-time record, with a 12 percent jump from the previous year. Meanwhile, a successful public offering of 16 percent of Alrosa’s shares on the Moscow Stock Exchange ushered in a new stage in the company’s history and marked a key event of the 2013 reporting year.
"Today, we are setting for ourselves new goals to secure industry leadership position for our company - a strong player in the global diamond market with an impeccable corporate reputation and high ethical standards," said CEO Fyodor Andreyev.
"All this can be achieved only through a deep integration of the sustainability principles into our daily activities – by ensuring economic efficiency, environmental safety and social responsibility – while balancing the interests of all parties involved in the company’s operations.
"First and foremost, it means safeguarding the interests of our shareholders through effective implementation of Alrosa’s development strategy, and, above all, maintaining global leadership in rough diamonds production. To address this strategic objective, Alrosa has been successfully delivering on its investment program that provides for the construction of underground mines and commissioning of new fields.
"In the course of this financial year, much has been done to improve the effectiveness of the company’s corporate governance, including corporate risk management. I believe that the adoption of Alrosa’s Corporate Governance Code this reporting year is a good step in this direction. The company’s growth hinges on professionalism, strong motivation and well-being of our employees. Alrosa provides its workforce with decent working conditions and living standards. In 2013, we increased an average wage by 13.5 percent. The company’s personnel still enjoy a broad range of perquisites and benefits, including those provided under healthcare, housing and additional corporate pension programs.
Following broad-based discussions held with the company’s workforce, a new collective bargaining agreement for 2014-2016 between Alrosa and the Profalmaz interregional trade union was signed in December 2013. The company strives to exercise utmost responsibility in its approaches to restructuring, both when it divests of noncore assets and when it makes personnel decisions during transition to underground mining. The most important thing in these activities is to minimize their possible negative impact on the lives of the people in Western Yakutia, avoid sudden shifts in the living conditions in the region.
"Industrial and occupational safety poses the biggest challenge to the company. We pay a great deal of attention to this issue and put a lot of effort into production modernization and personnel training. The company invests heavily into new special clothing and protective equipment. Alrosa deploys new, effective production control mechanisms, while running complex industrial facilities, such as the underground mines under construction, which can significantly reduce or even eliminate the impact of a 'human factor' on the production process.
The firm continues to work closely with community-based organizations, municipal authorities, and local residents across all regions, where the Alrosa Group has operations. It is continuing with social investments under charity projects. "Meanwhile, environmental safety issues always top the agenda of the host communities and residents in the areas of the company’s mining operations. Environmental stewardship measures implemented at our enterprises follow the framework of comprehensive environmental protection programs developed jointly with the regional environmental protection agencies.
"The year 2013 saw the adoption of the company’s Environmental Policy by the Alrosa Supervisory Board, completion of an environmental audit, certification of an environmental management system compliant with the international and internal corporate standards. During the reporting period, we invested in environmental protection activities, with a nearly fourfold increase year-on-year. Most of the allocated funds were used for the construction of environmental protection facilities.
"We advocate maintenance of high standards of responsible business conduct and relationship building with our partners. In May 2014, Alrosa’s Executive Committee approved the Alrosa Alliance Guidelines on Responsible Business Practices, serving as a benchmark for the company’s long-term clients. According to the document, all Alrosa clients that buy raw materials under long-term contracts must share the Kimberley Process goals and principles and ensure nonconflict origin of diamonds, operate in accordance with the principles of lawful and fair competition, counter bribery and corruption, ensure transparency and disclosure of information, strictly respect human rights and workers’ labor rights. In our opinion, market participants bear a shared responsibility for the diamond industry’s reputation."