Corporate Social Responsibility and Sustainable Development Report ABOUT BUSINESS AND SOCIAL CORPORATE OCCUPATIONAL SAFETY AND SOCIAL PROJECTS AND ABOUT THIS EMPLOYEES RESPONSIBILITY GOVERNANCE ENVIRONMENTAL PROTECTION INVESTMENTS REPORT

Table of Contents

Review by Chairman of the Board of Directors 4. Employees 46 Alexey Mordashov 2 Staff Profile 48 Review by Chief Executive Officer of Policy and Management 49 AO Severstal Management Alexander Shevelev 4 Motivation and Engagement 49 Talent Selection and Promotion System 51 Compensation 51 About Severstal 6 1. Employee Performance Evaluation 53 Mission 8 Idea Factory and Innovator Support 53 Vision 8 Training and Development System 54 Values 8 Severstal Women’s Club 57 Overview of Severstal 8 Engagement of High School and University Core Businesses and Corporate Structure 11 Students and Young Professionals 58 Logistics 13 Work Environment 61 Severstal Vision and Strategy 13 Employee Benefits 62

2. Business and Social Responsibility 18 5. Occupational Safety and Environmental Protection 66 Management of Social Responsibility and Occupational Safety 68 Sustainable Development in Severstal 20 Environmental Protection 74 Severstal’s Documents and Initiatives in the Power Consumption And Energy Efficiency 86 Areas of Sustainable Development and Corporate Social Responsibility 21 Stakeholder Engagement 25 6. Social Projects And Investments 90 Severstal Awards and Rankings in 2019 32 2019 Highlights 92 External Social Programmes of Severstal: Policy and Management 92 Corporate Governance 34 3. Contribution to Sustainable Development of Standards of Corporate Governance 36 Severstal Regions 93 Governing Bodies 36 Social Investments And Social Partnership 98 Risk Management 38 Support for Culture 101 Managing Innovations 40 Corporate Volunteering 103 Quality Management 41 Customer Care 42 7. About This Report 104 Prevention of Corruption and Violations of Approach Used to Evaluate the Materiality of Laws and Internal Regulations 43 Individual Topics for Inclusion in This Report 106 Transparency 44 Description of the Information 108 Human Rights 44 Appendices 109

Severstal Corporate Social Responsibility and Sustainable Development Report 2019 1 GRI 102–14 Chairman's Review

Dear partners and colleagues: In 2019, Severstal maintained its position as a global industry leader in efficiency, equipped to deliver strong performance in all market conditions. The dedicated work of our people across all Severstal businesses and production chains empowered Severstal yet again to demonstrate the promise of Severstal’s updated strategy, announced in 2018, and our vision to be the first-choice company for our customers, employees and shareholders.

2 Severstal Corporate Social Responsibility and Sustainable Development Report 2019 ABOUT BUSINESS AND SOCIAL CORPORATE OCCUPATIONAL SAFETY AND SOCIAL PROJECTS AND ABOUT THIS EMPLOYEES SEVERSTAL RESPONSIBILITY GOVERNANCE ENVIRONMENTAL PROTECTION INVESTMENTS REPORT

As a part of our comprehensive business transformation We maintain a continuous dialogue with our business partners, programme, today we are moving away from disconnected communities and government authorities. Our assets play asset management towards an integrated value creation chain, an important role in the development of local communities. replacing an inflexible centralised sales structure with flexible They create jobs for local communities, generate orders for local industry-specific teams and product groups. The success of our small and medium businesses, and generate tax revenue for new strategy largely depends on the initiative and engagement various budgets. of our people. All changes that we have planned need to come We also help address social issues and invest in improving the along with the changes in our corporate culture in three areas quality of life in local communities, municipal landscaping that we define as “speed”, “inspiration” and “collaboration”. an