ANNUAL REPORT OF ELEKTRO PRIMORSKA D. D. COMPANY AND ELEKTRO PRIMORSKA GROUP FOR YEAR 2017 ANNUAL REPORT OF ELEKTRO PRIMORSKA, D.D. AND THE ELEKTRO PRIMORSKA GROUP FOR THE YEAR 2017 Contents A. BUSINESS REPORT . 5 01. REPORT BY THE MANAGEMENT BOARD . 6 02. STATEMENT OF MANAGEMENT'S RESPONSIBILITIES . 8 03. SUPERVISORY BOARD REPORT . 9 04. CORPORATE GOVERNANCE STATEMENT . 12 4.1. Declaration of compliance with the Corporate Governance Code . 12 4.2. Compliance with the recommendations and expectations of the Slovenian Sovereign Holding . 12 4. 3. Internal control and risk management system relating to financial reporting and auditing . 12 4. 4. Holding of securities of the company, in terms of achieving a qualifying holding, as defined by the law governing the takeovers, ownership of securities . ensuring special control rights, restrictions on voting rights . 12 4. 5. Management Board. .13 4.5.1. Appointment and composition. .13 4.5.2. Responsibilities and functions. .13 4.5.3. Remuneration of the Management Board . 13 4.6. Supervisory Board . 13 4.6.1. Appointment and composition. .13 4.6.2. Competence and functioning . .14 4.6.3. Remuneration of members of the Supervisory Board and Supervisory Board Committees . .14 4.7. General Meeting of Shareholders . .14 4.8. Management of the parent company and the group. .14 05. Company ID . 15 5.1. Company Profile. .15 5.2. Mission, vision and business culture of the Company . 16 5.2.1. Mission of the Company. .16 5.2.2. Vision of the Company . 16 5.2.3. Business culture . 16 5.3. The regulatory framework of the Company's activities in the sphere of power supply . 16 5.4. Organisation of the Company . 18 06. HUMAN RESOURCE MANAGEMENT in 2017 . 19 6.1. General . 19 6.2. Age structure of employees . .20 6.3. Structure of employees according to the years of service . 21 6.4. Structure of employees according to gender. .22 6.5. Educational structure of employees of Elektro Primorska and the Elektro Primorska Group . 22 6.6. Employees with disabilities . .23 6.7. Education of employees . 23 6.8. Care for employees . 23 6.9. Health and safety at work . .23 6.10. Voluntary supplementary pension insurance . .24 6.11. Accident insurance. .24 6.12. Other activities that affect the well-being of employees. .24 07. REALISATION OF THE ANNUAL GOALS IN 2017 . ..