Key Provisions of the Policy on Remuneration and Reimbursement for Governing Bodies
The remuneration of the sole executive body and FPC’s other key managers directly depends on the achievement of relevant key performance indicators.
Key Performance Indicators of FPC’s top managers have been developed in accordance with the Long-Term Development Programme of Russian Railways, its Subsidiaries and Affiliates to 2020, and RZD Holding’s 2030 Development Strategy.
By Order of Russian Railways No. 1545r dated 22 June 2015, the following target performance indicators were specified for FPC: revenue, passenger traffic, traffic safety, and labour productivity growth.
The target performance indicators have served as a basis for corporate and functional key performance indicators of FPC’s top managers, which underpin their motivation system.
The following tasks were completed when developing the motivation system:
- the impact of top managers’ actions on the existing business processes was reviewed
- the KPIs were ranked through vertical cascading
- the weight (share) of corporate and functional key performance indicators was determined, and the same number of KPIs was determined in line with the draft Regulations on the Bonus System for Key Managers.
The key managers’ corporate KPIs and their weight were approved by the Human Resources, Remuneration, and Corporate Governance Committee of FPC’s Board of Directors.