Sustainability

GPM social responsibilities

Sustainability

At GeoProMining we view ourselves as a long-term investor in the regions where we have a presence, which means that sustainability is among our key strategic priorities. We seek not only to deliver value to our shareholders, but also to secure the sustainable development in the interests of our employees, local communities and governments. Our social responsibility programme is called ‘Resources for Good’ and it covers several important aspects of our relationships with key stakeholders, including taking care of our employees, minimizing our impact on the environment and supporting local communities. We view all of these areas as important components of the successful and sustainable development of our business.

Employees

Our assets are located in Armenia and Russia, and our operations play an important role in the socio-economic development of the regions where they are located. We are conscious of the importance of our status as an employer, and offer attractive salaries and benefits packages to our employees. Workers and members of their families receive free medical care and, at times, financial support. Our company regularly provides professional training opportunities to promote the ongoing development of our staff. We also offer relocation training programmes across our operations. We believe that GeoProMining has established itself as a responsible and reliable employer.

Investment in our people is one of our most important priorities and we are fully committed to supporting the continued professional development of GeoProMining employees. We view this as a key element of our future success and seek to implement a unified professional culture across our operations.

Health & Safety

Health & safety is a priority for us at GeoProMining. Our operations are currently in compliance with local regulatory requirements. The company’s facilities undergo regular inspection by state authorities for adherence to safety standards and use of appropriate personal protection equipment.

We are also committed to introducing independently verified health and safety management systems in accordance with OHS AS 18001.

Environment

Industrial production has an impact on the environment and we view it as our responsibility to undertake all possible efforts to minimize the impact of our operations on the environment. Our objective at our operations is to prevent pollution, to use energy and natural resources rationally and to manage waste efficiently. We seek to comply fully with all applicable environmental law requirements and to develop and implement efficient management systems with due regard for best international practices.

For example, a portion of our assets in Armenia are located in the conservation area of a drainage basin for Lake Sevan; as a result we seek to ensure that our work in this area is carried out in accordance with Armenian law and environmental regulations Maintaining high environmental protection standards in our key modernization projects is an important priority for us, which is why we have them verified by experts from a number of leading companies in the areas of environmental expertise, new processing technologies and waste management.

The Agarak Plant is introducing a closed recycling system that will completely prevent waste water from getting into the surrounding territories, including boundary river Araks. The system will also significantly reduce the amount of water used in production cycle.

We plan to implement ISO standards across all of our operations in the near future in order to ensure that people at all levels of the production chain and corporate governance system maintain a consistently high standard.

Local Communities

Through our interactions with public authorities and local administrations we seek to respond to the needs of the people in the regions where we operate and to direct our support to those projects that are most relevant to the local communities. We regularly invest in social projects such as the development of fire safety, energy and water infrastructure, as well as repairs to hospitals, schools and kindergartens. Other traditional priorities are economically and socially vulnerable groups, such as orphans, handicapped people and veterans.

GeoProMining pays special attention to educational programmes for children and teen-ages. Along with the opening of the interactive classes and the scholarship programme for students in universities of Russia and Armenia, we support projects aimed at pre-school children. We are involved in the construction of a kindergarten in the Ararat region and support this Children Development Centre in Vardenis in its educational programmes for children from low-income families living in the region of Gegharkunik. Through a project initiated by the Russian Embassy in Armenia, GPM provides equipment and computer classes for interactive instruction of Russian language in regional schools, which improves Armenians’ knowledge of Russian. Such classrooms have already been opened in Ararat, Armavir and Vardenis. GPM holds special events to celebrate International Children’s Day and arranges festive New Year parties for the children of its employees.

In 2012 GPM has launched a scholarship programme to help talented Armenian students study in in leading Russian and Armenian universities. The programme is aimed at training personnel for the Company. The first five students are studying now at the St. Petersburg Plekhanov State Mining Institute and the Yerevan State University.

We actively sponsor sporting initiatives. For example, in Yakutia, we are a co-sponsor of the International Sports Forum ‘Russia – a Land of Sports’ and the 5th annual international 2012 Children of Asia Games. Next year we plan to arrange a table tennis competition for schoolchildren in Yakutia.

GeoProMining is involved in the development of socio-economic infrastructure in the regions, where the company operates. GPM is co-financing the construction of a gas pipeline in the village of Sotk in Gegharkunik region of Armenia.

In September of 2010, GPM, the administration of the Gegharkunik region (Armenia) and the Social Initiatives Fund of the Government of the Republic of Armenia signed an agreement for strategic cooperation in the sphere of social development of the region. Through this agreement, we will work with the Social Initiatives Fund, in conjunction with the World Bank, to finance a major reconstruction project for the Cultural Centre in the town of Vardenis. GPM also supports the construction of the “St. Amenaprkich” church in Ararat.

In Yakutia GPM has established municipal-private partnerships with the Oymyakon ulus and the Verkhoyansk region of Sakha Republic (Yakutia) where the company’s facilities are located to pursue its social responsibility programme. This format of social activities is recommended by the Yakutian Government and helps to address the needs of local communities timely as well as contribute effectively to the social and economic development of the region. For instance in 2012 GPM is facilitating the construction of a sports centre in the Bala settlement of the Arylakh Nasleg as part of My Yakutia in the XXI Century initiative. In 2011 the company contributed to setting up a paleontological museum in the Betenkes settlement. The company combines major projects with its regular support of the Ust-Nera Orphanage and the Khomenko School in Ust-Nera.

Culture

In all the regions where GeoProMining is present we devote considerable attention to supporting culture and the arts.

In Armenia, we support the K.S. Stanislavski Russian Drama Theatre, one of the most prominent cultural institutions in Yerevan, which stages plays by Russian and Armenian playwrights. In Georgia, we actively supported cultural events, including the Joaquin Cortes concert in 2008, a Jazz Festival in Tbilisi in 2009, and in 2010, the first ever Georgian Fashion Week.

We co-sponsored the concert of the Goodwill Ambassador Bryan Adams. His performance in Tbilisi on 19 September 2008 was dedicated to democracy, peace and freedom, and was held in the context of World Peace Day. In March 2011, GPM participated in the organization of a concert by the famous Brazilian Jazz singer, Tanya Marie, all of the proceeds from which went to a charity aiding homeless children.

GPM supported the activities of the International Charity Foundation Iavnana of the famous Georgian opera singer, Paata Burchuladze, which was created under the name ‘Let’s Save the Future.’ The goal of the Fund is to help orphans get adopted by caring families as well as to support poor muti-child families.

GeoProMining plans to continue to support cultural programmes across its respective regions.