7.1. Address on Behalf of the Board of Directors on the Corporate Governance Performance in the Reporting Year

Dear shareholders, investors and partners!

Transneft is constantly improving its corporate governance practices, both at the level of the Company itself and at Transneft subsidiaries.

Last year, corporate governance was focused on relations with shareholders and investors. In order to provide them with complete, relevant and transparent information about the Company, in March 2019, a special business unit for interaction with investors and shareholders was established. This allowed us to establish a regular dialogue with shareholders and investors: Transneft’s financial results were covered at meetings with the management of the Company and during telephone conferences, at target meetings with investors in Moscow and in key financial centres of foreign countries with the highest concentration of institutional investors.

Great attention was paid to the principles of transparency and openness: in 2019, the Company had its own Corporate Governance Code and the Regulations on Information Preparation and Disclosure approved.

To further improve the internal control system, the Anti-Corruption Policy and the Regulations on Internal Audit were updated, external assessment of the quality of internal audit was carried out.

In 2020, we intend to further improve the corporate governance system of Transneft: external assessment of the Company’s Risk Management System will be carried out, and internal documents in the field of insider information protection will be updated.