Norilsk Nickel Corporate Governance

Università Commerciale luigi bocconi |

MMC Norilsk Nickel Russia |

Corporate Governance (a.y. 2012/2013) |

Cod. 20123 |

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Antonio Mercurio 1239284

ABSTRACT

The Research examines the History and evolution of a Russian company considered strategic to the Russian government, Norilsk Nickel. The study outlines how the Corporate Governance practices of the company have been influenced by the Russian economic model, underlying the areas where the governance is particularly weak. The main results show: strong involvement of the government in the management and ownership of the company; fault of the traditional corporate governance mechanisms such as independence of the supervisory board, and separation between ownership and control; the typical agency problem form characterizing highly concentrated ownership structures with limited safeguard of minority shareholders; presence of control enhancing mechanisms.

Contents

MMC NORILSK NICKEL 1

The Privatization 3

THE CONTEXT 4

OBJECTIVES, STRATEGIES AND PERFORMANCE 6

THE OWNERSHIP 13

The Years From 1999 To 2006 14

American Depositary receipts 15

The Years From 2007 to 2012 15

Recent Developments 17

CORPORATE GOVERNANCE 17

CONCLUSIONS 22

BIBLIOGRAPHY 24

MMC NORILSK NICKEL

MMC “Mining and Metallurgical Company” Norilsk Nickel is a Russian mining and smelting company. It is headquartered in Moscow and is the world's leading producer of nickel and palladium and it is ranked among the world’s top ten copper producers. Its products’ portfolio also comprises platinum, cobalt, chromium, rhodium, silver, gold, iridium, ruthenium, selenium, tellurium and sulfur.

The Group is characterized by a strong vertically integrated business model. In addition to operating assets, the Company possesses sales and marketing network in the major regions of the world, energy assets ensuring the security of energy supply to the Company’s operations and proprietary research and development...