Compliance Service
KMG conducts its business in a fair and ethical manner, always guided by the principle of legitimacy. We strictly comply with all applicable laws and regulations, take all steps to prevent corruption, care about business reputation, and seek to implement high international standards of ethics.
KMG’s compliance system helps make sure all our operations are aligned with the laws, industry standards, and other regulatory requirements. Components of the compliance system are integrated into all aspects of our operations.
The key areas of focus for KMG’s Compliance Service are:
- anti‑corruption;
- regulatory compliance and adherence to the standard norms of corporate and business ethics;
- insider information management;
- business reputation management;
- management of conflicts of interest.
In line with best global practices of corporate governance, KMG has the following internal documents on compliance:
- Anti‑Corruption Policy;
- Confidential Informing Policy;
- Conflict of Interest Management Policy;
- Counterparty Due Diligence Policy;
- Internal Control Rules for Granting Access Rights to Insider Information and Preventing Information Misuse by Insiders;
- Code of Business Ethics.
In order to meet the standards of business conduct and ethics, the Compliance Service carries out due diligence of KMG’s counterparties. This practice helps prevent signing contracts with those acting in bad faith while also reducing the risks of contractual violations.
The Compliance Service also screens candidates nominated to fill vacancies related to administrative and organisational functions. This is a way to enable the reliability and professionalism of the Company’s management by reducing the possibility of corruption by highly ranked officers. One of the hiring criteria for new employees in the area of procurement is to successfully pass psychology and polygraph (lie detector) tests.
An important anti‑corruption effort at KMG Group is internal analysis of corruption risks. Based on analysis results, we adopt action plans to eliminate root causes and conditions conducive to corruption.
Since 2020, the Company requires employees across the board to declare any conflicts of interest. This contributes to the efficiency of conflict of interest management.
Since KMG’s securities are listed and traded on stock exchanges, the Compliance Service takes steps to prevent insider information misuse by those classified as insiders under the laws of Kazakhstan.
Reporting tools
In order to quickly identify violations, prevent any negative implications, ensure compliance with applicable laws and internal regulation, maintain strong business reputation and public perception, and foster corporate culture, Samruk‑Kazyna Group, including KMG and its subsidiaries and associates, have a centralised hotline in place operated by KPMG, an independent auditor.
Using the hotline, employees can anonymously report known facts of corruption, fraud, discrimination, and any other violations committed by employees and counterparties of KMG and its subsidiaries and associates.
The hotline contacts are available on the websites of KMG and its subsidiaries and associates, with measures taken to raise employee awareness about it.
In 2023, the number of whistleblowing reports via the hotline went up by 23% year‑on‑year, demonstrating the success of KMG’s measures to prevent corruption.
We are aware of the importance of fostering whistleblowing channels as the key sources of information about threatened or actual violations. It is our belief that in order for people to trust whistleblowing tools, all reports so received need to be considered comprehensively, in full, and without any bias.
Compliance training and professional development
As an entity engaged in anti‑corruption efforts, KMG closely monitors anti‑corruption initiatives in Kazakhstan. Aware of the importance of anti‑corruption, we aim to instil respective culture in our employees.
To that end, we provide anti‑corruption training and make sure it is continuous, consistent and up‑to‑date. To increase anti‑corruption awareness of the employees of KMG and its subsidiaries and associates, compliance functions and officers across KMG Group hold regular meetings and seminars with executives and employees, covering enforcement of Kazakhstan’s anti‑corruption laws. Some of the events are attended by officials of the state‑run Anti‑Corruption Agency.
In 2023, KMG’s Compliance Service, with support from the Anti‑Corruption Agency, organised a seminar on effective anti‑corruption efforts.
The Compliance Service also provided employee training in conflicts of interest. This contributes to the efficiency of conflict of interest management and helps define the requirements for employee conduct to minimise the risks of decision‑making affected by personal interests and connections.
The Compliance Service supports the development of professional competencies and expertise of KMG Group’s compliance officers. Today, KMG’s compliance teams include seasoned professionals certified by international and national compliance organisations.
KMG is committed to high corporate responsibility standards, legitimacy, and impeccable business reputation. The compliance system is a key tool in all regulatory compliance efforts, including compliance with laws and regulations, industry standards, or ethical principles. The variety of activities that KMG is engaged in, including anti‑corruption, management of conflicts of interest, and adherence to internal control standards, is a testament to the Company’s comprehensive approach to strong governance and transparency of its operations.