Our Corporate Governance

Supervisory Board PKP CARGO S.A.

GRI G4-34, G4-38

Composition of the PKP CARGO S.A. Supervisory Board as at 31 December 2017:

Krzysztof Mamiński – Supervisory Board Chairman temporary discharge of duties of President of the Management Board

Mr. Krzysztof Mamiński has been associated with railways for over 40 years. He is a graduate of the University of Szczecin, where he obtained the degree of Master of Economics. He also completed post-graduate studies in the field of European Management Model in the Kozminski University in Warsaw.

He started working on the railways in 1980, in the IT Center at the Central Regional Directorate of the State Railways (CDOKP) in Warsaw. From 1990, he was a member of the National Committee of the “Solidarity” Trade Union, discharging, among others, the functions of the head of the National Section of Railway Employees of the “Solidarity” Trade Union and the head of the Office of Transport Employees in the union. In 1998-2002 he sat on the Management Board of Polskie Koleje Państwowe, in charge of restructuring and employee relations. From 2001 to 2012, he was President of the Union of Railway Employers, and from 2002 to 2012, he was President of the Management Board of Natura Tour Sp. z o.o., PKP’s subsidiary. From 2012 to 2013 he acted as the PKP S.A. Management Board Representative for Social Dialog in the PKP Group and for the following three years, he was the President of the Management Board of “CS Szkolenie i Doradztwo” Sp. z o.o., a company from the PKP Group. Then, from April 2016, he was President of the Management Board of Przewozy Regionalne Sp. z o.o., and from March 2017, President of the Management Board of PKP S.A. He has been President of the PKP CARGO S.A. Management Board since 26 October 2017.

Mirosław Antonowicz – Supervisory Board Deputy Chairman

Mr. Mirosław Antonowicz has a PhD in economics, specializing in management; he has been associated with the railway sector, including the PKP Group, for many years. Among others, he was a member of the PKP CARGO S.A. Management Board. He also sat on the supervisory boards of several railway companies. From 2006 to 2010, he was the Vice-President of the Office of Rail Transport responsible for market regulation. He is also an academic staff member of the Kozminski University. He was also a Presidium member and expert of the Transport Process and Logistics Team of the Committee on Transport of the Polish Academy of Sciences. He has also completed many post-graduate courses, including Management of Transport Companies at the Warsaw University of Technology and the Post-Graduate Course of European Financial, Economic and Legal Relations at the Warsaw School of Economics. He is an author of numerous publications and papers on management, transport and logistics.

Krzysztof Czarnota - Supervisory Board Member - independent member

Mr. Krzysztof Czarnota completed the Railway Technical School in Skarżysko-Kamienna as a Transportation Technician. Since 1977, he has worked for PKP, including in the Locomotive Depot in Skarżysko-Kamienna, in the Unclassified Station in Skarżysko, in the District Station in Skarżysko, in the Freight Transport Unit in Skarżysko and currently in the Company’s Eastern Unit in Lublin as a dispatcher in charge of the shift.

Since 1992, Mr. Krzysztof Czarnota has served as Chairman of the Independent Trade Union of Railway Workers of PKP Cargo S.A. in Skarżysko-Kamienna. Since the establishment of the Freight and Transshipment Industry Board at the Federation of Trade Unions of Railway Workers, he had served as its Chairman and currently is Vice Chairman of the Cargo Industry Board at the Federation of Trade Unions of Railway Workers. He is a member of the Bureau, the Board and the National Council of the Federation of Trade Unions of Railway Workers.

From the incorporation of the Company, i.e. from 2001 until 29 September 2015, he was a member of the PKP Cargo S.A. Supervisory Board and a representative of all employees of PKP Cargo S.A. as a delegate of the Federation of Trade Unions of Railway Workers.

Zofia Dzik - Supervisory Board Member - independent member

Ms. Zofia Dzik is a graduate of the Kraków University of Economics, University of Illinois in Chicago, University of Social Sciences and Humanities in Warsaw and of the Executive Programs at INSEAD Business School. She holds an MBA title from Manchester Business School and is a certified member of the Association for Project Management (APMP) and a certified member of The John Maxwell Team, a top international organization associating eminent leadership coaches, trainers and speakers.

In the years 1995-2003, she worked for Andersen Business Consulting as a consultant responsible for the insurance sector (Insurance Division Director). From 2003 she was associated with Intouch Insurance Group (RSA Group), where in the years 2004–2007 she performed the function of the President of Towarzystwo Ubezpieczeń LINK4 S.A., whereas in the years 2007–2009 a function of a management board member of Intouch Insurance B.V. in the Netherlands and the CEO for East-Central Europe of Intouch Insurance Group. In that capacity, she was responsible for developing new markets; she was also the chairwoman of the supervisory boards of: TU Link4 S.A. and Direct Insurance Shared Services Center in Poland, Intouch Strachowanie in Russia (a start-up) and Direct Pojistovna in the Czech Republic (a start-up), as well as the deputy chairwoman of the supervisory board of TU na Życie Link4 Life S.A.

In 2006-2008, she served as a management board member of the Polish Insurance Association. In the years 2007–2010 a supervisory board member of the Insurance Guarantee Fund. She also sat on the supervisory boards of: KOPEX S.A. and Polish Energy Partners S.A (PEP S.A.)

Currently, she is the President of the Humanites - Art of Upbringing Foundation, which has the goal of supporting social transformation in Poland and qualitative growth of the young generation, mentor, author of the “Consistent Leadership” model, an 8-stage growth programme for leaders building engaging organizations, director of the Academy for Leaders in Education as well as member of supervisory boards of private and public companies such as: BRW S.A., ERBUD S.A., Benefit Systems S.A. and in the past such as: PKO BP S.A., AmRest SE, PEP S.A.

Raimondo Eggink - Supervisory Board Member - independent member

Since 2002, Mr. Raimondo Eggink has been running an independent business as a consultant and trainer for entities operating in the financial market. At the same time, he has been a member of the Supervisory Boards of the following public and private companies: Zespół Elektrociepłowni Wrocławskich KOGENERACJA S.A. (since 2009), AmRest Holding SE (since 2010), PERŁA – Browary Lubelskie S.A. (2004-2005 and since 2008), Prime Car Management (since 2015), PKP Cargo S.A. (since 2015), Górnośląskie Przedsiębiorstwo Wodociągów S.A. (since 2015) and Suwary S.A. (since 2015).

Prior to that, he was a member of the Supervisory Boards in the following companies: Stomil-Olsztyn S.A. (2002-2003), Giełda Papierów Wartościowych w Warszawie S.A. (2002-2008), Wilbo S.A. (2003-2005), Mostostal Płock S.A. (2003-2006), Swarzędz Meble S.A. (2004-2005), PKN Orlen S.A. (2004-2008), KOFOLA S.A. (2004-2012, previously HOOP S.A.), Zachodni Fundusz Inwestycyjny NFI S.A. (2006), Firma Oponiarska Dębica S.A. (2008-2012), Netia S.A. (2006-2014) and Lubelski Węgiel “Bogdanka” S.A. (2012-2015).

Earlier, he served as Management Board Member, Investment Director, President of the Management Board and, most recently, liquidator of ABN AMRO Asset Management (Polska) S.A., a firm managing the assets of Polish institutional investors and high-net-worth individuals which terminated its business in 2001. He began his professional career in 1995 in the Warsaw branch of ING Bank N.V. where he played a major role in the establishment of Poland’s first asset management firm. In 1995-1997, he served as Vice-President of the Council of Brokers and Advisers, and in 2004-2013, he was a member of the Management Board of the CFA Society of Poland. He is the author of a number of articles on the development of the Polish capital market, especially on the protection of minority shareholders.

Mr. Eggink is a graduate of the Jagiellonian University majoring in theoretical mathematics where in 2010 he obtained his Ph.D. degree. He also holds an investment advisor’s license and is a CFA (Chartered Financial Analyst) Charterholder.

Małgorzata Kryszkiewicz - Supervisory Board Member

Ms. Małgorzata Kryszkiewicz is a graduate of the Finance and Banking Faculty of the Warsaw School of Economics (SGH). She started her professional career in 1995. In subsequent years, she worked in various positions associated with accounting, tax and financial management. From 2002 to 2014, she headed the Accounting Department and the Finance and Accounting Department at PKP S.A. Currently she runs a statutory auditor’s office providing financial revision, advisory and consulting services. Statutory auditor since 2009.

Tadeusz Stachaczyński - Supervisory Board Member

In 1980, Mr. Tadeusz Stachaczyński completed a Railway Technical School specializing in the operation and repair of traction vehicles. In 2010, he graduated in engineering from the Subcarpathian School of Higher Education in Jasło, majoring in transportation and freight forwarding. In 2011, Mr. Stachaczyński completed postgraduate studies in marketing and market research.

Since 1974, Mr. Tadeusz Stachaczyński has been employed by PKP CARGO S.A.’s Southern Division (formerly, PKP’s Locomotive Depot in Jasło). In 1995-2014, Mr. Stachaczyński was a councilor of the Town Council of Jasło where he served in the budget, development and audit committees.

Since 2009, Mr. Tadeusz Stachaczyński has served as Chairman of the Company Council of the Trade Union of Train Drivers at PKP CARGO S.A.’s Southern Division, and since 2013 has been Chairman of the Freight Sector of the Trade Union of Train Drivers.

Mr. Tadeusz Stachaczyński was a member of the Supervisory Board of PKP CARGO S.A. Centrum Logistyczne Medyka-Żurawica Sp. z o.o. in 2011-2013.

Władysław Szczepkowski - Supervisory Board Member

Mr. Władysław Szczepkowski graduated in law from the Faculty of Law and Administration in the Department of Theory of the State and Law of the Nicolaus Copernicus University in Toruń in 1992. From 1992 to 2005, he pursued his career in banking where he was involved in financial analysis and corporate restructuring projects; he also worked for legal departments. From 2005 to 2007, he was the President of the PKP CARGO S.A. Management Board. From 2010 to 2016, he worked for companies of the PGNiG Group. From September 2016 to March 2017, he was employed by Przewozy Regionalne sp. z o.o. Since the beginning of March 2017, he has been working for PKP S.A. as the Director – PKP S.A. Management Board Representative for the Strategy and Organization of the PKP Group. Since 2000, he has been entered in the list of legal counsels.

Czesław Warsewicz - Supervisory Board Member

Mr. Czesław Warsewicz is an economist by education. He graduated from the Management and Marketing Faculty of the Warsaw School of Economics (SGH) and subsequently conducted research at the Postgraduate Doctoral Course of the SGH Strategic Management Faculty. He participated in the first Polish edition of AMP – Advanced Management Program organized by the IESE Business School in Barcelona. A specialist in transportation and management. He has capital market experience gathered in the consulting firms EVIP and CAL where he prepared issue prospectuses for ZML “Kęty”, Cersanit and Hydrobudowa 7.

From 1993 to 1999, he worked for the private sector, including the following companies: Company Assistance Sp. z o.o., Raab Karcher Energieservice Sp. z o.o, EVIP International Sp. z o.o. In 1997, he joined the stock-exchange listed Provimi-Rolimpex S.A. group where he worked for 9 years. In 2006-2009, the President of the Management Board of PKP Intercity S.A. Currently, the President of the Management Board of “Blue Ocean” Business Consulting Sp. z o.o., a strategic consultancy firm specializing in the development of transportation plans for local government units. A member of the Program Committee of the Law and Justice party (PiS) responsible for the preparation of its transportation program, in particular in the area of railway transportation.

Detailed information on the changes in the composition of the PKP CARGO S.A. Supervisory Board in 2017 is provided in section 9.11 of the Consolidated Management Board Report on the Activity of the PKP CARGO Group in the financial year 2017.



Procedure for the appointment and dismissal of persons holding supervisory positions at PKP CARGO S.A.

In accordance with the adopted consolidated version of PKP CARGO S.A.’s Articles of Association (Resolution No. 1682/VI/2017 of the PKP CARGO S.A. Supervisory Board dated 27 June 2017), the Supervisory Board consists of 11 to 13 members (including the Supervisory Board Chairperson and Deputy Chairperson) appointed for a joint term of office. The Supervisory Board is appointed and dismissed by the Shareholder Meeting, subject to the provisions of § 19 Sections 2 and 3 of the Articles of Association of PKP CARGO S.A.

PKP S.A. is authorized to appoint and dismiss Supervisory Board Members in a number equal to half the composition of the Supervisory Board. At least one of the Supervisory Board members appointed by PKP S.A. satisfies the conditions of independence within the meaning of Article 86 Section 5 of the Act of 7 May 2009 on statutory auditors and their self-government authority, entities authorized to audit financial statements and public supervision (Journal of Laws No. 77, Item 649, as amended) and has qualifications in the field of accounting or financial auditing.

The Company’s employees are entitled to appoint and dismiss three employee representatives to the Supervisory Board. The rules and regulations for running elections for candidates to become an employee representative in the PKP CARGO S.A. Management Board and to appoint employee representatives to the PKP CARGO S.A. Supervisory Board and the procedure for their removal were adopted by the Supervisory Board with Resolution No. 1530/V/2016 on 30 March 2016. A failure to elect the Supervisory Board members representing the employees does not prevent the Supervisory Board from being appointed or from adopting effective resolutions.

Powers of the Supervisory Board

The Supervisory Board exercises permanent supervision over the Company’s operations in all areas of its activity. Moreover, its powers, in addition to matters reserved by the Commercial Company Code or other statutes, include selecting and changing the entity authorized to audit the Company’s financial statements and to review the Company’s accounting records, granting consent for the payment of an interim dividend by the Management Board towards the anticipated end-of-the-year dividend, appointing and dismissing the President and other Members of the Management Board, setting the number of Management Board Members, granting consent for the establishment or liquidation of the Company’s branch, issuing opinions on proposals submitted by the Management Board to the Shareholder Meeting.

Operation of the Supervisory Board

The procedure of the Supervisory Board’s operation is described in detail in the Supervisory Board Bylaws adopted by the Supervisory Board. In accordance with the provisions of these Bylaws, the Supervisory Board makes decisions in the form of resolutions. For Supervisory Board resolutions to be valid, all the Supervisory Board members must have been invited and at least half of them must be present, including the Supervisory Board Chairperson. Resolutions of the Supervisory Board are adopted by an absolute majority of votes. If an equal number of votes is cast “for” and “against”, the latter including abstentions, the Supervisory Board Chairperson has the casting vote. Supervisory Board resolutions in the matter of suspension of Management Board members or Management Board require the consent of the Supervisory Board Chairperson. Supervisory Board resolutions may also be adopted without holding a meeting, except for resolutions pertaining to the election of the Supervisory Board Chairperson or Deputy Chairperson, the appointment of a Management Board member and the dismissal or suspension of these persons in their duties. The Supervisory Board holds its meetings no less frequently than once every two months.

Conflict of interest

In accordance with the Bylaws of the Supervisory Board, in the event of conflicting interests of the Company and personal interests of a Supervisory Board member, his/her spouse, family or relatives (to the second degree next of kin) and personal relations, the Supervisory Board member should refrain from participating in the discussion and voting on the resolution of such matters and request that this fact be recorded in the minutes of the Supervisory Board meeting.

Independence criteria for Supervisory Board members

Independent PKP CARGO S.A. Supervisory Board Members satisfy the independence criteria for Supervisory Board Members defined by the European Commission in Annex II to the Commission Recommendation of 15 February 2005 on the role of non-executive or supervisory directors of listed companies and on the committees of the (supervisory) board (EU OJ L 05.52.51) and additional requirements specified in the “Good Practices of Companies Listed on the WSE” constituting an attachment to Resolution No. 26/1413/2015 of the WSE Supervisory Board of 13 October 2015.

Supervisory board committee

supervisory Board AUDit committee

The PKP CARGO S.A. Audit Committee is appointed by the PKP CARGO S.A. Supervisory Board. It consists of at least three Supervisory Board members, provided that the majority of the Committee members meet the independence criteria and are appointed in the manner specified in § 20 and 21 of the Company’s Articles of Association.  At least one member of the Audit Committee must have qualifications in the area of accounting or audit of financial statements and at least one member of the Audit Committee must have knowledge and skills in the specific industry in which the Company operates.Committee members are appointed for a term corresponding to the Supervisory Board’s term of office. Tasks of the Audit Committee include in particular: oversight of the organizational unit responsible for internal audit, monitoring the financial reporting process, monitoring the performance of internal control systems, risk management and internal audit systems, including the area of financial reporting, monitoring financial review activities, monitoring the independence of the statutory auditor and the entity authorized to audit financial statements, also when it provides to the Company other services than financial review, assessing the independence of a statutory auditor and giving consent for it to provide permitted auditing services, recommending an entity authorized to audit financial statements to the Supervisory Board to perform financial review activities for the Company, in compliance with the policies in force in the Company.

Composition of the Audit Committee of the PKP CARGO S.A. Supervisory Board as at 31 December 2017: Raimondo Eggink, Małgorzata Kryszkiewicz, Zofia Dzik.

Detailed information on the composition of committees of the PKP CARGO S.A. Supervisory Board and its changes in 2017 is provided in Chapter 9.11 of the Consolidated Management Board Report on the Activity of the PKP CARGO Group in the financial year 2017.

NOMINAtion Committee

The PKP CARGO S.A. Supervisory Board appoints Nomination Committee. It consists of three Supervisory Board Members, of whom at least one Supervisory Board Member must satisfy the independence criteria and be appointed in the manner provided for in § 20 and 21 of the Company’s Articles of Association, to discharge the function of Committee Chairman. Committee members are appointed for a term corresponding to the Supervisory Board’s term of office. The Nomination Committee organizes and exercises ongoing oversight of the recruitment procedure for the positions of the Company’s Management Board members and of the process of assessment and appointment of the Company’s Management Board members, and supports the attainment of the Company’s strategic objectives by presenting opinions and suggestions to the Supervisory Board pertaining to the employment structure and compensation for the Company’s employees, including in particular the Company’s Management Board Members and upper level management.

Composition of the Nomination Committee as at 31 December 2017: Zofia Dzik, Mirosław Antonowicz, Władysław Szczepkowski.

Detailed information on the composition of committees of the PKP CARGO S.A. Supervisory Board and its changes in 2017 is provided in Chapter 9.11 of the Consolidated Management Board Report on the Activity of the PKP CARGO Group in the financial year 2017.

STRATEGIC Committee

The Strategic Committee is appointed by the PKP CARGO S.A. Supervisory Board. It consists of at least three Supervisory Board members, of whom at least one Supervisory Board Member must satisfy the independence criteria and be appointed in the manner provided for in § 20 and 21 of the Company’s Articles of Association. Committee members are appointed for a term corresponding to the Supervisory Board’s term of office. The Strategic Committee supports the Supervisory Board in the oversight over the definition of the strategy as well as the appropriate implementation of the strategy and annual and long-term activity plans for the Company and its Group.

Composition of the Strategic Committee as at 31 December 2017: Czesław Warsewicz, Raimondo Eggink, Mirosław Antonowicz.

Detailed information on the composition of committees of the PKP CARGO S.A. Supervisory Board and its changes in 2017 is provided in Chapter 9.11 of the Consolidated Management Board Report on the Activity of the PKP CARGO Group in the financial year 2017.