OMV PETROL OFİSİ A.Ş CORPORATE GOVERNANCE COMPLIANCE REPORT

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2 OMV PETROL OFİSİ A.Ş CORPORATE GOVERNANCE COMPLIANCE REPORT

3 Corporate Governance Compliance Report OMV PETROL OFİSİ A.Ş. CORPORATE GOVERNANCE COMPLIANCE REPORT 1. Statement of Compliance with Corporate Governance Principles Our company OMV Petrol Ofisi A.Ş. fully complies with all compulsory principles stipulated in Communiqué on Identification and Implementation of the Corporate Governance Principles with Serial Number: IV and Number: 56, published by Capital Market Board. Also the Company substantially complies with the non-compulsory principles. The company will take required actions in order to achieve full compliance with respect to future legislative amendments and applications. During the year 2013, independent Board of Directors members were appointed. The charters of the Audit Committee, the Corporate Governance Committee and Early Recognition of Risk Committee were revised in accordance with the current legislation and they commenced their operations effectively. The announcement of the General Assembly Meeting was made 3 weeks before the meeting and all information, documents and reports required to be prepared were provided to the investors. Also the website of our Company was revised in order to achieve full compliance with the Corporate Governance principles. CHAPTER 1 - SHAREHOLDERS 2. Investor Relations Department Our Company, performing all obligations scrupulously with respect to protection of shareholders rights as a principle within the scope of our Articles of Association and relevant legislation, embodies an Investor Relations Department (contact address: yatirimciiliskileri@poas.com.tr) in order to respond correctly, accurately and in time to shareholders queries. Pursuant to the principles of equality, transparency, accountability and responsibility, this department responds to all queries except for queries that relate to commercial secrets. The continuous communication between the Management and the shareholder is ensured in this way. The department additionally sends reports to the top management. Capital Markets Manager Alper Yücel (alpery@poas. com.tr / ) and Investor Relations Coordinator Alper Gür (alperg@poas.com.tr / ) are working in this department. The main functions of the department are as follows: to respond to all written and verbal information requests of the shareholders regarding the Company, within the scope of the relevant legislation, except where undisclosed information and trade secrets are involved, to ensure the maintenance of accurate, safe and up-to-date records regarding the shareholders, to ensure that General Assemblies are held in conformity with the applicable legislation and the Articles of Association, to keep available all documents required at the General Assembly meetings, to keep records of General Assembly meetings results and to convey these results to the shareholders upon their requests, to monitor all matters pertaining to public disclosures, including legislation and the Company s Information Policy. In year 2013, 18 shareholders contacted us in order obtain information regarding various subjects. 3. Exercise of Shareholders Right to Obtain Information In order to ensure the exercise of shareholders rights to obtain information, all information which does not relate to trade secrets is announced in national newspapers within the scope of the applicable legislation and also announced to the Public Disclosure Platform via material disclosures within the scope of the Capital Markets Board communiqué. All shareholders are treated equally and no discrimination was made with respect to the exercise of their right to obtain and review information. Therefore, such matters mentioned above are publicly available on the company s website In order to ensure efficient and up-to-date exercise of shareholders rights to obtain information, our Company, provides a separate section under Investor Relations on our website, which is constantly updated. Minority shareholders right to request a special auditor s appointment from the General Assembly is regulated within the scope of the legislation. There is no diverging provision in our Company s Articles of Association regarding special auditor appointment. The appointment of a special auditor was requested during the Ordinary General Assembly Meeting pertaining to the year 2012 dated 16 May 2013, in order to determine the reasons of the fine imposed with respect to our Company s Samsun Terminal, and the contradiction between the Board of Directors resolution regarding the delisting of the Company and thereafter its waiver (potential market misleading 58 I OMV Petrol Ofisi Annual Report 2013 I Corporate Governance Compliance Report

4 Operations in 2013 I Financial Highlights I Corporate Governance I Independent Auditor s Report actions), however this request was denied as a result of voting. 4. General Assembly Meetings The Ordinary General Assembly Meeting was held on May 16, The quorum achieved in this meeting was 97%. All announcements related to the General Assembly were made 21 days before the General Assembly Meeting. Also, statements regarding agenda, the financial statements, the annual report, the board of auditors report, information regarding related party s common and continued transactions, the proposed amendment deed of the Articles of Association, form of power of attorney and the donation and payment policies were made available to all shareholders on the Company s website 21 days before the meeting. The shareholders, Board of Directors members, Company employees and the representatives of the independent audit firm attended the General Assembly Meeting. However, no other stakeholders or media did attend the meeting. One of the shareholders requested from our Company s Investor Relations Department to add items regarding Company s buy back of its own shares from the Stock Exchange and Delisting of the Company to the agenda of the General Assembly Meeting by written application. However, due to the reason that there is no Board of Directors - resolution regarding delisting and buy back process, these requests were not added to the agenda and the reasoning of such situation was submitted for shareholders information during the General Assembly. The matters stated in the agenda are presented in an objective, detailed, clear and concise manner so as to be easily understood by shareholders, with the opportunity to voice their opinions and ask their queries, and an efficient discussion platform is established. All of the queries asked by the shareholders, who attended the meeting regardless of whether or not on the agenda, were answered, and all of the queries, responses, opinions and annotations were recorded in the meeting minutes. The List of Attendees and the Meeting Minutes were disclosed in the Public Disclosure Platform. Information regarding the amount of donations and their beneficiaries in 2013 were given to the shareholders in a separate agenda topic in the General Assembly Meeting. 5. Voting Rights and Minority Rights The Company refrains from practices that complicate the exercise of the voting rights and ensures that each shareholder can vote in the most practical way. Pursuant to the Company s Articles of Association, each share grants one voting right. There are no privileges regarding voting rights. There is no provision in our Articles of Association that prevents non-shareholders from voting by proxy as representative of a shareholder. 6. Dividend Rights No privileged dividend right exists in the Articles of Association. The Dividend Distribution Policy of the Company, available on the Company website, is as follows: The dividends shall be distributed to the shareholders in cash and/or by way of bonus share distribution within the scope of the applicable legislation and General Assembly resolutions pursuant to financial markets main economic indicators, and to the extent that allows the Company s financial structure optimization. In year 2013, no profit distribution was made to the shareholders due to the financial needs of the Company. 7. Transfer of Shares There is no provision in Company s Articles of Association that impedes transfer of shares. All shareholders including minority and foreign shareholders are treated equally. CHAPTER II - PUBLIC DISCLOSURE AND TRANSPARENCY 8. Information Policy Our Company s Information Policy is executed in accordance with matters set out within the scope of the Capital Market Legislation, Capital Market Board Decisions and other relevant legislation. In this scope the disclosures are made properly and on time to the public. The Information Policy is available on our Company s website. The top management is responsible for carrying out the Information policy of the Company. 9. Company Website and its Content The official website of OMV Petrol Ofisi A.Ş. can be accessed via The website is available in both in Turkish and English. Corporate Governance Compliance Report I OMV Petrol Ofisi Annual Report 2013 I 59

5 The website includes information on the shareholder and management structure, the Articles of Association, the annual reports, financial statements, the trade registry data, contact information, product information, corporate governance principles, compliance reports, special situation statements, the agendas, list of attendees and meeting minutes regarding the general assembly meetings, updated Company presentations, and information regarding policies and committees. 10. Annual Report The Company s Annual Report is prepared in both Turkish and English and it includes all relevant accurate and correct information with respect to the Company s activities within the scope of the Corporate Governance Principles and other regulations. CHAPTER III - STAKEHOLDERS 11. Informing Stakeholders Company personnel have access to the circulars and announcements through the intranet portal of the Company and important announcements are also delivered to all employees through . Employees and senior managers of the Company convene periodically and evaluate the progress and objectives in the course of the relevant year and exchange ideas. Meetings between the Executive Board of our Company and the employees of our Company were held where the previous year s evaluations and the targets of the current year were discussed. Messages from the Management, corporate activities, social announcements and any other information for the purpose of sharing are announced to all our employees through the Communication Boards located at the Head Office, terminals, regional offices, storage facilities and aviation directorates. Information on important developments related to the Company is provided to our stakeholders through visual and written press and other media instruments such as Internet, the Public Disclosure Platform and press conferences. Our stakeholders can easily access all information pertaining to the Company and its shares through the written press and Material Disclosures made to the Public Disclosure Platform, by contacting the Investor Relations Department or calling the Alo Takas and Alo MKK lines. Stakeholders of the Company, investors and analysts may easily access the Company s financial statements, activity reports and any presentation regarding the Company on the website of the Company or by calling the Investment Relations Department. Besides, regional dealer meetings are being held regarding new products and services. Our Customer Services Unit provides assistance for all kinds of matters to customers who can reach us through various channels, such as the toll-free consulting lines at (free of charge) and (for cell phones), and via the Internet. 12. Stakeholders Participation in Management Meetings with the Company s employees are being held and the feedbacks from these meetings can help in the decision making process of the Company management. The expectations and requests of the Company s stakeholders are evaluated carefully and any problems are being solved by proper communication. 13. Human Resources Policy As OMV Petrol Ofisi s motto is Our most valuable resource is our employees, in order to achieve its goals OMV Petrol Ofisi adopts an approach based on consistent and sustainable relationship with its employees. The Company s human resources policy is based on developing a team of employees which is innovative, creative, dynamic, open to changes, customer oriented, and environmentally friendly and adds value, and corresponding systems and processes to increase the productivity of such a team. The human resources policy does not discriminate people due to their race, ethnic origin, nationality, religion or sex; it gives same chances to people on equal terms and creates a healthy and safe environment for its employees and gives opportunities to develop their careers. Job descriptions and performance criteria are defined and announced to the employees. Decisions for training, appointments and promotions are taken diligently by consulting objective data and considering corporate interests. There is a great emphasis on providing training to develop both professional knowledge and the capabilities and personal talents of our employees. The Company s work environment is designed to maximize safety and efficiency. The Company did 60 I OMV Petrol Ofisi Annual Report 2013 I Corporate Governance Compliance Report

6 Operations in 2013 I Financial Highlights I Corporate Governance I Independent Auditor s Report not appoint any special delegate for communication with our employees. No complaints regarding discrimination issues have been received from any employee in Ethical Rules and Social Responsibility OMV Petrol Ofisi values generally accepted ethical rules and commercial customs, and pays attention to ensure that all employees abide by these rules in their relationships with the stakeholders. The ethical rules of our Company are announced to the public by publishing it on the Company s official website. OMV Petrol Ofisi gives great importance to corporate social responsibility projects related to the dynamics and social needs of the society, in addition to supporting the formation of teams in order for the employees to realize their individual willingness under the corporate identity. OMV Petrol Ofisi s social responsibility efforts are based on environmental, social and economic sustainability. Under the framework of its sustainability program Resourcefulness, OMV Petrol Ofisi conducts projects for both helping the environment and the society in addition to activities for better management of natural resources and efficient use of energy with innovative solutions. A pioneer in many fields throughout its 73 years of history, OMV Petrol Ofisi has strived to raise public awareness on energy efficiency by developing environmentally friendly products. OMV Petrol Ofisi believes that the process of awareness raising can be accelerated by educational activities. OMV Petrol Ofisi builds on its long-established history, and continues to support governments with its community-oriented activities and social responsibility projects. CHAPTER IV BOARD OF DIRECTORS 15. The Structure and Composition of the Board of Directors The Board of Directors of our Company consists of at least 6 (six) and a maximum of 12 (twelve) members elected by the General Assembly. In case there is a vacancy in the Board of Directors memberships, or in case an Independent Board member loses its independency, the vacancy shall be filled by an election conducted pursuant to the relevant article of the Turkish Commercial Code and the CMB regulations. The essential qualifications for a Board member are in accordance with the criteria provided in the Corporate Governance Principles of CMB. Currently, there are 2 independent board members who fully correspond to the independency criteria of CMB. The independent members submitted their written independency to the Company. 16. Operating Principles of the Board of Directors The agendas of the Board of Directors meetings shall be determined in accordance with the requirements of our Company s needs, as well as economic developments in the country and in the world. The BOARD OF DIRECTORS Name Surmane Title Current Positions Held Outside the Company Gerhard Roiss Chairman OMV Aktiengesellschaft CEO David C. Davies Vice Chairman OMV Aktiengesellschaft CFO Manfred Leitner BoD Member OMV Aktiengesellschaft Member of Executive Board Stefan Waldner BoD Member OMV Aktiengesellschaft Member of Executive Board Jaap Huijskes BoD Member OMV Aktiengesellschaft Member of Executive Board Hans Peter Floren BoD Member OMV Aktiengesellschaft Member of Executive Board Tulu Gümüştekin Terzioğlu BoD Member CPS Advisory CEO Gülsüm Azeri BoD Member - CEO İzocam Tic. San. A.Ş. Independent BoD Member; Mondi Tire Kutsan Kâğıt ve Ambalaj San. A.Ş. Independent BoD Member Clive Mark Hyman Independent BoD Member Hyman Capital Services Limited UK Chairman Haluk Kaya Independent BoD Member Bosch Ev Aletleri A.Ş. Member of Executive Board Corporate Governance Compliance Report I OMV Petrol Ofisi Annual Report 2013 I 61

7 Board of Directors shall meet once every 3 months and in any case when the Company business necessitates. The agenda of the meeting and other documents are sent to the members of the Board of Directors, at least one week prior to the meeting date. The meeting quorum for the meetings of the Board of Directors shall be attained through and make decisions with the quorums set forth in the Articles of Association. Each member has only one vote and members of the Board of Directors have equal voting rights. There is a Board of Directors Secretariat established to determine the methods of preparing the agenda for Board of Directors meetings, to decide on the number of meetings to be held in a period as well as the methods and processes related to participation and announcements during the period, and to provide information and maintain communications with the members of the Board of Directors on all matters. No counter votes have been cast in any of the Board of Directors meetings held in Pursuant to Article 367 of the Turkish Commercial Code and the Company s Articles of Association, the Board of Directors is entitled to delegate some or all of its managerial and representational authorities to one or several members; or jointly to one member and a non- executive member, such as to the General Manager or one or more managers. The Board of Directors is also entitled to form internal or external committees in order to exercise its duties and authorities. There is no related party transaction or material transaction that was not approved by the independent members of the Board of Directors in Number, Organization and Independence of Board Committees In our Company, an Audit Committee, a Corporate Governance Committee and an Early Recognition of Risk Committee were established in line with the legislation and their charters were published on our website. Corporate Governance Committee The Committee s duty is to monitor the Company s compliance with the capital market legislation and the Corporate Governance Principles set forth in the same legislation, in order to conduct improvement studies and to submit proposals to the Board of Directors. The Committee shall also fulfill the duties of the Nomination Committee and the Remuneration Committee according to the legislation of 2012 in force. The Committee shall be established and authorized by the Board of Directors. The Committee shall consist of at least two members. The Chairman of the Committee shall be elected amongst the independent members of the board of directors. The Committee shall convene at least four times a year. Resolutions passed at the Committee meetings shall be in writing. Haluk KAYA Clive Mark HYMAN David C. DAVIES Manfred LEITNER Chairman of the Corporate Governance Committee Member of the Corporate Governance Committee Member of the Corporate Governance Committee Member of the Corporate Governance Committee Audit Committee In our Company the Audit Committee is established to monitor the implementation of the reporting systems in accordance with applicable law and regulations, the disclosure of financial statements, the implementation and effectiveness of independent audit and internal control systems. The Audit Committee will convene at least four times a year, or more if required. The Chairman and the members of the Committee shall be elected amongst the independent members of the board of directors. The Committee shall be established and authorized by the Board of Directors. All related party transactions are regularly reported to the Audit Committee. Clive Mark HYMAN Haluk KAYA Chairman of the Audit Committee Member of the Audit Committee Early Recognition of Risk Committee The Committee shall conduct studies for the early detection of risks that may jeopardize the existence, development and continuity of the Company, for the implementation of the necessary precautions for the detected risks, review the risk management systems, examine the financial statements and audit the investment plans, risks thereof and the expenditures. 62 I OMV Petrol Ofisi Annual Report 2013 I Corporate Governance Compliance Report

8 Operations in 2013 I Financial Highlights I Corporate Governance I Independent Auditor s Report Haluk KAYA Chairman of the Early Recognition of Risk Committee Clive Mark HYMAN Member of the Early Recognition of Risk Committee David C. DAVIES Member of the Early Recognition of Risk Committee Manfred LEITNER Member of the Early Recognition of Risk Committee 18. Risk Management and Internal Control Mechanism Activities regarding risk management and internal control in the Company are conducted by the Internal Audit, Risk Management, Financial Control Management and Operational Control Directorates. The Audit Committee examines the reports including detailed information on the aforementioned activities, which are issued by such directorates and ensure that the essential issues in these reports are to be discussed by the Board of Directors of the Company. The Risk Management Department aims to (i) describe and evaluate any risks which may affect the objectives of the Company, (ii) establish any system required for the Management of the Company in accordance with the policies determined by the Board of Directors, and (iii) take all necessary actions accordingly. In this respect, the risk management process and any liabilities arisen out of this process were described and regular monitoring and reporting proceedings were initiated. The analysis results are taken into account for the establishment of strategic processes and determination of audit requirements in order to provide the efficiency of risk assessment in the decision-making processes. The Internal Audit Department analyses the processes to ensure the compliance of such activities with any rules and regulations, to increase the efficiency thereof; and provides solutions regarding the efficiency of the risk management system. The regular annual risk-oriented audit program of the Company, drafted upon the assessment regarding the results of the risk analysis, is used to evaluate the efficiency of the internal control and risk management process and to follow relevant corrective actions related to the findings. process after having simultaneously assessed the Company s activities with respect to the valid rules and determined measures. 19. Strategic Targets of the Company OMV Petrol Ofisi A.Ş. conducts its business by aiming to preserve its profit-oriented sector leadership. In this respect, the Company develops systems to provide continuous improvement and business excellence and configures human resources accordingly. Studies conducted by the Company management regarding the establishment and implementations of the strategic targets are submitted to the Board of Directors. The Board of Directors evaluates whether the targets are met and reviews the detailed reports regarding activity results and performance of the Company. The current status of the Company is reviewed in the Board of Directors meetings, which have been convening periodically and frequently, as well as new targets and strategies that are developed therein. 20. Remuneration Rights, benefits and salaries of Board members are determined by the Company s General Assembly. Furthermore, the remuneration of senior managers are disclosed to the public in the footnotes included in the financial statements. The total remuneration for the year 2013 amounts to TRY 10,098,000. The Remuneration Policy was introduced to the shareholders in the General Assembly and also disclosed on the website. In the 2013 Ordinary General Assembly Meeting, the compensation for Clive Mark Hyman and Haluk Kaya as independent Board members was set as EUR 2,500 per month (gross) and TRY 5,000 per month (gross) for the other Board members. Neither stock options nor payments based on the performance of the Company are used for the remuneration of the independent Board members. In 2013, no dividends were paid to Board members. The Company does not give any loan or credit or warranty to the Board of Directors members and managers, neither directly nor through third parties. Operational Control and Financial Control Directorates follow the developments in the legislation, coordinate the compliance process of all of the Company s activities with such amendments and submit proposals regarding change in the Corporate Governance Compliance Report I OMV Petrol Ofisi Annual Report 2013 I 63