Risk management system of AlES JSC

The risk management system of AlES JSC is an integral part of corporate governance and is aimed at ensuring sustainable development, financial stability and maintaining the Company’s business reputation. Risk management is carried out in accordance with the principles of sustainable development.

In order to organize risk-oriented management, respond promptly to changes in the external and internal environment, and reduce potential losses when risks materialize, the Company has implemented and is improving a corporate risk management system that includes the appointment of a risk coordinator and special committees. Those responsible for risk management, members of the Committee and risk coordinators ensure the implementation of risk management procedures and methods, regular updating of risk information, updating and documentation of data, as well as the development of internal regulatory documents on risk management.

The Company’s Board of Directors has approved a consolidated register, a risk map, and quarterly reports on key risk management with a description and analysis of key risks. In order to apply a risk-oriented approach, the Company’s Board of Directors has approved a risk appetite, which is divided into three types of activities: investment, financial and operational.

When identifying risks, the Company relies on expert assessments, statistical data, a database of losses incurred, the results of audits and other checks, etc. Identified risks are entered into the Company’s risk register and risk map for subsequent assessment, management and monitoring. The risks included in the risk register and map are regularly (annually) reviewed to determine their relevance and materiality.

In accordance with its Risk Management Policy, the Company identifies the following risks: strategic, operational, financial and legal.

Cases of a slowdown in the economic growth of the Republic of Kazakhstan, a weakening of the national currency, changes in the structure of the electricity market and tariff optimization have a key impact on the Company’s operating conditions. At the same time, support from the state and the sole shareholder provides opportunities for development and increased competitiveness in the domestic market. Thus, based on the results of the work carried out to identify risks for AlES JSC for 2026, 37 risks inherent in the Company’s activities were identified and assessed, the efficiency threshold values were updated, and the risk factors and measures to reduce them were updated by the risk owners. The Company also understands the high significance of the problems of global warming, climate change and the transition to a low-carbon economy, which is why in 2026, climate physical risks and climate transition risks remain in the risk register in the category of strategic risks.