Promoting chess throughout society
One of the strategic objectives of the Kazakhstan Chess Federation (KCF) is to build strong and long-term partnerships with relevant government offices in our country in order to promote chess throughout our society. We see this not as a one-sided story, but a win-win story where everyone considers each other's interests as we all strive to achieve our respective goals.
Over the past year, we have made great progress in this area. I am very pleased to report that The Comprehensive Chess Development Plan for the Republic of Kazakhstan was adopted by the government and that at the direction of our President, Kassym-Jomart Tokayev , the chess-in-education project is currently being implemented. In addition, we are now holding numerous tournaments around the country that encourages diplomats, government officials, and successful business people to become involved the chess universe, making holding or participating in a chess tournament not just fashionable, but a new mainstream for Kazakhstani HR in the corporate world.
Perhaps one of the better examples of our success in this area is our recent Senat Open Chess Tournament. The tournament was launched in April of this year with the personal support of the Chairperson of the Senate of the Parliament of Kazakhstan, Maulen Ashimbayev, and its main objective was to hold a tournament among deputies of maslikhats (locally elected government officials) of all levels, as well as public figures and journalists, under the auspices of the Chamber of Parliament. On August 31st, the final took place in Astana, in which 130 people from all regions participated.
The Senat Open helped us to activate the chess agenda at a very local level where 220 out of 226 maslikhats were involved in the project and more than 2000 people took part in the tournament. In many of the regions represented, it allowed us to strengthen the interaction between our KCF branches and local authorities, and in several regions where the Comprehensive Chess Development Plans were signed, decisions were made to increase funding for chess sports.
On August 31st, in addition to participating in the official ceremony of opening, Chairman Ashimbayev held a meeting with the chairmen of maslikhats, where they discussed issues of further supporting chess in their regions and the wider involvement of deputies and the public in the process. This was a very constructive and important meeting for all participants in Kazakhstani chess and I want to extend a special thanks to the vice president of the KCF, Alexander Babenko, for his tremendous work in organizing the tournament over the past four months!
I have a dream.
I have a dream.
I think that to live in harmony in a country among diversified people who have similar peaceful goals and aspirations, who can laugh at the same jokes, speak the same language, and whose human-being values are close to yours, is one of the greatest luxuries a person can enjoy. A dream really, and I think this is happening in Kazakhstan.
The social projects I am involved with are my attempt to decorate my home, my country, with a pattern. A pattern not just to simply enjoy life in well off Europe or North America, but to make my own home country of Kazakhstan cozy and comfortable for my fellow citizens, and for me.
We have two big sports focuses in Kazakhstan: the QJ League youth football and chess, two of the most beautiful games in the world and there is no reason why we cannot be world champions in both! Two sports in which strategy, clarity of mind, good physical condition and endurance are everything. In both games it’s important to control the center of the field and sometimes, carry out flank attacks. For me, working in the sports federation was a big personal challenge: to prove to myself that the right "entrepreneurial" approach can work, and it does, when you focus on building and motivating the team!
We have a lot of talented, caring children who want to realize their dreams for success. From a business perspective, to make millions of these dreams come true, we need to act together, and it all starts with setting the foundation for the team of the future. A team of strong, talented, highly paid and sought-after people who have turned dreams into reality. We have the ability to create a lot of this kind of future human capital in Kazakhstan, if we provide for a creative environment and invest in the training and development of our people so that they can appreciate good paying jobs. This has a domino effect as it will not only attract specialists from all regions of the country to be part of our business teams, it will also make international companies eager to work with them. And what’s best is that Freedom Holding Corp. is in a position to mobilize people and resources to support these kinds of teams when faced with challenges. Our company and our people have competencies in digitalization, which is the key to efficiency, everywhere. We live in the world of the Internet of things and with the rapid advancement of AI, things are becoming simpler and cheaper, even in our two great sports where the results of each athlete’s performance and each training session can be digitized and on the desk of their football coach or in the hands of the Chess Federation in real time.
From a sports perspective, we are building targeted support for our teams of athletes. We discover "stars," provide financial resources, help with tournament expenses, pay for coaches, and consult. When members of our teams start traveling and playing against the strongest opponents, they grow wings, and they learn that anything and everything and anything is possible.
On both the chess and football fronts we provide for a lot of game practice and we organize many national tournaments and sponsor trips abroad. We build close relationships with international federations, learn from them, and this gives us the opportunity to understand the world’s best practices, get inspired by ideas, exchange experiences, get additional quotas for our athletes, and a better feel the opportunities and trends that appear in the world.
We build strong partnership with the most important stakeholders in our universe, our governments, including the Ministry of Sports, Digitalization, Higher Education and Education, at a state level, as well as the local regional Akimats and their cities’ sports departments. We organize and sponsor a lot of "corporate tournaments" covering a vast number of people from completely different strata of society, including government employees and bankers, teachers and doctors, and even penitentiary officials and prisoners. All coming together with human and financial resources, to organize sports festivals and competitions as we try to bring the world’s best practices to make everyone’s life better. 🏟️
We are learning to build partnerships with global brands, such as Snickers, Red Bull, and Mastercard, making them part of the team too. We have created cooperation and partnerships between federations and now, the federations for football, tennis, and chess share resources with one another to make one plus one equal greater than two. And, using all our reputational capital, we show value in the involvement of supporting sports to other medium and large-sized businesses, illustrating by example why this can be beneficial for them.
Do we need infrastructure? Of course, yes, it is a key to success, and as a private company, we can help build this infrastructure faster and cheaper, often at our own expense, but it’s worth it. The state can’t do everything, everywhere, all at once, and it’s slow moving. Many important projects are not so much about money, but about high-quality project management and trust between the Akimats and strong leaders of the sporting federations they are interacting with. Leaders who have significant reputations for getting things done. It’s not a criticism, but a reality when dealing with any bureaucracy anywhere in the world.
To play the long game, a team needs a deep pool of talent to draw on and our country has a very deep pool in this regard. They just need the right set up to make Kazakhstan one of the strongest sports nations in the world, where our national teams take first place, becoming high value participants on the international stage. It could be a dream come true, don’t you think?
At the end of the day the most important thing for us is investing in people. People like coaches all over the country, who need quality training and financial support to teach our children as well as investments in control standards for the training of referees and digitalization of their work, investment in sports journalists and marketer education, match day managers, analysts and lawyers…the people list is long, but each one is important.
In many countries around the world, sport is really about big business and show business, with no real positive social impact. Not for us. For Kazakhstan it’s different. Freedom invests tens of millions of dollars a year, and sometimes without visible financial return, because I believe that with 5-7 years of consistent and professional work, keeping up the pace, and giving of ourselves to this cause, we have the potential to change our society for the better. To make this kind of quantum leap, it is necessary to have a long-term vision, and not focus on immediate returns.
International Biology Olympiad and the International Collegiate Programming Contest
Posted to LinkedIn on 10 July 2024
One of the most valuable assets of Kazakhstan is its people living in peace and harmony. It’s a foundation on which members of our society can create completely unique and breakthrough products and solutions with broad applications and enormous potential and growth prospects. Almost 30% of our population are children under the age of 14, and the percentage of children over the age of 12 has increased by more than 5%. Absolutely amazing numbers when you think about the human potential represented in these figures.
That’s why I believe that we should do all we can to support them. Providing drivers for growth and development as well as creating socio-economic elevators is how we can help all these kids reach their potential. This also explains why Freedom Holding Corp. invests heavily in education projects, supports youth sports, and promotes science programming in an effort to reach the widest possible range of young Kazakhstanis. It may seem at times that our attention is focused only on chess and football players, but this is not entirely true. This year, we supported two large projects in the field of science and technology, including the International Biology Olympiad (IBO) and the International Collegiate Programming Contest (ICPC).
The first of them began this weekend in Astana, bringing together participants from 81 countries and Kazakhstan is represented by 4 schoolchildren: Galymzhan Baktybai, Amina Tynyrbai, Nurtore Torekhanuly and Dias Suleimenov. I wish these guys good luck, and I want them to know that we are proud of them.
The IBO is headquartered in Germany and the fact that this event is being held in Kazakhstan is a reflection of the growing international trust that has been earned by our country. It is a high assessment of the achievements of our young biologists who have participated in the Olympiad since 1996. Over 28 years, our incredible students have won 80 awards including 2 gold medals, 20 silver medals, and 54 bronze medals.
We believe that the Olympiad will further strengthen our international educational ties, will be an important step towards scientific discoveries and achievements that will change the world, and will help familiarize foreign guests with the capabilities of Kazakhstan, its historical monuments, rich national culture and achievements. We are honored to be the host of such an event.
“It always seems impossible until it’s done.” - N. Mandela.
Posted to LinkedIn on 23 July 2024
Cool, complex, and innovative businesses may only be created by smart, free, well-motivated people who trust each other. These are people who choose you as a leader much more than you may choose them, and these are people whose respect is hard to earn, easy to lose…and impossible to forget. In short, a potentially perfect recipe for inter-personal problems. However, creativity is not born in top-down verticals, where people often do not understand what they are doing and why they are doing it, or where they are held back more by fear than by inspiration, and so as a leader you must find the right balance.
This can be difficult, because as a leader, you often have to go where there are no roads, only directions, and you have to sell the prospect of stability to your people, while at the same time you are completely deprived of this “stability” and it can be an internal hell. You don’t really know whether your innovation will work, whether you will be able to assemble a product from all the numerous and constantly moving pieces of the puzzle, whether you will be let down, whether you will be understood correctly, or whether the market, partners, and regulators will accept it. And so, your idea and your team goes nowhere without trust and mutual understanding between highly intelligent, creative, and independent people – not an easy feat to attain.
The greatest value is created where a complex product makes the user experience very simple, where the consumer can experience the “magic” of your project while all the complexity remains “under the hood.” To create innovative products, you need to have a high tolerance for risk, you need to constantly rise and fall, you need to walk through numerous “Valleys of Death” as many projects turn out to be much longer than initially anticipated, and you may lose shareholder money for years with a completely unobvious effect. Even the most composed visionaries among the current leaders in capitalism often had to carry out their projects on sheer faith and the team’s buy-in on what they were doing.
Skepticism is a most natural emotion in innovative new businesses and you can only defeat negative public sentiment with the faith of a large, well-motivated team of grounded intelligent people. Otherwise, it’s not worth trying. The way of innovation is always uncomfortable, risky, and yet, very interesting. If you want to live a quiet, stable, life don’t innovate. Undertake a business that is simple, understandable, and if you can, try and achieve some sort of exclusivity in it through good business methods. In this scenario you need to get comfortable with the idea that nothing lasts forever and that one day you will eventually lose to your competitors and innovators. Nevertheless, with a little luck you might make a career in this, but not much more.
IQanat School in Borovoye
In February of this year, together with another leading Kazakh businessman, Aidyn Rakhimbayev, we opened a new campus of the IQanat School in Borovoye, called the Freedom House. I supported this project, knowing that thanks to it, the dreams of thousands of rural children who want to study and change our country for the better will come true.
In previous posts, I’ve talked about the immense potential for community impact this building has and its functionality. I am very pleased to report that on June 20th, together with other trustees of the IQanat Project, we learned the names of children who, thanks to their victory in the Republic Olympiad IQanat, will sit at the school desks in Borovoye, including the Freedom House campus, in September. These are the 100 best schoolchildren who went through several stages of academic testing and turned out to be the best among thousands in their age category across the country. Most of these children are from socially vulnerable families.
In fact, over the 5 years that I have been associated with this project, it has consistently exceeded our expectations of success. We are witnessing a real miracle: in addition to academic learning, children are given hope and motivation as well as access to activities not typically within reach of their communities. As an example, a recent trip to the world's largest high-mountain-altitude skating rink, Medeu, was also coupled with educational training, organizational meetings, and preparation courses for the Kazakhstan Unified National Testing (UNT) exams and the International English Language Testing System (IELTS) tests. To put this in perspective, most of these kids have never traveled outside their village. 70%-80% of them are from low-income large or single-parent families and the IQanat team delivered to them an experience that they will not soon forget, and neither will I.
In joining these kids at Medeu I was once again convinced that Kazakhstan is a very young nation; our average age is just over 30 and almost a third of the population are children under 15. In many ways, it’s very cool for me to be part of this mix because I get to witness the world change not from year to year, but from day to day, as I watch these kids become able to participate in new solutions, new professions, and entirely new industries that are soon emerging. Under these conditions, countries with citizens who are able to master new skills, effectively apply advanced knowledge, and have progressive views with a focus the future, will prosper. I am certain that Kazakhstan will be one of these countries because I had the opportunity to meet our leaders of tomorrow amongst these schoolchildren. For me, and for Kazakh society, this kind of return on investment in the IQanat School project is priceless.
Freedom Telecom Kazakhstan
Over the past year, we have talked a lot about our ambitions and plans to enter the communications market and in late 2023, we did it. We launched this business on the strength of our brand name alone, and quickly, “Freedom Telecom Kazakhstan” became instantly recognizable in our markets. One of our main advantages in launching a business from scratch is the absence of the burden of obsolete infrastructure. The modern technologies we possessed when we started this business allowed us to launch approximately 30 new services under the Freedom Telecom brand in the shortest possible time, including broadband internet access and open access to Wi-Fi in cities. And we believe that some of the best is yet to come under this business segment as we also expect to enter the mobile telecommunications market in the not-too-distant future.
The year has shown us that technologies are changing rapidly and that new standards are emerging. Increasing our pace to stay ahead of these changes and our competitors in the marketplace is the right use of our time, but this kind of audacity and ambition should always be supported by strong expertise, experience, and our reputation for being trustworthy and making good on our commitments. To help us here, we went looking for a strategic partner who could provide us with the consulting support we needed to advance our telco progress, and it became Vodafone, with whom we recently signed a corresponding agreement.
Vodafone is a company with a forty-year history, occupying a leading position in the number of subscribers among global telecom operators. Working with Vodafone will give us access to some of the world's best technologies and practices, innovations, and experience and I am convinced that this will be a completely new era for Kazakhstani consumers and the telecommunications market. Having a strong strategic partner will allow us to increase our efficiency through rapid introduction of innovative technological solutions and products that have already been tested in markets where Vodafone currently operates.
Cooperation with Vodafone is a signal to the whole world that Kazakhstan has the right telecommunications policy, an open economy that is ripe for this type of technology, and that we understand the rules of the game. In the end, we really want to become the change agent who will provide high-quality, affordable internet and mobile communications to all populated areas of the country and with a partner like Vodafone, this mission seems much more feasible.
Teach for Qazaqstan
On June 21, during a live broadcast, I talked about the fiscal 2024 yearend results, our investments in the digital ecosystem we have created, and our overall projects and plans. This was an open broadcast that is available for viewing by anyone. As you might imagine, during the broadcast, the focus of my attention and the attention of the media revolved around our financial results, which is very normal in this kind of situation.
As I thought more about this broadcast it occurred to me that I did not mention the great work being done with “Teach for Qazaqstan” (TFQ) who is a network partner of the “Teach for All” global network. The TFQ project was created by the McKinsey Kazakhstan partner, Dulatbek Ikbayev, and is financially supported by Freedom Holding Corp. TFQ has a big mission which is to reduce educational disparity between urban and rural areas, training a new generation of teachers, and providing modern educational opportunities for schoolchildren. This is another amazing tool that will allow our young nation to be competitive tomorrow, and children from rural schools and single-industry towns to feel equal to those in cities today.
In Kazakhstan we really are experiencing a demographic boom, but unfortunately, the educational infrastructure and personnel training systems needed to keep pace with this growth isn’t there, and this is worsened by the fact that there are simply not enough teachers. What I’m speaking about here is are forward thinking teachers who are very familiar with AI tech, such as Chat GPT, have a good background and an open mind, and are capable of giving something more to children than just what they can read in a textbook.
TFQ partially solves this problem. Now the team led by Gulnara Salmen and Gulnur Zhasekenova is making a large-scale selection of every kind of instructor who wants to connect their activities with teaching at a school. They conduct educational retraining under the auspices of SDU University and employ these newly trained instructors in schools where there is shortage of personnel and a demand for this kind of teacher.
They select from a field of practicing IT specialists, marketers, journalists, and researchers who come to a regular regional school and work with children for two years. Suitable candidates are not only given basic teaching skills, but they are also supported throughout the entire period of work and integrated with school management and local communities.
While the TFQ project has just been launched and is continuing to be tested, the first 25 teachers are working in the Karaganda region and at the end of June, they will be joined by another 15 colleagues. This is an amazing project that needs to be scaled up rapidly and I really want my business colleagues to support these guys.
We live in an era of constant change
We live in an era of constant change: sometimes not so noticeable, and sometimes large-scale. It can feel like almost every day we have some sort of crisis, external or internal, that demands our attention and precludes us from getting a start on something new or important. Under these circumstances it’s easy to feel that now is not the time: not the time to study, not the time to get married, to have children, open or scale up a business, or launch new products, and that all of this can wait until a more favorable time.
If we stop and think about it objectively, we need to realize that now is the more favorable time, because challenges will always exist and things will not get any easier. Despite our personal fears, under the objective light of day, a huge number of opportunities in a favorable external environment exist and we need to not just seize the day, but the moment.
And it doesn’t need to be giant steps from the beginning. Small steps are important too. I finished the battle with the problems I had in the morning and went ahead and made some progress on the thing I put off “until a better time.” Even if it’s just a couple of hours, before the next “survival” task comes along. This kind of attitude and progress will not just will bring you closer to your life goals, it will reduce your risk of failure, open up new opportunities for you, give you further energy to move forward and not burn out from the eternal struggle with general life problems. It will bring you knowledge, people, partners, and resources that will quickly help you defeat all the old “monsters” of everyday life. They might, of course, create new ones, but it is arguable that this is precisely how real development happens.
And, you know, the same can be said about government. Everything is always about being the “right time” to do things and there always seems to be too many threats to progress. What is needed is real courage to risk short term stability, for the broader goal of getting out of the status quo swamp. From a financial perspective, preserving the status quo is in itself already a huge risk. Corporate lending continues to decline as a share of GDP, and business in general not related to the budget, even trade, begins to suffer when faced with a corporate lending rate of 18-19% against the real NB rate in tenge above 15% and inflation at 8%. Yes, there are potential risks in aggressive rate cuts and yes, there will always be objective reasons to be afraid. But we need to make up our minds and quickly reduce the cost of borrowing to be in line with several of our neighbors: approximately 8.5-10%. Now is the time and there may simply not be a better moment. To drive overall societal wealth and wellbeing our country needs real business lending! Not government subsidies and handouts. We are young and enterprising…We need freedom from the status quo!
Freedom and Principles of Sustainable Development: Our Social and Environmental Projects
About 5 years ago we listed our shares on NASDAQ, and in doing so we took on the responsibility of being a publicly traded and highly transparent company. Ongoing compliance and transparency takes a constant commitment to the work required, and in my opinion we manage this process successfully. We adhere to similar commitments in the field of sustainable development. Being a signatory to the UN Global Compact, and one of the largest supporters of the ESG agenda in the financial sector of Kazakhstan and the entire region, is an extremely important component of our business.
Our ESG efforts continue, and in May of this year I became the chair of the UN Global Compact Consultative Committee in Central Asia. Established to find effective solutions for transborder issues related to water management, environment, hunger and poverty, as well as infrastructural problems, energy and food security, Freedom Holding Corp. joined the UN Global Compact in 2023.
The UN Global Compact is a non-binding United Nations pact adopted in 2000 to get businesses and firms worldwide to adopt sustainable and socially responsible policies.
The initiative includes ten primary principles in four areas: human rights, labor, environment and anti-corruption. By following these principles, the participants of the Global Compact can synchronize their activities, stay focused on the social agenda and create a more inclusive and sustainable global economy.
In other words, thousands of big and small companies, representing different industries and countries, have united to address global challenges and improve the world.
Of course, words are just words until you act on them. Over the past couple of years alone, Freedom Holding Corp. has allocated about $33.8 million for projects aimed at sustainable development goals. Moreover, we have donated more than $54.1 million to update infrastructure throughout Kazakhstan, improve educational and health care systems, support sports, and promote many other important initiatives that increase the quality of life of our fellow compatriots. We also promote the principles of a green economy and plan to invest significant cash resources in sustainable financial instruments and projects by 2027.
Furthermore, for more than twelve months now we have been implementing a massive internal ESG transformation of our company. We want to integrate ESG principles into our corporate environment and become a regional leader in the sphere of sustainable development.
In late 2023, Freedom Holding Corp. published its first Sustainability Report as the company continues to follow ESG standards in the universe of environmental protection, ethical treatment of employees and clients, transparency in business operations and active participation in charitable initiatives.
Practical implementation of these principles allows us to go beyond the framework of just charity or environmental activities. We are reaching toward fundamental changes, and this non-financial information has already become an integral part of our financial reporting as required by the U.S. Securities and Exchange Commission for publicly traded companies. Moreover, we have chosen to develop a digital financial ecosystem that also helps us comply with the overall ESG agenda by cutting our consumption of natural resources and reducing our carbon footprint.
We could have probably stopped here and rested on our laurels. However, with several colleagues from Kazakhstan and Uzbekistan, we have decided to go one step further and join the Consultative Committee. The number of members of the UN Global Compact in Kazakhstan, Uzbekistan, Kyrgyzstan and Tajikistan has risen from 55 to 112 over the past several months, and in my new role as the Committee’s chair, I hope my experience and commitment will continue this important work make a difference.
I am glad that Kazakhstan has a chance to be one of the regional players who leads the way for various businesses. I am convinced that in the end, we will develop a collective response to complex and tragic events such as the floods we dealt with recently. This will also help private and public sectors in our region improve their response to risks and vulnerabilities and provide more effective relief for people in need.
In August 2023, we created the Freedom Shapagat Corporate Fund, which is currently responsible for coordinating the company’s charity and sponsorship activities related to sustainable development.
This spring, the Fund came up with one of its most interesting ideas in the world of environmental protection. The idea is to collect plastic and aluminum containers for their proper disposal and recycling with the help of reverse vending machines called “Fandomats.” We launched the first such Fandomat installation in Almaty, and we expect the Fund will aid in installing 100 additional Fandomats in Almaty’s and Astana’s most crowded areas. This project is not just about the separation and collection of waste; for us, it is about forming an ecologically advanced culture with good habits where we reduce waste and encourage responsible consumption and a transition to a circular economy.
Of course, I understand that along with education and provocation, financial resources and incentives are needed to promote this agenda. That is why anyone who inserts used bottles or cans into our Fandomats will be collecting real money in a Freedom Bank account that they can choose to donate or simply save. As our Fandomat experience continues, I expect that we will constantly be modifying and improving the process, but from my perspective, the important part of any new initiative is taking action, and I’m very pleased that we have done so.