Kremlin Towers_ENG.pdf

CONTENTS
ENEMY MUST BE KNOWN
METHODOLOGY OR HOW
TO GET INTO GROUP
CHAPTER 1
HOW RUSSIA WAS GOVERNED
Post-Soviet algorithms — similarities and differences with Ukraine.
Phenomenon “Families”
Russia under Putin (system creation)
Formal pyramid of power today is hard to believe
CHAPTER 2
RUSSIA TODAY
Russia as a corporation, not a state
Influence groups or a circle around Putin
More about groups — resource base and opportunities
Media field — full control and the “Telegram problem”
Post-war and elite groups
If Putin’s gone?
03 /
04 /
09 /
27 /

3
One of the biggest oversights of Ukraine after 2014
was the lack of a systematic study of Russia: the econ-
omy, culture, value frameworks of the inhabitants,
and political mechanisms. As a result, in 8 years of
war (and the war began in 2014, not in 2022), there
was no understanding of how decisions are made
and, most importantly, how they are implemented
in the Russian Federation. Even in sports, coaches
and athletes study the opponent, but we considered
it superfluous, trying to project our perception and
usual mechanisms onto the Russian reality. And we
were often wrong. But we continue to try to create
myths in which we ourselves believe. Such as, for ex-
ample, the broad “national liberation movement”, the
ability of the Russian liberal opposition not to seize
power, but to control the territory of its country. In
the end, let's remember how many times we cele-
brated the “year of the Russian Federation economic
collapse” and how surprised we were when every-
thing we had planned did not happen. This is on the
one hand.
On the other hand, the continuation of parasitism on
the Russian information field. Most of the Ukrainian
media, for example, took information about events in
the post-Soviet space, in Asia, and even in a number
of EU countries from Russian sources. Then, chang-
ing the terminology, figuratively speaking, changing
the “good and bad places”, they offered the product
to the Ukrainian consumer. Thereby multiplying the
misunderstanding of the enemy and, at the same time,
imperceptibly for themselves, spreading the Russian
thesis construction of showing the events in the
world. Headlines changed, key theses, perhaps, too,
and the rest of the web of implicit Russian was (and
is) generously offered to the Ukrainian consumer.
The enemy must be known. Knowledge itself creates
a foundation for adequate risk assessment and com-
petent planning of our actions.
The Ukrainian Institute for the Future has already re-
leased several Russian thematic reports. This work
was planned as early as 2021. February 2022 made its
corrections, but returned to the topic. The key idea
of the work is to provide an understanding of how
and by whom decisions are made in the Russian Fed-
eration. That is, to reveal the topic of “Kremlin tow-
ers”, which have been talked much about, but only a
few people are able to describe.
In other words, this is a cross-section of the Russian
elites. Where, the starting point (or criterion for
analysing a person) is taken as his ability to make de-
cisions at his level, and not publicity, activity in social
networks or the frequency of mentions by the Rus-
sian mass media.
Influence groups and mutual support groups have
been identified. But, most importantly (and this is the
difference from other similar works), an attempt was
made to assess the comprehensive potential of each
of the groups — to what extent it has the entire set
of necessary resources (power, economic, political,
media, personnel). Because the ability to claim power
depends on the completeness of resource provision.
Everything you need is there – you can act yourself.
If one or more resources are missing, we are talking
about the need for a coalition. And now it is time to
evaluate potential allies and opponents.
Of course, the described scheme is not static. And in
a year and a half, it will require significant refinement.
We also do not claim to be a “standard” approach, as
we are sure that there are people and organizations
capable of doing better. Our task, as we see it, is to
provide a set of information for work and analysis
right now and to create an incentive for the “Russian
research” activation by others. And the schemes giv-
en in our report will be supplemented and updated
regularly.
ENEMY MUST
BE KNOWN

4
KREMLIN TOWERS
Before describing the methodology, it is worth making important remarks:
This classification is not comprehensive.
Since the analysis of connections and dependencies did not include family relationships, friendships (etc.).
Accordingly, the schemes are based on open information as of summer 2022.
Names of groups are conventional.
Some are historically developed terms (such as “family”), some are based on the field of activity, and, for
example, the name “technocrats” is taken from Russian works on the classification of Putin's entourage.
Groups and their members are not static!
This means that the same person can belong to two (or more) groups at once. But this does not concern
the “core” members of the group.
To analyse dependencies and interests, a set of more than 500 Russian politicians and businessmen was
taken (about 250 remained in the schemes). The base sample was made according to the following criteria:
Putin's closest entourage. These are the ones who have direct contact with him. As a basis for the
analysis, people from the following groups were considered: the Security Council, the Presidential
Administration, people who often appear next to Putin, as well as people mentioned in the analysis of
the Russian president's closest circle.
Government of the Russian Federation, primarily key ministries only at the level of minister and first
deputy.
In the law enforcement agencies, in addition to the head of the department, the biographies (part of
them available) of the heads of key units were analysed.
State Duma, Federation Council. Leaders of factions and key committees of the Radfed and the State
Duma at the level of their heads.
Representatives of the President in Federal Districts. The current line-up and their predecessors. In
particular, the reasons for their resignation, the subsequent career (of their predecessors). As well as
relations with key groups.
02
03
04
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01
METHODOLOGY
OR HOW TO GET
INTO GROUP

5
WHT IS
INFLUENCE GROUP
Heads of Federation subjects. The governor's biography, his connections with groups in Moscow,
relations with local elites. And also predecessor(s). In particular, the history of running for elections
(nomination of a new candidate, re-election, history of elections from the database of “executives”).
Managers, owners and “personalities” of key Russian media, new information resources.
Enterprises whose shares are traded on the Moscow Stock Exchange. These are, as a rule, former
state-owned companies that remain in the Kremlin's sphere of interest and the bulk of whose shares
belong to either FDM or state (related) banks. On the basis of information on the ownership structure,
such companies were grouped by clusters of influence (for example, VEB Bank owns shares in 8
companies, 4 of which have more than 25% stake). The profiles (biographies) of private investors
(owners) and managers were analysed.
Representatives of Russian business (based on the rating of Russian Forbes). Here, the key criterion
for entry into the scheme was work (leases, long-term contracts, partnerships) with key public
sectors, enterprises or companies listed on the Moscow Stock Exchange. As well as political activity
of a number of businessmen. If the business is conducted by two partners and there is no data on the
difference in their position, the “senior partner” was entered in the scheme.
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08
09
07
The general scheme was created according to the principle “from top to bottom”. At the first stage, key
groups were identified, in whose behaviour there are clear signs of meaningful attempts to influence the
country's policy for their corporate purposes.
The criterion for assigning a number of people to the category of “influence group” is the presence or pos-
sibility of gaining control over at least half of the types of resources with which one can fight for power.
Specifically:
Power resource
Financial resource (money, companies)
Political resource (presence of dependent (related) people in the parliament, government)
Media resource - the presence of own (or managed) mass media, reaching more than 5 million people
Regional resource - the presence of dependent governors in the Federation subjects (or partners)

6
KREMLIN TOWERS
If a group of people has at least half of the listed resources, it falls into the category of influence groups. As
a result, 6 were selected: “Security forces”, “VPC” group, “Gazprom” and “Rosnafta” groups, the Kovalchuks
group and Technocrats. As well as Yeltsin's “Family” group.
It should be noted that within certain groups there are subgroups, conflicts, and a struggle for influence.
And on the conditionally external field, they lobby for decisions that are beneficial to all members. For in-
stance:
the Gazprom group includes managers from both this company and Novatek. There is competition
between them, but the group itself protects the interests of the gas sector on the outside.
Among the technocrats there is a group of financiers (Gref, Nabibulila) and several groups related to
the political component or the energy sector (for example, Rosatom). There is tension and competition
between them, but on the outside the group acts in a coordinated manner.
Among the security forces, there is competition between the Ministry of Internal Affairs, FSB, investigative
team, GRU, SVR. However, the group adheres to a coordinated policy in protection of common interests.
Such a “resource-oriented” approach made it possible to optimize the scheme and not include a number of
businessmen from the TOP-30 of the Russian Forbes ranking. Not having their own influence resources, they
are not able to independently set the agenda and to solve their problems they resort to the help of one or
another influence group.
On the other hand, key influence groups do not use the business of these individuals as a permanent source
of financial resources. For this purpose, there is budget money, their own economic block, and dependent
companies from the list of the Moscow Stock Exchange. Money from other sources is received only as either
“coverage fees” or fees for access to their orders (the same budget).
After defining the basic groups, the ranking of the participants was carried out. The first and key link is made
up of people who:
have direct access to Putin
may initiate consideration of an issue not directly related to their official duties. In other words, they can
create the agenda.
RNKING INSIDE
THE GROUPS

7
Based on this, Oleksandr Bortnikov did not get into the key group (as of the summer of 2022), who has
weekly reports from Putin, but their topic concerns either the activities of the FSB or the execution of Putin's
assignments (for example, work in the Ukrainian direction, censorship of the Russian press, etc.).
The group is not static. So, for example, the Minister of Defence of the Russian Federation Sergey Shoigu,
who was (and remains) close to Putin, but against the background of the failures of the Russian army in
Ukraine, is losing credibility and influence.
On the other hand, the influence of Russian Prime Minister Mishustin is growing, though he is not yet included
in the key link of influential groups, but is already close to this status.
The second link in each of the groups is politicians (or managers) of the highest level – people who have
the opportunity to have meetings with Putin, but cannot on their own create the agenda for such meetings.
Simply put, it's coming to a presentation, an audience, but not coming with a new idea worth thinking about.
The third link is people dependent on key people in groups. As a rule, these are people who owe career
growth to the core of the group, and are connected to them by business relations, or are simply subordinates.
CTEGORIES
“OUTSIDE GROUPS”
In the category “outside groups” there are people from the “political superstructure”. As a rule, these are
top-ranking politicians. However, the popularity (media presence) of their surnames does not provide other
resources, in particular, influence resources. The political system of Russia rather plays the role of a screen
and “forge of personnel”.
Another group is “extra-system players”. These are such people as Kadyrov, Prigozhin, Nechaev and others.
These people have the opportunity to challenge Putin, but are limited by the narrow range of tasks they
are given. Simply put, influential Russian politicians who play the role of proxies on issues that cannot be
effectively resolved using the established mechanisms of Russian politics are classified as “extra-system
players”. And until their scope of activity/responsibility expands, they have no chance to grow to form their
own influence group.

8
KREMLIN TOWERS
HOW
RUSSIA WS
GOVERNED
Chapter 1

9
The first system of state power in the Russian Federation was created by Boris Yeltsin as a counterbalance
to the “union” system. Institutionally, (until the end of 1992) it was a system created during the late USSR
(constitutional reform of 1989) and did not have drastic differences from other “union” republics. However,
Yeltsin actively formed a group of allies who occupy key positions (or, if possible, placed his people there).
The second direction is flirting with local elites (autonomous republics within the RSFSR, which, against the
background of the “parade of sovereignties” common to the USSR, wanted to strengthen their status. It was
during this period that Yeltsin is credited with the phrase he uttered in front of the “political asset” of Ufa “we
tell the Verkhovna Rada, the government of Bashkiria: you will take that share of power that you can swallow
yourselves”.
The contours of such a “broad” coalition of opposition to the “union government” were finally formed by
mid-1990 and differed little from the positions of the local nomenclature in other “union republics”. Except
for the “two-tier” status of the parliament. Where the base in the form of the Congress of People's Depu-
ties was supplemented by the “Verkhovna Rada”, which performed the functions of a permanent presidium
with extended powers (in particular, regarding the adoption of laws). But on Yeltsin's side (and the idea of
strengthening Russia's status) there were:
regional (Administration of the RSFSR) economic managers;
“republican” party elites who saw prospects for further career growth (to the level of the USSR), but had
ambitions to concentrate more power and resources in their hands;
directors of large enterprises who wanted to reduce the control of the Council of Ministers of the USSR
and reduce the quotas of “scheduled deliveries”;
informal groups of various stripes — from “democrats” to resurgent “imperialists”. For both of them, the
communist leadership of the USSR was, rather, a political enemy;
and what is important for understanding the processes in Russia — regional elites. The leadership of the
“autonomous republics” within the RSFSR were rather allies of Yeltsin (in contrast to the leadership of the
autonomies in other union republics, which opposed the “republican government”).
The latter was reflected in a complex of three documents (separately for autonomous republics, areas and
regions, and autonomous districts), which received the general name “Federal Treaty”, which delimits the
powers between the Federal Centre and the Subjects of the Federation. At the same time, for example, Ta-
tarstan never signed any of the components of the Federal Treaty, but in 1994 it signed its document “On the
delimitation of the subjects of management between the state authorities of the Russian Federation and the
Republic of Tatarstan and mutual delegation of powers”, which in its original format was in effect until 2007.
POST-SOVIET
LGORITHMS–
Similarities and differences with
Ukraine. Phenomenon “Families”

10
KREMLIN TOWERS
That is, the Russian Federation at that time was really a Federation, where its subjects had full power on their
territory, except for the powers voluntarily (!) transferred to the federal centre.
The Verkhovna Rada was reformatted into a bicameral parliament, where the upper chamber, the Council
of Nationalities, was conceived as an expression of the interests of the Subjects of the Federation and was
formed according to the quota principle.
On the other hand, the system of management remained post-Soviet in nature. The political agenda for the
mass media was tried to be set by the “democrats” who were popular at that time, which in fact represented
a field with a fairly wide spread of ideological orientations among the leaders. Real management decisions
were made by the old (RSFSR level) nomenclature. The financial resource was concentrated in the hands of
the so-called “red directors”. The real reformation of the management system looked scary for the key groups
in the Russian government. That is why the first contradictions between Yeltsin and those who formed the
basis of his supporters in 1991 appeared already in 1993:
regional elites tried to get maximum bonuses from the centre,
part of the former party elite (republican level) did not see the need to reform the country's management
system, considering it possible to restore the conditional USSR, only on a smaller scale;
“red directors” were frightened by the prospect of privatization and wide-ranging economic reforms — it
threatened their own influence.
and formally and actually performed the role of representative of the Subjects of the Federation,
representative of their interests.
some of the so-called “informals” quickly decided to develop their own projects. Moreover, they are of
different orientations — from conventional “monarchism” to liberal-democratic movements. What they
had in common was that both of them were sharply critical of Yeltsin.
and, finally, another influential group appeared – politicians and managers of the “Union” scale were
forced to realize themselves in the conditions of the Russian Federation, thereby creating additional
competition for personnel of the former “Republican” level.
A large-scale political crisis began with Yeltsin's attempts to dissolve the Verkhovna Rada of the Russian Fed-
eration and attempts by the Armed Forces of the Russian Federation to dismiss the president. It ended with
the storming of the «White House» in 1993 and a complete reformation of the parliament with the creation
of a bicameral State Duma. In fact, with authoritarian methods, Yeltsin defeated the opposition, which tried
to recreate an authoritarian system. At the same time, in the search for allies, Yeltsin relied on quite motley
groups:
part of the liberals who were scared of the prospect of restoring the USSR;
managers of the former “union” level, who saw an opportunity to ensure their own increased influence
and participation in power in the situation happening;
regional elites who expected to obtain additional benefits for themselves and their regions against the
background of the weakening of the position of the President of the Russian Federation;
and, most importantly, he managed to maintain control over the executive branch — the fringes in the
government were minimal.

11
Another peculiarity was revealed — the position of the Communist Party of the Soviet Union. The party
headed by Zyuganov, who by 1993 managed to “cut off” all the leaders of the former USSR from the leader-
ship, was guaranteed to pass to the parliament and had prospects of their candidate winning the presidential
elections. So, Zyuganov played “his own game”. His party actually (with the exception of press statements)
remained an outside observer. And after that, they “picked up” part of the electoral sympathies of supporters
of the Armed Forces of the Russian Federation.
It was in 1993 that Yeltsin's group of “friends” began to form into what was later called a “family”. That is, in
parallel with the formal system of public administration, a parallel system based on the placement of trusted
people in key areas began to be built. The centre of decision discussions was actually transferred to the level
of informal meetings of Yeltsin with his closest entourage. Therefore, when today we talk about the “closest
entourage” around Putin, it is worth bearing in mind that such an approach began to be developed at the
beginning of the Yeltsin era.
To parallelize processes and take control of key state flows — the deployment of “their own” people to manage
theenergymarket,transport,gasandoilexports.Thekeyapproachistocontrolflowsratherthanproduction.
Therefore, privatization (where monopolization) took place in the following years in the specified areas
starting privatization and stimulating the process of creating oligarchs. It was an attempt to “break down”
the red directors;
a coalition with a number of regional clans and an attempt to choose the key ones among them. Also, an
attempt to choose “authoritative” partners among the heads of national autonomies;
monitoring of the capitals (in a broad sense, including Yekaterinburg, Perm, Novosibirsk and Nizhny
Novgorod).
The first stage, which was accompanied by a reboot of the country's management system, which was carried
out in the form of the issuance of “temporary” “constitutional decrees” of the President of the Russian Federa-
tion and the adoption of a new constitution at the referendum in December 1993. Yeltsin stabilized his posi-
tion and, considering the lessons of the political crisis, began attempts to neutralize key groups of opponents.
The emergence of oligarchs became one of the manifestations of this process. By 1994, businessmen who
had gained control over assets as a result of (often non-transparent) privatization had become a group ca-
pable of counterbalancing the influence of “red directors”. First of all, we are talking about those businessmen
who actively cooperated with Yeltsin's closest entourage. At the same time, some of them actually became
part of the “family”. On the one hand, they enjoyed bonuses from state resources and access to export
infrastructure (over which control was established by Yeltsin's entourage), as well as the “power umbrella”
from the government. On the other hand, they took an active part in political activity: they were part of the
management (or ownership) of mass media, they participated in important of them for Yeltsin's entourage.
CONTOURS OF FMILY
CRETION

12
KREMLIN TOWERS
The result of the policy was the emergence of a “family” as a group of managers, businessmen who had a
comprehensive (!) resource – assets in all areas – finance, power, media.
According to a similar algorithm for obtaining a complex resource, other groups of influence were also tried
to be created. Most of them to one degree or another were dependent (cooperated) with the “family”, es-
pecially at the early stage of formation. Later, their subjectivity increased. Among the key ones, it is worth
mentioning the Rosneft group, which emerged as one of the first “independent” groups as a result of the
reform of the state-owned company “Rosneftgaz” (which, in turn, was created on the basis of the Ministry
of Oil and Gas Industry of the USSR). But due to the fact that the mining market was already divided in many
ways during the privatization process, this group did not become key.
Gazprom Group became the second raw material group. The transformation of the Gazprom concern into
RAV in 1993 can be considered as its beginning. And the company's management became a key resource for
the Russian authorities. Due to the fact that gas export remained monopolized, foreign currency exchange
was concentrated in the hands of one state company. As a result, Gazprom's money was a “second cash
register” for Yeltsin's entourage.
The third group, which still exists today, is the OPK group (today the Chemezov group). The reason for its
creation lies in the specifics of the arms business. Most of the companies of the Russian military-industrial
complex were sent for privatization. On the other hand, trading first in old Soviet and then in modernized
weapons was good business. But the business, in which the presence of players “independent” of the Russian
government, tried to prevent the Western states.
At the same time, oligarchic groups (i.e., big business that seeks control over media resources and interference
in politics) were emerging, playing “their own game”. The most striking manifestation was the appearance of
V. Husynskyi's MOST group, which owes its birth to a large part of the mass media, which were perceived as
“liberal” at the early days of Putin's rule.
In 1996, thanks to such a scheme and the binary choice “either communist or Yeltsin”, it was possible to mo-
bilize administrative resources, family and business to win the presidential elections.
As a way to “thank” the allies and knock out the resource base of the communists, the second wave of
privatization began in 1997, when the Russian government agreed to sell shares of several large state-owned
companies at once. It was this year that M. Khodorokovsky's “Menatep” band began to absorb Yukos. That
led to the beginning of the political career of the oligarch.
In this period, more precisely from 1996 to 1999, the structural design of the group of security forces takes
place. The leadership of the army, special services, and militia went through a period of disorganization, lost
the Chechen war and began to “reconquer” their zone of influence.
Thus, most of the groups that still exist today arose during Yeltsin's time and were “inherited” by Putin. Even
the first, “Petersburg” cohort of managers consisted of either employees of the special services or employees
of the “second role” of the team of managers of St. Petersburg. By the way, the starting point of the Kovalchuk
clan, which is one of the most influential, is the bank “Russia”, founded in the “northern capital”.

13
Many books and articles have been written on the topic “why Putin” and not someone else. But let's try to
assess the condition of Yeltsin's entourage.
The family could not take control of the country due to the catastrophic drop in the rating of Yeltsin
himself, the negative attitude of society towards the “family” itself, and the lack of bright “their own”
candidates.
At that time, the Gazprom and Rosneft groups did not have sufficient human resources, but at the
same time they already had money.
The leaders of the liberal wing could not even theoretically seize power after the disaster of 1998.
The front of the regional elites began, which was expressed in the formation of the socio-political
movement “All Russia”.
The growth of nostalgia for the empire among the population created the prerequisites for the
recovery of the communists' positions. On the other hand, there was activity among a part of the
elites to create a party that also works in a moderately radical field — the party “Fatherland”. Which,
a few months later, united with the regions in “Fatherland – All Russia”, which in 1999 tried to become
the “party of power”, but did not get even 30% of the votes.
It is worth mentioning separately the growing influence of a group of security forces that tried to
become a real and important participant in the Russian political process.
As we can see, there was an imperial request in society. That is, it is necessary to offer people the format of
“restoring the empire”. At the same time, none of the groups could guarantee the maintenance of the situation
on their own. By and large, none of the above wanted the communists to return.
Therefore, the war in Chechnya, the positive reaction to Lukashenko's activism regarding integration (at that
time he systematically hurried to unite countries and enter the Russian political field) in the form of signing
documents were predictable.
WHY PUTIN?
03
02
06
05
04
01

14
KREMLIN TOWERS
And the ideal candidate seemed to be “their own”, at first glance, weak, unable to hold the situation without
the support of at least several groups. But at the same time, preferably, it is connected to the power unit.
Putin met all the criteria.
Thus, at this stage, Putin was the result of a “family” bet and a compromise with several nascent (reinforcing)
groups. At the same time, the front appeared almost immediately – “Fatherland-All Russia”, which claimed
the role of the “party of power”, tried to play the tandem of Primakov-Luzhkov. But the compromise reached
with the key oligarchic groups provided Yeltsin (and Putin as his successor) with financial and media resources.
The position of the security forces (primarily the FSB, which strengthened, sympathy for the army after the
2nd Chechen war) gave a force. It was administrative as well. As a result, Yuriy Luzhkov gave up on his plan
and resigned himself to subordinate status even before the elections.
Control over shadow levers or the
formation of Putin's Kremlin towers
From the perspective of strengthening his power, for Putin, the formation of his own entourage became the
issue number one. And here it was not only and not so much about the arrangement of managers in the formal
system of the Russian government. The new president was well informed about the real decision-making
system he wanted to transform for himself. Therefore, during the period of his first term, he concentrated on
the creation of what today in the media is called “Kremlin towers”.
First of all, the strengthening of the power bloc (which Putin carried out in the position of prime minister) and
the career growth of representatives of the clan of managers (and employees of the special services) from
St. Petersburg continued.
The importance of the Gazprom group is sharply increasing. It is the only state corporation that has remained
a monopolist in a key export direction. And since the appointment of its management was in the area of
government responsibility, Putin had time to put his people there in 1999-2000. And in 2000, his close
associate and future “changer” Dmytro Medvedev headed the company. With him, Gazprom begins to
actively strengthen its influence on the Russian government and turns into a notional “Kremlin tower”.
The gradual concentration of mining resources around Rosneft and the growing influence of Sechin begins.
It is significant that at the initial stage of the struggle to increase oil assets, the Kremlin supported both the
state-owned Rosneft company and Mikhail Khodorkovsky's private company Yukos. The purpose of such a
policy was to eliminate many middle players from the market and establish control over the industry.
RUSSI UNDER PUTIN
STRT ND FIRST STEPS
system creation

15
Clash of the two mentioned groups was inevitable under this approach. Who would be the winner
depended on the political ambitions of the company leaders. Unlike Sechin, Khodorkovsky decided to play
independently (in particular, sponsoring opposition parties). As a result, in 2003, an investigation began
regarding tax payments for 2000-2003 (the exact time of Putin's presidency) and then the Yukos case, which
ended with the company's takeover by Rosneft. As a result, Sechin and his entourage became another key
group in Putin's orbit.
The years 1999-2004 became the time of formation of another influential group, the base of which is the
defenceindustry,butwhichismoreappropriatetobecalledthe“ChemezovGroup”.In1999,SerhiiChemezov
was appointed to manage Promexport, one of (but not the only) seller of Russian weapons to foreign markets
(Rosoboronexport was also there). Under his leadership, the concentration of assets in the field of defence
industrial complex began. With the help of administrative resources (change of managers in state-owned
companies) and financial instruments (crediting, debt restructuring and redemption, takeover and merger
agreements) in 2001-2003, a group was formed that united key manufacturers of military equipment and
locked 90% of its export for themselves. At the same time, unlike, for example, Rosneft, Chemezov initially
tried to create a maximally closed system, which would also include control over financial flows. So, for
example, one of the first “acquisitions” of the group was the acquisition of control over “Novikombank” and
the transfer of most of the financial flows of controlled companies to this institution. As a result, the bank
from a modest 174 in the rating (in 1999) entered the TOP-50 Russian banks by 2004, and by 2010 – into
the TOP-25. Finally, the Chemezov Group formalized (formally) its economic base with the creation of the
Rostec Corporation in 2007.
In the same period, the Kovalchuk family changes its status and begins to be established as one of the “Kremlin
towers”. Bank “Russia” controlled by them is actively entering the market of lending to key state-owned
companies. And also provides a financial resource for takeover operations. In particular, the mentioned
Rosneft and VPC groups at the initial stage of their structural design (2000-2003) used the services of the
bank “Russia”. Thanks to this, the Kovalchuk family, in addition to political resources (due to their friendship
with Putin), dramatically increased their financial resources and became one of the centres of decision-making
on personnel issues. That is, to actively propose to Vladimir Putin candidates for filling vacant positions in the
management system.
And, finally, one more direction of Putin's strengthening can be called tactical alliances with the heads of
large state-owned companies, but without stimulating the creation of their own management clans. The
most vivid example can be the transformation of the Ministry of Communications of the Russian Federation
into OJSC “Russian Railways” in 2003. The first head of the new company was the relevant minister Gennady
Fadeev, who came to manage the railway even before the Yeltsin government in 1992. However, as early
as 2005, the Russian Railways was headed by Volodymyr Yakunin, whom Putin had known since the mid-
1990s from his work in the Main Control Directorate of the President of the Russian Federation (Yakunin
is Putin's protégé and his successor as head of the North-Western Directorate since 1997). Thanks to the
control over the railway, Putin got the opportunity to influence the business of the largest financial and
industrial groups of the Russian Federation. It was at the time of Yakunin's leadership that most of the scandals
related to the redistribution of rolling stock and provision (more precisely, restrictions) of opportunities for
the transportation of their cargo by large Russian commodity companies.

16
KREMLIN TOWERS
Already at the turn of 2001-2004, Vladimir Putin strengthened enough to attack the key groups of the
elites of the Yeltsin era. The new president of the Russian Federation:
received his own financial resources (and depended on support from old groups);
provided manageability in the personnel policy;
cemented the power block, providing the possibility of controlled pressure and fairly well-known and
influential representatives of the Russian elite;
created a system of economic influence on oligarchic groups through control over transport, energy
(together with the “family”), finance (development of controlled financial groups + control over state
banks).
The result was an attack on the oligarchs who did not want to become second-order players in Putin's entou-
rage.
Mykhailo Husynskyi, the owner of the “Mist” group, became the first victim, where the main reason for the
attack by the authorities was the struggle for information resources – the NTV company and a number of
popular print publications. As a result, already in the middle of 2001, the Gazprom-media structural division,
created as a result of the gas monopolist's “buyout” of the shares of the television company and other mass
media, appeared within OJSC “Gazprom”. A few months later, the conflict between Putin and Berezovsky
resumed. After the first failed attempt in 1999 (the time of the premiership), the second attack began at the end
of 2001. The formal claims at that time consisted of tax evasion and embezzlement of Aeroflot funds. The real
reason is Berezovsky's control of the “First Channel” and the struggle for control of the air transport market,
which Putin could not win without control of Aeroflot.
Thus, by early 2002, Vladimir Putin's entourage controlled key television channels:
a group of NTV channels through Gazprom Media;
after Berezovsky’s emigration, the Kovalchuk group seized control of the “First Channel” (it is ORT);
the RTR channel group was controlled by Putin himself through the government of the Russian Federation
(RTR is a state-owned company).
Such a media “empire” allowed, by manipulating public opinion, to launch attacks on the country's key oligar-
chic groups (provided that they did not agree to work in the new system) and prepare for election campaigns
with a sufficient level of optimism. In particular, by gaining control over the parliament and attacking regional
elites.
STRUGGLE FOR
PLCE UNDER THE SUN
FOREVER

17
In the sphere of public affairs, Putin is concentrating on forming a “party of power” and gaining control
over the political field. As early as 2001, the leadership of the “Fatherland-All Russia” bloc changed and
it merged with the Unity party, which was created in 1999 “under Putin” and was intended to ensure his
support in the presidential elections. The leaders of the “Unity and Fatherland – United Russia” association,
which appeared as a result, were close to Putin Sergey Shoigu, his key competitor Yuriy Luzhkov and the
leader of Tatarstan, Meytymir Shaimiyev.
Three years later, in 2004, the leadership triumvirate was dissolved and the party, which shortened its
name to “United Russia”, was headed by Segrei Gryzlov.
At the same time, issues of control over other political groups are being resolved.
In the liberal field, there was an active competition between several Russian parties, the key ones being
Yabluko and SPS. But after 1998, the possibility of them getting a majority in the parliament was minimal.
In addition, the leaders of these parties spent a significant part of their resources on competition and
restraining their ideological allies.
The most dangerous for Putin and his entourage was the group of the population, which was inclined to
imperial slogans. Whether it is nostalgia for the USSR, or a desire to restore some analogue of the Russian
empire of the 19th century model. Such sentiments (the desire to see a “strong hand” in the management
of the state) were widespread in no less than half of the Russian population. And this field gave votes to
both the Communists and the LDPR or many small right-wing radical parties that were close to entering
the Duma (DON, Congress of Russian Communities and others). In order to control the processes, the
“National Patriotic Union “Batkivshchyna” was created, which united in one structure the already mentioned
“Volunteer Movement of Special Purpose (DON)”, the Congress of Russian Communities, the right-wing
party “Narodna Volya” of Serhiy Baburin and the left-wing party “For a Decent Life” (Serhiy Glazyev) and
Vasyl Shestakov's Socialists. As a result, in the elections to the State Duma of the fourth convocation, the
“Batkivshchyna” party criticized not so much the party in power, but its main competitors in the fight for
voters — the Communist Party of the Russian Federation and the Communist Party of the Soviet Union.
The result was predictable. The Communist faction shrunk to 10% of mandates, the LDPR fell to 6%.
“United Russia” itself obtained a constitutional majority in the Duma due to control over self-nominated
candidates.
PRTY(IES) OF
POWER

18
KREMLIN TOWERS
Another problem – the Russian Federation as a “Federation” – the presence of local elites who had their
own interests and ambitions. At the same time, Yeltsin's administration and “Batkivshchyna” did not oppose
the growing influence of regional elites, and in some regions deliberately supported the strengthening of local
clans. Such a situation persisted at least until the end of 1998 and allowed Yeltsin (and the “Family”) to success-
fully restrain political opponents at the federal level.
The upper chamber of the Russian Parliament – the Federation Council – since its creation in 1993, was called
to become a body that primarily represents the interests of the regions. At the same time, at the initial stage
(1993-1996) it was a body that represented regional elites — direct elections of “senators” were held in the
subjects of the Federation. At the same time, local election commissions were formed under the full control
of local authorities, and the participation of the Central Election Commission of the Russian Federation was
rather formal.
The 1995 law changed the procedure for forming the GF — now it included two representatives from each
region:
Head of the subjects of the Federation by position (governor)
a representative from the regional legislative assembly (elected by deputies)
In this way, both the central government and the regional elites succeeded in eliminating the “surprise factor”,
when a “senator” could become, for example, a political opponent of the local government. But the upper
chamber of the Federal Assembly retained its functionality as a place of representation of regional groups, a
place of lobbying for the interests of political clans from the subjects of the Federation.
First attack on regional clans and
establishment of control
In 2001, with the proposal of Vladimir Putin, the system is changing. The new president of the Russian
Federation saw the direct participation of “governors” in political games in Moscow as a threat to his own
strengthening. But, not having the opportunity (and resources) to enter into a confrontation with the regions,
he proposed a compromise solution, according to which the participation of the subjects of the Federation
in the work of the upper chamber of the Federal Assembly is organized through “appointed representatives”
who perform their duties on a professional basis.
THE PROBLEM OF
REGIONS OR HOW TO
KEEP FEDERATION
ONLY IN THE TITLE

19
Thus, the governor cut himself off from Moscow politics, sending in his place an “authorized representative”
who, growing in contacts and not risking being recalled (for the duration of his mandate), gradually reduced
his dependence on regional elites. A similar situation was with the second candidate from the region – a
“representative” of the legislative assembly, who also lost connection with (or dependence on) local political
clans.
As compensation for the governors, the State Council of the Russian Federation was created – an advisory
body under the President of Russia, which included the heads of the Subjects of the Federation, but in addi-
tion to them the heads of the Federal Assembly (both chambers, heads of factions), representatives of the
president in the regions and other people who may be added to the members by order of the President of
the Russian Federation.
Four years after reformatting the upper house of parliament, Putin was given the opportunity to pass a key
amendment to the law that marked the beginning of the end of the influence of regional elites on politics at
the federal level. At the proposal of the President of Russia, the State Duma and the Federation Council (!)
are changing the process of electing regional heads. More precisely, cancel them. Since 2005, the candidacy
of the head of the region has been proposed by the President of Russia and approved by local legislative as-
semblies. For the governors who were acting at that time, at first glance, little has been changed – they already
controlled the regional parliaments. However, from the point of view of the local elites, it meant the end of
independent politics. Previously, a regional clan could elect their own leader. Or competing clans indepen-
dently and without interference in the process competed for control over the region, in particular offering
their governors to the population. Since 2005, only that clan and that candidate for the post of governor who
passed a kind of casting in the Kremlin and was personally approved by Putin could win in such competition.
Such a system lasted until 2012, and in view of the five-year term of office of the head of the subject of the
Federation, all heads of Russian regions passed through the sieve of “approval”. That is, the Kremlin approved
the system of control over the regional elites.
Return to democracy
or the end of federalism
Direct elections of governors were returned only in 2012. The relevant law was adopted a few months before
the end of Dmitry Medvedev's term as president.
However, until that moment, the independence of regions and regional elites was significantly limited. In the
political field, due to the “curation” of the Kremlin, and in the economic field, due to changes in the tax system
of Russia (in 2005-2010), the subjects of the Federation lost control over a significant part of financial flows.
In particular, the change in the taxation of raw materials companies, the redistribution of tax revenues (tax on
exports instead of tax on mineral resources, increase and creation of holdings with “Moscow” or “St. Peters-
burg” registration, change in the order of distribution of revenues from VAT, excise duties) led to the fact that
the regions (except 5-6) became dependent on central funding. That is, there was a complete change of roles:
local elites did not negotiate about the Federal Centre’s share of their income, but acted as beggars, and the
Kremlin already made decisions on funding the regions.
The direct elections of the governors, which resumed against this background, no longer carried risks for the
Federal Centre. Attempts by the regional elites to present an “uncoordinated” candidacy had budget prob-
lems for the next five years. Moreover, the term “parachutist” appeared – a candidate for the position of the
head of the subject of the Federation, who did not live (and did not work) in this region before the elections.

20
KREMLIN TOWERS
These were proposed either directly (which is rare) or through a rather simple scheme:
7-8 months before the elections, the head of the subject of the Federation resigns and Putin appoints an
acting representative (elections are not held when the acting head is appointed).
And the recent appointee and “acting” governor “wins” the election.
In 2012, changes were made to the principle of formation of the Federation Council. At present, the represen-
tative from the executive power (governor) is known in advance. Each gubernatorial candidate in the election
presents a list of three people, the first of whom becomes a “senator” in case of victory (the other two are
“spare-in”). At the same time, the head of the subject of the Federation does not have the right to recall his
representative from the Council of the Federation. A representative from the legislative assembly is only one
of its deputies. Who, becoming a “senator”, just as quickly loses dependence on regional elites.
By 2022, the majority of heads of Russian regions were “parachutists”. More than 80% of them have never
lived or worked in the region under leadership before.
The result is a closed system of complete control over the regions, in which the word “Federation” in the
name of the country is deprived of its meaning:
The leaders of the regions become people who are in no way related to the regional elites and most often
come from other regions. They are appointed by the Kremlin.
At least 50% of the members of the Federation Council are directly or indirectly appointed by the Presi-
dent of the Russian Federation (up to 30 persons are appointed for life and from one representative of the
regions, represented by a governor appointed (actually) by the President). The rest — deputies of local
legislative assemblies — are initially in the minority and quickly lose touch with the regions.
The State Council of the Russian Federation, which at the initial stage of its existence was a consultative
body of the president with the leaders of regional elites, was transformed into a body that includes the
President of the Russian Federation and governors appointed by him.
Regional elites lost any possibility to influence the policy of the Federal Centre. Moreover, they lost the op-
portunity to grow and transform (independently or in alliance with others like them) into an independent
political group in the Russian Federation.
In 2019-2021, the Kremlin took additional measures to strengthen control over local elites. The procedure for
monitoring the implementation of national programs in the subjects of the Federation was changed. Previous-
ly, local legislative assemblies (and local governments) developed plans for the implementation of national
programs on their territory, received funding for this under their responsibility and managed the money. That
is, they had a financial resource additional to the established budget. According to the new practice, proposals
for national programs in the regions and responsibility for their implementation are the governor's responsibil-
ity. As well as instructions, control over the allocation of funds.

21
The slogan of the «United Russia» election campaign is “Strong president – strong country” is a concise
formula of the imperial mechanism of the functioning of power in the Russian Federation. In fact, Putin is
not only “higher” than all branches of government in the country, but, in fact, he is the “alpha and omega” in
decision-making and management of power resources at many levels. Therefore, we can define the presiden-
tial monopoly on power as one of the main characteristics of the Russian vertical of power.
The second feature is the existence of a real and formal power pyramid in the Russian Federation. The reason
for this phenomenon is the decorativeness of the existence of democratic institutions and the imitation of
competitive mechanisms in the country, and the purpose is to cover up the real way of decision-making and
the persons responsible for managing these or other processes.
Thus, the Kremlin pyramid of power rests on three main pillars of control, namely: control over economic
resources and public opinion, as well as control of law enforcement agencies over the state.
Schematically, we can depict the pyramid of power as follows:
FORML
PYRMID OF POWER
TODY
is hard to believe

22
KREMLIN TOWERS
The party was founded on December 1, 2001, but let's pay attention to the years 2004-2007, which became
fateful for it. During the second term of Putin's presidency, the State Duma of the Russian Federation made
substantial amendments to the law “On Political Parties”. These changes fundamentally changed the condi-
tions for the functioning of political parties, which played into the hands of United Russia.
Thus, among the main changes were: an increase in the number of the party to 50,000 people, with the con-
dition that the party must have members in at least half of the subjects of the Russian Federation numbering
at least 500 people, in other subjects – at least 250 people; cancellation of the right of electoral unions to
form electoral blocks; the provision by which political parties were prohibited from nominating candidates
from other political parties; public observation of the elections was cancelled; introduced a 7% pass barrier.
In addition, since 2002, the procedure for granting powers to the heads of the executive power of the sub-
jects of the Russian Federation has changed – and since then they were no longer elected by the population,
but began to be appointed “from above” by the regional parliaments on the proposal of the President. With
these changes, Putin secured total influence in the regions, which helped him to concentrate elites in his
hands and ensure loyalty to the ruling party for years. Since then, the existence of the opposition became
impossible.
Today, the structure of the party will consist of regional, local and primary departments of the party, which
are its structural units and operate on the basis of the current Charter. Regional branches of “United Russia”
were created in all subjects of the Russian Federation, and currently 82,631 primary and 2,595 local branches
of the party are functioning. Dmytro Medvedev is the head of the party and part-time deputy head of the
Security Council of the Russian Federation. In particular, the Supreme Council of the party, whose Chair-
man is Boris Gryzlov (Chairman of the Board of Directors of JSC “Tactical Missile Armament Corporation”,
Ambassador Extraordinary and Plenipotentiary of the Russian Federation to the Republic of Belarus) will
include the entire Russian “elite”, which in the best Soviet traditions, in its activities does not deviate from
party policy.
The State Duma of the Russian Federation belongs to the legislative branch and together with the
Federation Council form the Parliament of the Russian Federation – the Federal Assembly – the highest
body of legislative power. Thus, the parliament of Russia consists of two chambers: the Federation Council
(upper) and the State Duma (lower). Chambers differ from each other in terms of the number of members, the
order of formation, and the powers granted to them by the Constitution.
The State Duma is headed by the chairman, under whose authority are the first deputies, deputies and the
Council of the State Duma.
“UNITED RUSSI
STRUCTURE
STTE DUM
STRUCTURE

23
The Federation Council is the “upper” chamber of the Federal Assembly. Delegates from all subjects of the
Russian Federation are represented in the Federation Council, in particular, each region of the country has
one representative from the legislative and executive powers (senators), which should theoretically allow
considering the interests of all regions of the country.
It is important that the legislation of the Russian Federation enshrines another fictitious provision – the
President of the state does not have the authority to dissolve the Federation Council. Instead, such authority
rests with the State Duma (which, for obvious reasons, follows party policy exclusively). Meetings of the
upper and lower chambers are not held together, so they do not pass general resolutions. In addition, the
interaction between the chambers is carried out in the specially created Council of Legislators, which is
headed by the heads of both chambers – two assistants.
The main function of the Federation Council is to review and agree on laws developed by State Duma
deputies before these projects reach the President's desk. In addition, within the competence of the
Federation Council are areas related to military operations and peace agreements, the appointment and
dismissal of some senior officials of the Russian Federation.
All members of the Federation Council work as members of special working groups – committees, each of
which is responsible for its own specific area. Under the Federation Council, temporary commissions and
specialized councils have been established.
FEDERTION COUNCIL
STRUCTURE
The State Duma structure includes:
committees, sub-committees, which work according to the branch principle;
deputy associations and factions, which are formed on political grounds;
there are commissions to solve operational issues of legislative and other activities.
Deputies of the State Duma perform formal functions: they approve the candidacy for the position of the
Head of the Government presented by the President, listen to the reports of the Government and Ministers,
appoint and dismiss a number of high-ranking officials, bring charges against the President, etc.
In the 8th convocation of the State Duma (2022), the party “United Russia” is represented, which has 49.82%
of the mandates, as well as the Liberal Democratic Party, the CPRF, “Just Russia”, “New People”, and one
mandate each in the “Party of Growth”, “Batkivshchyna” and “Civil Platform”. As we can see, competitive
advantages are clearly on the side of the “United Russia” party.

24
KREMLIN TOWERS
The Security Council is not just another “manual” structure of the President of the Russian Federation, but
is the closest to the Presidential Administration. Together, they are auxiliary bodies under the President
and in fact have extended powers. The role of the Security Council began to grow gradually from 2012, in
particular it played a prominent role in all aggressive decisions of the Russian Federation regarding Ukraine.
Officially, the Security Council “prepares the decisions of the President of the Russian Federation on issues
of Russia's development strategy, ensuring the protection of vital interests of the individual, society and the
state from internal and external threats, conducting a unified state policy in the field of ensuring national
security”.
The Security Council is formed by the President and permanent members of the Security Council are also
appointed by him, and the President himself is the Chairman of the Security Council. The Secretary of the
Security Council is directly subordinate to him. The secretary ensures activities for the sake of Security,
manages its apparatus.
In addition to the Chairman, the Security Council consists of the Secretary of the Security Council, permanent
members and members of the Security Council, who are included in the Security Council and excluded
from it by the President of the Russian Federation upon the proposal of the Secretary of the Security Council.
Security Council members participate in Security Council meetings with voting rights.
Not surprisingly, of the permanent members, about half have previously served in the KGB and FSB, and the
majority are law enforcement officers.
Therefore, the pyramid of power in the Russian Federation is a gradually and clearly constructed mechanism,
where the last instance for making all decisions is one person who represents the entire state. The principle
of functioning of this system calls into question the probability of its breaking in the coming years. The
number of trained staff “spliced” in this system is immeasurable. For example, according to official data, the
total number of personnel reserves of individual federal bodies as of January 1, 2021 was 52,391 people.
Therefore, the number of professionally trained followers of the functioning of this vertical of power
confirms, rather ominous in this case, the saying that “there are no irreplaceable people”.
SECURITY COUNCIL
STRUCTURE

26
KREMLIN TOWERS
RUSSI
TODY
Chapter 2

27
In the description of the processes taking place in the Russian Federation, external observers and analysts pay
attention to law-making, statements of key people in the pyramid of power and (or, at best) to the activities
of individuals in Putin's entourage. The approach has a right to existence. As well as a simple assessment of
influence groups, or “Kremlin towers”, the transformation of their policies.
But in both the first and second cases, the question of motivation of both individuals and entire “clans” remains
open. As well as the motivations of the state machine's actions: both formal and deep. In order to understand
the processes, you should ask yourself the question “what is the Russian Federation?”
Federation?
In the chapter devoted to the transformation of the system of influence of the centre on the regional elites,
the processes are described, which lead to the conclusion that the word “Federation” does not define the
essence of the Russian state. Regional elites at the first stage were cut off from collective decision-making
at the central level. And in the second stage, which began in 2013-15, they were also cut off from managing
a significant part of financial flows even on their territory. The only chance for career growth of a regional
leader is to go through one of the influential groups in Putin's entourage. But, in this case, even after returning
to his region or republic, he will already be a representative of the interests of the “centre”, but not an
exponent of local interests.
And decision-making at the level of the Federation, where governors and representatives of legislative
assemblies formally participate, actually boils down to the mechanisms of voting in bodies, more than half of
which are appointed by the Kremlin:
Governors are parachutists and are actually assigned to watch over the territory. They are dependent
on Moscow and not on their region. It is part of the State Council.
Half of the senators in the Federation Council are proposed by central-dependent governors. The
second half, due to their “professional work in Moscow”, is quickly losing touch with the small Fatherland.
And, finally, the golden share is life-long and Putin-appointed “senators”. There are not many of them, but
they act as a safeguard in case of even an unlikely frontal of the regions.
Thus, Russia is not a federal state by its very nature. It is a multinational state with formal attributes of a
federation, but an extremely strong system of vertical subordination.
RUSSI AS
CORPORTION, NOT
A STTE

28
KREMLIN TOWERS
Empire?
Indeed, the nature of the Russian Federation's management, the desire to expand its spheres of influence, and
ultimately, the inertia of historical processes suggest that the Kremlin's management decisions are based on
an imperial matrix of behaviour.
At first glance, yes. And imperial ideas and values have an extremely strong influence on Russian society.
Typical features are:
the desire for expansion, the expansion of foreign policy influence, treating neighbours (and most
partners) not as equals, but as states and nations that have fewer rights to independent decisions than the
Russian Federation itself. And, as a consequence, the imposition of its own will.
an informal but actually existing division of citizens based on the principle of belonging to the titular
nation (or by place of residence). Those whom Lenin called “Russian foreigners” can achieve recognition,
partially shed the layer of “second-rate” only through achievements at the “All-Russian” (read imperial)
level. Of course, having given up their identity.
construction of a business model for the state's existence based on the maximum exploitation of the
resource base of dependent countries or remote regions. Moreover, the situation when neighbouring
states or distant Subjects of the Federation risk becoming more developed, more prosperous than the
“metropolis” is perceived as a threat to the existence of the whole of Russia.
The only thing missing is an ideological basis. Simply put, answers for Russians themselves “what is Russia
and the Russian world”. Constructions formed in the late 1990s and early 2000s, based on the dominance
of “Russian culture”, Russian Orthodoxy, cease to be relevant. The reason lies in the transformation of
Russian society itself, in particular, the emergence of new social groups. But even more important are the
demographic problems. Russia is becoming extinct. To be more precise, its “Russian component” is dying
out. The number of population stabilizes due to natural growth in national autonomies and inward migration
flows. The decrease among migrants of citizens of Ukraine, Belarus, and Moldova does not make it possible
to compensate for the skew toward representatives of the “national republics”. By the way, precisely in
order to reduce the demographic (or cultural) shock from the change in the structure of the population, the
Kremlin conducted and is conducting an active policy of “passportization”, as well as attracting immigrants to
problem regions. But this does not solve the problem, it only postpones the moment of its manifestation and
the moment of collapse of even the fake ideological construction based on the “Russian nation” as the central
element. Even in 2021, the Russian Orthodox Church was not mentioned in Putin's message to the Federal
Assembly as a key structure. Instead, the Russian president thanked “religious leaders” for cooperating with
the authorities.
It can be argued that the concept of the “Russian world” is in crisis. Metropolis loses population and cultural
influence. Dominions are growing with inhabitants who are the bearers of “non-Russian” culture. The idea of
“Russian Russia” could be transformed into the concept of a “multinational empire”, but under the condition
of real federalism or, at the very least, the influence of a number of key regions on politics at the central
level. The reverse process takes place – building a vertical pyramid of subordination. Informal groups of
influence around Putin are not built on a national basis, but rather on a corporate basis — by spheres of
activity or responsibility. In the groups themselves, there is not a single representative of the regions who
would act as a representative of the interests of their territory. There are conditional “foreigners”, but they
pursue the interests of their groups, even to the detriment of the interests of their own nation. By the way,
the same applies to the Russian nation — it is not a subject in the informal system of government in the Russian
Federation.

29
And, in the end, it is worth paying attention to the ideological work. In the documents of the Valdai Club,
HSE, RANHiGS, not a single (!) program document has appeared in the last five years, which would introduce
a new thesis construction and become the basis for state policy. There is an attempt to compile a “new”
one from theses formulated in the late 1990s and to rewrite some of the key points voiced on international
platforms. Like the idea of a new industrial revolution, which was discussed at the Davos Forum 8 years ago.
Or the idea of competition of the civilization system, which was formulated in the People's Republic of China
and is the core of Chinese foreign policy. Naturally, this is fully reflected in Putin's “programmatic speeches”
since 2015. The process showed itself most vividly in 2022, when the idea of a “quick war” failed.
Therefore, it can be stated that the Russian ruling elite actively uses imperial narratives, but according to the
nature of its organization, according to the ideological foundations of politics, Russia is no longer an empire.
The third option is a corporation
Institutions of power in the Russian Federation (parliament, courts, government) are not a real system of
decision-making and partly play the role of a screen. Regional elites, despite the declarative federal structure
of the state, are also cut off from the levers of control at the central level. The ideological construction,
imperial in its essence, is experiencing a deep crisis and today serves, rather, as a decoration. At the same
time, efforts to develop a new state ideology are not yet visible.
At the same time, real decisions are made by several groups, which are organized on a “professional” or
“industry” basis, where the idea of maximizing profits while ensuring stable working conditions is the basis.
This is a description of a transnational corporation. Only not of the modern type, but, rather, a sample of
colonialism (the world from 1918 to the 1960s). Where each of groups has a “part” in a state called “Russia”.
They work together to eliminate competitors on the field. But at the same time, they can wage a fierce
internal struggle for redistribution of spheres of influence inside.
At the same time, the use of ideological constructions (the same imperial narratives) can be compared with
attempts to implement corporate culture and corporate loyalty. Where a representative of any department
(in Russia, a territory) cannot be successful in attempts to grow, based only on his professional specificity (in
Russia, national identity). Treating dependent territories as a resource base is also part of the corporation's
working logic.
In this case, the idea of the “Russian world” as a basis for the expansionist policy completely resonates
with the process of “importing civilization”. Moreover, parallels with even earlier periods of active colonial
expansion are more relevant here.
Perception of the Russian Federation as a corporation brings clarity to the specifics of this country's politics.
Where there are “acceptable levels of capital withdrawal”, where there is a common raw material base,
but there is no desire to make a rapid technological transformation. Where foreign trade is perceived as a
mechanism of pressure and control over partners. Where an economic breakthrough in the resource-source
region is perceived as a threat to the entire business model and such a process requires immediate response
measures. After all, where creating comfortable living conditions for citizens is not an unquestionable priority.
Such a transformation is completely logical. An empire that loses its ideological basis and in which the formal
system of decision-making gives way to informal, shadowy mechanisms sooner or later begins to function as
a “normal” transnational corporation.

30
KREMLIN TOWERS
There are several attempts in the press to classify Putin's entourage.
In the Russian Federation, in terms of methodology, the most developed concept proposed by Yevgeny
Minchenko is Politburo 2.0. In which the key persons of V. Putin's inner circle are identified, i.e. those who
are most likely to participate in key management decisions. And spheres of influence based on personal or
professional connections are derived from them.
In European sources, they analyse either the personal composition of the “inner circle” or the interests of
key Russian corporations (Gazprom, Rosneft, Rusal, and others).
In the Ukrainian information field, they either work in “European traditions” or talk about “Kremlin towers”
without clearly classifying such towers and tracking their vertical structure.
All in all, none of the proposed approaches provides an understanding of the causes of internal conflicts in
the Russian elites, a number of personnel or management decisions. And, even more so, the functions of
individual representatives of the Kremlin's leaders on the foreign field.
This document proposes an approach focused on groups that have common interests and are able to defend
them, lobby for necessary political and economic decisions (for the group). And they are also capable of
conditional “reproduction” – that is, with a working internal system of personnel training and growth.
With this approach, an influence group can only be a group that has at least three of the four characteristics:
A mechanism for participation in decision-making at the highest level. That is, a person (people) who
has the opportunity to communicate with Putin according to their own agenda. An important aspect is not
to meet in connection with professional duties (meetings with the Prime Minister, weekly receptions of
the FSB leadership), but to offer a conversation outside the usual schedule and to come with your agenda,
your questions and your proposals.
Common area of interests. Is includes corporate interests for groups that have arisen around key industries
or specific groups organized on common functions in the state (for example, law enforcement officers).
Availability of own resource base. This can be related to business (for groups that have arisen around
corporations) or to control over a number of state institutions (for example, the army, power structures,
state banks).
Access to budgetary flows. A real influence group is able to carry out budget allocation. She can be a
donor or a recipient. But it retains access to the budget as part of its resource base if necessary.
INFLUENCE GROUPS
OR A CIRCLE AROUND
PUTIN

31
Ideally, each of the influence groups for its existence should have a set of additional characteristics that
allow it to remain stable:
power resource
financial resource (money, companies)
political resource (presence of dependent (related) people in the parliament, government)
media resource – the presence of own (or managed) mass media, reaching more than 5 million people
regional resource – the presence of dependent governors in the subjects of the Federation (or partners)
In fact, none of the key groups in Putin's entourage can boast of strong positions in all of the above-mentioned
respects. But there is not a single one that does not have a set with less than 3 out of 5 resources. In recent
Russian history, there was only one such company that disappeared with the change of managers of the key
company - the Russian Railways group.
Below there is a sample chart of key groups in Putin's entourage. Where the grouping of surnames is made
according to the following principle:
The first column (under Putin's surname) is the leaders of the groups. Those who are part of the closest
circle of communication of the Russian president and can offer ideas in the field of state policy. The
same people who are able to come to the first person's office “without being called”. It should be noted
that some of the close circle (including Putin's relatives, Shoigu, who is a holiday companion) are not
the leaders of the groups. They can protect their interests, the interests of their department, but they
are hardly capable of influencing large-scale issues. These individuals are grouped by the principle of
common interests and are the core of each group.
The second circle, which is already clearly divided into groups, consists of top managers who have
direct access to Vladimir Putin and ensure the implementation of key decisions. Their job is to implement
decisions, perhaps to suggest ideas for improving performance, but they can only indirectly set the
political agenda.
The third category is approximately at the same level with the second one. These are the people who
control each group's key resources. It can be a corporate bank, a firm, a specialized institute or a media
group.
It should be noted that a significant part of the Russian Forbes list is missing from the scheme. However, this
approach is logical. An oligarch, who is not a member of one of the groups, can ask the state (read Putin's
entourage) to protect his interests. Maybe even get it. But he has no right to interfere directly in politics. And
his resources can be used by the state (or one of the groups) in a forced partnership format. Of course, losses
will be compensated later. But there is a difference between the functions of a “wallet” and a “banker”.
Thus, we have 6 key groups:
A group of security forces. This is a heterogeneous group that unites people associated with the army,
the Ministry of Internal Affairs, special services, investigations, punishments execution and control
over legality. This direction is important, given the specifics of the Russian state and aggressive foreign
policy. And the power bloc with the arrival of Putin became one of the foundations of his power.
01

32
KREMLIN TOWERS
At the same time, there are contradictions and even conflicts within the group, which the Russian
president is in no hurry to extinguish, since the monolithic force component in the conditions of
autocracy creates risks of a military coup.
Chemezov's group or the Military Industry Committee group. This “Kremlin tower” arose in the
process of strengthening control over the Russian defence complex in the early years of Putin's term.
In fact, it was he who initiated the transformation of a group of influential lobbyists from the defence
industry into a single group. Of course, under the control of a close person. He subsequently carried
out personnel purges and finally organized a closed, but quite stable and influential group.
The Rosneft group, which was also created during Putin's reign with the help of the monopolization
of oil exports and the gradual displacement of companies not under its control from the production
market. Note that in addition to the head of the state-owned company, one of the Russian oligarchs
is present in this group. Viktor Vekselberg's business is closely related to the oil sector and money
flows between the Russian budget and Rosneft corporation. The peak of this group's influence fell on
the period from 2010 to 2017. However, Rosneft was prevented from growing further by its sphere
of activity adjacent to Gazprom, which created both points of mutual interests and a large field of
competition for influence.
“Gazprom-Novatek” group. One of the oldest groups that emerged during the reign of Boris Yeltsin
around the Russian gas monopolist. Today, it unites people associated with PJSC Gazprom, as well
as with its formal competitor, the Novatek company. And, as in the case of the “Rosneft” group, here
among the key figures we see the “ordinary oligarch” – Arkady Rottenberg, who does business in
cooperation with subsidiary companies of both Gazprom and Novatek.
Kovalchuk's group. The only “family” group in Putin's entourage. Its core is the Kovalchuk brothers,
their close and distant relatives, business partners. This is the only group that did not have a “basic
asset” during its inception, around the development of which a system of influencing the authorities
was created. The bank “Russia” became rather a derivative of the realization of Putin's friendship with
Yuriy Kovalchuk. Perhaps due to this – the priority was not to protect the interests of their business,
their industry – this group (more precisely, the Kovalchuks) were able to offer a number of personnel
solutions in areas not related to the bank “Russia”. And today this group is one of the most extensive,
having its own representatives (protégés), including in the sphere of interests of competing groups.
“Gref-Kirienko” group. Or a group of conventional “technocrats”. It was created with the active
support of the Kovalchuk group and unites managers who prioritize the issue of the efficiency of the
state as a whole. It is no coincidence that the majority of the political resource of this group consists
of people related to the financial sphere, planning, and stimulating the economy. But in the last 5
years, this group has strengthened, stopped being a “branch of the Kovalchuk group” and has become
almost the only one that offers a fairly effective system of selection and training of personnel for
public administration.
Until the spring of 2022, there was another group in Putin's entourage – the “Yeltsin family”. Its key
representative was Valentyn Yumashev, who served as the president's adviser from 1998 to April 2022. Its
function was to secure some agreements that allowed some people from Yeltsin's inner circle to remain
subjects in the political field of the Russian Federation. The preservation of such a “status quo” was the unifying
element of this group. The “family” has not proposed new solutions for at least the last 8 years, focusing on
“survival”. Yumashev's demonstrative resignation became a certain kind of signal from Putin that he is taking
over the full power, not wanting to put up with the existence of even old, insignificant agreements. In this
logic, starting in May 2022, there were attacks on key people connected to the “family”. Anton Kudrin was
the last representative of the group to hold a formal position of the highest rank. As of today, the group as a
whole no longer exists, but some of its members, most likely, will fall into one of the listed six groups. Some,
such as Prokhorov and Deripaska, prefer not to be public as much as possible, trying to distance themselves
from participation in Russian politics. That is, to move into the category of “ordinary Russian oligarchs”.
03
04
05
06
02

33
Mykhailo Mishustin deserves a special mentioning. The head of the government of the Russian Federation
increased his influence tremendously at the end of 2021. And, if at the time of his appointment he was rather
a creature of the Kovalchuks, then already in 2022, he could be perceived as a completely independent
figure. However, the war in Ukraine, or more precisely, its transition into a protracted phase, made its own
corrections. Budgetary flows are increasingly managed manually. And individual groups in Putin's entourage
are locking up their resources as much as possible. A typical example is general approaches to industrial
policy and the sphere of the defence complex, considered separately. As well as the area of finding a way
out of the semiconductor crisis. Under such a division, the government loses the opportunity to use universal
mechanisms of stimulation and control over the situation, turning, rather, into an intermediary on economic
issues between the various “Kremlin Towers”. Thus, from the point of view of Mishustin's personal growth,
the prospects of growing his own group, the failure of Putin's military plans became his personal and political
tragedy. The Prime Minister returned to the practice of using the political rear — the Kovalchuk group or
technocrats(Gref-Kirienko)andsearchingfortacticalalliesintheformofothergroupsoneachindividualissue.
Below is an approximate diagram of influence groups in Putin's entourage. We deliberately focused on
personalities, and not on the assets (or departments) they control.
Each of the listed groups has “its” representatives or protégés both in key departments and in business
structures. For ease of perception, the key influence groups are marked with colour. People who are their
protégés are also marked with colour (coloured rectangles). It should be noted that in this scheme there is
not a single sphere that would be completely under the control of one group of influence. On the one hand,
it is the result of internal competition and struggle for resources. On the other hand, there is a conscious
personnel policy of Putin, who fears the creation of completely closed groups independent of external
influences.
The only possible exception is Chemezov's group. But, due to its specificity and concentration on the
defence industry, this group is most in demand by others, but also the most dependent on the position of the
other five groups. Therefore, the policy of “concentration within” allows Chemezov to maintain his sphere of
influence, but its narrowness does not create prerequisites for an independent political game and, as a result,
does not create risks for the power of Vladimir Putin. At the same time, Chemezov himself has “his” people
in PEK, the power bloc, and the financial sector. That allows him to maintain his position under conditions of
internal competition between the “Kremlin towers”.
Outside of the established influence groups, there are several dozen (or hundreds) of representatives of the
Russian elite. Politicians and businessmen who can influence the processes in the Russian Federation, but
who are not protégés of one of the “Kremlin towers” and do not have the resources, opportunities to form
their own group.
In the given diagram, they are grouped by spheres of activity and the specifics of contacts with Vladimir
Putin.

36
KREMLIN TOWERS
Representatives of the first group can be tentatively called “trustees”. The brightest representatives are
Kadyrov, Prigozhin, Nechaev. These people are united by functionality: they have access to the first person,
they can even propose their agenda, but the sphere of their activity is narrowly specialized. They are
involved in solving some separate, niche problem.
Nechaev and the party “New People”. The key function is the creation and maintenance of a party that
would channel (direct in a controlled direction) the moods and activity of the liberal part of Russian society.
In 2021, the story was a success. In 2022, Nechaev did not cope with his task, which was vividly illustrated
by the political processes against the background of mobilization. On the other hand, in its original form,
the “New People” party could not cope with such a task. The reason is the lack of a unifying ideological
framework at the state level. When a country operates in the regime of a corporation, the idea of war
as a way of maintaining positions does not clash with the ideology of openness and liberalism. Nechaev
remains in the bracket, his party is not scrapped, but he is still in secondary roles.
Kadyrov represents a certain system of agreements with the region, which is in rebellion, and is also used
as a factor of intimidation of Putin's opponents in the domestic and foreign arenas. His role has expanded
somewhat in recent years due to his activity on the field. Kadyrov is one of the informal communicators
with the elites of Saudi Arabia and the United Arab Emirates. Considering that these countries are important
for the Kremlin, the Chechen leader has a stable position. But within the Russian political community, his
function is limited, his position directly depends on the favour of Vladimir Putin and the expediency of
using him as a proxy. Kadyrov does not have his own resource base for maintaining positions outside
Chechnya.
Prigozhin. He is also an agent in narrow areas. Today, he is associated with the PMC, but it is worth recalling
his activity in creating troll factories, curating “new media”, starting from “information agencies” working in
conflict zones, ending with a network of telegram channels. But for all his “successes”, Prigozhin remains a
representative for areas where there is a problem that cannot be solved using formal state institutions. As
soon as there is an opportunity to act openly, using state institutions, Prigozhin is forgotten.
The next group of Russian figures can be called the “political stratum”. These are the employees and public
leaders of the formal system of political power. Leaders of parties, factions in the State Duma, heads of
parliamentary committees. And also, the key propagandists: not media owners, but hired workers who are
popular among the population. This also includes representatives of the president in the Federal Districts. All
these people have in common the fact that they perform an important function, but do not have their own
resource base to fully promote their agenda or form “their influence group”. Simply put, these people are
being replaced, unlike people (or group leaders) from Putin's inner circle. The speaker of the State Duma can
be replaced, this will not create additional challenges for the system. And, for example, it is difficult to do so
with Chemezov or Kovalchuk.
Of course, each such figure has his own specifics of work and communication with Putin. For example,
Sobyanin, who is a member of the inner circle (Minchenko in his own scheme introduces him to the core of
the Politburo – the inner circle). Indeed, the Moscow mayor is in direct contact with the president. But the
Politburo has a rather narrow function, which is close to Putin's entourage, with whom Putin is in contact,
who can propose his agenda to a certain extent, a narrow function, that is, it could even theoretically be
classified as one group with which Sobyanin remained an informal “watcher” until the last moment in regions
where the local ones are still strong, i.e. he acts as the leader of some Russian governors who have made their
own careers and rely on the resource base and support of the local elites. There are not many such regions,
but 7-8 key ones are important for Moscow.

37
And, finally, the regional elites, governors who directly manage the subjects of the Russian Federation.
Most of them are in a dependent state — they are proteges of one or another group of influence in Putin's
entourage. Simply put, the security forces, the Chemezov group, Rosneft, Gazprom-Novatek, the Kovalchuks,
the technocrats — they all have their own governors, who can later continue their careers in these groups.
There are a small number of regions where the governors are not “parachutists”, but rather representatives
of local elites. These are either large national autonomies or regions where the interests of several Moscow
influence groups collide. For example, Saratov region as a place of equal interests of Gazprom and Rosneft.
And there are subjects of the Russian Federation that can be classified as “party quotas”. These regions are
assigned as “base” regions for parliamentary parties. There, the governor is primarily a party functionary and
an example of a possible career for young leaders following the “party line”. There are few of them, but the
presence of a faction in the Duma during two convocations guarantees at least one “governor's seat”. The
decline in party influence reduces quotas. A typical example is the LDPR's loss of 2 “governors” at once over
the past 2 years. The party's withdrawal from the Duma means “resetting” its representation in the leadership
of the regions in the next election cycle.
Conditional ideologues are also given on the diagram. Despite the fact that the Russian state does not have
an ideological core at this stage, there are a few people whose works and theses are used to one degree
or another for program performances of the first persons. Their function is to be a source of theses for
compiling into a public speech, for example, Putin.

38
KREMLIN TOWERS
After describing the general system, it is logical to dwell on each group in more detail. In order to assess its
possibilities of influencing or playing an independent political game, it is worth paying attention to six key
parameters:
Availability of power resource. These are not only armed formations, but also the presence of enforce-
ment mechanisms, internal arbitration and (or) the ability to be an arbitrator for others.
Financial basis. On the one hand, each of the influence groups has access to budget flows or “public
money”. But the concept of “financial resource” is somewhat broader – how much the group is able to
close financial flows internally and how self-sufficient this system is.
Political resource. It refers to the presence of dependent (connected) people in the parliament, gov-
ernment, and other key departments. And also, in the area of responsibility of other competing groups.
Media resource — the presence of own (or managed) mass media, reaching more than 5 million people
Regional resource — the presence of dependent governors in the subjects (or partners) of the Federa-
tion.
Personnel block — a system of either fully controlled or dependent universities, training centres that al-
low training of new leaders both for renewal of the group composition and for promotion (and career
growth) in other areas.
Based on this approach, let's try to evaluate each of the groups of influence. Each of the groups has a core or
key persons and persons of the second order. Key people are the people on whom the group is based. Obvi-
ous leaders who have the possibility of regular contact with Putin and express the interests of their group.
And they are also able to propose a new agenda, political combinations. Their disappearance (change) is a
challenge for the entire management system of the Russian state, since such a process will inevitably lead to
increased competition between the “Kremlin towers”. Second-order people are influential politicians who
have access to Putin. But their difference lies in the fact that they cannot themselves propose a new agenda
outside their narrow sphere of responsibility. More precisely, they can, but only after gaining the support of
key persons or the majority (!) of people like them – second-order persons. Their disappearance or replace-
ment does not carry any risks for the group and the entire system as a whole.
At the same time, it should be noted right away that a person's membership in one or another group is not
permanent. There are people who are equally dependent (equally connected) with two or more groups.
For such parts, this is a logical system of behaviour and ensuring career growth – you do not depend on the
temporary strengthening or weakening of one of the “Kremlin towers”. And on the other hand, they can be a
compromise in personnel appointments in areas where the interests of several groups collide.
To begin with, the diagram of the structure of the security forces (Siloviki) and Military Industry (Chemezov)
groups.
MORE ABOUT
GROUPS
resource base and opportunities
01
02
03
04
05
06

41
Security forces (Siloviki)
Mykola Patrushev and Anton Vaino are the first-order persons in the group of security forces. There can
be no doubts about the first one. The functionality of the second was studied in great detail and concluded
that its activities are to one degree or another connected with communication between various groups of
influence in Putin's entourage, but at the same time the politician almost always followed the key interests of
the security forces.
The second-order individuals are the heads of relevant Ministries and departments: the Ministry of Internal
Affairs, the Federal Security Service, the Federal Security Service, the Investigative Committee, of course, the
FSB, the National Security Service, and the Russian Guards. And also, Dmytro Kozak, as one of whose figures
who is involved in solving purely political tasks, and weightlifter Yuriy Chaika, who is engaged in the North
Caucasian Federal District. This region is important for the group of security forces, since all (except Kadyrov)
heads of the subjects of the Federation have passed through the selection sieve of this “Kremlin Tower” and
are dependent on the security bloc. The district cannot be classified as resource-rich, from the point of view
of industrial potential or mineral reserves. But it is actually such from the point of view of the distribution
of budget flows, which go both to social needs and to support the governance of the region. On the other
hand, a number of complex but important resource territories have been placed under the control of security
forces. Like, for example, Sakha-Yakutia, the governance of which is critical for Russia.
From the point of view of the resource base of the security forces, as well as other “Kremlin Towers”, they
pursue a policy of maximum isolation. That is, financial and other incoming flows remain within the group until
the end. The presence of its own (controlled) insurer — the military insurance company (TSK JSC), a number
of commercial organizations (the Garrison, the forestry service, etc.) and control over the regions allows,
on the one hand, to earn from state financing of the defence sector, and on the other hand, it guarantees
certain protection (data, protection against attacks) in case of wars between the “Kremlin Towers”. The only
oversight of this group in the field is the lack of their “own” bank. There were several attempts to choose a
basic financial organization to service the MoD's cash flows, but apparently Putin's position was given, and
the key bank remains the Kovalchuks' “Russia” bank. The structure of the “security forces” group also includes
“Roscosmos” (for which there is a continuous struggle with Chemezov's group). But so far this corporation and
its financial flows are controlled by the “power” of the “Kremlin tower”.
Separately, both among people of the second order and in the power block, the sphere of responsibility or
the sphere of interests of Viktor Zolotov is highlighted in colour. The Rosgvardiya is formally an independent
structure, created considering the internal forces of the Ministry of Internal Affairs. However, Zolotov retained
influence over the Ministry of Internal Affairs and is still a key figure who is often more influential than the
minister. According to the same scheme, the influence of the head of “Rosgvardiya” also extends to the system
of the Ministry of Emergency Situations.
The sphere of political assets of the group is not too strong. First of all, these are the heads of the specialized
committees of the Duma and the Federation Council, several deputies. There are relatively few people
from the clan of the security forces in other fields. And this destroys the myth of the FSB's control over the
economy. Indeed, the presence of a military (more precisely, KGB) past is a good entry in the biography of a
young careerist. But you will not achieve political growth on the subject of only supporting the power bloc.
That is why promising managers are quickly lured to other “Kremlin towers”. The situation is exacerbated
by the lack of own educational institutions that would train state managers. There are either departmental
institutes or programs that are “under the wing” of other influence groups.
Thegroup'smediaresourcesarequitemodest.ApartfromthedepartmentalTVchannel,radio,andnewspapers,
this group cannot boast of controlling the Russian mass media. There are oligarch-partners who are close to
the security forces and provide their resources. But this kind of cooperation cannot be called permanent. The
clearest evidence of this is the division of sympathies between the security forces and Prigozhin for the TV
channel “Tsargorod” and the group “KP”. Moreover, in the autumn conflicts, they chose the side of the latter.

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