Header Background


Executive directors

directors invested with specific duties by the Board of Directors.

Non-executive directors

directors not invested with specific duties by the Board of Directors and not delegated individual management powers.

Independent directors

Snam directors meeting the independence requirements set out in the Code of Corporate Governance, to which Snam subscribes.

Balanced scorecard

the instrument used as the basis for the short-term variable incentive system to support the achievement of the corporate objectives by translating the business strategy into a set of measurable performance metrics for each eligible person.


elements included in the non-monetary component of remuneration, aimed at increasing the well-being of employees and their families in economic and social terms. This category covers all provisions aimed at satisfying pension and welfare needs (supplementary pension, healthcare and insurance cover), but also “perquisites”, which consist of goods and services made available by SNAM S.p.A. to its employees.

Code of Corporate Governance

as defined by Borsa Italiana, this is the “Code of Corporate Governance for Listed Companies” approved by the Corporate Governance Committee. The document, in line with the experience of the main international markets, indicates the best practices for corporate governance recommended by the Committee to listed companies, to be applied in accordance with the “comply or explain” principle, which requires an explanation of the reasons for any non-compliance with one or more recommendations contained in the application principles or criteria.

Control and Risk Committee

consists of three independent non-executive directors (one of whom is chosen as Chairman) and one non-executive director, and provides recommendations and advice to the Board of Directors, assisting it by carrying out suitable investigations to support its decisions concerning the internal control and risk management system, as well as those relating to the approval of financial relationships.

Appointments Committee

consists of two independent non-executive directors (one of whom is chosen as Chairman) and one non-executive director, and provides recommendations and advice to the Board of Directors. Its main tasks include: proposing candidates for directors when one or more director positions are vacated during the year, and ensuring compliance with requirements on the minimum number of independent directors and on quotas reserved for the least represented category; submitting candidates to the Board of Directors for the corporate bodies of Subsidiaries included in the scope of consolidation and of strategic foreign companies owned by the company. Among other things, it prepares and proposes procedures for the self-assessment of the Board and its Committees.

Remuneration Committee

consists of two independent non-executive directors (one of whom is chosen as Chairman) and one non-executive director, and provides recommendations and advice to the Board of Directors in relation to the remuneration of directors and managers with strategic responsibilities. In particular, the Committee submits the annual Remuneration Report to the Board of Directors for its approval and makes proposals concerning the remuneration of executive directors and members of Board Committees.

Corporate System Framework

is an internal Snam Group document, approved by the Board of Directors, and aimed at describing and explaining the following with respect to Snam S.p.A. and its subsidiaries: (i) the Snam Group; (ii) the organisational and governance model; (iii) the corporate management system; and (iv) the Group’s operating model.

Managers with strategic responsibilities

according to IAS 24, this means “key management personnel”, namely “those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly”. Snam S.p.A. has identified four such persons, who are listed in this document.

EBITDA (Earnings before interest, tax, depreciation and amortisation)

also referred to as “gross operating profit” or “GOP”, this is an indicator of profitability that shows the company’s profit deriving solely from its operations, i.e. before interest (financial management), taxes (fiscal management), depreciation of assets and amortisation.

EBIT (Earnings Before Interest and Taxes)

also referred to as Operating Profit. this is an indicator of profitability obtained by subtracting amortisation, depreciation and provisions from gross operating profit (see EBITDA).

Fair Value of equity remuneration

also defined as fair value. International Financial Reporting Standard 2 (IFRS 2) defines fair value as “the amount for which an asset could be exchanged, a liability settled, or an equity instrument granted could be exchanged, between knowledgeable, willing parties”.

Free Cash Flow

the (monetary) cash flow produced by operating and non-operating activities.

Short-term variable incentives

refers to the Annual Monetary Incentive Plan – IMA, which entitles participants to an annual cash bonus according to the results achieved, in the previous year, with respect to the defined targets.

Variable medium-to-long-term incentives

broken down into two separate plans (“2013 Deferred Monetary Incentive Plan – IMD” and “2013 Long-Term Monetary Incentive Plan – IMLT”), which entitle participants to a monetary bonus payable according to the results achieved at the end of the vesting period (see vesting).

Directors’ termination indemnity

sum of money payable to a director when he/she leaves office.

Employee severance indemnity

sum of money payable to an employee at the time his/her labour contract is terminated as an executive.

Accident frequency index

based on the UNI 7249 standard, this is one of the indicators used to measure safety in the workplace. According to the above standard, this index is calculated as the number of accidents occurring per million hours worked over a given period and/or within a given scope at company level.

Threshold level

the minimum level to be achieved, below which the plan does not provide for the payment of any incentive.

Target level

the standard level of target achievement that gives entitlement to 100% of the incentive.

Related-party transactions

the procedure “Transactions with Interests of Directors and Statutory Auditors and Transactions with Related Parties”, adopted pursuant to Article 2391-bis of the Italian Civil Code and the “Regulation on Transactions with Related Parties” (adopted by Consob under Resolution No. 17221 of 12 March 2010, and later amended by Resolution No. 17389 of 23 June 2010), which sets out the principles and rules that must be followed by Snam and the companies that it directly or indirectly controls in order to ensure the material and procedural transparency and correctness of transactions carried out by Snam and its Subsidiaries with Related Parties and with Interests of Snam’s directors and statutory auditors, also taking account of the objective of avoiding any risk of depleting the company’s assets.

Non-compete agreements

according to Art. 2125 of the Italian Civil Code, these are “agreements that place limits on an employee’s activities for a period following the termination of the contract”.

Pay mix

the percentage of fixed remuneration, variable short-term incentives and medium-to-long-term incentives paid at the target level.

Peer group

group of companies used to compare company results with those of Snam according to defined performance parameters; it is made up of the following major listed European companies in the utilities sector: Enagas, National Grid, Red Electrica, Severn Trent, Terna and United Utilities.

Performance Plan

the instrument that defines the targets used as the basis for the variable short-term incentives system.

Remuneration policy

the body of remuneration programmes for fixed and variable remuneration implemented at the company level in order to support the achievement of the strategic objectives.

Proxy advisors

companies used by institutional investors that issue specific recommendations based on Shareholders’ Meeting documents and their own voting policies, which can have a significant influence on voting on the Remuneration Report.

Issuer Regulations

Consob Regulation No. 11971 of 14 May 1999, containing the rules applicable to entities issuing financial instruments.

Fixed remuneration

includes all fixed annual compensation, before taxes and social security contributions payable by the employee, and therefore not including annual bonuses, other bonuses, indemnities, fringe benefits, reimbursement of expenses or any other form of variable or occasional remuneration.

Variable remuneration

consists of the variable short-term incentive and the medium-to-long-term incentive (see the related descriptions in this glossary).

Salary review

the process of reviewing the fixed annual remuneration for all eligible management personnel.

Stock option

financial instrument whereby a company grants the beneficiaries the right to purchase shares in that company or another company belonging to the same group at a predetermined price (strike price).

Consolidated Finance Act (TUF)

the “Consolidated Act on Financial Intermediation”, Legislative Decree No. 58 of 24 February 1998 (as amended). The TUF introduced “principle-based” legislation on financial matters, which at the primary legislative level establishes only general guidelines, leaving the definition of detailed rules to the supervisory authorities (e.g. Consob).

Total Shareholder Return (TSR)

indicates the overall return of an equity instrument taking into account price changes and the distribution of dividends.

Adjusted net profit

the net profit obtained excluding special items and the effects of those events that are non-recurring or not representative of the standard business process.

Vesting (vesting period)

period between the assignment and exercise of the entitlement to a right to receive a bonus.

to pagetop