Annex 1 – The Code of Corporate Governance (July 2015) and the reference to the information contained in the Report regarding the implementation of its recommendations (“comply or explain” principle)

Article 1 – Role of the board of directors

1.P.1

Listed companies are governed by a board of directors that meets at regular intervals, adopts an organisation and a modus operandi which enable it to perform its functions in an effective manner.

1.P.2

The directors act and make decisions with full knowledge of the facts and autonomously pursuing and placing priority on the objective of creating value for the shareholders over a medium-long term period.

1.C.1

The board of directors shall:

a) examine and approve the strategic, operational and financial plans of both the issuer and the corporate group it heads, monitoring periodically the related implementation; it defines the issuer’s corporate governance and the relevant group structure;

b) define the nature and level of risk consistent with the strategic objectives of the issuer, including in its assessment all risks that might be relevant in view of the sustainability of the issuer’s activities in the medium to long term;

c) evaluate the adequacy of the organisational, administrative and accounting structure of the issuer as well as of its strategically significant subsidiaries in particular with regard to the internal control system and risk management;

d) specify the frequency, in any case no less than once every three months, with which the delegated bodies must report to the board on the activities performed in the exercise of the powers delegated to them;

e) evaluate the general performance of the company, paying particular attention to the information received from the delegated bodies and periodically comparing the results achieved with those planned;

f) resolve upon transactions to be carried out by the issuer or its controlled companies that will significantly impact the issuer’s strategies, profitability, assets and liabilities or financial position; to this end, the board shall establish general criteria for identifying material transactions;

g) evaluate, at least annually, the performance of the board of directors and its committees, as well as their size and composition, taking into account the professional competence, experience, (including managerial experience) and gender of its members and their time in office as directors. If the board of directors makes use of consultants for this evaluation, the corporate governance report shall provide information on their identity and other services, if any, performed by such consultants to the issuer or to companies having a control relationship with the issuer;

h) report its view to shareholders on the managerial and professional profiles deemed appropriate for the composition of the board of directors, prior to its appointment, taking into account the outcome of the assessment mentioned under letter g) above;

i) provide information in the corporate governance report on: (1) its composition, indicating for each member the position (executive, non-executive, independent), the relevant role held within the board of directors (including by way of example, chairperson or chief executive officer, as defined by article 2), the main professional characteristics as well as the duration of his/her office since the first appointment; (2) the application of article 1 of this Code and, in particular, the number and average duration of meetings of the board and of the executive committee held during the fiscal year, and the related percentage of attendance of each director; and (3) the methods for implementing the evaluation procedure described in letter g) above; and

j) adopt – to ensure the correct handling of corporate information – upon proposal of the managing director or the chairperson of the board of directors, internal procedures for the internal handling and disclosure to third parties of information concerning the issuer, having special regard to price sensitive information.

1.C.2

The directors shall accept the directorship when they deem that they can devote the necessary time to the diligent performance of their duties, also taking into account the commitment relating to their own work and professional activity, the number of offices held as director or statutory auditor in other companies listed on regulated markets (including foreign markets) in financial companies, banks, insurance companies or companies of a considerably large size. The board shall record, on the basis of the information received from the directors, on a yearly basis, the offices of director or statutory auditor held by the directors in the above-mentioned companies and include them in the corporate governance report.

1.C.3

The board shall issue guidelines regarding the maximum number of offices as director or statutory auditor for the types of companies referred to in the above section that may be considered compatible with an effective performance of a director’s duties, taking into account the attendance by the directors to the committees set up within the board. To this end, the board identifies the general criteria, differentiating them according to the commitment entailed by each role (executive, non-executive or independent director), as well as the nature and size of the companies in which the offices are performed, plus whether or not the companies are members of the issuer’s group.

1.C.4

If the shareholders’ meeting, when dealing with organisational needs, authorises, on a general, preventive basis, derogations from the rule prohibiting competition, as per Article 2390 of the Italian Civil Code, then the board of directors shall evaluate each such issue, reporting any critical matters at the next shareholders’ meeting. To this end, each director shall inform the board, upon accepting his/her appointment, of any activities exercised in competition with the issuer and of any effective modifications that ensue.

1.C.5

The chairperson of the board of directors shall ensure that the documentation relating to the agenda of the board is made available to directors and statutory auditors in a timely manner prior to the board meeting. The board of directors shall provide information in the corporate governance report on the promptness and completeness of the pre-meeting information, providing details, among other things, on the prior notice usually deemed adequate for the supply of documents and specifying whether such prior notice has been usually observed.

1.C.6

The chairperson of the board of directors, also upon request of one or more directors, may request to the managing directors that certain executives of the issuer or the companies belonging to its group, in charge of the pertinent management areas related to the board agenda, attend the meetings of the board, to provide appropriate supplemental information on the items on the agenda. The corporate governance report shall provide information on their attendance.

Article 2 – Composition of the Board Of Directors

2.P.1

The board of directors shall be made up of executive and non-executive directors, who should be adequately competent and professional.

2.P.2

Non-executive directors shall bring their specific expertise to board discussions and contribute to the adoption of fully informed decisions paying particular care to the areas where conflicts of interest may exist.

2.P.3

The number, competence, authority and time availability of non-executive directors shall be such as to ensure that their judgement may have a significant impact on the taking of board’s decisions.

2.P.4

It is appropriate to avoid the concentration of corporate offices in one single individual.

2.P.5

Where the board of directors has delegated management powers to the chairperson, it shall disclose adequate information in the corporate governance report on the reasons for this organisational choice.

- the managing directors of the issuer or a subsidiary having strategic relevance, including the relevant chairmen when these are granted individual management powers or when they play a specific role in the definition of the business strategies;

- the directors vested with management duties within the issuer or in one of its subsidiaries having strategic relevance, or in a controlling company when the office concerns also the issuer; and

- the directors who are members of the executive committee of the issuer, when no managing director is appointed or when the participation in the executive committee, taking into account the frequency of the meetings and the scope of the relevant resolutions, entails, as a matter of fact, the systematic involvement of its members in the day-to-day management of the issuer.

The granting of deputy powers or powers in cases of urgency to directors, who are not provided with management powers is not enough, per se, to cause them to be identified as executive directors, provided however, that such powers are not actually exercised with considerable frequency.

2.C.2

The directors are required to know the duties and responsibilities relating to their office.
The chairperson of the board of directors shall use his/her best efforts to allow the directors and the statutory auditors, after the election and during their mandate, in the most appropriate forms, to participate in initiatives aimed at providing them with an adequate knowledge of the business sector where the issuer operates, of the corporate dynamics and the relevant changes, proper management of risk and the relevant regulatory and self-regulatory framework.
The issuer shall include in the corporate governance report the type and organisational methods of the initiatives taken during the reporting period.

2.C.3

The board shall designate an independent director as lead independent director, in the following circumstances: (i) if the chairperson of the board of directors is the chief executive officer of the company; and (ii) if the office of chairperson is held by the person controlling the issuer.
The board of directors of issuers on the FTSE MIB index shall designate a lead independent director when requested by the majority of independent directors, except in the case of a different and reasoned assessment carried out by the board to be included in the corporate governance report.

(a) represents a reference and coordination point for the requests and contributions of non-executive directors and, in particular, those who are independent pursuant to Article 3 below; and;

b) cooperates with the chairperson of the board of directors to guarantee that directors receive timely and complete information.

2.C.5

The chief executive officer of issuer (A) shall not be appointed director of another issuer (B) not belonging to the same corporate group, if the chief executive officer of issuer (B) is a director of issuer (A).

Article 3 – Independent directors

3.P.1

An adequate number of non-executive directors shall be independent, in the sense that they do not maintain, directly or indirectly or on behalf of third parties, nor have recently maintained any business relationships with the issuer or persons linked to the issuer, of such a significance as to influence their autonomous judgement.

3.P.2

The directors’ independence shall be assessed by the board of directors after the appointment and, subsequently, on a yearly basis. The results of the assessments of the board shall be communicated to the market.

3.C.1

The board of directors shall evaluate the independence of its non-executive members having regard more to the substance than to the form and keeping in mind that a director usually does not appear independent in the following events, to be considered merely as an example and not limited to:

a) if he/she controls, directly or indirectly, the issuer also through subsidiaries, trustees or third parties, or is able to exercise a dominant influence over the issuer, or participates in a shareholders’ agreement through which one or more persons can exercise a control or dominant influence over the issuer;

b) if he/she is, or has been in the preceding three fiscal years, a significant representative of the issuer, of a subsidiary having strategic relevance or of a company under common control with the issuer, or of a company or entity controlling the issuer or able to exercise over the same a considerable influence, also jointly with others through a shareholders’ agreement;

c) if he/she has, or had in the preceding fiscal year, directly or indirectly (e.g., through subsidiaries or companies of which he is a significant representative, or in the capacity as partner of a professional firm or of a consulting company) a significant commercial, financial or professional relationship:

or is, or has been in the preceding three fiscal years, an employee of the above-mentioned parties;

d) if he/she receives, or has received in the preceding three fiscal years, from the issuer or a subsidiary or holding company of the issuer, a significant additional remuneration (compared to the “fixed” remuneration of non-executive director of the issuer and to remuneration of the membership in the committees that are recommended by the Code) also in the form of participation in incentive plans linked to the company’s performance, including stock option plans;

f) if he/she is vested with the executive director office in another company in which an executive director of the issuer holds the office of director;

g) if he/she is shareholder or director of a legal entity belonging to the same network as the company appointed for the auditing of the issuer; and

3.C.2

For the purpose of the above, the chairperson of the entity, the chairperson of the board of directors, the executive directors and managers with strategic responsibilities of the relevant company or entity, must be considered as “significant representatives”.

3.C.3

The number and competences of independent directors shall be adequate in relation to the size of the board and the activity performed by the issuer; moreover, they must be such as to enable the constitution of committees within the board, according to the indications set out in the Code.
In the case of issuers on the FTSE MIB index, at least one third of the board of directors’ members shall be made up of independent directors. If such a number is not an integer, it shall be rounded down.
In any event, there shall be no fewer than two independent directors.

3.C.4

After the appointment of a director who qualifies himself/herself as independent, and subsequently, upon the occurrence of circumstances affecting the independence requirement and in any case at least once a year, the board of directors shall evaluate, on the basis of the information provided by the same director or available to the issuer, those relations which could be or appear to be such as to jeopardise the independent judgement of such director.
The board of directors shall notify the result of its evaluations, after the appointment, through a press release to the market and, subsequently, within the corporate governance report.
In the documents mentioned above, the board of directors shall:

- disclose whether criteria for assessing independence have been adopted that are different from those recommended by the Code, also with reference to individual directors, and if so, specifying the reasons; and

3.C.5

The board of statutory auditors shall ascertain, within the framework of the duties attributed to it by the law, the correct application of the assessment criteria and procedures adopted by the board of directors for evaluating the independence of its members. The results of such controls are communicated to the market in the corporate governance report or in the report of the board of statutory auditors to the shareholders’ meeting.

Article 4 – Establishment and functioning of the internal committees of the board of directors

4.P.1

The board of directors shall establish among its members one or more committees, tasked with providing proposals and advice as indicated below.

a) the committees shall be made up of at least three members. However, in those issuers whose board of directors is made up of no more than eight members, committees may be made up of two directors only, provided, however, that they are both independent. The committees’ activities shall be coordinated by a chairperson;

b) the duties of individual committees are provided by the resolution by which they are established and may be supplemented or amended by a subsequent resolution of the board of directors;

c) the functions that the Code attributes to different committees may be distributed in a different manner or demanded from a number of committees lower than the envisaged one, provided that for their composition the rules are complied with those indicated from time to time by the Code and is ensured the achievement of the underlying objectives;

e) the committees, in performing their duties, have the right to access the necessary company’s information and functions, according to the procedures established by the board of directors, as well as to make use of external consultants. The issuer shall make available to the committees adequate financial resources for the performance of their duties, within the limits of the budget approved by the board;

f) non-committee members, including other board members and persons belonging to issuer’s structure, may attend committee meetings oat the invitation of the given committee to provide background information on agenda items; and

g) the issuer shall provide adequate information, in the corporate governance report, on the establishment and composition of committees, the contents of the mandate entrusted to them, as well as, on the basis of the indications provided for by each committee, the activity actually performed during the fiscal year, the number of meetings held, their average duration and the percentage of attendance by members.

4.C.2

The establishment of one or more committees may be avoided and the relevant duties may be assigned to the board of directors, under the coordination of the Chairperson and provided that: (i) independent directors represent at least half of the board members; if the number of the board members is odd, a rounding down to the lower unit shall be carried out; (ii) adequate time is dedicated during the board meetings to actions that the Code requires the committees to carry out, and this circumstance is disclosed in the corporate governance report; and (iii) as far as the control and risk committee is concerned, the issuer is neither controlled by another listed company nor it is subject to management and coordination.
The board of directors shall describe in detail in the corporate governance report the reasons underlying the choice not to establish one or more committees; in particular, it provides adequate grounds for the decision not to establish the risks and control committee in consideration of the complexity level of the issuer and the sector in which it operates. In addition, the board shall periodically reassess this decision.

Article 5 – Appointment of directors

5.P.1

The board of directors shall establish from among its members a committee to propose candidates for appointment to the position of director, made up of a majority of independent directors.

5.C.1

The appointments committee shall be vested with the following functions:

a) to express opinions to the board of directors regarding its size and composition and express recommendations with regard to the professional skills necessary within the board as well with regard to the topics indicated by articles 1.C.3 and 1.C.4.; and

b) to submit the board of directors candidates for the office of director in cases of co-option, should the replacement of independent directors be necessary.

5.C.2

The board of directors shall assess whether to adopt a plan for the succession of executive directors. In the event of adoption of such a plan, the issuer shall disclose it in the corporate governance report. The review of the preparation of the above plan shall be carried out by the appointments committee or by another committee established within the board of directors that is assigned this task.

Article 6 – Remuneration of directors

6.P.1

The remuneration of directors and managers with strategic responsibilities shall be established in a sufficient amount to attract, retain and motivate people with the professional skills necessary to successfully manage the issuer.

6.P.2

The remuneration of executive directors and managers with strategic responsibilities shall be defined in such a way as to align their interests with pursuing the priority objective of the creation of value for the shareholders in a medium/long-term timeframe. With regard to directors with managerial powers or performing, also de-facto, functions related to business management, as well as with regard to managers with strategic responsibilities, a significant part of the remuneration shall be linked to achieving specific performance objectives, possibly including non-economic objectives, identified in advance and determined consistently with the guidelines contained in the policy described in principle 6.P.4.
The remuneration of non-executive directors shall be proportionate to the commitment required from each of them, also taking into account their possible participation in one or more committees.

6.P.3

The board of directors shall establish from among its members a compensation committee, made up of independent directors. Alternatively, the committee may be made up of non-executive directors, the majority of which to be independent; in this case, the chairperson of the committee is selected from among the independent directors. At least one committee member shall have an adequate knowledge and experience in finance or remuneration policies, to be assessed by the board of directors at the time of his/her appointment.

6.P.4

The board of directors shall, upon proposal of the compensation committee, establish a policy for the remuneration of directors and managers with strategic responsibilities.

6.P.5

If the office or the employment of an executive director or a general manager is terminated, the issuer shall disclose detailed information on the matter via a press release, on completion of the internal process leading to the assignment or recognition of indemnities and/or other benefits.

6.C.1

The policy for the remuneration of executive directors and other directors covering particular offices shall define guidelines on the issues and consistently with the criteria detailed below:

a) the fixed component and the variable component are properly balanced according to issuer’s strategic objectives and risk management policy, taking into account the business sector in which it operates and the nature of the business carried out;

c) the fixed component is sufficient to reward the director when the variable component is not delivered due to failure to achieve the performance objectives specified by the board of directors;

d) the performance objectives – i.e., the economic performance and any other specific objectives to which the payment of variable components (including the objectives for the share-based compensation plans) is linked – is predetermined, measurable and linked to the creation of value for the shareholders in the medium/long term;

e) the payment of a significant portion of the variable component of the remuneration shall be deferred for an appropriate period of time; the amount of that portion and the length of that deferral shall be consistent with the characteristics of the issuer’s business and associated risk profile;

f) contractual arrangements shall be provided to permit the company to reclaim, in whole or in part, the variable components of remuneration that were awarded (or to hold deferred payments), as defined on the basis of data which subsequently proved to be manifestly misstated; and

g) indemnities eventually set out by the issuer in case of termination of directors shall not exceed a fixed amount or fixed number of years of annual remuneration. Termination payments shall not be paid if the termination is due to inadequate performance.

a) shares, options and all other rights granted to directors to buy shares or to be remunerated on the basis of share price movements shall have an average vesting period of at least three years;

c) directors shall retain a certain number of shares granted or purchased through the exercise of the rights referred to in letter a), until the end of their mandate.

6.C.3

Criteria 6.C.1 and 6.C.2 shall apply, mutatis mutandis, also to the definition – by the bodies entrusted with that task – of the remuneration of managers with strategic responsibilities.
Any incentive plan for the person in charge of internal audit and for Executive responsible for preparing corporate accounting documents shall be consistent with their role.

6.C.4

The remuneration of non-executive directors shall not be – other than for an insignificant portion – linked to the economic results achieved by the issuer. Non-executive directors shall not be beneficiaries of share-based compensation plans, unless it is so decided by the annual shareholders’ meeting, which shall also give the relevant reasons.

- periodically evaluate the adequacy, overall consistency and actual application of the policy for the remuneration of directors and managers with strategic responsibilities, also on the basis of the information provided by the managing directors; it shall formulate proposals to the board of directors in that regard; and

- submit proposals or issue opinions to the board of directors for the remuneration of executive directors and other directors who cover particular offices as well as for the identification of performance objectives related to the variable component of that remuneration; it shall monitor the implementation of decisions adopted by the board of directors and verify, in particular, the actual achievement of performance objectives.

6.C.6

No director shall participate in meetings of the compensation committee in which proposals are formulated to the board of directors relating to his/her remuneration.

6.C.7

When using the services of an external consultant to obtain information on market standards for remuneration policies, the compensation committee shall previously verify that the consultant concerned is not in a position that might compromise its independence.

a) adequate information on the indemnity and/or other benefits, including their amount, timing of disbursement – distinguishing both between the component immediately paid out and the one subject to deferral mechanisms and between the component received as director from those relating to an employment relationship, if any – and “claw-back” clauses, if any, with specific reference to:

b) information about the compliance or non-compliance of the indemnity and/or other benefits with the remuneration policy and, in case of even partial non-compliance with the remuneration policy, information about the internal procedures applied according to Consob’s regulations on related-party transactions;

c) information about the application, or non-application, of any mechanism that provides restrictions or corrections to the indemnity in case of termination due to objectively inadequate results, as well as whether requests have been formulated for the restitution of remuneration already paid out; and

d) information as whether the replacement of the terminated executive director or general manager is governed by any succession plan adopted by the company and, in any case, information about procedures that have been or will be applied for the replacement of the director or manager.

Article 7 – Internal control and risk management system

7.P.1

Each issuer shall adopt an internal control and risk management system consisting of policies, procedures and organisational structures aimed at identifying, measuring, managing and monitoring key risks. Such a system shall be integral to the organisational and corporate governance framework adopted by the issuer and shall take into consideration the reference model and the best practices that are applied both at national and international level.

7.P.2

An effective internal control and risk management system contributes to the management of the company in a manner consistent with the objectives defined by the board of directors, promoting an informed decision-making process. It helps to ensure the safeguarding of corporate assets, the efficiency and effectiveness of management procedures, the reliability of the information provided to the corporate bodies and to the market, and compliance with laws and regulations, including bylaws and internal procedures.

7.P.3

The internal control and risk management system involves the following bodies, each within its respective area of competence:

a) the board of directors, which guides and assesses the adequacy of the system, and identifies from among its own members:

b) the person in charge of internal audit, entrusted with the task of verifying the functioning and adequacy of the internal control and risk management system;

c) other roles and business functions with specific tasks relating to internal control and risk management, organised according to the company’s size, complexity and risk profile; and

d) the board of statutory auditors, also acting as an internal control and audit committee, which is responsible for oversight of the internal control and risk management system.

Each issuer shall provide for coordination methods between the above-mentioned bodies to enhance the efficiency of the internal control and risk management system and reduce duplication of activities.

7.P.4

The control and risk committee shall be made up of independent directors. Alternatively, the committee may be made up of non-executive directors, the majority of which to be independent; in this case, the chairperson of the committee is selected from among the independent directors. If the issuer is controlled by another listed company or is subject to the management and control of another company, the committee shall be made up exclusively of independent directors. At least one member of the committee is required to have an adequate experience in the area of accounting and finance or risk management, to be assessed by the board of directors at the time of appointment.

a) define the guidelines of the internal control and risk management system, so that the main risks concerning the issuer and its subsidiaries are correctly identified and adequately measured, managed and monitored, determining, moreover, the level of compatibility of such risks with the management of the company in a manner consistent with its strategic objectives;

b) assess, on at least an annual basis, the adequacy of the internal control and risk management system taking into account the characteristics of the company and its risk profile, as well as its effectiveness;

c) approve, on at least an annual basis, the plan drafted by the person in charge of internal audit, after hearing the board of statutory auditors and the Director in Charge;

d) describe, in the corporate governance report, the main features of the internal control and risk management system and the methods of coordination established by the entities involved in it, expressing an assessment of its adequacy; and

e) assess after consulting the board of statutory auditors, the findings reported by the external auditor in the suggestions letter, if any, and in the report on the main issues resulting from the audit.

At the proposal of the Director in Charge, the board of directors shall, subject to the favourable opinion of the control and risk committee and after consulting the board of statutory auditors:

7.C.2

The control and risk committee, when assisting the board of directors, shall:

a) assesses, together with the Executive responsible for preparing corporate accounting documents and after consulting the external auditors and the board of statutory auditors, the correct application of the accounting principles, as well as their consistency for the purpose of the preparation of the consolidated financial statements, if any;

c) review the periodic reports of the internal audit function concerning the assessment of the internal control and risk management system, as well as the other reports of the internal audit function that are particularly significant;

e) request the internal audit function to carry out reviews of specific operational areas, giving simultaneous notice to the chairperson of the board of statutory auditors;

f) report to the board, at least every six months, upon approval of the annual and half-year financial report, on the activity it carries out and the adequacy of the internal control and risk management system; and

g) support, with appropriate investigations, the assessments and decisions of the board of directors relating to the management of risks arising due to prejudicial acts of which the board has become aware.

7.C.3

The chairperson of the board of statutory auditors or another statutory auditor designated by this chairperson shall participate in the work of the control and risk committee; the remaining statutory auditors are also allowed to participate.

a) shall identify the main business risks, taking into account the characteristics of the activities carried out by the issuer and its subsidiaries, and submit them periodically to the review of the board of directors;

b) shall implement the guidelines defined by the board of directors, taking care of the planning, realization and management of the internal control and risk system, constantly monitoring its adequacy and effectiveness;

d) may ask the internal audit function to carry out reviews of specific operational areas and on the compliance of business operation with rules and internal procedures, giving simultaneous notice to the chairperson of the board of directors, the chairperson of control and risk committee and the chairperson of the board of statutory auditors; and

e) shall promptly report to the control and risk committee (or to the board of directors) issues and problems resulting from his/her activity or of which he/she has become aware in order for the committee (or the board) to take the appropriate actions.

a) shall verify, both on an ongoing basis and when special needs require, in conformity with international professional standards, the adequacy and effective functioning of the internal control and risk management system, through an audit plan, to be approved by the board of directors. Such a plan shall be based on a structured analysis and ranking of the main risks;

d) shall draft periodic reports containing adequate information on its own activity, and on the company’s risk management process, as well as about the compliance with the management plans defined for risk mitigation. These periodic reports shall include an assessment of the ability of the internal control system to achieve an acceptable risk management profile;

f) shall submit the reports indicated under items d) and e) above to the chairperson of the board of statutory auditors, the control and risk committee and the board of directors, as well as to the Director in Charge; and

7.C.6

The internal audit function may be entrusted, as a whole or by business segment, to a party external to the issuer on condition that the party meets the professionalism, independence and organisation requirements. The adoption of such organisational choices, with appropriate reasons, shall be disclosed to the shareholders and the market in the corporate governance report.

Article 8 – Statutory auditors

8.P.1

The statutory auditors shall act with autonomy and independence, including with regard to the shareholders that elected them.

8.P.2

The issuer shall adopt suitable measures to ensure an effective performance of the duties typical of the board of statutory auditors.

8.C.1

The statutory auditors shall be chosen from among persons who may qualify as independent, also based on the criteria set forth in this Code with regard to the directors. The board shall verify compliance with the above criteria after appointment and annually thereafter, sending the results of its checks to the board of directors, which shall present them, after appointment, by means of a press release to the market, and, subsequently, in the corporate governance report, using methods that conform to those stipulated for directors.

8.C.2

The statutory auditors shall accept the appointment when they believe that they can devote the necessary time to the diligent performance of their duties.

8.C.3

The remuneration of statutory auditors shall also be commensurate with the duties required of them, the importance of the role held, and the dimensional and sectorial characteristics of the business.

8.C.4

A statutory auditor who has an interest, either directly or on behalf of third parties, in a certain transaction of the issuer, shall promptly and exhaustively inform the other statutory auditors and the chairperson of the board about the nature, terms, origin and extent of his/her interest.

8.C.5

As part of their activities, the statutory auditors may ask the internal audit function to assess specific operating areas or corporate operations.

8.C.6

The board of statutory auditors and the control and risk committee shall exchange information relevant to the performance of their respective duties on a timely basis.

Article 9 – Shareholder relations

9.P.1

The board of directors shall take initiatives aimed at promoting the broadest possible participation by shareholders in the shareholders’ meetings and facilitating the exercise of shareholders’ rights.

9.P.2

The board of directors shall endeavour to establish an ongoing dialogue with shareholders based on the understanding of their reciprocal roles.

9.C.1

The board of directors shall ensure that a person is identified as responsible for handling relationships with shareholders and shall periodically assess whether it would be advisable to establish a business structure responsible for this function.

9.C.2

All the directors usually participate in the shareholders’ meetings. The shareholders’ meetings are also an opportunity for disclosing to the shareholders information concerning the issuer, in compliance with the rules governing price-sensitive information. In particular, the board of directors shall report to the shareholders’ meeting the activity performed and planned and shall use its best efforts for ensuring that the shareholders receive adequate information about the necessary elements for them to adopt in an informed manner the resolutions that are the competence of the shareholders’ meeting.

9.C.3

The board of directors should propose to the approval of the shareholders’ meeting rules laying down the procedures to be followed to permit an orderly and effective conduct of the shareholders’ meetings of the issuer, without prejudice, at the same time, to the right of each shareholder to express his or her opinion on the matters under discussion.

9.C.4

In the event of significant changes in the market capitalization of the company’s shares or in the composition of its shareholders, the board of directors shall assess whether proposals should be submitted to the shareholders’ meeting to amend the by-laws in respect to the majorities required for exercising actions and rights provided for the protection of minority interests.