Remuneration Committee

Composition, appointment and powers

The Remuneration Committee, first established by the Board of Directors in 2002, is composed, in line with the recommendations of the Code of Corporate Governance, of three non-executive directors, the majority of whom are independent, with the Chairman chosen from the independent directors.

At least one member of the Committee has adequate knowledge and experience in financial matters or remuneration policies, as assessed by the Board of Directors at the time of the appointment. On 11 May 2016, the Board of Directors identified the Chairman (Monica de Virgiliis) as a member who possesses adequate knowledge and experience of financial issues and remuneration policies.

Since 11 May 2016, the Remuneration has been composed of the following Directors:

The Executive Vice President Human Resources & Organization of Snam performs the role of Secretary to the Committee and helps the Chairman in carrying out his/her functions. The composition, tasks and operating methods of the Committee are governed by dedicated regulations², approved by the Board of Directors and most recently updated on 11 May 2016.

The Committee makes proposals and provides advice to the Board of Directors::

• to submit the Remuneration Report for the approval of the Board of Directors, with particular regard to the remuneration Policy for directors and managers with strategic responsibilities, so that it may be presented to the Shareholders’ Meeting called to approve the financial statements within the time limits set by law;
• it reviews the vote on the Remuneration Report taken by the Shareholders’ Meeting in the previous financial year and expresses an opinion to the Board of Directors;
• it prepares proposals regarding the remuneration of the Chairman and the Chief Executive Officer, with regard to the various forms of compensation and economic treatment;
• it makes proposals concerning the compensation of members of the Board Committees;
• it examines information reported by the CEO and proposes:
• the general criteria for the remuneration of managers with strategic responsibilities;
• general guidelines for the remuneration of other managers of Snam and its Subsidiaries;
• annual and long-term incentive plans, including share-based plans;
• it proposes the definition of performance targets, the aggregation of company results, the definition of claw-back clauses related to the implementation of incentive plans and the determination of the variable remuneration of directors with powers;
• it proposes the definition, with regard to Directors with powers: i) of the compensation to be paid in the case of termination of employment; ii) of non-compete agreements;
• it monitors the application of decisions made by the Board;
• it periodically evaluates the suitability, compliance and sound application of the Policy adopted, expressing proposals to the Board in this regard;
• it performs any duties that may be required by the procedure concerning related-party transactions carried out by the Company;
• it reports on the exercising of its functions to the Shareholders’ Meeting convened to approve the separate financial statements for the year, through the Chairman of the Committee or another member appointed by the latter.

In accordance with the Board’s decision, the Remuneration Committee also annually reviews the remuneration structure of the Senior Vice President of Internal Audit and ensures that it is consistent with the general criteria approved by the Board for managers, indicating the above to the Chairman of the Control and Risk Committee for the purposes of the opinion which he must express on this matter at the Board meeting.

The Remuneration Committee reports to the Board at least every six months on the activities carried out before the deadline for the approval of the financial statements and the half-year report, at the board meeting indicated by the Chairman of the Board of Directors; following each of its meetings, the Committee updates the Board of Directors, at its first meeting, with regard to the subjects dealt with and the observations, recommendations and opinions formulated.

In addition, the Committee reports on the operating methods of its functions to the Shareholders’ Meeting called for the approval of the financial statements for the period, via the Chairman of the Committee, in accordance with the provisions of its Regulations, in compliance with the Code of Corporate Governance and with the aim of establishing a dedicated channel of communication with shareholders and investors.

In order to perform its analytical and preliminary functions effectively, the Remuneration Committee makes use of the competent Company structures and can, through the latter, take advantage of the support of external consultants who are not in a position to compromise the independence of the advice.