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Nomination and Remuneration Committee

06/21/2016 - 10:00 PM

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Composition

According with Telecom Italia Principles of Corporate Governance the Nomination and Remuneration Committee is made up of non-executive directors, of whom the majority shall be independent, including at least one elected from a slate presented by minority shareholders in accordance with the Bylaws. At least one member of this Committee shall possess adequate expertise in financial matters or pay policies.

The chairman of the board of statutory auditors, or another statutory auditor designated by the chairman, attends the meetings of the Nomination and Remuneration Committee, although the other statutory auditors may also attend.  

Responsibilities

The Committee, pursuant to art. 5.C.1 of the Borsa Italiana Code, has been assigned the following responsibilities as regards the appointment of directors:

  • 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 (limit to the accumulation of offices) and 1.C.4 (derogations from the prohibition of competition pursuant to Article 2390 of the Italian Civil Code);express opinions on specific aspects relating to the identification of the main risks for the company;
  • to submit to the Board of Directors candidates for directors offices in case of co-optation, should the replacement of independent directors be necessary.

The Committee, pursuant to art. 6.C.5 of the Borsa Italiana Code, has been assigned the following responsibilities as regards remuneration:

  • to periodically evaluate the adequacy, overall consistency and actual application of the policy for the remuneration of directors and key management personnel, also on the basis of the information provided by the managing directors; it shall formulate proposals to the Board of Directors in that regard;
  • to 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;
  • to monitor the implementation of decisions adopted by the Board of Directors and verify, in particular, the actual achievement of performance objectives.

 

Furthermore, without prejudice to the responsibilities assigned to it by the Borsa Italiana Code, on the basis of Telecom Italia’s Principles of Corporate Governance, the Committee shall:

  • oversee the succession plan for Executive Directors, and monitor the updating of the company management replacement lists, prepared by the Executive directors;
  • establish the procedure and period for the annual evaluation of the Board of Directors;
  • propose the criteria for allocating the total annual compensation established by the Shareholders' Meeting for the whole Board of Directors;
  • perform other duties assigned to it by the Board of Directors.

The Committee shall report to the Board of Directors on its activity in the most appropriate manner, and in any case at the first possible meeting.

The Committee shall appoint a Chairman from among its independent members, to coordinate the work of the Committee and speak on its behalf to the Board of Directors and its Chairman. Insofar as they are applicable, the operational rules set out for the Board of Directors shall apply to the Committee

During 2015 the Committee defined the planning of its activities for the execution of the tasks assigned to it, and there were seven meetings (average length: 2 hours and 15 minutes). In particular, the Committee monitored the deployment of the remuneration policy for the year, and submitted to the Board of Directors the proposal for the short term incentive targets for the  Executive Directors, as well as - in agreement with the Control and Risk Committee - for the Heads of the control functions; it prepared the final figures for the 2012-2014 LTI plan and the 2014 MBOs for the Chairman and Chief Executive Officer; it defined the procedures for carrying out the 2015 board evaluation; it oversaw the updating of the succession planning process for Executive Directors and Top Management; it defined the guidelines for the remuneration policy (introducing - among other things - the clawback rule), submitting them for review to the full board. It also undertook benchmarking of the compensation of the Boards of Statutory Auditors of companies listed on the Electronic Share Market included in the FTSE/MIB index. The Board of Directors was kept informed of these various activities at each first available meeting.

For further information on the work of the Committee relating to the 2016 remuneration policy, see the Remuneration Report.

The Committee (whose meetings are attended by the Chairman of the Board of Statutory Auditors or any other Auditor designated by said Chairman, without prejudice to the possibility for all Statutory Auditors to attend) was able to access the information and company departments necessary to carry out its tasks, inviting the Executive Directors and/or managers responsible for the areas being discussed in each case to provide support. The Committee was not assigned financial resources of a predetermined amount, but was able autonomously to bring in external consultants. In particular, it identified Mercer Italia, having ascertained in advance that is not in situations that might compromise its independence of judgement, as its advisor for the two year period 2015-2016.

The percentage of attendance at meetings in 2015 was 89.25%. In 2016 two meetings have already taken place.

 

For further information, please contact:
Telecom Italia S.p.A.
Corso d’Italia n. 41
00198 Roma
Ph. +39.06.36881
Email: corporate.affairs@telecomitalia.it