Governance Information • Mar 31, 2016
Governance Information
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TRADITIONAL MANAGEMENT AND CONTROL MODEL
Date of approval of the Report: 4 March 2016 www.atlantia.it/it/corporate-governance/
| INTRODUCTION | 5 |
|---|---|
| 1. PROFILE OF Atlantia SpA | 6 |
| 2. INFORMATION ON THE OWNERSHIP STRUCTURE (art. 123-bis CFA) | 7 |
| a) Structure of issued capital | 7 |
| b) Significant shareholdings in the Company | 8 |
| c) Shareholder agreements | 8 |
| d) Change of control provisions | 10 |
| e) Authority to purchase treasury shares | 15 |
| f) Management and coordination activities | 17 |
| 3. COMPLIANCE | 20 |
| 4. BOARD OF DIRECTORS | 21 |
| 4.1. Election and replacement | 21 |
| - Succession planning |
24 |
| 4.2. Composition | 24 |
| 4.3. Role of the Board of Directors | 26 |
| -Activities performed in 2015 | 29 |
| -Assessment of the size, composition and functioning of the Board of Directors |
31 |
| 4.4. Executive Directors and Officers | 33 |
| -Executive Committee | 33 |
| -Chairman of the Board of Directors | 33 |
| -Chief Executive Officer | 34 |
| 4.5. Independent Directors |
35 |
| 4.6. Lead Independent Director | 37 |
| 5. THE PROCESSING OF CORPORATE INFORMATION | 38 |
| 6. BOARD COMMITTEES | 40 |
| 7. NOMINATIONS COMMITTEE | 41 |
| 8. HUMAN RESOURCES AND REMUNERATION COMMITTEE | 42 |
| 9. REMUNERATION OF DIRECTORS | 45 |
| 10. CONTROL, RISK AND CORPORATE GOVERANCE COMMITTEE | 46 |
| A) Composition and functioning |
46 |
|---|---|
| B) Functions assigned to the Control, Risk and Corporate Governance | |
| Committee | 48 |
| C) Activities performed in 2015 | 49 |
| 11. INTERNAL CONTROL AND RISK MANAGEMENT SYSTEM | 52 |
| - Main characteristics of existing risk management and internal |
|
| control systems in respect of financial reporting process | 55 |
| - Description of the main characteristics of existing risk management |
|
| and internal control systems in respect of the financial reporting |
|
| process | 55 |
| - Guidelines and assessment of adequacy, efficacy and effective functioning of Internal Control and Risk Management System |
58 |
| 11.1 Director responsible for the Internal Control and Risk | |
| Management System | 59 |
| - Activities performed in 2015 |
59 |
| 11.2 Director of Internal Audit department |
60 |
| 11.3 Organisational Model (Legislative Decree 231/2001) |
63 |
| 11.4 Independent Auditors | 66 |
| 11.5 Manager responsible for financial reporting | 67 |
| 11.6 Coordination of individuals involved in the Internal Control and |
|
| Risk Management System |
67 |
| 12. DIRECTORS' INTERESTS AND RELATED PARTY TRANSACTIONS | 68 |
| - Committee of Independent Directors with responsibility for Related |
|
| Party Transactions | 69 |
| - Directors' interests |
70 |
| 13. ELECTION OF STATUTORY AUDITORS | 71 |
| 14. COMPOSITION AND FUNCTIONING OF BOARD OF STATUTORY |
|
| AUDITORS | 74 |
| 14.1 Procedure for reporting to the Board of Statutory Auditors | 76 |
| 15. INVESTOR RELATIONS | 78 |
| 16. GENERAL MEETINGS | 79 |
| TABLES | |
3
| Table 1: Information on the ownership structure of Atlantia SpA | 81 |
|---|---|
| SIGNIFICANT SHAREHOLDINGS AS AT 31 DECEMBER 2015 | 82 |
| Table 2: Structure of Atlantia SpA's Board of Directors and | |
| Board Committees | 83 |
| Annex A | 85 |
| Summary of the personal and professional details of Atlantia's Directors as at 31 December 2012 |
|
| Table B: Number of years in position from initial appointment at Atlantia SpA |
89 |
| Annex 1 | 90 |
| List of other positions held by the Directors in other companies listed on Italian and international regulated markets, and in large financial, banking and insurance companies. |
|
| Table 3: Structure of Atlantia SpA's Board of Statutory Auditors | 93 |
This report is intended to provide a general and complete overview of the corporate governance system adopted by Atlantia SpA.
In compliance with the legal and regulatory obligations in this regard, the Report contains information on the ownership structure, adhesion to the Codes of Conduct and the observance of the consequent commitments, highlighting the choices that the Company has made in application of corporate governance principles.
The text of this Report is published on the internet website of the Company, www.atlantia.it/it/corporate-governance/ and a copy has been provided to the Italian Stock Exchange in accordance with the terms and procedures set forth under applicable regulations.
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Atlantia's Articles of Association provide that the Company has the following corporate purpose:
a) the acquisition of investments and interests in other Companies and Entities;
b) the financing, including the issuance of guarantees, indemnities and collateral and the technical, industrial and financial coordination of Companies or Entities in which it has shares;
c) any equity, real estate, financial and industrial investment, whether in Italy or abroad.
Ancillary to its principal business, the Company may also purchase, own, manage, use, update and develop, directly or indirectly, trademarks, patents and know-how concerning electronic tolling systems and related or connected activities.
In accordance with the current Articles of Association, Atlantia has adopted a traditional type system of management and control. Corporate management is assigned to the Board of Directors, while all aspects concerning supervisory functions are assigned to the Board of Statutory Auditors and responsibility for auditing the Company's accounts to the Independent Auditors appointed by General Meeting of the shareholders.
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Atlantia SpA's issued capital amounts to €825,783,990.00 consisting of 825,783,990, par value €1.00, ordinary voting shares.
The Company issued 163,956,286 Atlantia SpA 2013 Ordinary Share Contingent Value Rights ("CVRs") on the effective date of the Atlantia - Gemina Merger (1 December 2013) for allotment free of charge to Gemina's ordinary and/or savings shareholders, who received Contingent Value Rights in exchange for Atlantia shares in application of the share exchange ratio of one Contingent Value Right for each Atlanta share allotted in accordance with the share exchange ratio.
The following were approved at the Extraordinary General Meeting of 8 August 2013: i) issuance together with shares to satisfy the merger share exchange ratio of up to 164,025,376 CVRs and, at the same time, ii) an increase in issued capital to irrevocably satisfy the CVRs up to a par value of €18,455,815.00 through the issuance of 18,455,815 Atlantia ordinary shares with a par value of €1.00.
The CVRs are governed by the Terms and Conditions of the Atlantia SpA 2013 Ordinary Share Contingent Value Rights (the "Terms and Conditions") which are available on the Company's website at www.atlantia.it/pdf/integrazione-delregolamento-dei-diritti-di-assegnazione-condizionati.pdf.
Subject to the conditions of allotment as defined in the Terms and Conditions, the CVRs provide their holders with the right to receive a number of Atlantia ordinary shares determined with reference to the Final Allotment Ratio and a Dividend Adjustment as set out in the Terms and Conditions.
In response to the joint application of Atlantia SpA and Gemina SpA, the CONSOB indicated on 1 August 2013 that the CVRs were not eligible for listing.
In consequence of the CONSOB's adverse decision, certain additions were made to the Terms and Conditions so as to provide assurance to CVR holders of the ability to liquidate the instruments, including an undertaking by the Company to provide CVR holders, for a period of ten months from the issue date of the CVR, with a put option at a price fixed on issuance.
Accordingly, and in compliance with the Terms and Conditions, from 3 December 2013, being the first Stock Exchange trading day after issuance of the CVRs, to 3 October 2014, being the last day of the tenth month from their issuance (the "Exercise Period"), each holder had the right to sell to Atlantia all, and not just some, of the CVRs held when exercise of the put option (the "Put Option") is notified. The Put Options could be exercised at an all-inclusive price of €0.0732 for each CVR (the "Exercise Price").
In the Exercise Period, between 3 December 2013 and 3 October 2014, 160,698,634 CVRs were exercised out of the 163,956,286 CVRs issued, accounting for approximately 98% of the total.
Put Options unexercised during the Exercise Period can no longer be exercised or used with Atlantia, while all the Contingent Value Rights transferred to Atlantia were cancelled.
The rights of holders of Contingent Value Rights that did not exercise their put options will be recognised under article 3 of the Terms and Conditions only if the Material Event occurs during the validity period of the CVRs.
The number of CVRs outstanding as at 31 December 2015 is shown in Table 1 of the Appendix to this Report.
Information on share-based incentive plans, in the form of share options and/or share grants, is provided in the Remuneration Report prepared pursuant to art. 84-quater of the Regulations for Issuers, which is available on the Company's website at (http://www.atlantia.it/it/investor-relations/assemblee.html).
It has been reported to the Company and to the CONSOB that there were the following significant interests in the issued capital of Atlantia SpA at 31 December 2015:
Art. 119-bis, paragraphs 7 and 8 of the Regulations for Issuers grants asset management companies and duly authorised entities who have purchased managed investments, represented by interests of above 2% and below 5%, an exemption from the reporting requirements provided for by art. 117 of the Regulations in question.
Pursuant to art. 122 of the Consolidated Finance Act and the relevant provisions of the Regulations for Issuers, an agreement was concluded on 15 January 2008 (the "Shareholders' Agreement") between Sintonia S.A. (now Sintonia SpA or "Sintonia"), Sintonia SpA (now Edizione Srl), Mediobanca – Banca di Credito Finanziario SpA and Sinatra sarl (a company owned by GS Infrastructure Partners), concerning Sintonia ("Sintonia") and, in certain respects, Atlantia SpA ("Atlantia"). An extract of the Agreement was published in the daily newspapers, il Sole 24 Ore, Milano Finanza and Finanza & Mercati on 25 January 2008.
1 After the merger of Edizione Holding SpA and Sintonia SpA with Ragione became effective, on 1 January 2009, Ragione took the name of Edizione Srl and assumed direct control of the sub-holding, Sintonia SpA, which in turn controls investments in the utilities and infrastructure sectors, including, among others, Atlantia.
2 Having moved its registered office to Italy, Sintonia SA transformed its legal form into an Italian "società per azioni" and was entered into the Milan Register of Companies on 27 June 2012 under the name Sintonia SpA.
Information on the amendments to the Shareholders' Agreement in 2008-2012 is contained in the Corporate Governance reports and ownership structures relating of past years which are available on the Company's website: http://www.atlantia.it/it/corporate-governance/index.html.
The following 2013 amendments to the Shareholders' Agreement were announced in accordance with statutory requirements at that time and published in Il Sole-24 Ore:
On 19 December 2014 Edizione Srl sent to Atlantia the notification provided for by articles 129 and 131, paragraph 3, of the Regulations for Issuers, related to the termination of the Shareholders' Agreement. The Shareholders' Agreement was due to expire on 21 June 2015 and should have been tacitly extended until its expiration date for all the parties that did not send withdrawal notice at least six months in advance (i.e. 21 December 2014).
On 19 December 2014, in accordance with the Shareholders' Agreement, all the parties other than Sintonia notified their intention not to renew the Agreement.
Therefore, pursuant to the Agreement, Edizione Srl announced that it would initiate the process of spinning off Sintonia to assign to wholly-owned subsidiaries of the departing shareholders, other than Edizione, a portion of Sintonia's assets – including the ordinary shares of Atlantia SpA – and liabilities.
On June 16, 2015 Edizione S.r.l. notified Atlantia SpA that, on that date, the pro rata spin-off of Sintonia SpA took effect, as provided for by the Sintonia Agreement which, as such, was terminated as of June 16, 2015.
As a result of the spin-off, Pacific Mezz InvestCo S.à.r.l., Sinatra S.à.r.l. e Mediobanca Banca di Credito Finanziario SpA were attributed all the shares outstanding of the three companies listed below, and each such company was assigned a number of Atlantia shares proportionate to the equity interests held in Sintonia:
InvestCo Italian Holdings S.r.l. (wholly owned by Pacific Mezz InvestCo S.à.r.l.), which received 66,513,016 shares, equal to approximately 8.05% of Atlantia's issued capital;
Edizione S.r.l. remained instead the sole shareholder Sintonia, whose equity interest in Atlantia decreased to 30.25%, for a total of 249,833,818 shares.
The Single Concession Arrangement in force, executed on 12 October 2007 by the subsidiary, Autostrade per l'Italia SpA (ASPI), and ANAS3 – and approved by Law 101 dated 6 June 2008 – expressly identifies the requirements that, in the event of a change of control of the operator, pursuant to art. 2359 of the Italian Civil Code, must be met by a new controlling entity. Failure to meet such requirements may result in termination of the concession.
Specifically, these requirements are:
A substantially similar clause is included in the single Concession Arrangements of the Italian motorway operators controlled by Autostrade per l'Italia (except for the company that manages the Mont Blanc Tunnel), which were signed in 2009 and approved pursuant to Law 191 of 23 December 2009. These agreements came into effect at the end of 2010, following the execution of documents implementing the requirements of the CIPE resolutions of 2010.
A brief description of the Change of Control (COC) clauses in loan agreements entered
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3 Concession administration functions of ANAS SpA were transferred by operation of law to the Ministry of Infrastructure and Transport effective 1 October 2012 in accordance with art. 11, para. 5 of Law Decree 216 of 29 December 2011 converted by Law 14 of 24 February 2012, as amended. On 24 December 2013, Autostrade per l'Italia and the Ministry of Infrastructure and Transport signed an addendum to the Single Concession Arrangement – which was approved with decree dated 31 December 2013, and registered by the Court of Auditors on 29 May 2014 – whereby the parties introduced a five-yearly update to the financial plan. However, this addendum did not result in any amendment to the change of control rules for the operator.
into by the Atlantia Group companies is provided below:
As the conditions precedent under ii) above are met, ASPI will activate an autonomous first demand guarantee for the benefit of the bank on both the lines of the facility.
The agreement contains a change of control clause in relation to the continuing ASPI role as shareholder of SAM (with a threshold of 51% of SAM's outstanding voting shares). Failure to comply with the clause constitutes a case of compulsory
early repayment and cancellation of credit lines.
f) Day-to-day operations of Atlantia Group companies entail the assumption of bank and capital markets debt obligations typically to finance investments in infrastructure and its maintenance.
Concessions are often operated by special purpose vehicles ("SPVs") which are generally the parties to the loan agreements in their capacity as borrowers.
In almost all cases, change of control provisions are included in the loan agreements to assure that Group expertise will be made available to the SPV or other borrower on a continuing basis.
These are specific undertakings which can have an effect on the loan generally including an acceleration in the event of a change in the structure of the borrower's shareholders.
Such change of control clauses have been included in the loan agreements of the following consolidated subsidiaries of Atlantia:
a. Triangulo do Sol Auto-Estrada SA
The terms and conditions of the 4 January 2013 691.1 million real bond issue provide for an acceleration in the event of a change of Atlantia SpA's indirect control of the issuer unless approved by 75% of bondholders.
b. Rodovias das Colinas SA
The terms and conditions of the 11 March 2013 950 million real bond issue provide for an acceleration in the event of a change of Atlantia SpA's indirect control of the issuer unless approved by 75% of bondholders.
The terms and conditions of the 13 May 2013 250 million real bond issue provide for an acceleration in the event of a change of Atlantia SpA's indirect control of the issuer and the guarantor, AB Concessoes SA unless approved by 80% of bondholders.
In January 2015 Prosperity Bank renewed the loan agreement for an additional 12 months, on the same terms and conditions, with the amount of the revolving part equal to USD 3.18 million and that of the term loan equal to USD 1.0 million..
The loan agreement provides for acceleration and cancellation of the line in the event that the equity interest of Autostrade dell'Atlantico Srl in the Company falls below 51%.
e. Grupo Costanera SpA
The 112.8 million peso bank loan agreement signed with Banco do Chile on 29 February 2012 provides for an acceleration in the event the interests of the current shareholders falls below 50% plus one share.
The 105.3 million peso bank loan agreement signed with Banco do Chile on 10 December 2007 provides for an acceleration in the event of a variation in the direct and indirect shareholdings of Grupo Costanera, Atlantia SpA and CPPIB.
The loan agreement of 28 December 2005 for a 380.0 million zloty loan provides for an acceleration in the event of a variation in the direct and indirect interests of the Borrower's current shareholders or other companies engaged in the construction or operation of the road or of the guarantor, in the event that this could result in a material adverse change.
Regarding Aeroporti di Roma SpA (ADR), attention is called to the following change of control clauses and the like:
The existing Single Concession Arrangement signed on 25 October 2012 by Aeroporti di Roma SpA (ADR), a Group company, and ENAC (the Italian Civil Aviation Authority) - and approved with a Cabinet Office Decree dated 21 December 2012 – sets out the specific requirements and obligations that the new parent must fulfil - in case of change of control for the Operator, pursuant to article 2359 of the Italian Civil Code – on penalty of termination of the concession.
Specifically, these requirements and obligations include:
4 Paragraphs 1 and 2 provided that "changes concerning the Operator (i.e. "any merger, spin-off, demerger, transfer or business or units thereof, change in registered office or corporate purpose, dissolution of the company") must be approved in advance by the Ministry of Infrastructure and Transport and the Ministry of the Economy, following a review by Enac, on penalty of termination of the concession.
c) the board of directors and the board of statutory auditors are composed, to the extent required, of persons meeting the professional requisites and, if appropriate, the independence requirements pursuant to Legislative Decree 58/1998, as well as the integrity requirements for companies listed on a stock exchange, as established by the laws of the country in which the company has its headquarters.
Any transaction resulting in a change of control for the Operator - pursuant to article 2359 of the Italian Civil Code, which, as such, makes the above provisions inapplicable - must be submitted to ENAC with all the necessary details for approval, which will be provided within 60 days of submission. In the absence of any response, the approval is automatically issued pursuant to article 20, paragraph 1, of Law 241 of 7 August 1990, as amended.
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Regarding the ADR Group, attention is called to the following contracts:
I. The special purpose vehicle (SPV) Romulus Finance Srl funded the securitisation in 2003 of existing bank debt that had been raised in 2001 by ADR for the privatisation of the company. The securitisation was effected through the issuance of bonds in five tranches with maturities varying between 7 and 20 years. In order to assure adequate funds to service and repay the above tranches, Romulus Finance, in turn, obtained a back-to-back bullet loan from ADR on the same date, which was also subdivided into five distinct lines of equal amount and maturity as the bonds, under a €1,265,018,896 Amended and Restated Senior Term Loan Facilities Agreement.
The asset-backed securities issued by Romulus have been guaranteed, since inception, by Ambac Assurance Limited which, in its capacity as controlling party of the Romulus issue, had voting rights, on behalf of the bondholders, on requests to waive provisions of, or amend, the loan agreements by ADR or SPV Romulus Finance.
Following the important refinancing process completed in the first quarter of 2014, the only line of the Romulus/ADR loan outstanding – and as such, the only Romulus bond tranche – at 31 December 2015 was the "A4", for a total amount of €325,018,896 (maturing in February 2013). The corresponding bond tranche outstanding is in pounds sterling, with a total amount of £215 million. Romulus entered into a sterling/euro fixed/fixed Cross Currency Swap (CCS) for the sterling tranche from the start, in order to hedge the related interest rate and currency risk (see Paragraph 2.1.3 for more details), the terms and conditions of the CCS, on the euro/fixed leg's side, being the same as the above-mentioned back-to-back loan that Romulus obtained from ADR. In 2015 significant events took place which contributed to change substantially the structure of the Romulus loan. Specifically, at the end of January Atlantia, ADR's shareholder, completed a tender offer where, by purchasing 99.87% of the Romulus 4 bonds, it will play a decisive role in case the Bondholders were called upon to adopt a resolution. In addition, on 22 July 2015, still upon request by Atlantia, ADR entered into an agreement whereby Ambac Assurance in fact exited the transaction, resigning from the role taken within the structure of the securitisation. With the elimination of the controlling party role exercised by Ambac as guarantor of the Romulus issue, all waiver and amendment requests by ADR or the SPV are in fact subject to approval of the general meeting of the A4 bondholders, which is firmly under Atlantia's control. The Romulus/ADR loan agreement, to support the service of the A4 issue, includes a mandatory acceleration clause in the event of a change of control of ADR, unless otherwise agreed by lenders.
The common rights of creditors for each financing facility, such as those pertaining to the exercise of change of control provisions, may be exercised by majority vote pursuant to a separate agreement, the ADR Security Trust and Intercreditor Deed governing, among other things, the extent to which consents are needed to approve waiver requests by ADR and Romulus.
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On 2 October 2015 Pavimental SpA entered into a loan agreement for an amount of up to €50,000,000 with Credit Agricole Corporate Investment Bank Deutschland to fund the purchase of the TBM, the relevant accessories and any other equipment necessary to complete the works related to Lot 2 Galleria Santa Lucia (Variante di Valico), a contract awarded by Autostrade per l'Italia, and the cost of the insurance policy issued by Euler Hermes for the benefit of the exporter of the TBM and related accessories. The loan has an average maturity of 6.5 years and carries an interest rate of approximately 2.25%.
At 31 December 2015 total disbursements amounted to €10,622,969.74. The loan agreement calls for Pavimental to have a backlog of works and service contracts
from Group Companies worth at least three times the amount of the loan outstanding and allows the lender to terminate the agreement in case the Atlantia Group no longer controls the company (change of control clause).
Pursuant to art. 123 bis, first paragraph, letter m), CFA, shareholders at General
Meeting on 24 April 2015, revoked the unused portion of the previous authority dated 16 April 2014, granting the Board of Directors, pursuant to arts. 2357, et seq., of the Italian Civil Code and art. 132 of Legislative Decree 58 of 24 February 1998, the powers to, within 18 months, purchase on the market, in one or more tranches, a maximum of 82,578,399 treasury shares, with a par value of €1.00 (including the 2,854,664 treasury shares acquired by the Company on 24 April 2015, pursuant to previous shareholder resolutions), and otherwise, where lower, up to the maximum number of treasury allowed by law from time to time.
This corporate action was carried out to:
(a) operate in the market, in accordance with the laws and regulations in force from time to time, including through intermediaries, to support Atlantia's share liquidity and/or to stabilise its price, in the presence of unusual fluctuations, due to excess volatility or little market liquidity or sales by shareholders which can affect Atlantia's share price or, more generally, temporary market turmoil;
(b) operate in the market with a medium/long-term approach to investing, including to create long-term equity interests or to take market opportunities by buying and selling shares, in the market (in relation to the purchases in the manner indicated in the Illustrative Report to the Shareholders) or (regarding the sale, disposal or use) in the OTC market or also outside the market or through an ABB or in blocks, at any time, in whole or in part, in one or more instances, without time limits, provided that such transactions take place at market prices;
(c) build a share inventory to sell, dispose of and/or utilise treasury shares – whether held in portfolio or purchased pursuant to the above shareholder resolution – at any time, in whole or in part, in one or more instances, and without time limits, provided that the relevant transactions take place in keeping with the Company's strategic guidelines, in connection with capital actions including, but not limited to, stock-for-stock transactions, contributions, share swaps or in relation to share-based transactions or other corporate and/or financial transactions including, without limitation, acquisitions, mergers and the like or loan transactions or incentives and similar transactions, in relation to which it is necessary or appropriate to award or perform any other act of disposition of treasury shares (for example in relation to convertible securities, bonds or warrants) as well as to fulfil obligations arising from stock option plans, stock grants or otherwise incentive programmes, whether for payment or free of charge, to group directors and officers, employees or collaborators, it being understood that if the reasons for the purchase no longer apply, the treasury shares held in portfolio or purchased pursuant to the above authority may be used for the other purposes indicated above and/or sold.
The General Meeting also required, subject to funds sufficient for the Company's investment plans, that the above treasury share purchases be made:
(a) at prices consistent with the provisions of article 5, paragraph 1, of Commission Regulation (EC) No 2273/2003 of 22 December 2003, that is, as of the date of the report to the shareholders, at a price not exceeding the higher of (i) the price of the latest independent transaction and (ii) the highest current independent offer made on the MTA market, organised and managed by Borsa Italiana SpA, or otherwise at a price per share to within 20% of the closing reference price for the day prior to that of every single transaction;
(b) in any way permitted by the laws and regulations in force from time to time, particularly, as of this writing, article 132, paragraph 1, TUF and article 144-bis, paragraph 1, sub-paragraphs a), b), c) and d) of the Regulations for Issuers.
The General Meeting of Shareholders authorised the sale or other act of disposition and/or use, in one or more instances and at any time, without any time limit, of all or part of the treasury shares held in portfolio or purchased pursuant to the resolution, including before completion of the purchases of the maximum amount authorised by the resolution, for all the purposes outlined above, provided that if such transactions are carried out:
(a) for cash, they will have to be executed at a price per share to be determined on the basis of market practices prevailing from time to time otherwise at a price per share to within 10% of the closing reference price for the day prior to that of every single transaction;
(b) in connection with capital actions, including stock-for-stock transactions, contributions, share swaps or in relation to share-based transactions or other corporate actions and/or financial transactions, they must be executed with the price limits and on the terms and conditions set by the Board of Directors;
(c) in relation to share-based incentive plans, treasury shares must be awarded to the beneficiaries of these plans in place from time to time, in accordance with the terms and conditions of the plans.
For the additional terms and conditions of the shareholder resolution on the authority to purchase and sell treasury shares, reference is made to the Report to the Shareholders available on the Company's website: (http://www.atlantia.it/pdf/ass2015/ATL\_Relazione\_Illustrativa\_punto\_3\_odg.pdf).
Lastly, the number of treasury shares in portfolio at the end of 2015 was 2,401,753, or 0.29% of the issued capital.
Sintonia SpA, through Schemaventotto SpA, directly and indirectly holds the relevant majority of Atlantia SpA's issued capital. Sintonia SpA transferred its registered office from Luxembourg to Italy in 2012 and incorporated Sintonia SpA in that year.
Following termination of the Shareholder Agreement referred to in paragraph c) above, Sintonia SpA holds 30.25% of the Company's issued capital.
Despite the decrease in its equity interest, Sintonia SpA holds sufficient voting rights to exercise dominant influence at the ordinary general meetings of Atlantia SpA's shareholders, pursuant to art. 2359 of the Italian Civil Code, as referred to by art. 2497 sexies of the Code, considering that, to date, the conditions (e.g. the composition of the Board of Directors) that determined this situation have not changed.
The fact that Atlantia is deemed not to be subject to management and coordination by Sintonia SpA, was confirmed in a specific joint declaration sent to Atlantia SpA on 12 March 2009 by Sintonia SA and Schemaventotto SpA. Given that there have not been any further announcements or changes in circumstances, the basis for considering Atlantia as not subject to management and coordination by its parents, Sintonia SA and Schemaventotto SpA, is deemed to be unchanged.
On 20 March 2009 Atlantia SpA's Board of Directors thus issued an attestation stating that Atlantia is not subject to the management and coordination of either Sintonia SA or Schemaventotto SpA. Eventually, Schemaventotto SpA was merged with and into Sintonia SA.
Given that there have not been any further announcements by Sintonia SpA or changes in the relevant circumstances, Atlantia SpA can definitely be considered as not subject to management and coordination by Sintonia SpA.
With reference to relations between Atlantia SpA and its subsidiary, Autostrade per l'Italia SpA, after due consideration on 14 February 2008 Atlantia's Board of Directors acknowledged that Autostrade per l'Italia continues to be subject to the management and coordination of Atlantia SpA, since the circumstances that previously determined this situation had not changed.
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As noted in previous reports, following the review of the organisation of the Group in 2007, confirming Atlantia SpA's role as a holding company responsible for investments and portfolio strategies and Autostrade per l'Italia's role as an independent sub-holding company operating in the motorway sector, the Board of Directors, on 14 December 2007, partially in consequence of the Company's new Corporate Governance Code, transferred responsibility for management and coordination of the Operators and industrial companies controlled by its subsidiary to Autostrade per l'Italia itself.
As a result, Autostrade per l'Italia and Autostrade per l'Italia's subsidiaries have complied with the requirements of art. 2497 bis of the Italian Civil Code and continue to do so at this time.
Moreover, subsequent to the merger of Gemina SpA, which took effect on 1 December 2013, Aeroporti di Roma is subject, pursuant to article 2497 of the Italian Civil Code, to the management and coordination of Atlantia SpA
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Aeroporti di Roma SpA entered in the Rome Companies' Register, in accordance with art. 2497 bis of the Italian Civil Code, that it is subject to management and coordination by Atlantia SpA. Aeroporti di Roma SpA, for its part, manages and coordinates its own subsidiaries.
Lastly, following completion in 2015 of the group reorganisation of the equity interests in Pavimental SpA and Spea Engineering SpA (resulting from the merger between Spea – Ingegneria Europea SpA and ADR Engineering SpA), Atlantia SpA carries out management and direction activities over the two companies, which completed the required filings to confirm such condition.
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It should be noted that:
Atlantia SpA's corporate governance system is based on a compendium of rules that are in line with the most recent market and regulatory standards. This system has been created and revised over time by the introduction of rules that substantially correspond to the evolution of business and the requirements of the 2011 Corporate Governance Code prepared by the Corporate Governance Committee for Listed Companies except in the circumstances described further below. As explained in the reports on corporate governance and the ownership structure published in previous years, the Company substantially implemented the recommendations in 2007 contained in Borsa Italiana's Corporate Governance Code of 2006 by approving its own Corporate Governance Code on 14 December 2007, to provide shareholders and stakeholders a tool to understand more easily and rapidly Atlantia SpA's governance structure.
The Board of Directors revised its Corporate Governance Code on 11 November 2011, 14 December 2012 and 11 December 2014 – upon proposal of the Control, Risk and Corporate Governance Committee - incorporating amendments to the Corporate Governance Code for Listed Companies by the Corporate Governance Committee for Listed Companies.
The full text of the latest version of Atlantia SpA's Corporate Governance Code, as revised by the Board of Directors on 11 December 2014, is available on the Company's website at www.atlantia.it/en/corporate-governance/.
The regulations contained in the Articles of Association and the General Meeting Regulations complete the Company's corporate governance system.
Atlantia SpA is subject to the Italian law.
This Report has been prepared using the format provided by Borsa Italiana for the January 2015 fifth version of corporate governance reports.
The Board of Directors amended the Articles of Association by resolution of 13 July 2012 in accordance with Law 120 of 12 July 2011 which inserted new paragraphs 1 ter, article 147 ter and 1 bis, article 148 of the CFA (Legislative Decree 58/98, as amended) requiring listed companies to assure balanced gender quotas amongst and between persons nominated for election as directors. Articles 19 and 20, in particular, were amended with respect to appointments to the Board of Directors in as far as the method of compiling slates is concerned and the additional requirement for gradual transitional arrangements, to assure compliance with gender quotas when determining the results of elections to the Board Directors. Article 21 was also amended with respect to the replacement of directors in compliance with statutory requirements on gender quotas. All elections to the Board of Directors are made with reference to slates submitted by Members and the retiring Board of Directors, containing sequentially numbered candidates. The slates of candidates for the position of Director must be filed with the Company's registered office at least twentyfive days before the date of the General Meeting to be held as a first or one call meeting. The slates will be made available to the public, according to the procedures required by the applicable regulations, at least twenty-one days before the date of the General Meeting to be held as a first or one call meeting. Each Member has the right, singly or jointly with other Members, to submit one slate only, and any candidate included in more than one slate shall be disqualified. No slate may contain a number of candidates exceeding the maximum number of Directors as provided by the Articles of Association. Each slate must include at least two candidates who meet the independence requirements established by law, and one of these must be entered in first place on the slate. Slates containing a number of candidates equal to or higher than three must indicate:
at least a fifth of the candidates belonging to the least represented gender for the first term of office in application of Law 120 of 12 July 2011;
Only those Members who, singly or jointly with other Members, at the date on which the slates were filed with the Company, represent at least one percent of the issued capital, or the minimum shareholding to be determined in accordance with the applicable laws and regulations, may submit a slate.
This percentage is in line with the CONSOB regulations contained in resolution 17633 of 26 January 2011. Each Member proposing a slate must submit or mail a certificate issued by the intermediaries in accordance with the law and regulations in force, to the registered office within twenty-one days before the date of the relevant General Meeting to be held as a first or one call meeting, attesting to their holding of the minimum percentage shareholding required in order to submit slates. Each slate must be accompanied by:
exhaustive information regarding candidates' personal and professional details;
declarations of the individual candidates accepting their candidature and providing a personal warranty that there is no fact or deed that could give rise to their disqualification and that they meet the legal requirements for holding such office, and that, where applicable, they meet the independence requirements established by the legislation and regulations in force;
an indication of the identities of the Members who have submitted the slates and their total percentage shareholding.
Any individual having the right to vote may only vote for one slate. Members of the Board of Directors are elected in the following manner:
Directors selected, is selected, provided that legislation in force concerning the balance between gender quotas has been observed. In the event of a tie of slate votes, and, therefore, equal quotients, the General Meeting shall hold a new election and the candidate receiving the simple majority of votes shall be elected.
Article 2.2, sub-paragraph (c) of the Company's Corporate Governance Code provides that if Atlantia is a component of the FTSE-MIB index, at least one third of directors are required to be independent.
Such number shall be rounded down to the lower integer, in the event that it is not a whole number.
The number of independent Directors may, however, never be less than two.
The Board of Directors – upon a proposal of the Control Risk and Corporate Governance Committee dated 14 December 2012 – did not embrace the principle whereby concentration of corporate roles in one person should be avoided, as contemplated by the Corporate Governance Code for Listed Companies (principle 2.P.4), because it established that the decision to concentrate Group roles in one individual should be assessed by the Board of Directors as and when required and on a case by case basis, without prejudice to the continuing nature of non-group positions held.
The Board of Directors in office at 31 December 2015 was elected by shareholders at the General Meeting of 30 April 2013.
At the General Meeting held on 30 April 2013, shareholders approved the proposal that the number of members of the Board of Directors should be fifteen and, in accordance with art. 19, paragraph 3 of the Articles of Association, voted to fix the term of office of the new Board of Directors as three financial years.
Fifteen Directors were the appointed for the financial years 2013, 2014 and 2015, based on the slates submitted by the shareholders according to the terms and procedures provided for by art. 20 of the Articles of Association and published in national daily newspapers.
A total of two slates were submitted.
Pursuant to art. 20, letter b) of the Articles of Association, 12 Directors were elected, with 71.63% of the voting shares, from the majority slate submitted by Sintonia SpA: Fabio Cerchiai, (Chairman); Giovanni Castellucci, (Chief Executive Officer); Carla Angela; Gilberto Benetton; Carlo Bertazzo; Alberto Clô; Massimo Lapucci; Giuliano Mari; Valentina Martinelli, Monica Mondardini; Clemente Rebecchini and Paolo Zannoni.
The Director, Paolo Zannoni, resigned by letter dated 8 May 2014, and received on 9 May 2014, and on 12 June 2014 the Board of Directors co-opted Matteo Botto Poala.
Pursuant to art. 20, letter c) of the Articles of Association, three Directors - Bernardo Bertoldi, Gianni Coda and Lucy P. Marcus - were elected with 26.18% of the voting shares from the minority slate submitted by the law firm Trevisan & Associati on behalf of the following shareholders: Allianz Global Investors Italia SGR SpA manager of the Allianz Azioni Italia All Stars fund; Anima SGR SpA manager of the Prima Geo Italia fund; Arca SGR SpA manager of the Arca Azioni Italia and Arca BB funds; BNP Paribas Investment Partners SGR SpA manager of the BNL Azioni Italia fund; Eurizon Capital SGR SpA manger of the: Eurizon Azioni Area Euro and Eurizon Azioni Italia funds; Eurizon Capital SA manager of the: Eurizon EasyFund Equity Italy, Eurizon Investment Sicav – Europe Equities, Eurizon Investment Sicav – PB Equity EUR, Eurizon EasyFund Equity Europe LTE, Eurizon EasyFund Equity Euro LTE, Eurizon EasyFund Equity Utilities LTE, Eurizon EasyFund Equity Italy LTE, Rossini Lux Fund – Azionario Euro funds; Fil Investments International manager of the Fidelity European Fund; Fideuram Gestions SA manager of: Fideuram Fund Equity Europe and Fonditalia Equity Italy; Interfund Sicav manager of the Interfund Equity Italy; Generali Investments Europe SpA SGR individual manager of the following Assicurazioni Generali SpA, Alleanza Toro SpA and Generali Life SpA portfolios: Pioneer Asset Management SA; Pioneer Investment Management SGRpA manager of the Pioneer Italia Azionario Crescita and UBI Pramerica funds, manager of the Ubi Pramerica Azioni Italia fund.
No link was found between the two slates submitted.
The candidates shown in the slates for election to the Board of Directors declared that they met the independence requirements pursuant to both article 148 paragraph 3 of the Consolidated Finance Act ad article 3 of Atlantia's Corporate Governance Code.
Atlantia's Succession Plan and Talent Management processes are used in the Group for the development of human resources and organisational development decisions. They ensure the Group's management continuity by identifying key positions, potential successors for the key positions and setting out growth plans.
In 2015, it was not necessary to update the Succession Plan prepared in the previous year. Besides, during the year, new top executives were hired. Thus, the Plan is expected to be revised in 2016.
In 2015, the Group's Human Resources department confirmed the model to evaluate the skills and performance of current Group key employees, which was implemented with the direct involvement of the competent departments of the Group's individual companies.
With regard to planning for the succession of Atlantia's CEO, the Board of Directors is responsible for coordinating and managing any unexpected replacement of a serving Director. The procedures and timing are linked to the related circumstances.
The Board of Directors at 31 December 2015 is, consequently, composed of fifteen Directors: thirteen non-executive Directors and two executive Directors (the Chief Executive Officer and the Chairman). The number and authority of non-executive directors shall be such as to ensure that their opinions have a significant effect on board resolutions and that their specific skills and expertise are brought to bear on deliberations, thus helping to ensure that decisions are taken in the Company's best interests.
Currently, non-executive directors are, consequently, Angela, Benetton, Bertazzo, Bertoldi, Botto Poala, Clò, Coda, Lapucci, Marcus, Mari, Martinelli, Mondardini, Rebecchini and Zannoni. The Board of Directors appointed Mari as the Director Responsible for the Internal Control and Risk Management System on 13 June 2013.
The Company's Corporate Governance Code specifies that Directors accept their election when they believe that they can devote enough time to carry out their duties diligently, also in view of the number of positions as a Director or Statutory Auditor held in other Italian and foreign companies listed on regulated markets, and in financial, banking, insurance or other large companies. Table 2 summarises the number of positions in such companies held by each Director as at 31 December 2015, in addition to their position in Atlantia SpA. Annex 1 lists the positions.
In the meeting held on 14 December 2012, at the recommendation of the Control, Risk and Corporate Governance Committee, the Board of Directors maintained in the Corporate Governance Code its prerogative to express its views on the maximum number of directorships or positions as statutory auditor that Directors can hold in listed companies, whether Italian or foreign, in financial, banking or insurance companies or in large companies, taking into account also the participation of Directors in Board Committees, in order not to undermine the effectiveness of their role as Company Directors or Statutory Auditors. Such guidance should be interpreted in conjunction with the requirements laid down in the subsequent sentences of article 1.5 of the Company's Corporate Governance Code whereby, regarding the maximum number of positions, the Board of Directors considers as a necessary precondition for potential Directors or Statutory Auditors the availability of an adequate amount of time to serve effectively in office (see application criterion 1.C.3 of the corporate governance code for listed companies). Such assessment should be made by the shareholders, when they select the candidates for inclusion in the slate for election to the Board of Directors and Board of Statutory Auditors, and, most of all, by candidates to such offices.
Atlantia has not adopted any rules on this matter, as they were not considered necessary, considering the ownership structure and the current powers vested in the Board of Directors.
Also, several amendments were introduced to the laws in force that foster a composition of the Board of Directors and the Board of Statutory Auditors that meet regulatory and selfregulatory requirements (for example, article 144 terdecies of the Regulations for Issuers, article 147 - ter and article 148 of the Consolidated Finance Act, among others).
In order to enable the Directors to carry out their duties in an informed manner, the Company's Chairman has launched a number of initiatives aimed at increasing their knowledge of the Company and how it operates, including updates on developments in the regulatory and self-regulatory environment. Induction sessions were organised for 21 January, 11 June and 16 October 2015 in which information was provided to Directors and Statutory Auditors on risk management and monitoring; on the Group's growth guidelines; on the status and prospects of ADR SpA, particularly with reference to Fiumicino Airport.
Information on Independent Directors is provided in section 4.5.
The number of years in service since originally appointed at the Atlantia General Meeting of 26 November 2003 are shown in Table B herewith.
The personal and professional details of each Director in office at 31 December 2015 are shown in Annex A herewith.
In the meeting held on 14 December 2012, upon proposal of the Control, Risk and Corporate Governance Committee, the Board of Directors did not adopt criterion 1.C.1.h) of the Corporate Governance Code for Listed Companies relating to the requirement for the Directors to provide their opinion to the Shareholders - based on the assessment of the functioning, size and composition of the Board of Directors - on the management and professional experience that would benefit the Board, prior to the election of its new members.
It is worthy of note that, the assessments conducted from time to time on the composition and functioning of the Board of Directors and its Committees did not reveal any criticalities in terms of the free determination of the composition of the Board of Directors through the nomination of Directors on the basis of slates submitted by the majority and minority Shareholders that would justify the expression of such opinions.
There is no reason that Shareholders holding an equity interest sufficient to submit their own slates should refrain from asking members of the retiring Board of Directors as to the necessary management and professional experience.
The conduct of the Board of Directors to any general waiver by the General Meeting of the non-competition clause must be consistent with legislation regarding the powers authorised by the General Meeting as permitted by art. 2390, Italian Civil Code.
However, so far the Shareholders have never authorized any waiver of the noncompetition clause under article 2390 of the Italian Civil Code.
The Board of Directors is the corporate body responsible for the management of the Company and is, therefore, the only body with the authority and full powers to conduct the affairs of the Company in pursuit of the priority objective of creating shareholder value.
In performing its duties, the Board of Directors must comply with the principles of proper management of the Company and its affairs by observing all relevant laws and regulations and requirements of the Code of Ethics.
The Board of Directors oversees the proper execution and implementation of powers that it has delegated and has the power to issue directions regarding the powers so delegated and to assume responsibility for related transactions. The Board of Directors must, in any event, continue to be vested with policy-making and control powers in respect of the overall operations of the Company in its various components.
The Board of Directors is provided with accurate and timely reports by holders of delegated powers within the Company regarding the performance of those powers and with respect to the Company's business undertakings and their outlook, as well as transactions entered into by the Company and the Group that are considered material due their size or nature. Consequently, as required by art. 27 of the Articles of Association, Directors delegated with specific powers reports to the Board of Statutory Auditors on transactions having significant effects on the results of operations and financial position entered into by the Company and Subsidiaries, particularly having regard to any such transactions that involve Directors acting on their own behalf or on behalf of third parties. Such reports are made on the occasion of Board meetings to be held at least every quarter or, for urgent matters, in documentation to be sent by registered mail to each standing Auditor.
The Board of Directors has, among other things, sole responsibility for:
Company's and Group's management and the Internal Audit department, and particularly any information received from the Chairman, Chief Executive Officer and the Risk Control and Corporate Governance Committee;
The Board of Directors shall, subject to the consent of the Control, Risk and Corporate Governance Committee:
The Board of Directors shall, on the proposal of the Director responsible for the risk management and internal control system and subject to the consent of the Control, Risk and Corporate Governance Committee and having consulted with the Board of Statutory Auditors:
In consultation with the Board of Statutory Auditors, the Board of Directors also appoints and terminates the appointment of the Manager Responsible for Financial Reporting.
The Board of Directors shall meet at least four times a year, or whenever deemed appropriate by the Chairman. Meetings may also be called by Directors and/or the Board of Statutory Auditors and/or Statutory Auditors, pursuant to the law and the Articles of Association.
The Chairman and the Chief Executive Officer normally inform the Board of Directors during the meeting about significant events that have occurred since the last meeting and, at least on a quarterly basis, about the overall performances of the Company and the Group, the outlook and their exercise of the powers granted to them. Prior to the meeting, and subject to the procedure for managing price sensitive information, the Directors shall be provided with adequate information and documentation regarding the matters to be discussed and included in the agenda. The material, which shall include the content of the resolutions to be voted on, must normally be sent to the Directors at least three days before the date of the meeting to which it refers.
Any Director may propose agenda items for future meetings of the Board of Directors. Every Director shall also be entitled to raise issues, during the meeting, that are not on the agenda. The meeting shall decide whether or not to deliberate the issue not on the agenda by majority vote of all the Directors present.
The participation at Board of Director meetings of the General Manager, where appointed, the Chief Financial Officer, the Manager Responsible for Financial Reporting and of any other managers – in relation to agenda items for which the Board deems their contribution to be of consequence – is deemed to be consistent with management of the Company in pursuit of the creation of shareholder value.
The Chairman, with attendees' consent, may invite other external persons to attend meetings of the Board of Directors as observers or in order to provide support or advice.
The Board of Directors of Atlantia SpA held a total of 12 meetings in 2014 with an average length of 2.5 hours.
The average attendance at Board meetings was 96%. (The percentage attendance for each Director is shown in Table 2).
On the occasion of the meetings Directors were provided sufficiently in advance with all the necessary documentation to ensure fruitful participation in Board discussions. The Chairman ensured that the documents provided in advance were timely and complete, preserving the confidentiality of the relevant data and information.
In order to ensure the timeliness and completeness of pre-meeting information for the Board of Directors, documentation was sent by e-mail in 2014 relating to board meeting agenda items in compliance, to the fullest extent possible, and without prejudice to procedures for confidential or price sensitive information, with the requirement for adequate information and examination of documents no less than three days prior to Board of Directors' meetings.
Such deadline was usually complied with.
On the limited number of occasions where the documents could not be provided sufficiently in advance, care was taken to illustrate in suitable and accurate manner the matter, providing all the necessary clarifications was provided during the Board meeting, where required, and making available by e-mail the relevant documentation in any case.
The Company's Chief Financial Officer, who is also the person assigned the role of Manager Responsible for Financial Reporting, participated in all Board meetings.
The Chairman assured that Directors were able to participate in initiatives aimed at providing them with sufficient expertise in the sector in which Atlantia works, corporate dynamics and their evolution as well as the regulatory and self-regulatory environment. Regarding 2015, reference is made to paragraph 4.2.
At its meeting of 10 July 2015, the Board of Directors approved the dates of Board meetings it expects to be held during 2016. On this basis, 13 meetings have been planned.
A financial calendar is published by the end of the first month after the close of the financial year, showing the dates of Board of Directors' meetings to examine the annual and interim reports and the date of the General Meeting to approve the annual report. The financial calendar is available on the Company's website at www.atlantia.it.
As of the date of this Report, three meetings had been held in 2016.
In 2015, the Board of Directors assessed, among other things, the Company's performance after considering information provided by executive directors and officers and comparing planned with actual results.
The Board of Directors also approved strategically important transactions of Atlantia and its subsidiaries, earnings, assets and cash flow based on the provisions of paragraph 4.3 and the Company's Corporate Governance Code.
On 17 January 2013, Atlantia's Board of Directors approved participation in the streamlining required by arts. 70, paragraph 8, and paragraph 1-bis of CONSOB Resolution 11971/1999 of 20 January 2012, as amended, delegating, however, disregarding, as permitted, the obligation to publish the information required by Annex 3B of the Resolution for mergers, demergers, capital increases through in-kind contributions, acquisitions and sales.
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On 11 December 2014 the Board of Directors, upon proposal of the CEO, established the Internal Audit department (which was eventually renamed Group Internal Audit department), effective 1 January 2015, and at the recommendation of the Director in charge of the risk management and internal control system and subject to the consent of the Control, Risk and Corporate Governance Committee, and having consulted with the Board of Statutory Auditors, appointed as Director of the Internal Audit department Ms Concetta Testa, who replaced the previous Director of Internal Audit, Mr Simone Bontempo. On 19 December 2014, Memorandum no. 12/2014 was issued with the structure of the Internal Audit department as follows:
The Director of Internal Audit reports to the Chairman of the Board and has no responsibility over any operational areas.
In addition to being responsible for the matters attributed to it by the Company's Corporate Governance Code, the Internal Audit department is responsible for:
At its meeting of 8 March 2013 and in pursuance of the Corporate Governance Code, as revised on 14 December 2012, the Board of Directors conducted analyses and discussions on the nature and level of risk consistent with the issuer's strategic objectives. A revision to the analysis was reviewed by the Board of Directors on 13 December 2013. At its meeting of 11 December 2014, in pursuance of the Company's Corporate Governance Code updated as of the same date, the Board of Directors conducted analyses and discussions on the nature and level of risk consistent with the issuer's strategic objectives.
Also on 6 March 2015, the Board of Directors, at the recommendation of the Director responsible for the internal control and risk management system and with the approval of the Control, Risk and Corporate Governance Committee in consultation with the Board of Statutory Auditors established guidelines for the internal control and risk management system and expressed a positive opinion on Atlantia's internal control and risk management system, as specified in the following notes.
At its meeting of 8 May 2015, the Board of Directors set out the Risk Appetite level for the Group, as well as the strategies and objectives to be pursued.
At its meeting of 11 December 2015, the Board of Directors heard a presentation on the risk management approach adopted by the Boards of Directors of different Group companies.
Upon proposal of the Director in charge of the risk management and internal control system, subject to the consent of the Control, Risk and Corporate Governance Committee, and having consulted with the Board of Statutory Auditors, on 22 January 2016 the Board of Directors reviewed and approved the 2016 Group Audit Plan.
On 22 January 2016, the Board of Directors approved the 2016 Group Budget which incorporated, among other things, the budgets for Autostrade per l'Italia, Aeroporti di Roma, Pavimental and SPEA Engineering and noted the Group's medium- to long-term outlook.
Article 14 of Atlantia's Corporate Governance Code, in keeping with criterion 1.C.1 subparagraph g) of the Corporate Governance Code for Listed Companies, adopted Recommendation no. 2002/162/EC of the European Commission which provides, among others, that the Board of Directors of a listed issuer assess every year its work, using as standards of reference its own composition, organization and functioning.
This self-assessment has already been carried out in January and February 2016 in relation to 2015.
The self-assessment process, which was undertaken by the Company's governance bodies, was structured as follows:
In particular, the aspects listed below were assessed:
The self-assessment showed that Atlantia's Board of Directors is already in line with the requirements laid down and expected by the applicable laws in force and the provisions on Corporate Governance.
More specifically:
The governance system adopted by the Company is considered effective overall.
Atlantia's current board is adequate in terms of number and knowledge necessary regarding tasks, attributable responsibilities and the legal framework of reference. Gender diversity was adequate.
The Board's composition was considered suitable to provide a mix of skills and experience, thanks also to an effective assessment of the level of risk consistent with the Company's strategic goals.
In this context, the relationship between Independent and Non-Independent Directors is appropriate and suited to corporate requirements.
The Induction programme offered to Directors is appreciated.
Directors participate regularly in meetings, which are adequate in terms of frequency, duration and manner of convening. The minute taking process is such as to show in a detailed manner the decision-making process. Presentations at Board meetings help to shape voting decisions.
The types of matters reserved to the Board are such as to allow Directors to take part in important decisions for an effective management of the Company.
The management of confidential and price sensitive information, and its dissemination to third parties, is consistent with the relevant procedure adopted by the Board of Directors.
The definition of the Board Committees (Control, Risk and Corporate Governance Committee; Human Resources Committee; Committee of Independent Directors with responsibility for Related Party Transactions) is considered adequate and the mission of the individual committees is clearly defined. The Committees' work has helped the Board of Directors in its decision-making process, thanks also to the reports on the activities performed.
At the meeting held on 1 March 2016, the Control, Risk and Corporate Governance Committee performed a preliminary review of the self-assessment exercise for 2015.
At the meeting of 4 March 2016, the Board of Directors analysed and discussed the results related to the self-assessment. The results were positive and largely in line with those of the previous years, in relation to the themes under analysis.
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The Board of Directors has not set up an Executive Committee.
Pursuant to art. 30 of the Articles of Association, the Chairman is vested with the powers of representation before third parties and in legal proceedings.
The Chairman also has an executive role, in as much as he is also responsible, in addition to the powers provided by law and the Articles of Association, for the following:
overseeing relationships between the Company, the Group, taken as a whole, and Italian and non-Italian authorities, entities and organisations, including those of a multilateral nature.
ensuring the receipt by Directors of all the necessary documentation at least three days in advance regarding items on the agenda for Board meetings, in order for them to participate effectively and constructively in the business of Board meetings, encouraging directors to provide their inputs;
At its meeting of 10 May 2013, the Board of Directors re-appointed Giovanni Castellucci as Chief Executive Officer and General Manager.
The Chief Executive Officer is responsible for the execution of Board resolutions and the management of the company.
Atlantia observes the requirement of art. 2391, Italian Civil Code, that directors must notify other directors and the Board of Statutory Auditors of any interest of the director or a third party in a transaction of the Company advising the nature, terms, origin and importance. In the event such director is the Chief Executive Officer, the director should refrain from becoming involved in the transaction delegating all powers to the Board.
The CEO is responsible for the formulation of proposals to the Board of Directors regarding:
The General Manager is, among other things, responsible for:
conclusion of legal instruments and agreements intended to settle disputes, involving amounts of up to €2,000,000 per settlement;
conclusion of legal instruments and agreements for the extension of loans to Group companies and guarantees to, or on behalf of, third parties (including Group companies), provided that the amount does not exceed €5,000,000 per transaction;
The Chief Executive Officer regularly, at least quarterly, submits the same report to the Board of Directors and the Board of Statutory Auditors on the activities performed in discharging his duties, ensuring, above all, that the Board of Directors receives adequate information on significant, irregular, unusual or related party transactions, or transactions in which the Chief Executive Officer acts in his own interest or in the interests of third parties, so that the Board of Directors may, in turn, formally report to the Board of Statutory Auditors.
Similar reporting requirements are applicable to executive Directors in respect of the activities performed in discharging their duties.
At its meeting of 14 December 2012, at the recommendation of the Control, Risk and Corporate Governance Committee, the Board of Directors determined that - in the event that the CEO is called upon to serve as Director in another issuer, not belonging to the same group, whose Chief Executive Officer is an Atlantia Director – the Board of Directors will consider as a necessary precondition to serve as Director or Statutory Auditor, the availability of an adequate amount of time to perform their duties in such capacity, as provided for by article 1.5 of the Company's Corporate Governance Code. In addition to the above, the Directors, in accordance with the provisions of article 2391 of the Italian Civil Code, must notify to the other Directors and the Board of Statutory Auditors any interests that they might have – whether personal or on behalf of third parties – in a given Company transaction, specifying the nature, terms, origin and extent of such interests. In the case of the CEO, he shall refrain from undertaking the transaction, leaving the responsibility for its consummation to the Board of Directors.
However, there has never been any case of interlocking directorate, within the meaning of criterion 2.C.5 of the Corporate Governance Code for Listed Companies.
A suitable number of non-executive Directors are required to qualify as independent Directors.
On the basis of the provisions of the Company's Corporate Governance Code, a Director shall normally, but not necessarily, be disqualified from being an independent Director if the Director:
a) directly or indirectly controls the issuer, including control exercised through subsidiaries, trustees or through a third party, or is able to exercise significant influence over the issuer, or participates in a shareholders' agreement through which one or more persons may exercise control or significant influence over the issuer;
b) has, or had in the previous year, a direct or indirect commercial, financial or professional relationship of significance with (i) the issuer, a subsidiary of the issuer or any prominent representative of such parties, (ii) with a party, who, either alone or together with others through a shareholders' agreement, controls an issuer or (for companies or entities) with any prominent representative thereof;
c) is or was, at any time during the previous three years, an employee of the issuer, one of its subsidiaries or any party controlling the issuer through a shareholders' agreement, or of a representative of the issuer;
d) is or was, at any time during the previous three years, a representative of the issuer or any of the issuer's strategically important subsidiaries, or of a company jointly controlled with the issuer; or, a company or other entity that, whether acting alone or in concert with others through a shareholders' agreement, controls the issuer or is able to exercise significant influence. 'Prominent representative' means the Chairman, legal representative, executive Directors and key management personnel;
e) receives, or has received in the past three years, from the issuer or a subsidiary or parent of the issuer, significant additional remuneration compared to the "fixed" (as determined by Atlantia) remuneration paid to a non-executive Director of the issuer, including participation in performance-related incentive plans, including share option plans; f) is the Executive Director in another company in which an executive Director of the issuer is a Director;
g) is a shareholder or a Director of a company or entity belonging to the group of companies appointed to audit the issuer's accounts;
h) is a close family member of an individual who holds any one of the above positions or engages in any one of the above activities;
i) was a Director of the Company for more than nine of the last twelve years.
The independence of Directors shall be periodically reviewed by the Board of Directors, based on information provided by the individuals concerned. For this purpose, the Board shall, based on the statements provided, examine the Director's direct or indirect commercial, financial or professional relationships with the Company, assessing their significance both in absolute terms and with reference to the economic and financial position of the individual concerned. This shall also take account of any relations that, although not significant from a financial viewpoint, are of particular importance for the prestige of the interested party. The results of the Board of Directors' reviews shall be disclosed to the market.
The determination of a Director's independence by the Board of Directors subsequent to appointment is made in accordance with art. 144 novies, paragraph 1 bis, letter a) of the Regulations for Issuers.
Any criteria used for the determination of independence other than that provide by the Code is assessed, as and when necessary, by the Board of Directors.
The quantitative and qualitative governance criteria used by the Company to ascertain the importance of relations being examined are set out in point 3.2 of Atlantia's Corporate Governance Code.
The following members of the Board of Directors of Atlantia SpA elected by the General Meeting of 30 April 2013 qualified as independent: Messrs Angela, Bertoldi, Clò, Coda, Marcus, Mari and Mondardini. These Directors all met the independence requirements provided for by both the CFA (art. 148, paragraph 3) and the Company's Corporate Governance Code (art. 3.1).
At its meeting of 12 February 2016, Atlantia SpA's Board of Directors the periodic independence test for Directors Carla Angela, Bernardo Bertoldi, Alberto Clô, Gianni Coda, Lucy P. Marcus, Giuliano Mari and Monica Mondardini, pursuant to article 3.2 of the Company's Corporate Governance Code.
On the same date the Board of Statutory Auditors verified the correct application of the criteria and procedures adopted by the Board of Directors in assessing the independence of Directors.
The outcome of the assessments conducted by the Board of Directors and the Board of Statutory Auditors was disclosed to the market on 12 February 2016.
There were seven independent directors on the Board as at 31 December 2015.
Provided that Atlantia is still a component of the FTSE MIB, article 2.2 of the Company's Corporate Governance Code requires that at least one third of the Board of Directors must be independent. In the event one third is not a whole number, it is rounded. The number of independent Directors may, however, never be less than two.
Atlantia's Corporate Governance Code requires the independent Directors to meet separately in closed session at least once a year.
In 2015 Independent Directors met in a closed session on 11 December 2015 and made certain positive observations on board reporting, induction meetings and succession plans.
On the basis of the provisions of art. 30 of the Articles of Association, the Chairman and Chief Executive Officer are authorised to represent the Company.
The separation of the positions of Chairman and Chief Executive Officer renders the appointment of a Lead Independent Director unnecessary.
With regard to the internal management and publication of documents and information relating to Atlantia, with specific reference to price sensitive information, the Company's Board of Directors has adopted the following procedures:
Moreover, following a positive opinion of the Control, Risk and Corporate Governance Committee, in 2014 the Board of Directors updated both procedures, to introduce the organizational changes brought about by the merger of Gemina SpA with and into Atlantia SpA and to adapt them to the new organizational set-up.
The updated versions of both documents are available on the internet at: www.atlantia.it/it/corporate-governance/and the company intranet.
The Procedure for Market Announcements regulates the internal management and publication of price sensitive information by Atlantia SpA and its subsidiaries (meaning the companies controlled directly or indirectly by Atlantia), as provided for in the related regulations and in compliance with art. 8 of the Company's Corporate Governance Code and art. 8 of the Group's Code of Ethics.
In particular, the Chairman and Chief Executive Officer are responsible for managing confidential information in line with the requirements of Atlantia's Corporate Governance Code (articles 6.3, letter c, and 8.1) and their powers. The Chairman is responsible for proper and prompt disclosure to market regulators and the Chief Executive Officer for providing the market with trading updates.
In compliance with Legislative Decree 58/98, as amended, Atlantia has established a register of persons with access in insider information or information that could become classified as such as a result of their jobs, profession or in the course of the performance of their duties.
The Domestic Legal and Corporate Affairs unit is responsible for keeping the Register current.
The same unit also notifies the relevant persons that they have been included in the register and of all subsequent variations, and/or deletions and advises them of the responsibilities involved in accessing and properly managing information into which they may come into possession as well as obligations of confidentiality.
The Procedure for Market Announcements is completed and supplemented by the provisions of the Code of Conduct for Internal Dealing, approved by the Board of Directors at its meeting of 15 July 2010, in implementation of the provisions of arts. 152 sexies, 152 septies and 152 octies of the CONSOB Resolution 11971 (the "Code of Internal Dealing"). The Code of Internal Dealing governs the reporting requirements of Relevant Persons to Atlantia SpA and the Market on transactions (share purchase, sale subscription or exchange) concluded by such persons and the related financial instruments within the limits and terms imposed by the Code.
The Company's Code of Internal Dealing identifies Relevant Persons and "Persons closely linked to Relevant Persons", also establishing that it is the responsibility of a Relevant Person to indicate other Persons who, in relation to the activities performed by or tasks assigned to them, including for limited periods of time, are subject to the same rules as Relevant Persons.
The Code of Internal Dealing also provides that Relevant Persons and Persons Closely Linked to Relevant Persons (except for shareholders holding 10% or more of the Company's issued capital) may not trade in the Company's shares or related financial instruments during the ten days preceding an announcement to the market of Board of Directors approval of the Company's draft annual and semi-annual financial statements, or the results of the first and third quarters of each year and until such time as the announcement is actually made.
The Board of Directors established the Committees listed below, pursuant to the recommendations of the Corporate Governance Code for Listed Companies:
In addition, the Board of Directors has established the:
3) Committee of Independent Directors with responsibility for Related Party Transactions, pursuant to the CONSOB Regulations on related party transactions.
Regarding said Committees, reference is made to the following sections of the Report. The Company does not have a Nominations Committee for the reasons explained below.
As reported last year – from the introduction of Atlantia's Corporate Governance Code and upon proposal of the Control, Risk and Corporate Governance Committee – the Board of Directors did not establish a nominations committee, as new directors are appointed according to a slate voting procedure, in accordance with the procedure provided for by art. 20 of the Articles of Association. Such procedure is transparent and compliant with the requirements of the Corporate Governance Code for Listed Companies.
Atlantia's Board of Directors did not, therefore, deem it necessary to appoint such a committee, considering that:
The establishment of a Nominations Committee was, therefore, not deemed necessary.
On the other hand, it should be noted that the various Company Boards of Directors elected from time to time have been characterised by a varied and balanced presence of distinguished management, economic, legal and business professionals and that the role and authoritativeness of independent and non-executive directors and the self-assessment procedure allow the Board of Directors to fulfil the nomination functions attributed to the Committee by the Corporate Governance Code for Listed Companies.
As provided by article 10 of Atlantia's Corporate Governance Code, the Board of Directors has set up a board committee called the Human Resources and Remuneration Committee, which has five non-executive Directors. The Committee has investigative functions and provides consultation and advice to the Board. At least one member of the Committee must possess adequate financial knowledge and expertise, to be evaluated by the Board of Directors at the time of appointment. The Committee elects the Chairman from among its members.
With reference to the composition of the Committee, Atlantia's Corporate Governance Code deviates in part from principle 6.P.3 of the Corporate Governance Code for Listed Companies, which provides that: "The Board of Directors shall establish, from among its members, a remuneration committee, made up of independent directors. Alternatively, the committee may be made up of non-executive directors, the majority of which are to be independent; in this case, the chairman 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".
In fact, the Board of Directors was granted the broadest powers possible when determining the Committee's composition to assess the experience, professionalism and independence of the non-executive directors considered to be the best candidates for the committee.
This approach was approved by the Board of Directors at the meeting of 14 December 2012, having heard the opinion of the Control, Risk and Corporate Governance Committee.
This, however, did not preclude Atlantia's Board of Directors from adopting, upon the appointment of the Human Resources and Remuneration Committee in office, a composition in line with the recommendation contained in principle 6.P.3 of the Corporate Governance Code for Listed Companies ("Alternatively, the committee may be made up of non-executive directors, the majority of which to be independent; in this case, the chairman of the committee is selected among the independent directors") as the majority of members of the Committee consists of independent directors and the Chairman is a Director that fulfils the independence requirement.
In the meeting held on 10 May 2013 Atlantia's Board of Directors appointed as members of the Committee the following non-executive Directors: Carlo Bertazzo, Alberto Clò, Gianni Coda, Massimo Lapucci and Monica Mondardini.
The Directors, Clò, Coda and Mondardini all meet the independent requirements pursuant to article 148 paragraph 3 of the Consolidated Finance Act and article 3 of the Corporate Governance Code.
At the meeting of 29 May 2013, the Committee confirmed Alberto Clò as its Chairman.
The possibility to appoint non-executive Directors as members of the Committee – without the obligation for the majority to be made up of independents – allows the Board of Directors the broadest choice of highly qualified candidates for the position. In the meantime, the Board may appoint as members of the Committee all independent directors, or a majority of Independent Directors, thus following, in fact, the recommendations of the Corporate Governance Committee – which was in fact the case in this particular instance.
The objective is to allow the Board of Directors to identify, from among its members, those non-executive Directors that, for various reasons (such as professional experience, specific duties assigned to the Committee, individual characteristics, ability to express a substantially independent conduct, beyond the formal requirement etc.), are best suited to ensure the proper functioning of the Committee and to provide research support to the Board of Directors on financial issues and related compensation policies.
Upon their appointment, the Board found that all the Committee members are in possession of specific and adequate financial expertise and at least one has expertise in remuneration policy.
The Committee elects a Chairman from among its members and
As required by the Corporate Governance Code, the Chairman and Chief Executive Officer/General Manager attend the Committee's meetings, except for meetings at which proposals regarding their own remuneration are discussed.
As required by the Committee's Regulation, the Chairman of the Board of Statutory Auditors (or other Standing Auditor designated by the Chairman) participates in meetings – upon request of the Committee's Chairman - whenever matters are deliberated for which the Statutory Auditors' recommendation is required; this particularly includes meetings where the overall compensation of Chairman of the Board of Directors, the Chief Executive and other Directors is determined or the criteria for the remuneration of Company and Group key management personnel and senior management for approval by the Board of Directors as recommended by the Board of Statutory Auditors.
The Committee's meetings may be attended also by other persons, if requested by the Committee, to provide information and opinions on specific agenda items.
In 2015 the Committee held seven meetings, which were duly recorded on minutes by the Secretary, with an average duration of approximately one hour and a half (the percentage attendances of Committee members at the meetings are shown in Table 2) and took decisions and formulated proposals regarding the following points:
The Board has been supported by verifiably independent leading consultancy firms for the above matters.
At least seven meetings are planned for 2016, three of which have already been held at the date of this Report.
Autostrade per l'Italia's Head of Group Human Resources also attended Committee meetings to act as the Committee's Secretary and take minutes.
The Company, through the Head of Human Resources, ensured that the Committee had access to the information and functions necessary for the performance of its duties and, when so required, the Committee availed itself of external consultants.
Atlantia's Board of Directors approved a Group Remuneration Policy on recommendation of the Human Resources and Remuneration Committee in December 2011.
At the Board meeting of 21 January 2015 a recommendation by the Committee was approved to review Policy for 2015.
The Policy entailed the pursuit of impartiality, in the face of sustainable performance, within the organisation and competitiveness with the Company's peers in comparable sectors in terms of business and size.
The Group Remuneration Policy had been developed in a manner consistent with the applicable laws and regulations, including the principles and criteria of art. 6 of the July 2015 version of the Corporate Governance Code of Listed Companies adopted by art. 10 of Atlantia's Corporate Governance Code.
The Policy is described in the "Remuneration Report" which has been placed on the Company's website (http://www.atlantia.it/it/corporate-governance/remunerazione.html) and was submitted to the General Meeting on 24 April 2015 for a consultative, non-binding vote pursuant to art. 123 ter, paragraph 6, CFA, where it was approved.
All of the information on remuneration paid in 2015 required to be disclosed in the Report on Corporate Governance and the Ownership Structure, including the information required by art. 123-bis of the CFA, has been included in that Report, to which reference is made.
Atlantia's Board of Directors established and Control and Risk Committee and called it "Control, Risk and Corporate Governance Committee" (hereinafter referred to as "CRCGC" or "the Committee").
The Committee's composition is governed by Atlantia's Corporate Governance Code, which provides that this Committee be composed of "non-executive Directors, including at least one Director representing minority shareholders (…)".
On this aspect, Atlantia's Corporate Governance Code differs in part from principle 7.P.4 of the Corporate Governance Code for Listed Companies, which provides that: "The control and risk committee is made up of independent directors. Alternatively, the committee can be made up of non-executive directors, the majority of which being independent ones; in this case, the chairman of the committee is selected from among the independent directors. (…)".
This approach had been approved by the Board of Directors at the meeting of 14 December 2012, having regard to the opinion of the CRCGC.
Such approach is intended to allow the Board of Directors a broad overview of the experience, expertise and independence of judgment of the non-executive Directors considered suitable candidates for the Committee.
This, however, did not preclude Atlantia's Board of Directors from adopting, when the current Committee was appointed, a composition that is totally in keeping with the recommendation contained in the abovementioned principle 7.P.4 of the Corporate Governance Code for Listed Companies ("The control and risk committee is made up of independent directors."), as the members of the current Committee are all independent directors.
In fact, on 10 May 2013, the Board of Directors appointed as members of the CRCGC Carla Angela, Lucy Marcus and Giuliano Mari, all of them non-executive and independent directors pursuant to article 148, paragraph 3, of the Consolidated Finance Act and article 3 of the Corporate Governance Code.
The possibility to appoint non-executive directors as members of the CRCGC – without the obligation that at least the majority be made up of independent directors – allows the Board of Directors the broadest choice of qualified candidates for the position, it being understood that the Board may appoint all independent directors on the Committee, or mostly independent directors, in keeping with the recommendations of the Corporate Governance Committee, as was the case in this instance.
The objective is for the Board of Directors to identify such non-executive directors who, for different reasons (such as professional experience, specific expertise in the matters dealt with by the Committee, individual characteristics, ability to act independently in both substance and form etc.), are best qualified to ensure the proper functioning of the Committee and the most effective research support to the Board on the internal control system, risk management and financial reporting.
Still with respect to the composition of the Committee, Atlantia's Corporate Governance Code provides that: at least one member should be a minority Directors; at least one of the members should have adequate accounting, finance or risk management experience; the Chairman of the Committee should be elected by the members of the Committee.
Regarding the above provisions, attention is called to the following.
Mr Lucy Marcus was elected on the minority slate.
Mr Giuliano Mari has accounting, finance and/r risk management expertise considered adequate by the Board of Directors at the time of appointment.
In the first meeting of the Committee, which was held on 13 June 2013, Giuliano Mari was elected Chairman of the Control, Risk and Corporate Governance Committee.
With respect to the functioning of the Committee in question, it is noted in particular that:
As required by the Corporate Governance Code, the Chairman of the Board of Statutory Auditors (or another standing Auditor, at his request) attend Committee meetings. Depending on the issues to be deliberated, the Chairman of the Board of Directors, the Chief Executive Officer, the Director responsible for the Internal Control and Risk Management System, the Manager Responsible for Financial Reporting, all standing Auditors, the Director of Internal Audit and any other managers whose presence is deemed necessary may be invited to take part.
In 2015, the CRCGC's meetings were attended, upon the Chairman's request, by all the corporate executives responsible for the areas under review by the Committee, in relation to the items on the agenda.
The Control, Risk and Corporate Governance Committee provides support, with due examination, for the Board's evaluation of and decisions relating to the internal control and risk management system as well as those relating to approval of financial reports.
The Control, Risk and Corporate Governance Committee:
The Committee meets at least once every two months at the behest of one of its members. Its members set down the Committee's rules of functioning.
5 Art. 11.3 of the Atlantia Corporate Governance Code specifically provides that:
1. The Board of Directors shall, subject to the consent of the Control, Risk and Corporate Governance Committee:
a) determines guidelines for the internal control and risk management system and review their adequacy at least once a year in terms of the nature of the company and the risks to which it is exposed. The Board shall also ascertain the effectiveness of the system and require the Director responsible for the internal control and risk management system to establish and maintain effective risk management and internal control procedures;
b) having consulted the Board of Statutory Auditors and the Director responsible for the internal control and risk management system, approves, at least once a year, the work plan developed by the Director of Internal Audit;
c) and, having consulted the Board of Statutory Auditors, assesses the findings of the independent auditors as may be contained in a letter of recommendations and the report on material deficiencies detected during the course of the independent audit.
2. The Board of Directors shall, on the proposal of the Director responsible for the risk management and internal control system and subject to the consent of the Control, Risk and Corporate Governance Committee and having consulted with the Board of Statutory Auditors:
a) appoints the Director of Internal Audit or revoke such appointment; b) ensures that the Director of Internal Audit has the resources needed to properly perform his duties;
c) determines the Director of Internal Audit's pay consistent with corporate policy.
The Committee's functions are entirely independent of those of the Supervisory Board, with which it engages in wide-ranging exchanges of information. The Committee (i) may request information from the Supervisory Board and (ii) provides information requested by the Supervisory Board.
In particular, the Board of Directors adopts resolutions on the matters listed below, with the favourable opinion of the Control Risk and Corporate Governance Committee.
Furthermore, the Board of Directors, at the recommendation of the Director responsible for the Internal Control and Risk Management System and based on the favourable opinion of the Control, Risk and Corporate Governance Committee, and having regard to the opinion of the Board of Statutory Auditors:
a) appoints and dismisses the Director of Internal Audit;
b) ensures that the Director of Internal Audit has adequate resources to perform his duties;
c) sets his compensation in accordance with corporate policies.
The favourable opinion of the Control, Risk and Corporate Governance Committee on the above matters is binding.
The Control, Risk and Corporate Governance Committee met fifteen times in 2015, for an average of approximately two and one half hours.
The Chairman of the Board of Directors and the Chief Executive Officer were invited to participate in all of the Committee's meetings and actually attended almost all. The Chairman of the Board of Statutory Auditors also attended nearly all meetings and several meetings were held jointly with the entire Board of Statutory Auditors. Moreover, the Committee's meetings are attended regularly also by the General Counsel and the Director of Internal Audit.
Committee meetings are recorded by the secretary to the Committee with the minutes being submitted at the next meeting to Committee members for approval.
In carrying out its duties, the Committee was able to access the company information needed for its duties.
The Committee addressed the following matters in 2015:
Report to the Board of Directors on the activities carried out by the Committee in the second half of 2014 and the first half of 2015;
Regular meetings with: the Director responsible for the Internal Control and Risk Management System, the Ethics Officer, Head of Operational Compliance, Director of Internal Audit, Atlantia's Group Controlling Director, Risk Officers of Autostrade per l'Italia and Aeroporti di Roma, CFO, Manager Responsible for Financial Reporting, independent auditors, Atlantia's Supervisory Board and Board of Statutory Auditors. One of the reasons for the meetings was the evaluation of internal control and risk management systems.
The Committee's work was supported by the Corporate Governance department.
The Committee did not make use of any specific financial resources in carrying out its duties.
During 2015 the Committee did not use any external consultants.
As set out in the 11 December 2014 revision of the Company's Corporate Governance Code, the internal control and risk management system consists of all of the instruments, rules, procedures and corporate organisational structures designed to enable - via the adequate identification, measurement, management and monitoring of the main risks sound and correct management of the Company in a manner consistent with the Company's objectives set out by the Board of Directors.
The risk management and internal control system established by the Board of Directors shall be based on the following general principles:
a) operational powers: operational powers are assigned taking account of the size and risks associated with the various categories of transaction;
b) organisational structures: the organisational structures are arranged in such a way as to avoid functional overlaps and the concentration of responsibility for highly critical or risky activities in one individual;
c) regular reports: each process is subject to a set of standards and a related regular report designed to measure its efficiency and effectiveness;
d) regular analyses: the professional knowledge and skills available within the organisation are periodically analysed in terms of their match with the objectives assigned;
e) operating processes: operating processes are defined in such a way as to ensure that there are adequate documentary records enabling their continuous assessment in terms of fairness, consistency and responsibility;
f) security systems: security systems guarantee an adequate level of protection for the corporate organisation's assets and data, to allow access to data as required in order to carry out the activities assigned;
g) risk monitoring: the risks connected to achievement of objectives are identified and periodically monitored and updated. Negative events that may pose a threat to the organisation's business continuity shall be appropriately assessed and the related protections adapted;
h) ongoing supervision: the risk management and internal control system must be subject to continuous supervision to enable periodic assessment and ongoing adaptation.
An effective internal control and risk management system contributes to:
v) protecting the value of the Company's assets, including the prevention of fraudulent activity that may damage the Company and the financial markets.
The function of the Board of Directors, as explained in the section on its role, is, subject to the consent of the Control, Risk and Corporate Governance Committee, to:
On 11 December 2014 the Board of Directors, upon proposal of the Chief Executive Officer, established the Internal Audit Department (which was eventually renamed Group Internal Audit Department) as of 1 January 2015 and - upon proposal of the Director responsible for the internal control and risk management system and with the favourable opinion of the Control, Risk and Corporate Governance Committee, having regard to the Board of Statutory Auditors' opinion - appointed as Director of Internal Audit Ms Concetta Testa. On 19 December 2014, Memorandum no. 12/2014 was issued with the structure of the Internal Audit Department as follows:
Memorandum no. 4/2015 outlined the scope of the responsibilities of the Group Internal Audit Department.
The Director of Internal Audit reports hierarchically to the Chairman of the Board and has no responsibility over any operational areas.
In addition to being responsible for the matters attributed to it by the Company's Corporate Governance Code, the Internal Audit Department is responsible for:
determining and revising internal audit and risk management methodologies through the provision of continual development in accordance with best practice.
On 8 October 2015, Instructions 3/2015 were issued to outline the scope of the responsibilities of the Group Internal Audit Department.
To create awareness of the role attributed to the Internal Audit Department within the Group, on 5 August 2015 Atlantia's Director in charge of the Internal Control and Risk Management System sent a letter – which had been previously shared with the Control, Risk and Corporate Governance Committee – to Atlantia's direct and indirect subsidiaries, in Italy and abroad, with a description of the scope of the Group Internal Audit Department's responsibilities.
The letter explained that the Internal Audit Department operates on the basis of an annual Plan, related to Atlantia and its subsidiaries, which is approved by Atlantia's Board of Directors pursuant to article 11 of the Company's Corporate Governance Code. In addition, the letter specifies that the Audit Reports, with a description of any findings and any areas for improvement of the internal control system detected – together with any recommendation – will be sent to the Company's governance and control bodies. Lastly, the letter indicated that it will be up to each Group Company, which in turn will adopt the necessary corporate resolutions, to:
The Internal Audit Department will, in turn, monitor completion of the corrective actions to be taken through appropriate follow-ups, notifying the Companies concerned.
Also on 22 January 2016, the Board of Directors, at the recommendation of the Director responsible for the internal control and risk management system and with the approval of the Control, Risk and Corporate Governance Committee, in consultation with the Board of Statutory Auditors, examined and approved the 2016 Audit Plan.
The risk management system should not be considered separately from the internal control system in relation to financial reporting. In fact, both are part and parcel of the same system.
In the context of the internal control system, with reference to the process of financial reporting, the Group has implemented and continually revises an internal control system for financial reporting, based on a series of administrative and accounting procedures such as to guarantee their truthfulness, accuracy, reliability and punctuality in accordance with the regulations governing their preparation.
The planning, implementation and maintenance of this system, and its regular assessment, are informed by international best practices and compliant with the "CoSo Report III", which is the internationally recognised framework of reference for the implementation, analysis and assessment of the internal control and risk management system. In particular, the CoSo Report III (published by the Committee of Sponsoring Organizations of the Treadway Commission) provides for five components (control environment, risk assessment, control activities, information and communication, monitoring activities) that operate at the level of organisational entity and/or operating/administrative process, based on their characteristics.
The internal control system for financial reporting provides for regulations, procedures and guidelines by virtue of which Atlantia SpA ensures the exchange of data and information with its subsidiaries, thereby ensuring their coordination. In particular, this activity is carried out through the distribution, by the Parent Company, of regulations for the application of the reference accounting standards, such as the "Guidelines for preparation of the IFRS reporting package used in drawing up the Group's consolidated financial statements", and procedures regulating the preparation of the separate and consolidated financial statements and of the interim accounts and reports.
The operational processes put in place by subsidiaries on the basis of the Parent Company's guidelines are applicable to the above.
The setting up of audits is performed after a process conducted according to a top-down approach, aimed at identifying the organisational entities, processes and specific activities capable of generating the risk of unintentional errors or fraud that could have a material impact on financial reports.
a) Phases of the existing risk management and internal control systems in respect of financial reporting
The process of monitoring the internal control system for financial reporting is reiterated on a six-monthly basis in compliance with the provisions contained in art. 154 bis, paragraph 5 of the CFA. The process is broken down into the following phases:
Identification of financial reporting risks: risk identification activities are performed with reference to Atlantia SpA's separate financial statements and the Atlantia Group's consolidated financial statements, and is based on the assessment of qualitative and quantitative aspects concerning, firstly, the selection of significant companies to be included in the analysis, and then the classes of transaction and significant accounts. This selection activity requires:
i) the determination of quantitative criteria with respect to the contribution in terms of operating performance and financial condition of the individual companies to the latest accounts and the selection rules, including minimum materiality thresholds;
Every material item of data/information is traced back to the accounting and administrative processes that originated them and the typical financial report "assertions" are identified (existence and occurrence of events, completeness, measurement and recognition, rights and obligations, presentation and reporting) and the risks that one or more financial statement assertions do not provide a true and fair view, with consequent impact on the financial report.
- Identification of controls for the risks detected: the risks detected are addressed through controls capable of mitigating them, both at entity level and at process level. Key controls are determined, according to risk-based and top-down controls; such controls are deemed necessary to ensure with reasonable certainty the prevention and timely identification of material errors in financial reporting.
- Assessment of controls in relation to identified risks: the process of analysing and assessing the internal control system for financial reporting continues with the assessment of the identified controls in terms of adequacy (effectiveness of control design) and in terms of effective application.
Effective application is tested through specific activities performed first of all by the management line responsible for implementing such controls and, to ensure the effective assessment and consistent design of the control system, by the Financial and Accounting Compliance unit available to the Manager in charge.
The monitoring of the effective application of administrative and accounting procedures is conducted with regard to the effective implementation of key controls.
The assessment procedure is chosen on the basis of the underlying risk: this choice takes into account the strengths and weaknesses of the control environment that may condition the outcome of the assessments made, the complexity of the control, the type of control (manual or automatic), the level of judgment required during the process and the dependence of the control on the functionality of other controls.
The monitoring activities involve sampling techniques in line with international best practices.
With reference to the automatic controls implemented, the assessment of adequacy and effective application is extended to the design and operation of general IT controls supporting the relevant applications.
At the end of the monitoring activity, any deficiencies or problems are tested for significance.
The Manager responsible for financial reporting will, at least every six months, bring to the attention of the Control, Risk and Corporate Governance Committee the results of the activities performed and the assessment process described above by checking, together with it, the adequacy of the administrative and accounting procedures, and their effective application, in view of the issue of the attestations provided for by article 154 bis of the Consolidated Finance Act. Such results are also brought to the attention of the Board of Directors and the Board of Statutory Auditors.
The internal control and risk management system requires a clear identification of the roles involved in its planning, implementation, monitoring and upgrading over time The Manager responsible for financial reporting is responsible for monitoring the internal control system on financial reporting. In particular, this Manager:
In performing these duties, the Manager responsible for financial reporting relies on the Financial and Accounting Compliance unit, which performs the following functions:
review of the design and effectiveness of controls;
fostering of the necessary synergies with Atlantia's Internal Audit department and the coordination of primary external experts in relation to their support to the performance of the unit's duties and responsibilities;
Lastly, the Manager responsible for financial reporting works in cooperation with the company units responsible for auditing the internal control system, to obtain all the information necessary to take effective action and to ensure the effectiveness and efficiency of the attestation process.
With regard to the provision in the Company's Corporate Governance Code, on the guidelines for the internal control system and the assessment of its adequacy, efficacy and effective functioning, At its meeting of 8 March 2013 and in pursuance of the Corporate Governance Code, as revised on 14 December 2012, the Board of Directors conducted analyses and discussions on the nature and level of risk consistent with the issuer's strategic objectives. A revision to the analysis was performed by the Board of Directors on 13 December 2013. At its meeting of 11 December 2014, in pursuance of the Company's Corporate Governance Code updated as of the same date, the Board of Directors conducted analyses and discussions on the nature and level of risk consistent with the issuer's strategic objectives.
During the year 2015 the Board noted the six-monthly reports in which the Internal Control and Corporate Governance Committee, the Supervisory Board, the Ethics Officer and the Manager Responsible for Financial Reporting described the activities carried out. Additionally, at the meeting of 6 March 2015, the Board of Directors established guidelines for the internal control and risk management system and expressed a positive opinion on Atlantia's internal control and risk management system.
Subsequently, at its meeting of 8 May 2015, the Board of Directors set out the Risk Appetite level for the Group, as well as the strategies and objectives to be pursued. At its meeting of 11 December 2015, the Board of Directors heard a presentation on the risk management approach adopted by the Boards of Directors of different Group companies.
Lastly, at its meeting of 4 March 2016 – upon proposal of the Director responsible for the internal control and risk management system, with the favourable opinion of the Control, Risk and Corporate Governance Committee, having heard the Board of Statutory Auditors – the Board of Directors set out the guidelines for the internal control and risk management system.
Moreover, at the same meeting, after noting the conclusions of the analysis by the Control, Risk and Corporate Governance Committee of the detailed information provided by staff responsible for the internal control and risk management system, the Board of Directors was of the opinion that the internal control and risk management system, as a whole, may be deemed adequate, efficacious and in good working order.
The Board of Directors determines guidelines for the internal control and risk management system and review their adequacy at least once a year in terms of the nature of the Company and the risks to which it is exposed. The Board also ascertain the effectiveness of the system and require the Director responsible for the internal control and risk management system (the "Director Responsible") to develop and maintain effective risk management and internal control procedures.
The Director Responsible determines the tools and the implementation procedures for the risk management and internal control system, in accordance with the guidelines set by the Board of Directors, overseeing the overall adequacy of the system, its functionality, and its adaptation to changes in the operating environment and in the legislative and regulatory frameworks. The Director Responsible also proposes the appointment of a member of staff to head the Internal Audit department or the revocation of such appointment.
The Director of Internal Audit reports his findings to the Chairman and the Director Responsible as well as to the Chairman, the Control, Risk and Corporate Governance Committee and Board of Statutory Auditors.
The Director Responsible implements revisions of the internal control and risk management system, whenever required to remedy any weaknesses found by the above audits.
The Director Responsible has the powers to require the Director of Internal Audit to examine specific operating areas and compliance with internal rules and procedures for company operations. Such internal audits are notified to the Chairmen of the Board of Directors, Control, Risk and Corporate Governance Committee and Board of Statutory Auditors.
The Director Responsible promptly reports any problems and critical issues, found through the Director's activities or notified to the Director, to the Control, Risk and Corporate Governance Committee (or Board of Directors) for the Committee (or the Board of Directors) to take the appropriate action.
On 13 June 2013, the Board of Directors appointed independent Director Giuliano Mari to the role of Director Responsible subject to the consent of the Control, Risk and Corporate Governance Committee.
In 2015 the Director Responsible for the internal control and risk management system performed the activities required by the Corporate Governance Code, which involved several meetings with the Head of Infernal Audit, the Group Controlling Director, the Risk Officers of Autostrade per l'Italia and Aeroporti di Roma, with the Chief Executive Officer of Autostrade per l'Italia and Aeroporti di Roma, with ASPI's Post-Audit Committee and with ADR's Risk Committee (now ADR's Post-Audit Committee), to analyse operational risks and to review the risk management activities performed to update the risk catalogue.
In particular, in 2015 the Director Responsible:
In more general terms, the Director Responsible has been gradually taking on the role of key person for the Group's Internal Control and Risk Management System, ensuring that its elements operate in a seamless and consistent fashion.
Pursuant to article 111.3 of the Corporate Governance Code, the Director of Internal Audit is responsible for verifying that the risk management and internal control system is properly functioning and is fit for purpose. In particular, the Director of Internal Audit is required to:
a) audit, on an ongoing and ad hoc basis and in compliance with international standards, the good working order and adequacy of the risk management and internal control system through the application of an audit plan, duly approved by the Board of Directors, based on a structured analysis and ranking of material risks;
b) is not responsible for any operational area and reports to the Chairman of the Board;
c) be provided with direct access to all information required for the performance of his duties;
d) prepare periodic reports containing sufficient information on audit activities, the method of risk management and compliance with plans developed for risk mitigation. The periodic reports contain an assessment of the internal control and risk management system;
e) promptly present reports on events of particular relevance;
f) distribute the reports pursuant to d) and e) above to the Chairmen of the Board of Statutory Auditors, the Risk Control and Corporate Governance Committee and the Board of Directors, as well as to the Director responsible for the internal control and risk management system;
g) ascertain, as part of the audit plan, the reliability of information systems including accounting systems.
The Director of Internal Audit is appointed, at the recommendation of the Director Responsible for the internal control and risk management system in conjunction with the Chairman of the Board of Directors, by the Board of Directors subject to the consent of the Control, Risk and Corporate Governance Committee and in consultation with the Board of Statutory Auditors.
On 11 December 2014 the Board of Directors – at the recommendation of the CEO, established the Internal Audit Department, effective 1 January 2015, and at the recommendation of the Director in charge of the risk management and internal control system and subject to the consent of the Control, Risk and Corporate Governance Committee, and having consulted with the Board of Statutory Auditors - appointed Ms Concetta Testa as Director of Internal Audit.
Ms Testa's compensation package is consistent with the remuneration policy of the Atlantia Group, in her capacity as an executive of Atlantia SpA.
The Director of Internal Audit, who reports to the Chairman of the Board of Directors, is not responsible for any operating areas. She has direct access to the information required for the performance of her duties, in addition to adequate resources for her work. She regularly reports her findings.
Internal Audit conducts audits Atlantia SpA and its Italian and international direct and indirect subsidiaries.
Internal Audit carries out its audit activities whilst assuring the necessary degree of independence, expertise and professional diligence as established in international professional practice standards and the Code of Ethics.
The audit activities are intended to check:
The main activities carried out by the Internal Audit department assessment are:
The conclusions of internal audits are set out in Internal Audit Reports which are simultaneously distributed to the audited units, the Director responsible for the internal control and risk management system and, upon request, to management and supervisory board.
Internal Audit Reports contain descriptions of findings and areas of improvement for internal controls in addition to an appropriate action plan.
The Internal Audit department is also responsible for monitoring, via its follow-up activities, implementation of the corrective actions identified, reporting to the Chief Executive Officer, the relevant managers and supervisory bodies.
During the year, the Director of Internal Audit continued to interact with executives and members of corporate bodies. In particular, as required by article 11.4 of Atlantia's Corporate Governance Code, the Director of Internal Audit reported on her activities to the Chief Executive, the Director Responsible for the internal control and risk management system and to the Control, Risk and Corporate Governance Committee. She met regularly with the Chairman of Atlantia's Board of Statutory Auditors and, upon request, with the Boards of Statutory Auditors of the Group's subsidiaries.
In addition, in accordance with article 12.1 of the Corporate Governance Code, the Director of Internal Audit participated in all the meetings of the Control, Risk and Corporate Governance Committee.
Lastly, she submitted to ASPI's Post-Audit Committee and ADR's Risk Committee (now Post-Audit Committee) reports and any recommended corrective actions, as applicable to their respective roles.
During 2015, the Internal Audit department carried out 81 audit missions, of which 66 were part of the Plan and 15 were undertaken following specific requests. In addition, one internal auditor acted as secretary to support the Ethics Officer in investigating around 70 reports.
In particular, it performed 54 operational audits, where it reviewed also the reliability of the information systems, including the accounting entry systems, of which 1 in relation to Atlantia and 53 in relation to Group companies. In addition, upon request of the Supervisory Boards, monitoring activities were initiated in areas exposed to the perpetration of offences under Law 231 for 14 Group companies and adherence to the Compliance Programme was checked in 10 foreign subsidiaries in Brazil, Chile, Poland and U.S.. Support was given to the Managers responsible for financial reporting of each of Atlantia and Società Autostrade Meridionali.
The Director of Internal Audit issued her annual report on 15 February 2016 for the period 1 January - 31 December 2015 to the Control, Risk and Corporate Governance Committee, certifying that in light of:
and as far as the department could ascertain within the scope of its duties and responsibilities, the internal control and risk management system is fit to ensure that the Company is managed in a way that is sound, proper and consistent with pre-established objectives.
During 2015, Atlantia continued its analysis and adjustment of its organisational, management and control tools to meet the requirements of Legislative Decree 231/01 and subsequent amendments. This was done to ensure that its Organisational, Management and Control Model keeps pace with regulatory developments and organisational changes during the year.
The model is comprised of:
a General Part, which synthesises the relevant provisions of Decree 231, describes the structure and purpose of the Model, establishes the composition and role of the Supervisory Board, establishes the criteria and methods for reporting required information to the Supervisory Board and describes the disciplinary system for breaches of the Model's requirements;
special Parts developed with respect to the risk of criminal activities which have been identified for Atlantia as the following: Crimes against the Public Administration, Corporate Crimes, including the corruption of private parties, and Market Abuse. The Special Parts of the Model set out the following:
An updated list of the offences referred to in Legislative Decree 231/01, and taken into account in mapping the activities at risk, is annexed to the Model.
The Model in its current form is based on the deliberations and analysis carried out by the Supervisory Board and a penal code expert, and derives from an examination of developments in regulations and jurisprudence relating to organisational models (with particular reference to the most recent pronouncements and judgments).
The adoption of the Organizational, Management and Control Model, of which the Code of Ethics is one of the elements, has contributed towards implementation of the Company's internal control system.
Atlantia's current Supervisory Board has been appointed by the Board of Directors on 10 July 2015, for the period 1 July 2015 – 30 June 2018, and consists of two external members, one of whom acting as coordinator, and the Director of Internal Audit.
The Board met 10 times in 2015, dealing with the revision of the Model (which was upgraded to include new offences, self-money-laundering and false accounting, introduced in the first half of 2015) and implementation of the Action Plan for monitoring and assessing the adequacy and effective implementation of the Model.
In addition, based on an updated map of risky areas under Legislative Decree 231/201, the Supervisory Board prepared a proposal to upgrade the Organisational Model by introducing changes in the General Part and in the Special Parts.
Atlantia's Supervisory Board reported regularly in 2015 to the Company's Board of Directors and Board of Statutory Auditors on the activities carried out, with regard to both revision of the Organisational, Management and Control Model and monitoring.
In common with Atlantia's Supervisory Board, the supervisory boards of Group Companies have implemented their action plans for monitoring and assessing the adequacy of their Organizational, Management and Control Models. The required operating assessments were conducted by the Group Internal Audit department, and periodical reports concerning supervisory activities during the various reporting periods were drawn up and sent to the respective boards of directors and boards of statutory auditors.
In consequence of their engagement on 24 April 2012, Deloitte & Touche SpA are the Independent Auditors engaged to perform the statutory audit of the separate and consolidated financial statements, the periodical assessment of the propriety of bookkeeping and a limited scope audit of the consolidated interim reports of Atlantia SpA for the financial years 2012-2020.
The Board of Statutory Auditors and the Independent Auditors periodically exchange information and data on their respective audits.
In the Procedure for the engagement of statutory audit firms and the monitoring of other engagements with a view to determining corporate responsibility and internal operating methods in support of the Board of Statutory Auditors for the engagement of statutory external auditors in accordance with law and regulation as in force from time to time and the management of the relationship with the statutory audit firm and its affiliates.
The procedure relates to senior management and the managements of Group companies who, in the performance of their duties, have direct or indirect contact with independent auditors during their internal audit procedures.
Pursuant to art. 33 of the Articles of Association, and in compliance with art.154 bis of the Consolidated Finance Act, the Board of Directors, subject to obtaining the required opinion of the Board of Statutory Auditors, appoints and dismisses the Manager Responsible for Financial Reporting. The Manager Responsible for Financial Reporting is selected from candidates with at least three years' experience in positions with appropriate responsibility for administration and finance, or administration and control in listed joint-stock companies, and who possess the integrity required by the regulations in force. The Directors fix the related remuneration and the term of office, which is renewable, and grant the manager all the authority and instruments necessary in order to carry out the duties assigned to them by law.
At its meeting of 10 May 2013, the Board of Directors confirmed the Chief Financial Officer (CFO) Giancarlo Guenzi as the Manager Responsible for Financial Reporting, having obtained the favourable opinion of the Board of Statutory Auditors, establishing his term of office as until the termination of the term of the Board of Directors currently in office.
In 2015 the internal control system was upgraded from an administrative and accounting viewpoint, for the purposes of attestations by the Chief Executive Officer and the Manager Responsible for Financial Reporting of the separate and consolidated annual financial reports concerning, among other aspects, the adequacy and effective application of the administrative and accounting procedures.
* * *
The coordination of communication between and among individuals involved in the internal control and risk management system is the responsibility of the Chairman of the Board of Directors, in accordance with the Chairman's operating powers conferred and monitored by Atlantia's Corporate Governance department.
Related party transactions shall be subject to the provisions of CONSOB Resolution 17221 of 12 March 2010, as amended and as implemented within the Company and the Group in the form of internal procedures.
Further information is also contained in art. 34 of the Articles of Association on related party transactions.
Pursuant to CONSOB Resolution 17221 of 2010, on 11 November 2010 Atlantia's Board of Directors - with the prior approval of the Independent Directors on the Related Party Transactions Committee, dated 8 November 2010 – approved the procedure designed to ensure the transparency and integrity of related party transactions.
The procedure defines the scope of application of the rules governing related party transactions (transactions of greater and lesser significance and transactions within the purview of the general meeting), the related cases of exclusion, and the procedures for drawing up and updating the list of related parties.
The new procedure has, from 1 January 2011, replaced the previously adopted standards for conducting Atlantia's related party transactions.
In compliance with the provisions of CONSOB Regulations on related party transactions (Resolution 17221 of 12 March 2010, as amended), on 21 October 2010 Atlantia set up the Committee of Independent Directors with Responsibility for Related Party Transactions, as shown below (hereinafter "RPT Committee").
Pursuant to CONSOB Resolution 17221 of 12 March 2010, as amended, on 11 November 2010 Atlantia's Board of Directors - with the prior approval of the Independent Directors on the Related Party Transactions Committee, dated 8 November 2010 – approved Atlantia's Procedure for Related Party Transactions (the "Procedure") in implementing the provision of art. "2391 bis c.c." and in conformity with the CONSOB Regulations having regard to related party transactions.
The Procedure was implemented on 1 January 2011.
The Procedure has since then been reviewed every year by the RPT Committee and the Board of Directors with respect to the need to modify or update the Procedure.
The conclusion of the reviews of the Procedure was the Board of Directors' confirmations that the Procedure was fit for purpose given in 2011, 2012, 2013 and 2014 with the consent of the RPT Committee.
Moreover, this Procedure was revised by the Board of Directors on 20 February 2014 with the approval of the RPT Committee. The purpose of the revision was to accommodate the merger of Gemina SpA with and into Atlantia SpA.
In 2015, further reviews and additions were made to reflect the Group's changes, to ensure the proper functioning of communication and reporting lines among the parties involved in the process (meeting of the Board of Directors of 11 December 2015, with the consent of the the RPT Committee on the same date).
The Procedure governs related party transactions entered into by the Company or one of its subsidiaries. It establishes the criteria for classification as a related party transaction and the definition of greater and lesser important transactions. It also indicates the methods of handling such transactions of greater and lesser importance.
The Procedure is available on the Atlantia website www.atlantia.it
In implementation of the Procedure, Atlantia established a Committee of Independent Directors with responsibility for Related Party Transactions on 21 October 2010 made up of three Independent Directors, responsible for:
On 10 May 2013, the Board of Directors appointed the following individuals to form a new RTP Committee: Bernardo Bertoldi, Monica Mondardini and Giuliano Mari, who was appointed Chairman of the Committee at the first meeting on 13 June 2013.
All members are independent Directors in accordance with art. 148, para. 3, CFA and art. 3 of the Corporate Governance Code.
The Committee has adopted its own Rules of functioning, approved at the meeting of 13 December 2010 and then amended on 27 January 2011. The Committee met twice in 2015.
Directors' interests
Regarding the cases where a Director has an interest in a transaction, whether personal or on behalf of third parties, such Director is required, in accordance with article 2391 of the Italian Civil Code, to notify the other Directors and the Board of Statutory Auditors, specifying the nature, terms, origin and extent of such interest. In the event such Director is the Chief Executive Officer, the Director should refrain from becoming involved in the transaction, delegating all powers to the Board.
The Board did not adopt any further resolution in this area.
As required by Art. 32 of the Articles of Association, members of the Board of Statutory Auditors are elected using slate voting and in compliance with law in force having regard to the balance between gender quotas. Should the application of gender quotas not result in a whole number of Board members belonging to the least represented gender, this number is rounded up to the nearest whole number.
Individuals who hold a number of posts as director or standing auditor equal to or above the maximum established by the applicable regulations, or do not meet the requirements for integrity, expertise and independence required by the applicable regulations, are not eligible. At least two Standing Auditors and one Alternate shall be selected from among individuals listed in the register of auditors, who have been engaged in the statutory audit of accounts for a period of not less than three years. Statutory Auditors not meeting such requirement shall be selected from amongst those persons with at least three years wideranging experience in:
a) the management and control of or executive duties in joint-stock companies having issued capital of at least two million euros; or,
b) professional activities or university instruction in legal, business and finance subjects; or,
c) managerial functions at government or public administration entities engaged in lending, finance or insurance. The lists shall indicate the names of one or more candidates, which must not exceed the number of Statutory Auditors to be elected, with each name assigned a sequential number.
Each slate shall consist of two sections: one for candidates for the office of Standing Auditor and one for Alternates. Each section must contain the names of one or more candidates. Slates that, taking into account both sections, contain a number of candidates equal to or higher than three must indicate:
at least a fifth of the candidates belonging to the least represented gender for the first term of office in application of Law 120 of 12 July 2011;
at least a third of the candidates belonging to the least represented gender for the following two terms of office. Where the number of candidates for Alternate Auditor is equal to or higher than two, they must be of two different genders. Only those Members who, singly or jointly with other Members, at the date on which the lists were filed with the Company, represent at least the percentage shareholding required by the preceding art. 20 for the submission of slates of candidates for the position of Director. Slates submitted by Members are filed with the registered office at least twenty-five days prior to the date of the General Meeting to be held as a first or one call meeting. The slates are made available to the public, according to the procedures required by the applicable regulations, at least 21 days prior to the date of the General Meeting to be held in first or one call. If, at the end of the above term of twenty-five days, only one slate has been submitted, or only slates submitted by Members associated with each other – as defined by the CONSOB pursuant to art. 148, section 2 of Legislative Decree 58/1998 – qualifying persons may continue to submit slates, through filing at the registered office, up to the latest deadline provided for by the laws and regulations in force. In this case, the size of shareholding required to qualify for the right to submit lists is reduced by half. In this case, the size of shareholding required to qualify for the right to submit slates is reduced by half. No individual shareholder, or shareholders belonging to the same group or shareholders who are party to a shareholder's agreement, may submit or vote for more than one slate, including via a proxy or a trust company, and any candidate included in more than one slate shall be disqualified.
Each slate shall be accompanied by:
information on the Members who have submitted the slates and their total percentage shareholding, together with certificates attesting to their ownership of the related shares;
exhaustive information regarding candidates' personal and professional details;
declarations from the individual candidates accepting their candidature and a personal warranty that there is no fact or deed which could give rise to their disqualification and that they meet the legal requirements for holding such office, including compliance with the limit on the total number of positions held, as established by the laws and regulations in force, and indicating any positions as director or statutory auditor held at other joint-stock companies;
a declaration from shareholders other than those who singly or jointly hold a controlling or relative majority interest, certifying the absence of any association - as defined by the CONSOB pursuant to art. 148, section 2 of Legislative Decree 58/1998 – with such shareholders.
Any slates not in compliance with the above are deemed to have not been submitted. Any individual having the right to vote may only vote for one slate. Members of the Board of Statutory Auditors shall be elected in the following manner:
a) Three Standing Auditors and one Alternate to be elected shall be taken in sequential order from the slate receiving the majority of votes cast by the holders of shares carrying voting rights, and in compliance with the legislation in force concerning gender quotas.
b) The remaining two Standing Auditors shall be taken from the other slates. For that purpose, the votes cast for those other lists shall be successively divided by one and two. The resultant quotients shall be allocated to the candidates on each slate who shall then be ranked in decreasing order by the total quotients allocated to them: the candidates elected shall be those with the highest quotients, provided that the required balance between the gender quotas has been complied with. The quotients attributed in this manner to the candidates of the various lists are then be ranked in decreasing order: the two candidates elected are those with the highest quotients subject to the compliance with gender quotas.
c) If, on completion of the election and the above procedures, legislation concerning the balance between the gender quotas elected has not been complied with, the candidates elected from the various lists are ranked in decreasing order, based on the quotients calculated in accordance with the procedure described in letter b). The candidate from the most represented gender with the lowest quotient in the ranking shall thus be replaced by the first of the candidates from the least represented gender to not be elected and belonging to the same slate. If there are no other candidates in this slate, the above replacement shall be approved by the General Meeting with the majority required by law.
If replacement of the candidate from the most represented gender with the lowest quotient in the ranking does not, however, enable the minimum quota required by the legislation in force to be reached, the above replacement process shall also be applied to the candidate from the most represented gender with the penultimate quotient, and so on rising from the lowest ranked candidate. In the event candidates have equal quotients, the General Meeting shall hold a new election and the candidate receiving the majority of votes shall be elected, provided that the legislation in force concerning the balance between gender quotas has been complied with.
The Chairman of the Board of Statutory Auditors shall be the first candidate on the minority slate that obtains the highest number of votes.
The remaining Alternate Auditor shall be drawn from the slate which receives the highest number of votes among the list submitted and voted for by Members who are not associated with the majority shareholders as defined by law.
d) Any Statutory Auditors not appointed using voting slates, are appointed by General Meeting resolution approved with the majority required by law in compliance with the legislation in force concerning the balance between gender quotas.
e) In the event that a Statutory Auditor elected by the majority is replaced, the Alternate receiving the majority of votes is appointed. In the event that a Statutory Auditor elected by the minority is replaced, the Alternate elected by minority shareholders shall be appointed, or, failing this, the next ranked candidate from the same list or, failing this, the first candidate on the minority list that obtained the second highest number of votes. Replacement must, in any event, take place in compliance with the legislation in force concerning the balance between gender quotas.
On 24 April 2015, the General Meeting elected, through the slate voting procedure, the Board of Statutory Auditors for the financial years 2015-2016-2017. Alberto De Nigro, Lelio Fornabaio and Livia Salvini were elected as standing auditors while Laura Castaldi was elected as alternate auditor on the basis of the slate submitted by Sintonia SpA. The Chairman, Corrado Gatti, standing auditor Silvia Olivotto and alternate auditor Giuseppe Cerati were elected in accordance with the provisions of article 148 of Legislative Decree 58/1998, as amended by Law 262/2005, on the basis of a slate submitted by a group of asset management companies and other institutional investors.
All the Statutory Auditors in office meet the integrity and experience requirements provided for by the applicable laws. The Articles of Association also disqualify persons holding a number of management and supervisory positions equal to or greater than the maximum number, as established by relevant legislation, from being appointed as a Statutory Auditor. In this regard, art.144-terdecies of the CONSOB's Regulations for Issuers (Limits on the accumulation of positions) states that anyone who is a member of the boards of statutory auditors of five issuers is disqualified from becoming a member of an issuer's board of statutory auditors. A member of an issuer's board of statutory auditors may take up other positions as a director or statutory auditor in the companies defined in Book V, Title V, Chapters V, VI and VII of the Italian Civil Code (the number of positions is shown in Table 3, whilst details of the related positions are available on the CONSOB's website), provided they do not exceed the maximum of six points resulting from application of the calculation model contained in Annex 5-bis, Schedule 1. Exempt positions and positions as a director or statutory auditor of small companies are not taken into account in calculating the accumulation of positions.
At its meeting of 8 May 2015 the Board of Statutory Auditors – based on the fact that art. 15, paragraph 2 of the Corporate Governance code, the most recent revision of which was approved by Atlantia's Board of Directors on 11 December 2014- requires that "Statutory Auditors be chosen from among persons who qualify as independent, including on the basis of the criteria established in this Code with regard to the Directors", and that "the Board of Statutory Auditors shall check compliance with these criteria after election and subsequently annually, reporting on the outcome of the checks in the corporate governance report" – checked that all the Company's Statutory Auditors met the independence requirements.
Pursuant to the Corporate Governance Code, any Statutory Auditors who, either themselves or on behalf of third parties, have an interest in a specific Company transaction, must promptly inform the other Statutory Auditors and the Chairman of the Board of Directors as regards the nature, terms and extent of their interest.
Atlantia SpA's Board of Statutory Auditors met a total of 16 times in 2015. Of these meetings, 6 were held by the Board previously in office and 10 by the current Board (the percentage of meetings actually attended by members of the board is reported in Table 3).
It should also be pointed out that the Board of Statutory Auditors normally meets with the same frequency as the Board of Directors. At the meeting of 22 January 2016, a total of 13 meetings were scheduled for year ahead.
In carrying out its duties, the Board of Statutory Auditors had periodic meetings during the year with Independent Auditors, the Manager Responsible for Financial Reporting and the Director of Internal Audit.
The Chairman of the Board of Statutory Auditors, or another standing Statutory Auditor at his request, attended the meetings of the Internal Control and Corporate Governance Committee.
The Board of the Statutory Auditors monitored, in accordance with art. 149, paragraph 1.c bis of the CFA, the implementation of the corporate governance rules provided for in Atlantia's Corporate Governance Code.
Before issuing their reports on the financial statements, the Board of Statutory Auditors and the Independent Auditors exchanged information on the checks carried out.
Partly in the light of the amendments introduced by Legislative Decree 39/2010, in 2010 the Board of Statutory Auditors assumed the role of the Internal Control and Audit Committee, overseeing:
i) the financial reporting process;
ii) the effectiveness of internal control, internal audit and risk management systems;
iii) the legally-required audit of the separate and consolidated financial statements;
iv) the independence of the Independent Auditors, in particular as regards the provision of non-audit services to the entity whose financial statements were being audited.
This requirement has been included in article 15.4 of the Corporate Governance Code.
The procedure for reporting information to the Board of Statutory Auditors within the meaning of art. 150, paragraph 1, Legislative Decree 58/1998 was revised on 20 December 2013.
The objective of this procedure is, firstly, to ensure that the Board of Statutory Auditors is provided with all the information it needs to perform the supervisory role assigned to it by the above Decree and, secondly, by favouring the transparency of the Company's management, to enable each Director to participate in its management in a more aware and informed manner. This procedure covers the flow of information between the Chief Executive Officer and the Board of Directors recommended by the Corporate Governance Code, and aims to confirm the centrality of the Company's Board of Directors, by ensuring that all members of the Board of Directors and Board of Statutory Auditors have access to the same information, and strengthen the internal control system.
The following information is to be provided under the procedure:
Each report reflects activities and transactions performed in the period of time (no more than three months) following the period (also no more than three months in length) covered by the previous report.
For the purposes of the reports, the procedure identifies transactions whose impact might be regarded as material in terms of the Company's results of operations, financial position and cash flows. Specifically, in addition to transactions that fall within the purview of the Board of Directors, pursuant to article 2381 of the Italian Civil Code, the Articles of Association and the Corporate Governance Code, material transactions conducted by Atlantia SpA or by its main direct or indirect subsidiaries include:
During the year the Board of Directors reported to the Board of Statutory Auditors on a quarterly basis.
The text of the Procedure is available on the Company's website at www.atlantia.it/encorporate-governance.
Furthermore, the Statutory Auditors participated in three inductions during the year for the purpose of providing the Boards of Directors and Statutory Auditors with information pertaining to the Company's operations, its corporate dynamics and evolution.
With respect to Legislative Decree 231/2001 and the Group's Code of Ethics, the Procedure for Relations with the Board of Statutory Auditors was revised on 20 December 2013 in order to determine the responsibilities and operational procedures for managing relations with the Board of Statutory Auditors.
This procedure relates to the staff of Atlantia and its subsidiaries who, in the performance of their specific duties, have direct or indirect contact with Statutory Auditors during their internal audit activities.
Atlantia's financial reporting is aimed at all its stakeholders.
To this end, the Company has set up a specific Corporate Finance and Investor Relations department, which is responsible for relations with the Italian and international financial community. It is headed by Massimo Sonego. The department is responsible for providing the market with timely, complete and clear quantitative and qualitative descriptions of the Company's strategies and results of operations, communicating with the market (investors and financial analysts) in all respects through:
In order to facilitate an ongoing dialogue with the financial community and, generally, with all stakeholders a webpage was created (developedwww.atlantia.it/en/investors/index.html), with a special section containing important information on the Company of interest to shareholders.
The Directors encourage and facilitate the highest possible attendance of shareholders at General Meetings, in particular by providing all the necessary information and documents to ensure the smooth running of and informed participation at meetings. The information is made available on a specific page of the Company's website.
The Corporate Governance Code requires General Meetings to be treated as forums to provide shareholders with reports on the Company's operating performance and outlook, in accordance with the regulations governing price sensitive information. In the event of significant changes in the Company's overall capitalisation, in the shareholder structure and in the number of shareholders, the Directors assess the appropriateness of recommending changes to the Memorandum of Association to the General Meeting, as regards the majorities required to pass resolutions and to exercise the prerogatives designed to protect minority shareholders.
The functioning of General Meetings, the related powers, the rights of those entitled to vote and how to exercise the rights are governed by the laws and regulations in force.
In particular, the Company's Articles of Association provide for the following.
To be entitled to attend general meetings and to exercise voting rights, the holders of voting rights are required to send a notice to the Company through their intermediary, in accordance with the laws and regulations in force (article 13). In particular, pursuant to the laws applicable in this area, the right to attend and to vote can be exercised by such persons as are holders of voting rights at the end of the seventh stock exchange trading day preceding the date set for the General Meeting in first call (the "Record Date") for which the intermediary sent the communication required by law. Persons who assume ownership of shares after the record date are not entitled to attend and vote at the General Meeting.
Furthermore, the holders of voting rights may appoint a proxy also by electronic means; the proxy can also be notified through the website or by certified email, in accordance with the procedures indicated in the notice of the General Meeting.
In addition, for each General Meeting the Company designates a person whom shareholders can appoint as a proxy, by the second stock exchange trading day prior to the date set for the General Meeting in first call, with voting instructions on all or some of the items on the agenda. The proxy is effective only for the matters for which voting instructions have been provided. The General Meeting Regulations, shown at the end of the Articles of Association, provide for the orderly and functional proceedings of Ordinary and Extraordinary General Meetings.
Among other things, the Regulations set out the procedure for qualifying shareholders to request to speak on items on the Agenda.
The full text of the Articles of Association and the General Meeting Regulations are available on the Company's website at http://www.atlantia.it/en/corporategovernance/articles-codes-procedures.html.
The Board of Directors endeavour to provide shareholders with adequate information on agenda items, making the related reports available to the public in the manner and in accordance with the timing provided for by law. Furthermore, pursuant to art. 127-ter, Legislative Decree 58/98 shareholders with voting rights may even put questions up to three days before a meeting in first call, which will be answered later in the meeting, using the appropriate webpage of the Company's website and sending the questions by fax or certified post.
The Annual General Meeting of 24 April 2015:
| BREAKDOWN OF THE ISSUED CAPITAL AS AT 31 DECEMBER 2015 | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| No. of shares | % of issued capital |
Listed | Rights and obligations | |||||||||
| Ordinary shares |
825,783,990 | 100 | Italian Stock Exchange |
Rights and obligations of ordinary shareholders |
| Other Financial Instruments (providing a conditional right to subscribe to a new issuance of shares)* |
||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Listed/Unlisted | Number issued** | Class of shares to satisfy exercise |
Maximum number of shares to satisfy exercise |
|||||||||
| Contingent Value Rights ("CVRs") |
unlisted | 163,956,286 | Ordinary shares | 18,455,815 |
*The CVRs provide their holders, on the fulfilment of the conditions of allotment as defined in the Terms and Conditions of Atlantia SpA 2013 Ordinary Share Contingent Value Rights, available for inspection at http://www.atlantia.it/en/pdf/Contingent\_Value\_Rights.pdf), with the right to receive a number of Atlantia ordinary shares determined with reference to the Final Allotment Ratio and a Dividend Adjustment, as set out in the Terms and Conditions.
The following were approved at the Extraordinary General Meeting of 8 August 2013 together with the issuance of shares to satisfy the merger share exchange ratio of up to 164,025,376 CVRs and, at the same time, an increase in issued capital to irrevocably satisfy the CVRs up to a par value of €18,455,815.00, through the issuance of 18,455,815 ordinary Atlantia shares with a par value of €1.00.
** The holders of the CVRs have exercised put options for 160,698,634 CVRs (98% of the outstanding CVRs) as at 31 December 2015, in accordance with the Terms and Conditions.
The CVRs acquired by the Company from such holders are cancelled.
| Reporting entity | SIGNIFICANT SHAREHOLDINGS AS AT 31 DECEMBER Direct shareholder |
% of ordinary shares | 2015* % of voting shares |
|---|---|---|---|
| Edizione S.r.l. | Sintonia SpA | 30.254 | 30.254 |
| Government of Singapore Investment Corporation Pte Ltd |
InvestCo Italian Holdings S.r.l. GIC PTE LTD |
8.136 | 8.136 |
| BlackRock Inc. | BlackRock Japan CO Ltd BlackRock Institutional Trust Company National Association BlackRock Advisors (UK) Ltd BlackRock Investment Management (Australia) Ltd BlackRock Financial Management INC BlackRock Asset Management Canada Ltd BlackRock Fund Advisors BlackRock Advisors LLC BlackRock Asset Management Deutschland AG BlackRock International Ltd BlackRock Investment Management (UK) Ltd BlackRock Asset Management North Asia Ltd BlackRock (Netherlands) BV BlackRock Investment Management Llc |
5.035 | 5.035 |
| Fondazione Cassa di Risparmio di Torino |
Fondazione Cassa di Risparmio di Torino |
5.062 | 5.062 |
| The Goldman Sachs Group Inc |
Athena Holding S.r.l. | 4.55 | 4.55 |
| Mediobanca – Banca di Credito Finanziario SpA |
MB Sinto S.r.l. | 2.71 | 2.71 |
* Art. 119-bis, paragraphs 7 and 8 of the Regulations for Issuers grants asset management companies and duly authorised entities who have purchased managed investments, represented by interests of above 2% and below 5%, an exemption from the reporting requirements provided for by art. 117 of the Regulations for Issuers. The companies who have declared their intention to take advantage of this exemption include, for example, BlackRock Inc..
| Table 2: STRUCTURE OF THE BOARD OF DIRECTORS AND COMMITTEES OF ATLANTIA SpA | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Board of Directors of Atlantia SpA | Control Risk and Corporate Governance Committee |
Human Resources and Remuneration Committee |
|||||||||||||||
| Title | Member (Surname and name) |
Year of birth |
Date first appointed (2) |
In office from (3) |
In office until (3) |
Slate (4) |
Executive directors |
Non executive directors |
Independent directors as per Corporate Governance Code |
Independent Directors as per CFA |
No. of other offices (5) |
Participation in Board meetings (6) |
(6) | (7) | (6 | (7) | |
| Chairman | CERCHIAI Fabio | 1944 | 14 April 2010 |
30 April 2013 | Approval 2015 accounts |
M | X | 8 | 12/12 | ||||||||
| CEO | CASTELLUCCI Giovannni |
1959 | 12 May 2006 |
30 April 201• | Approval 2015 accounts |
M | X | 2 | 12/12 | ||||||||
| Director | ANGELA Carla | 1938 | 30 April 2013 |
30 April 2013 | Approval 2015 accounts |
M | X | X | X | 0 | 12/12 | 14/15 | M | ||||
| Director | BENETTON Gilberto | 1941 | 26 November 2013 |
30 April 2013 | Approval 2015 accounts |
M | X | 3 | 12/12 | ||||||||
| Director | BERTAZZO Carlo | 1965 | 30 April 2013 |
30 April 2013 | Approval 2015 accounts |
M | X | 3 | 12/12 | 6/7 | M | ||||||
| Director | BERTOLDI Bernardo | 1973 | 30 April 2013 |
30 April 2013 | Approval 2015 accounts |
m | X | X | X | 14 | 12/12 | ||||||
| Director | BOTTO POALA Matteo |
1978 | 12 June 2014 |
12 June 2014 | Approval 2015 accounts |
M | X | 4 | 12/12 | ||||||||
| Director | CLÔ Alberto |
1947 | 26 November 2003 |
30 April 2013 | Approval 2015 accounts |
M | X | X | X | 3 | 12/12 | 7/7 | P | ||||
| Director | CODA Gianni | 1946 | 30 April 2013 |
30 April 2013 | Approval 2015 accounts |
m | X | X | X | 3 | 11/12 | 7/7 | M | ||||
| Director | LAPUCCI Massimo | 1969 | 30 April 2013 |
30 April 2013 | Approval 2015 accounts |
M | X | 1 | 12/12 | 5/7 | M | ||||||
| Director | MARCUS Lucy P. | 1971 | 30 April 2013 |
30 April 2013 | Approval 2015 accounts |
m | X | X | X | 0 | 11/12 | 15/15 | M |
| Director | MARI Giuliano | 1945 | 23 April 2009 |
30 April 2013 • |
Approval 2015 accounts |
M | X | X | X | 2 | 12/12 | 15/15 | P | |||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Director | MARTINELLI Valentina |
1976 | 30 April 2013 |
30 April 2013 | Approval 2015 accounts |
M | X | 0 | 12/12 | |||||||
| Director | MONDARDINI Monica |
1960 | 20 January 2012 |
30 April 2013 | Approval 2015 accounts |
M | X | X | X | 4 | 7/12 | 2/7 | M | |||
| Director | REBECCHINI Clemente |
1964 | 30 April 2013 |
30 April 2013 | Approval 2015 accounts |
M | X | 4 | 12/12 | |||||||
| Number of meetings in 2015 | Board of Directors: 12 | Control, Risk and Corporate Governance Committee |
Human Resources and Remuneration Committee |
|||||||||||||
| Quorum required to submit slates for the last appointments (under article 147 CFA): At least the lower of 1% of issued capital or the equity interest established by applicable laws and regulations |
1) The Remuneration Committee was renamed, in the new Corporate Governance Code approved in December 2014, "Human Resources and Remuneration Committee" and was enlarged in terms of members and scope of duties.
The Committee for the appointment of directors is not contemplated in the Corporate Governance Code of Atlantia SpA considering that, pursuant to the Articles of Association, the Board of Directors is appointed on the basis of a transparent procedure (slate voting). More details are available in paragraph 7 of the Corporate Governance report.
2) A director's date of first appointment is the date on which the director is appointed for the first time ever on the issuer's Board of Directors.
3) The symbols below in the column "In office since" indicate:
• Director responsible for the internal control and risk management system
• Executive responsible for managing the issuer (CEO)
4) This columns indicates the slate that elected the director (M: majority slate; minority slate; Board: slate submitted by the Board of Directors.
5) This column shows the number of offices as director or statutory auditor held by the party concerned in other companies listed on regulated markets, including foreign markets, in financial, banking, insurance or large companies. Details of the offices held are shown in Annex 1 of this Report.
6) This column shows the participation of directors in meetings of the Board of Directors and the Committees (that is the number of meetings in which they participated compared to the number of meetings in which they could have participated, e.g. 6/8, 8/8 etc.)
7) This columns shows the title of the director within the Committee: "C" Chairman; "M" member.
| Name and Surname | Position at Atlantia | Age |
|---|---|---|
| Fabio Cerchiai Chairman |
71 | |
| Giovanni Castellucci | Chief Executive Officer |
56 |
| Carla Angela | Director (1 ) |
77 |
| …………………… Gilberto Benetton Director |
74 | |
| Carlo BertazzoDirector | 50 | |
| Bernardo Bertoldi | Director (1 ) |
42 |
| ……………… Matteo Botto |
Director | 37 |
| Poala………………. | ||
| Alberto ClôDirector(1) | 68 | |
| Gianni Coda | Director (1 ) |
69 |
| …………………… Massimo Lapucci |
Director | 46 |
| ……………… Lucy P.Marcus |
Director (1 ) |
44 |
| ………………… Giuliano Mari Director |
(1) | 70 |
| Valentina Martinelli | Director | 39 |
| …………… Monica MondardiniDirector(1) |
55 | |
| Clemente Rebecchini | Director | 51 |
| …………… |
(1) Directors having declared their possession of the requisites of independence
Fabio Cerchiai was appointed Chairman in April 2010. He has a degree in economics and business. He started his career in 1964 with Assicurazioni Generali. He was Chairman of ANIA (the National Association of Insurance Companies). He has been a director of Edizione Srl since 2005 and Chairman of the Board of Directors of the ARCA Insurance Group since 2008. Mr Cerchiai was appointed, upon proposal of the President of the Council of Ministers, member of CNEL, to represent insurance companies in March 27, 2009.
Mr. Cerchiai is Chairman of UnipolSai SpA, Cerved Information Solutions SpA and SIAT SpA.
He has also been Chairman of Autostrade per l'Italia SpA since 2010. He is also a director of Quadrivio Group SpA
Giovanni Castellucci has been a director since June 2006. Mr. Castellucci graduated in mechanical engineering from the University of Florence and completed an MBA at SDA Bocconi in Milan. From 1988 to 1999 he worked for the Boston Consulting Group, a leading management consultancy firm, in Paris until 1991 and then Milan from 1991, where he became a partner responsible for Italian Customer Service and Pharma Practices. In January 2000 he was appointed Chief Executive Officer of the Barilla Group. He joined Atlantia in June 2001 as General Manager. Since April 2005 he has been Chief Executive Officer of Autostrade per l'Italia SpA, maintaining the position of General Manager of Atlantia. He has served as Chief Executive Officer of Atlantia SpA since 2006. He is also a Director of Aeroporti di Roma SpA.
Carla Angela has been a Director since May 2013. Ms. Angela holds a degree in Actuarial Sciences awarded by the La Sapienza University of Rome. She is the Chairwoman of the Italian Institute of Actuaries and was a professor of financial mathematics in the Economics Faculty of the La Sapienza University of Rome and was also the Head of the Mathematics Department for Finance and Insurance, Chairwoman of the Finance and Insurance Degree Programme and Coordinator of the European PHD in Social Statistical and Economical Studies. She is a member of the International Actuarial Association Council and the Board and Treasury of the Actuarial Approach for Financial Risk Section. She has also worked in the Actuarial Association of Europe and was recently appointed Honorary Chair.
Gilberto Benetton has been a Director since 2003. He was one of the founders of the Benetton Group in 1965. Mr. Benetton is Chairman of Autogrill SpA and Edizione Srl and a director of Mediobanca SpA, Sintonia SpA and World Duty Free SpA.
Carlo Bertazzo has been a Director since May 2013. Mr. Bertazzo graduated in Business Studies from the Ca'Foscari University of Venice in 1990. He joined Edizione Srl in 1995, where he is now General Manager. He was director of Schematrentaquattro SpA and Sintonia S.p.A… Currently he is a director of Eurostazioni SpA and Olimpias
Bernardo Bertoldi has been a Director since May 2013. Mr Bertoldi holds a degree in Economics from the University of Turin and currently lectures in the Department of Management at the University of Turin and at the ESCP Europe London e Turin Campus. He is a member of the CIFE – Cambridge Institute for Family Enterprise and collaborates with Il Sole 24 Ore. He is one of the founders of 3H partners, of which he is Chairman. He is a director of Euroventures Srl, of Family Advisory Società di Intermediazione Mobiliare SpA - Sella & Partners and of Vass Techonologies Srl, Chairman of Board of Statutory Auditors of Iveco – Oto Melara SCrl . He is standing auditor of Azimut - Benetti SpA, Centro Ricerche Fiat SCpA, CNH Industrial Capital Solutions SpA, di FIAT Chrysler Finace SpA, Plastic Components, Modules Holding SpA and RAI COM SpA as well as an alternate auditor of RAI Cinema SpA and Rai Pubblicità SpA.
Matteo Botto Poala has been a Director since June 2014. Mr. Botto Poala holds a degree in Business Studies from the Bocconi University in Milan. He is currently Managing Director at Goldman Sachs International (London). He is a director of Augusta Global Cooperative UA (Netherlands), Elenia Lampo Oy (Finland) and Redexis Gas SA (Spain). He was a director of Sintonia SpA.
Alberto Clô has been a Director since May 2003. Professor Clo was awarded a degree in Political Science from the University of Bologna in 1970. He is an associate professor of Applied Economics at the University of Bologna. Prof. Clô is currently an independent director at De Longhi SpA, SNAM SpA and Gruppo Editoriale l'Espresso SpA
Gianni Coda has been a Director since May 2013. Mr. Coda is a graduate in Mechanical Engineering. He joined the Fiat Group in 1979 and is an expert in the automobile business and related procurement and supply. He has held various positions at the Fiat Group during his career. He is a director of Italgas SpA, C.I.N. Group and SABELT.
Massimo Lapucci has been a Director since May 2013. Mr. Lapucci graduated in economics and business studies from the La Sapienza University of Rome in 1995. He is currently serving as the General Secretary of the Fondazione Cassa di Risparmio di Torino. He has served as Board Director of numerous companies during his career. He is a member of the Italian accountants body and is a registered auditor. Mr. Lapucci is a director of Beni Stabili Gestione SpA – SGR and an executive director of Effeti SpA (until 22 December 2014). He is a director of Banca Generali SpA
Lucy P. Marcus has been a Director since May 2013. Ms. Marcus graduated in History and Political Science from Wellesley College, Massachusetts, USA in 1993. She is professor of Leadership and Governance at the IE Business School and an associate of the CIBAM Centre for International Business and Management at Cambridge University. She is the founder and Chief Executive of Marcus Venture Consulting Ltd,
Giuliano Mari has been a Director since April 2009. Mr. Mari graduated in Chemical Engineering from the La Sapienza University of Rome. He was employed at the IMI SpA group from 1969 to 2002, holding, among others, the positions of Chairman and General Manager of IMI Investimenti SpA from 1999 to 2002. He subsequently served as General Manager of Cofiri SpA until 2004. Mr Mari is Chairman of Assietta Private Equity SGR SpA and a director of Engineering Ingegneria Informatica SpA.
Valentina Martinelli has been a Director since May 2013. Ms. Martinelli graduated in business studies from the Ca'Foscari University of Venice. She is currently in charge of the preparation of Group consolidated financial statements and corporate affairs at Edizione Srl. She commenced her career at Arthur Andersen SpA and is a registered auditor.
Monica Mondardini was appointed a Director in January 2012. She holds a degree in statistics and economics from the University of Bologna. She has worked at the Hachette Group and was a General Manager for Europe Assistance, and Chief Executive of Generali Spain. She is currently the Chief Executive of Gruppo Editoriale L'Espresso. Ms. Mondardini is Chief Executive of C.I.R. SpA, and Board Director of Crédit Agricole S.A. and Trevi Finanziaria Industriale SpA.
Clemente Rebecchini has been a Director since May 2013. Mr. Rebecchini graduated in economics and business studies from the La Sapienza University of Rome and became a certified Italian accountant in 1988. He is currently a head office director of Mediobanca SpA Mr. Rebecchini is Chairman of Telco SpA, Deputy Chairman of Assicurazioni Generali SpA and a director of Italmobiliare SpA and Istituto Europeo di Oncologia S.r.l.
Number of years in position from initial appointment at Atlantia SpA (commencing with the General Meeting of 26 November 2003)
| Directors in office at 31 December 2015 | |
|---|---|
| YEARS IN OFFICE | |
| CARLA ANGELA * | 3 |
| GILBERTO BENETTON | 13 |
| CARLO BERTAZZO | 3 |
| BERNARDO BERTOLDI * | 3 |
| GIOVANNI CASTELLUCCI | 10 |
| FABIO CERCHIAI | 6 |
| ALBERTO CLÔ' * | 13 |
| GIANNI CODA * | 3 |
| MASSIMO LAPUCCI | 3 |
| LUCY P. MARCUS * | 3 |
| GIULIANO MARI * | 7 |
| VALENTINA MARTINELLI | 3 |
| MONICA MONDARDINI * | 4 |
| CLEMENTE REBECCHINI | 3 |
| MATTEO BOTTO POALA | 2 |
* Independent Director
| DIRECTOR | OTHER POSITIONS |
|---|---|
| CERCHIAI Fabio |
Chairman of Autostrade per l'Italia SpA Chairman of Arca Assicurazioni SpA Chairman of Arca Vita SpA Chairman of Cerved Informatin Solutions SpA Chairman of SIAT SpA Chairman of Unipol Sai SpA Director of Edizione Srl Director of Quadrivio Group SpA |
| CASTELLUCCI Giovanni ANGELA |
Chief Executive Officer of Autostrade per l'Italia SpA Director of Aeroporti di Roma SpA |
| Carla | --- |
| BENETTON Gilberto |
Chairman of Autogrill SpA Chairman of Edizione Srl Director of Mediobanca SpA |
| BERTAZZO Carlo |
Director of Eurostazioni SpA Director of Olimpias Group S.r.l. General Manager of Edizione Srl |
| Chairman of 3H Partners Srl |
||||||||
|---|---|---|---|---|---|---|---|---|
| Director of Euroventures S.r.l. |
||||||||
| Director of Family Advisory Società di Intermediazione Mobiliare SpA – Sella & Partners |
||||||||
| Director of Sabelt SpA |
||||||||
| Director of Vass Technologies Srl |
||||||||
| Chairman of the Board of Statutory Auditors of Iveco – Oto Melara S.C.r.l. |
||||||||
| BERTOLDI | Standing Auditor of Azimut - Benetti SpA |
|||||||
| Bernardo | Standing Auditor of Centro Ricerche Fiat S.C.p.A. |
|||||||
| Standing Auditor of CNH Industrial Capital Solutions SpA |
||||||||
| Standing Auditor of FIAT Chrysler Finance SpA |
||||||||
| Standing Auditor of Plastic Components and Modules Holding SpA |
||||||||
| Standing Auditor of RAI COM SpA |
||||||||
| Alternate Auditor of RAI Cinema SpA |
||||||||
| Alternate Auditor of RAI Pubblicità SpA |
||||||||
| Director of Redexis Gas S.A. (Spain) |
||||||||
| BOTTO POALA | Director of Elenia Lämpö Oy (Finland) |
|||||||
| Matteo | Director of Augusta Global Coöperatieve U.A. (Netherlands) |
|||||||
| Managing Director of Goldman Sachs International (London) |
||||||||
| Director of Sintonia SpA (Italy) (until mid-2015) |
||||||||
| Director of De Longhi SpA |
||||||||
| CLÔ | Director of SNAM SpA |
|||||||
| Alberto | Director of Gruppo Editoriale L'Espresso |
|||||||
| CODA | Director of ITALGAS SpA |
|||||||
| Gianni | Director of C.I.N Group Director of SABELT |
|||||||
| LAPUCCI Massimo |
Director of Banca Generali SpA |
|||||||
| MARCUS Lucy P. |
--- | |||||||
| Director of Engineering Ingegneria Informatica SpA |
||||||||
| MARI | Director of Assietta Private Equity SGR SpA |
|||||||
| Giuliano | ||||||||
| MARTINELLI | --- | |||||||
| Valentina | ||||||||
| Director of C.I.R. SpA |
||||||||
| MONDARDINI | Chief Executive Officer of Gruppo Editoriale L'Espresso SpA |
|||||||
| Monica | Director of Credit Agricole SA |
|||||||
| Director of Trevi Finanziaria Industriale SpA |
| Deputy Chairman of Assicurazioni Generali SpA |
|
|---|---|
| REBECCHINI | Director of Italmobiliare SpA |
| Clemente | Director of Istituto Europeo di Oncologia |
| Central Director of Mediobanca SpA |
| Table 3 Board of Statutory Auditors | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Position | Member | Year of birth |
Date first elected * |
In office from |
In office until |
Slate ** |
Independent as per CG Code |
Attendance at Board of Statutory Auditor meetings *** |
Number of other positions held **** |
|||
| Chairman | Gatti Corrado |
1974 | 24 Apr 2012 | 24 Apr 2012 | 24 Apr 2015 | m | X | 6/6 (1) 9/10 (2) |
13 | |||
| Standing Auditor |
De Nigro Alberto | 1958 | 24 Apr 2015 |
24 Apr 2015 |
24 Apr 2017 | M | X | 9/10 | 13 | |||
| Standing Auditor |
Fornabaio Lelio | 1970 | 24 Apr 2015 |
24 Apr 2015 |
24 Apr 2017 | M | X | 10/10 | 17 | |||
| Standing Auditor |
Olivotto Silvia | 1950 | 24 Apr 2015 |
24 Apr 2015 |
24 Apr 2017 | m | X | 10/10 | 9 | |||
| Standing Auditor |
Salvini Livia | 1957 | 24 Apr 2015 |
24 Apr 2015 |
24 Apr 2017 | M | X | 8/10 | 2 | |||
| Alternate Auditor |
Castaldi Laura | 1965 | 24 Apr 2015 |
24 Apr 2015 |
24 Apr 2017 | M | X | ---- | ---- | |||
| Alternate Auditor |
Cerati Giuseppe | 1962 | 24 Apr 2015 |
24 Apr 2015 |
24 Apr 2017 | m | X | ---- | ---- | |||
| -----------------STATUTORY AUDITORS TERMINATED DURING THE REPORTING PERIOD ----------------- | ||||||||||||
| Surname Name |
||||||||||||
| Standing Auditor |
Di Tanno Tommaso | 1949 | 7 Apr 2006 | 24 Apr 2012 | 24 Apr 2015 | M | 5/6 | n.a. | ||||
| Standing Auditor |
Lupi Raffaello |
1956 | 16 Dec 2004 | 24 Apr 2012 | 24 Apr 2015 | M | X | 4/6 | n.a. | |||
| Standing Auditor |
Motta Milena |
1959 | 24 Apr 2012 | 24 Apr 2012 | 24 Apr 2015 | m | X | 6/6 | n.a. | |||
| Standing Auditor |
Trotter Alessandro |
1940 | 22 Sept 2003 | 24 Apr 2012 | 24 Apr 2015 | M | X | 6/6 | n.a. | |||
| Alternate | Cipolla | 1964 | 24 Apr 2012 | 24 Apr 2012 | 24 Apr 2015 | M | X | ---- | ---- |
| Auditor | Giuseppe Maria | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Alternate | Di Giusto | 24 Apr 2012 | 24 Apr 2012 | 24 Apr 2015 | m | X | |||
| Auditor | Fabrizio Riccardo | 1966 | ---- | ---- | |||||
| Number of meetings held during the reporting period: 16 (of which 10 by the current Board and 6 by the Board in office until 24 April 2015) |
|||||||||
| Indicate the quorum required for the submission of slates by minority shareholders for the election of one or more members (as per art. 148 |
|||||||||
| of the CFA): 1% | |||||||||
NOTES
** This column indicates M/m according to whether the member was elected from the majority (M) slate or a minority (m) slate.
**** This column shows the number of directorships or positions as statutory auditor held by the interested party, pursuant to art. 148-bis of the CFA and the related implementing measures contained in the CONSOB Regulations for Issuers. The full list is published by the CONSOB on its website, pursuant to art. 144 quinquiesdecies of the CONSOB Regulations for Issuers.
(1) Participation in meetings of the Board of Statutory Auditors in office until 24 April 2015
(2) Participation in meetings of the Board of Statutory Auditors in office since 24 April 2015
* The "Date first elected" indicates the date on which each Statutory Auditor was elected for the first time (in absolute terms) as a member of the issuer's board of statutory auditors.
*** This column shows the attendance of Auditors at meetings of the Board of Statutory Auditors (indicate the number of meetings attended with respect to the total number of meetings that could have been attended; e.g. 6/8; 8/8, etc.).
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