Remuneration Information • Apr 7, 2021
Remuneration Information
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APPROVED BY THE BOARD OF DIRECTORS ON MARCH 12, 2021
To complete extraordinary projects by pushing beyond the frontiers of innovation, opening the way for our clients to the energy of the future.
Creative intelligence; care for people and planet; striving for trust; enhancement of cultural identities.
Albania, Austria, Bulgaria, Croatia, Cyprus, France, Germany, Italy, Luxembourg, Netherlands, Norway, Poland, Portugal, Romania, Serbia, Spain, Sweden, Switzerland, Turkey, United Kingdom
Argentina, Bolivia, Brazil, Canada, Chile, Colombia, Ecuador, Guyana, Mexico, Peru, United States, Venezuela
CIS
Azerbaijan, Georgia, Kazakhstan, Russia
Algeria, Angola, Congo, Egypt, Equatorial Guinea, Ghana, Libya, Mauritania, Morocco, Mozambique, Nigeria, Senegal, South Africa, Tunisia, Uganda
Iraq, Israel, Kuwait, Oman, Qatar, Saudi Arabia, United Arab Emirates
FAR EAST AND OCEANIA
Australia, Bangladesh, China, India, Indonesia, Malaysia, Pakistan, Singapore, Taiwan, Thailand, Vietnam
| Section I - 2021 Remuneration Policy 16 Strategy, Sustainable development, Working conditions and Remuneration Policy 16 Link between Strategy, Sustainable development and Remuneration Policy 16 Working conditions and Remuneration Policy 17 Governance of the remuneration process 18 Bodies and persons involved 18 Compensation and Nominations Committee 18 2021 Remuneration Policy approval process 21 Possible exceptions to elements of the 2021 Remuneration Policy 22 Aims and general principles of the Remuneration Policy 22 Aims 22 General principles 22 2021 Remuneration Policy Guidelines 24 Chairman of the Board of Directors, Statutory Auditors and non-executive Directors 25 Chief Executive Officer-CEO 26 Senior Managers with strategic responsibilities 30 Section II - Compensation paid and other information 34 Report on compensation paid - 2020 34 Overview 34 Implementation of 2020 remuneration policies 37 Report on Compensation Paid for 2020 - Results of shareholder vote on Section II 38 Fixed compensation 38 Compensation for service on Board Committees 38 Variable incentives 38 Benefits 41 Ancillary remuneration instruments 42 Annual change in compensation and the performance of the Company 42 Compensation paid in 2020 43 Table 1 - Compensation paid to Directors, Statutory Auditors 43 and Senior Managers with strategic responsibilities Table 3A - Incentive plans based on financial instruments, other than stock options, 45 for Directors and Senior Managers with strategic responsibilities Table 3B - Monetary Incentive Plans for Directors 46 and Senior Managers with strategic responsibilities Shares held 47 Table 4 - Shares held by Directors and Senior Managers 47 with strategic responsibilities Annex pursuant to Article 84-bis of the Consob Issuers' Regulation 48 - 2020 Allocation of the Share-based Long-term Variable Incentive (LTI) Plan 2019-2021 and 2021 Allocation of the Short-term Variable Incentive Plan 2021-2023 |
Letter from the Chairman of the Compensation and Nominations Committee Introduction Overview 2021 Remuneration Policy 2020 Policy Report - Results of shareholder vote on Section I Executive summary: Saipem 2021 Remuneration Policy |
2 4 6 6 7 9 |
|---|---|---|
| Table 1 of form 7 in Annex 3A to Regulation No. 11971/1999 | 48 |
The Report is published in the "Governance" section of Saipem's website (www.saipem.com)
Paolo Fumagalli
Dear Shareholders,
as the Chairman of the Compensation and Nominations Committee and on behalf of the other members, Federico Ferro-Luzzi and Paul Schapira, I am pleased to present to you our 2021 Report on Remuneration Policy and Compensation Paid (Policy Report), which was approved by the Board of Directors on March 12, 2021. Consistent with the promise made when our Committee was established, this Policy Report has been prepared in order to assure Shareholders and Investors of maximum transparency regarding the quality of the remuneration systems adopted, highlighting their consistency with the business strategy of the Company while seeking to align the interests and motivations of Management with the priority objective of creating sustainable value for the stakeholders over the long term.
The 2020 AGM confirmed the high level of approval for Saipem's Policy Report, which was very well received by the Shareholders. This reflects constant effort by the Compensation and Nominations Committee to recommend suitable guidelines to the Board of Directors for the definition and implementation of remuneration policies aligned with best practices and domestic and international benchmarks, which continue to represent an important point of reference when assessing the adequacy and overall consistency of the remuneration paid.
From the beginning, the Compensation and Nominations Committee has worked on a radical overhaul of the remuneration policies adopted, seeking their continuous improvement via targeted action on the variable incentive systems, with a view to simplifying and strengthening the alignment of business performance with the creation of value for the Shareholders. The objective is to strike a suitable balance between the outlook and expectations of Stakeholders and the results achieved by Saipem over the long term.
In this context, the principal innovations introduced during the 2018-2021 mandate included:
in the strategic plan, but which contributed to pursuit of the strategic objectives, identified applying the criterion of importance;
≥ introduction of a new performance score coefficient linked to the "New Contracts" objective, with a view to recognising better the contribution made by Management to the acquisition of new non-oil projects, consistent with the strategic focus of Saipem on the energy transition and climate change matters.
When preparing this Policy Report, special attention was given to describing, in an even clearer and more immediate manner, how our Remuneration Policy is consistent with the business strategy and explaining the process of engagement followed in order to consolidate dialogue with the Shareholders and principal Proxy Advisors.
In particular, the 2021 Remuneration Policy Guidelines were determined after considering carefully the orientation expressed by the Shareholders that voted on the 2020 Policy. They envisage the introduction of further changes to the incentive systems that are intended to represent another significant step towards simplification and transparency for investors, such as:
Short-term Incentive Plan and the share-based Long-term Incentive Plan, so that effective comparisons can be made;
≥ clearer description of the procedural conditions to be satisfied in exceptional circumstances that require temporary exceptions to be made to certain elements of the Remuneration Policy.
In view of the changes in the global environment consequent to the sudden and unforeseeable COVID-19 emergency, which has generated widespread uncertainty, the 2021 Remuneration Policy Guidelines envisage focus on the definition of objectives for 2021 that are consistent with the Strategic Plan of the Company and fully aligned with the expectations of investors.
In this context, the business strategy of pursuing sustainable success is well supported by the link between the short- and long-term performance parameters and the principal strategic guidelines, which take account of the important business and non-financial (ESG) objectives.
The 2021 Remuneration Policy confirms the growing attention paid by Saipem to ESG (Environmental, Social, Governance) objectives and the support for stronger climate policies, consistent with the international principles adopted (e.g. Global Compact) and the UN Sustainable Development Goals (SDGs), as well as with the European guidelines intended to support economic recovery and sustainable development.
The Committee also proposed Remuneration Policy Guidelines for the new mandate 2021-2024 to the Board of Directors on March 12, 2021. They include the definition of compensation commensurate with the complexity of the role and the commitment required, in line with market benchmarks. The new Board of Directors, acting on a proposal from the new
Compensation and Nominations Committee, will be entitled, as in the past, to determine the compensation for the specific mandates granted and the membership of Committees.
Preparation of the Policy Report, which explains the above guidelines in more detail, took account of the changes made with regard to remuneration in Legislative Decree No. 49 dated May 10, 2019, which implemented Directive (EU) 2017/828 (Shareholder Rights Directive II, "SHRD II"), as well as the recommendations of the Corporate Governance Code for listed companies promoted by Borsa Italiana (the "Corporate Governance Code"), the latest version of which was approved in January 2020.
Convinced that the Remuneration Policy represents a key driver for the creation of sustainable value, I trust that the 2021 Report on Remuneration Policy and Compensation Paid presented for your examination will, once again, confirm the constant efforts made by the Committee in recent years and meet with your approval.
At the end of our mandate, I would like to take this opportunity to thank directors Federico Ferro-Luzzi and Paul Schapira for their excellent team work, the members of the Board of Statutory Auditors who participated in our activities, Saipem Management for the active collaboration provided and, in particular, Committee Secretary Massimo Roccuzzo, Deputy-Secretary Adriana Gea and all those who assisted the Committee in various ways for their precious contributions. Sincere best wishes also go to the incoming members of the new Committee.
March 12, 2021
The Chairman of the Compensation and Nominations Committee
This Report on Remuneration Policy and Compensation Paid (hereinafter, the "Policy Report") was approved by the Board of Directors of Saipem on March 12, 2021, acting on a proposal from the Compensation and Nominations Committee, whose members are all non-executive and independent Directors. The Report was prepared and finalised in compliance with the requirements of current laws and regulations: Article 123-ter of Legislative Decree No. 58 dated 24 February 1998, as incorporated in the Consolidated Finance Law (hereinafter, "TUF"); Article 84-quater of the Consob Issuers' Regulation (Decision No. 11971 dated May 14, 1999, as amended) and related Annex 3A, forms 7-bis and 7-ter; as well as in conformity with the recommendations of the Corporate Governance Code for listed companies promoted by Borsa Italiana (hereinafter, the "Corporate Governance Code"), the latest version of which, approved in January 2020, has been adopted by Saipem1. In keeping with the guidelines set out in the Company's Strategic Plan, the Remuneration Policy promotes alignment of the interests of Management with the priority objective of creating value for the stakeholders over the long term. This 2021 Report on Remuneration Policy and Compensation Paid (Remuneration Policy) defines and
These two sections of the Policy Report are both preceded by a summary of the main information, in order to give the market and investors an easy-to-read understanding of the key elements of the 2021 Policy. Lastly, Section II of the Policy Report identifies the equity interests held by the Directors, Statutory Auditors and Senior Managers with strategic responsibilities and contains information about the elements of remuneration relating to 2020, as required under current regulations3. The text of this Policy Report is sent to Borsa Italiana and made available to the public at the registered office of the Company and on its website in the "Governance" section, no more that twenty-one days prior to the date of the Shareholders' Meeting called to approve the financial statements for 2020 and Section I of the Policy Report, as well as to express a non-binding vote on Section II of the Policy Report, as required under current regulations4. Information on the financial instrument-based compensation plans currently in force is available in the "Governance" section of Saipem's website5. In compliance with current legislative and regulatory obligations6, the preparation of this Policy Report took into consideration analyses and further details
regarding the results of voting at the Shareholders' Meeting, the feedback received from shareholders and the main Proxy Advisors on the Saipem 2020 Policy Report and their indications for the 2021 Policy, as well as the results of engagement activities with the Proxy Advisors, indications contained in the new Issuers' Regulation, the recommendations contained in the new Corporate Governance Code and the market practices of leading listed companies.
In particular, the following points were considered:
(3) Article 114-bis TUF and Article 84-bis of the Consob Issuers' Regulation.
(4) Directive (EU) 2017/828 and Article 123-ter of Legislative Decree No. 58/1998, para. 6, as amended by Legislative Decree No. 49/2019. (5) At the address: http://www.saipem.com/sites/SAIPEM_it_IT/area/GOVERNANCE-saipem-governance.page.
(1) For more information on the terms of Saipem's adoption of the Corporate Governance Code, please refer to the "Governance" section of the Company's website (http://www.saipem.com) and to the document entitled "Corporate Governance and Shareholding Structure Report 2020". (2 ) The definition of "Senior Managers with strategic responsibilities" identified in Article 65, para. 1-quater, of the Issuers' Regulation – which references Annex 1 to Consob Regulation No. 17221 dated March 12, 2010 on instructions regarding transactions with related parties, as amended – includes persons who, directly or indirectly, have the power and responsibility to plan, direct and control the activities of the Company, such as the (executive and non-executive) board directors of the Company. Saipem Senior Managers with strategic responsibilities, other than Directors and Statutory Auditors, are those who sit on the Advisory Committee and, in any case, those who report directly to the CEO/the Chairman/the Board of Directors of Saipem SpA.
(6) Article 123-ter of Legislative Decree No. 58/1998 and Article 84-quater of the Consob Issuers' Regulation (Decision No. 11971/1999, as amended).
On March 12, 2021, the Board of Directors of Saipem resolved to submit: (i) Section I of the 2021 Report on Remuneration Policy to a binding vote at the Shareholders' Meeting; and (ii) Section II on the Compensation Paid for 2020 to a consultative vote.
The Remuneration Policy of Saipem, valid for one year, is designed to: (i) promote alignment of the interests of Management with the priority objective of creating sustainable value for the stakeholders over the long term; (ii) promote the corporate mission and values; (iii) attract, retain and motivate professional and managerial talents; (iv) incentivise the achievement of strategic objectives and the sustainable growth of the business.
On March 12, 2021, the Board of Directors approved the 2021 Policy Guidelines on a proposal from the Compensation and Nominations Committee, following an analysis of the relevant regulatory environment and market practices in Italy and abroad, as well as a comparative analysis of the remuneration paid, carried out with support from an international consultancy. Definition of the Policy Guidelines took account of the orientation expressed by the shareholders that voted at the Shareholders' Meeting on the 2020 Remuneration Policy.
The 2021 Remuneration Policy envisages retaining the elements of remuneration identified in the current Policy, while making some improvements to the instruments used. In particular, with a view to simplification and incentivising over performance against target, the Short-term Variable Incentive Plan 2021-2023 includes a new linear incentive curve based on a 50-150 point performance scale, corresponding to an incentive level linked to a 50-150% performance score. The new incentive curve is linear for scores of 100 points or more; the target score (100 points) and the maximum score (150 points) correspond to an incentive level of 100% and 150% respectively, while the incentive percentage for scores of less than 100 points is 50%; the incentive is zero for scores of less than 70 points (the trigger threshold), consistent with the 2020 Remuneration Policy.
Consistent with the Saipem strategy that focuses particular attention on the energy transition and climate change topics, the coefficient has been enhanced to 1.1 will be applied to the score obtained for the "New Contracts" objective, if the outstanding "Non Oil Related" element of the orderbook represents 75% or more of the entire Order portfolio at December 31, 2021, without exceeding the maximum score of 15 points. Operations intended to increase the value of Saipem and its assets over the time horizon of the Saipem Strategic Plan will again be deemed strategic in 2021; accordingly, as in the past, a multiplier will be applied to the individual performance score in order to guide Management towards higher value-added operations, reward the exceptional commitment required and facilitate the motivation of personnel with a significant impact on the successful outcome of those operations.
Additionally, in order to support better the creation of value over time, the 2021 allocation of the Long-term Incentive Plan 2019-2021 will include another business-based indicator with a 20% weighting: "Cumulative Adjusted EBITDA over the three-year period 2021-2022-2023".
Finally, the mandate of the current Board of Directors will end at the Shareholders' Meeting called for April 30, 2021 to approve the financial statements as of December 31, 2020. The 2021 Remuneration Policy Guidelines will be made available to the new Board of Directors, which will be responsible for the determining the compensation of the Directors with specific responsibilities, pursuant to Article 2389, para. 3, of the Italian Civil Code, and the compensation of the non-executive Directors for their membership of Board committees, in line with the legislative provisions and company regulations.
The 2021 Remuneration Policy, illustrated in detail in this Section I of the Remuneration Report, envisages the following:
and the maximum score (150 points) correspond to an incentive level of 100% and 150% respectively, while the incentive percentage for scores of less than 100 points is 50%; the incentive is zero for scores of less than 70 points (the trigger threshold), consistent with the 2020 Remuneration Policy. In addition, enhancement of the coefficient of 1.1 will be applied to the score obtained for the "New Contracts" objective, if the outstanding "Non Oil Related" element of the orderbook represents 75% or more of the entire Order portfolio at December 31, 2021, without exceeding the maximum score of 15 points.
When deciding Remuneration Policy, Saipem also considers other aspects that complement the fixed and variable economic-monetary elements, mainly by providing pension and social security benefits. The table on the following pages ("Executive Summary: 2021 Saipem Remuneration Policy") shows the main elements of the 2021 Guidelines approved for the remuneration of the Chief Executive Officer-CEO and the Senior Managers with strategic responsibilities (SMSR).
The Remuneration Policy is designed to be consistent with the business strategy and helps to promote alignments of the interests and motivations of Management with the interests of the shareholders and all stakeholders, including achievement of the priority objective of creating sustainable value over the long term.
Implementation of the business strategy is assured via the definition, by the Board of Directors, of short- and long-term priorities that are translated into objectives assigned to the Chief Executive Officer-CEO, with subsequent deployment to Management as a whole, supported by constant checks and monitoring of the progress made.
For this purpose, the variable incentive plans cover several years, with the deferral for three years of part of the short-term incentive, and include a substantial long-term incentive element.
The 2021 Remuneration Policy confirms the growing attention paid by Saipem to ESG (Environmental, Social & Governance) objectives and support for the strengthening of climate policies, consistent with the orientation consolidated at international level including, in particular, the Paris Climate Accords.
Saipem is committed to creating a work environment where different characteristics or personal or cultural orientations are considered a resource and a source of mutual enrichment, as well as being an inalienable element of business sustainability. In compliance with the applicable regulations and the principles underpinning the corporate Code of Ethics, Saipem guarantees equal opportunities to all personnel with fair contractual conditions and remuneration based exclusively on merit and expertise, without discrimination of any kind. This environment ensures that the cornerstone of the Remuneration Policy – and, more in general, the Management of personnel – is the recognition of merit and the application of distinctive and critical professional skills. In fact, Remuneration Policy is defined and implemented in a manner that is fully consistent with the results of the skill and performance assessments of each individual, at the same time ensuring alignment with specific job market needs and the employment laws and regulations applicable in the markets in which Saipem operates.
In accordance with current legislation (Article 123-ter, para. 6, of Legislative Decree No. 58/1998), the Shareholders' Meeting held on April 29, 2020 cast a binding vote on Section I of the 2020 Policy Report, with about 99% of the votes in favour.
More specifically, 98.6% of all the votes cast in 2020 were in favour, including 95.63% of the institutional investors; overall approval has averaged 97.90% over the past four years.
Market developments are monitored constantly and, subsequent to the Shareholders' Meeting, the
Compensation and Nominations Committee analysed the results of voting in various ways, including on a comparative basis, with particular reference to the votes cast by institutional investors. Examination of the voting recommendations made by Proxy Advisors and analysis of the results of engagement with Saipem shareholders
also provided valid support when defining the 2021 Remuneration Policy Guidelines and aligning with market expectations for the transparency (ex-ante and ex-post) of current incentive plans. Particular attention was also paid to the Pay for Performance model, ensuring its alignment with recent regulatory changes.
Our Values: ≥Creative intelligence ≥Care for people and planet ≥Striving for trust ≥ Enhancement of cultural
identities.
The values and responsibilities that Saipem recognises, accepts, agrees with and adopts, thus contributing to a better future for all, are described in the Code of Ethics approved by the Board of Directors on March 19, 2019.
All Saipem People, without distinct or exception, shall align their actions and behaviour with the principles and content of the Code of Ethics. Relations among Saipem People, at all levels, shall be characterised by honesty, fairness, cooperation, loyalty and mutual respect.
As required under current regulations7 , Saipem is committed to developing the abilities and skills of Management and employees, so that their energy and creativity can have full expression for the fulfilment of their potential, and to protecting working conditions as regards both mental and physical health of the workforce and their dignity. Saipem undertakes to offer, in full compliance with applicable legal and contractual provisions, equal opportunities to all its employees, making sure that each of them receives fair statutory and wage treatment exclusively based only on merit and expertise, without discrimination of any kind.
See page 17 of this Policy Report
| Principle | Description | ||
|---|---|---|---|
| The principal parties involved are: ≥Shareholders' Meeting ≥Board of Directors ≥Compensation and Nominations Committee ≥Human Resources ≥Independent Experts. |
long-term incentive plans, including share-based plans. on the compensation paid to a consultative vote. |
The Compensation and Nominations Committee determines the structure and content of the Policy for the remuneration of the Chairman, the Directors, the Chief Executive Officer-CEO and the Senior Managers with strategic responsibilities, considering the various forms of compensation and economic benefits, as well as the general criteria for the short- and The Compensation and Nominations Committee submits the Policy to the Board, which approves its content for presentation to the Shareholders' Meeting called to approve the annual financial statements. In addition, with regard to determining the remuneration of the Chief Executive Officer-CEO and the Directors with specific responsibilities, the Board takes the opinion of the Board of Statutory Auditors into consideration. If necessary, the Committee may obtain support from independent experts in this area. Having examined and approved the Policy, the Board of Directors submits Section I of the Report on Remuneration Policy to a binding vote at the Shareholders' Meeting and Section II |
|
| Human Resources | Independent experts |
||
| Compensation and Nomination |
Board | Shareholders' | |
| Committee | of Directors | Meeting |
(7) Article 84-quater of the Consob Issuers' Regulation (Decision No. 11971 dated May 14, 1999, as amended) and related Annex 3A, form 7-bis.
Guarantee fair remuneration, appropriate to the role and responsibilities assigned, in accordance with the principles of diversity, equal opportunities, recognition of the knowledge and professionalism of personnel, fairness and non-discrimination, compliant with all laws and internal and external regulations, and consistent with market benchmarks and the level of performance achieved.
The Saipem Remuneration Policy is determined with reference to the Governance model adopted by the Company and the recommendations of the Corporate Governance Code, in order to attract, motivate and retain professional and managerial talents, incentivise the achievement of strategic objectives and the sustainable growth of the business, align the interests of Management with the priority objective of creating sustainable value for the stakeholders, especially over the long term, and promote the corporate mission and values.
See page 22 of this Policy Report
| Principle | Description |
|---|---|
| New mandate 2021-2024 Update of peer group |
The 2021 Remuneration Policy has been prepared in a manner consistent with the relevant regulations and adopts the requirements of Directive SHRD II. The principal changes made |
| benchmark | with respect to the 2020 Policy include: ≥Definition of Guidelines for the remuneration of the Directors appointed for the new Board |
| Simplification of the curve of the Short-term Incentive Plan |
mandate. ≥Update of the panel of firms comprising the reference market for analysing the remuneration of the CEO, the Chairman, the Directors and the Statutory Auditors. ≥Revision of the incentive curve for the Short-term Variable Incentive Plan 2021-2023, with |
| Description of the link between Remuneration Policy, Strategy and Sustainability |
a focus on simplification. ≥ Expanded description of the contribution made by the Policy to achievement of the corporate strategy and pursuit of the long-term interests and sustainability of the |
| Greater weight for the ESG indicators Environmental, Social & Governance |
company. ≥Greater weight for the ESG indicators, now totalling 30%, within the 2021 objectives. ≥ Enhancement of the coefficient of 1.1 to be applied to the score obtained for the "New |
| Enhancement of the coefficient linked to the "New Contracts" objective |
Contracts" objective, if the outstanding "Non Oil Related" element of the orderbook represents 75% or more of the entire Order portfolio at December 31, 2021, without exceeding the maximum score of 15 points. ≥Strengthened description of the procedural conditions to be satisfied in exceptional |
| Procedural conditions for exception to the 2021 Remuneration Policy |
circumstances that require temporary exceptions to be made to certain elements of the Remuneration Policy on page 22. ≥The 2021 allocation of the Long-term Incentive Plan 2019-2021 includes a new |
| Additional business-based indicator | business-based indicator with a 20% weighting: Cumulative Adjusted EBITDA over the three-year period 2021-2022-2023. |
| for the Long-term Incentive Plan 2019-2021 - Allocation 2021 |
≥Improvement of the overview that introduces and summarises the main contents of Section II of this Policy Report. ≥Further expansion of the disclosure made about the results achieved, presented on an |
| Improvement of the Overview (Section II) |
accruals basis. ≥Addition of the annual change in the overall remuneration of Chief Executive Officer-CEO, |
| Further disclosure of results (Section II) |
the average overall remuneration of all employees and the performance of the company. |
| Annual change in compensation and the performance of the company (Section II) |
The variable remuneration of those executive roles that strongly influence corporate results is characterised by the significant incidence of long-term incentive components, through appropriate deferral of their incentives over a period of at least three years, with part of the long-term incentives subject to a further two-year retention period, consistent with the long-term nature of the business pursued.
The objectives linked to variable remuneration are predetermined, measurable and complementary to each other, in order to identify the priorities considered when determining the overall performance of the Company and the divisions, in line with the Strategic Plan and with the expectations of shareholders and other stakeholders, and promote a strong results-based orientation.
The incentives linked with variable compensation are paid following a scrupulous process of checking the results actually achieved, assessing achievement of performance targets assigned net of the effects of external variables, with a view to recognising the actual company performance attributable to Management action.
The 2021 Remuneration Policy Guidelines set pay-mixes consonant with managerial roles, with a greater weight given to the variable element (in particular the long-term element) for positions that have a greater influence on company results, as shown in the pay-mix chart shown below, which was calculated considering the monetisation of short- and long-term incentives in the event of achieving minimum, target and maximum results.
| Principle | Description |
|---|---|
| Recognises the skills, experience and contribution required by the role assigned. |
Fixed remuneration may be adjusted periodically in the context of the annual salary review involving all managers, following verification of their pay positioning against benchmarks compatible with the characteristics of Saipem and the roles assigned. These checks are carried out using a structured system of salary bands. The Saipem remuneration Policy envisages the use of merit matrices, in order to subordinate salary increases to an analysis of the pay positioning of personnel in terms of internal fairness and comparison with the reference market, in addition to assessment of their merit and skills possessed. |
| See pages 26 and 30 of this Policy Report |
The annual fixed remuneration of the current Chief Executive Officer-CEO is €1,045,000. The remuneration of the Chief Executive Officer-CEO to be appointed for the new mandate will be approved by the new Board of Directors acting on a proposal from the new Compensation and Nominations Committee, considering the mandates granted and duties assigned, as well as any variations will take into account the reference market benchmarks presented in table "Market references" on page 24. The remuneration of the SMSR is determined with reference to the level of the role assigned, with possible adjustments following annual reviews of competitive positioning. Annual adjustments are envisaged as part of the salary review process. |
The remuneration structure for the Chief Executive Officer-CEO and for the Senior Managers with strategic responsibilities is a balanced mix of a fixed element commensurate with the powers and/or responsibilities assigned and a variable element with a maximum limit designed to link remuneration to performance targets that are actually achieved.
The short- and long-term incentive systems are linked to the attainment of a series of economic-financial, business development and operating targets set with a view to achieving sustainable results over the long term, in line with the Company's Strategic Plan and with the responsibilities assigned.
The incentive levels (for the short-term incentive, the percentage to be applied to the annual incentive for on target performance as shown in table on page 27 and, for the long-term incentive, the percentage to be applied to fixed remuneration as shown in table on page 29) linked to the performance score envisaged in the variable incentive systems for the Chief Executive Officer-CEO and the SMSR are shown below:
| Min | Target | Max | |
|---|---|---|---|
| STI - Short-Term Incentive | 50% | 100% | 150% |
| LTI - Long Term Incentive | 40% | 100% | 160% |
Consistent with the 2020 Remuneration Policy, the minimum performance level (trigger threshold) for the short-term incentive is 70 points.
The short-term variable element promotes achievement of the annual budget objectives. All managers are included in the Plan.
See pages 26 and 30 of this Policy Report
(8) Modification of the performance scale from 70-130 points to 50-150 points does not affect determination of the additional bonus in the form of shares, the maximum percentage for which remains 22.5%, consistent with the 2020 Remuneration Policy.
The long-term variable element promotes alignment of the interests of Management with those of the shareholders and other stakeholders in creating sustainable value over the long
All managers are included in the
term.
Plan.
The third and final allocation of the Long-term Incentive Plan 2019-2021 will be made in 2021. This Plan envisages the assignment without charge of ordinary shares in Saipem SpA, differentiated depending on the level of the role, on achievement of the following performance conditions, measured at the end of the three-year reference period:
For the 2021 allocation, a new business-based indicator has been introduced – cumulative adjusted EBITDA over the three-year period 2021-2022-2023 – with a weighting of 20%. The weightings of the other business-based indicators have been adjusted accordingly, without changing the overall 50% weighting for business-based indicators envisaged in the Plan. Three-year Vesting + Co-Investment of 2 years for the Chief Executive Officer-CEO. Three-year Vesting + Retention Premium of 2 years for strategic personnel. For the current Chief Executive Officer-CEO, the incentive level on target is 100% of fixed remuneration, while the maximum is 160% of fixed remuneration. In addition, a further 25% of the shares accrued at the end of the Co-Investment period will be recognised. To maintain continuity, the Chief Executive Officer-CEO appointed for the new mandate will benefit from the same Long-term Incentive Plan 2019-2021 with Co-investment. For the SMSR, the incentive levels on target are differentiated depending on the role assigned, up to a maximum of 65% of fixed remuneration on target and 104% of fixed remuneration at maximum level. In addition, a further 25% of the shares accrued at the end of the Retention Premium period will be recognised.
The maximum value at the end of the vesting period shall not exceed four times the value of the shares at the moment assigned.
Shares are allocated every year. The vesting period is three years. The Retention Premium/Co-investment period extends for two years after the end of the vesting period. The effects of terminating the employment relationship are described in the paragraphs on the long-term variable incentive on pages 28 and 32. Clawback mechanisms: the clawback rules described on page 23 apply to the incentives.
See pages 27 and 31 of this Policy Report
compensation package, seen in terms of total reward, through the allocation of benefits in kind, mainly of a health and social security nature. Recipients: all managers.
See pages 30 and 33 of this Policy Report
These supplement the
≥Supplementary pension
≥Supplementary healthcare
≥Insurance cover for death or permanent invalidity and work and non-work related injuries ≥Company car for business and personal use.
Assignment of a car for business and personal use, subject to periodic review if the role assigned is changed.
The current CEO is entitled to reimbursement for actual travel between Rome and Milan once each week.
The CEO appointed for the new mandate will be entitled to the reimbursement of travel expenses, if the place of residence is more than 400 kilometres from the offices of the Company.
Termination indemnities to protect the company from potential competition risks and potential risks linked to disputes. Tools for retaining and protecting
the know-how of the Group.
Corporate Governance Code and not amounting, in total, to more than 2 years of fixed remuneration and target variable remuneration. SMSR: leaving indemnity (in accordance with the national collective employment contract). Possibility of agreeing supplementary indemnities based on internal policy criteria: Severance payment if a change of control results in termination of employment due to resignation or dismissal and/or demotion (maximum of 2 years of remuneration). No-competition agreements: may be activated on termination of the employment relationship (12 months' salary for each year of the agreement). Minimum-term agreements for the protection of know-how (12 months' salary for each year of the agreement). These instruments may be activated during the employment relationship or upon termination of employment.
Chief Executive Officer-CEO appointed for the new mandate: end-of-mandate indemnity and no-competition agreement determined in accordance with the recommendation of the
Current CEO: all-inclusive indemnity of €1,800,000 in case of early termination of the current mandate, excluding dismissal for just cause, and in case of resignation caused by demotion or change of control. No-competition agreement amounting to €1,200,000 for the
first 12 months of the agreement and €600,000 for the next 6 months.
See pages 29 and 32 of this Policy Report
See page 23 of this Policy Report
Borsa Italiana.
≥Recommendations of the Corporate Governance Code for listed companies promoted by Borsa Italiana, the latest version of which was approved in January 2020.
with the recommendation of the Corporate Governance Code for listed companies promoted by
The Remuneration Policy is designed to be consistent with the business strategy and helps to promote alignments of the interests and motivations of Management with the interests of the shareholders and all stakeholders, including achievement of the priority objective of creating sustainable value for the shareholders and all other stakeholders over the long term.
Implementation of the business strategy is assured via the definition, by the Board of Directors, of short- and long-term priorities that are translated into objectives assigned to the Chief Executive Officer-CEO, with subsequent deployment to Management as a whole, supported by constant checks and monitoring of the progress made.
For this purpose, the variable incentive plans cover several years, with the deferral for three years of part of the short-term incentive, and include a substantial long-term incentive element.
The link between the Remuneration Policy and business strategy of Saipem has been a fundamental point of reference in efforts to tackle the changing and challenging market conditions caused, not least, by the COVID-19 pandemic.
In responding early to current and future market requirements and the pressures associated with climate change, the Saipem strategy remains ever more focused on the energy transition. The attention paid by Saipem to safety matters has been further heightened by monitoring a new metric that both clients and competitors consider important: the HLFR (High Level Frequency Rate), which broadens the scope of the analysis to include near misses, not least in order to identify events that might have caused serious injuries. Taken together with the long-established TRIFR (Total Recordable Injuries Frequency Rate), the prevention-based system for ensuring the safety of personnel is now more complete and integrated.
In order to remain as competitive as ever, Saipem intends to support the traditional areas of business activity with significant growth in non-oil sectors, such as gas and LNG. Technical solutions will minimise the
carbon footprint of existing installations, with a view to achieving net zero carbon emissions throughout the value chain. Close attention is dedicated to the technological portfolio with regard to the emerging green technologies, such as hydrogen, biotechnologies and hybrid solutions. Consistent with this Saipem strategy, the coefficient has been enhanced for the performance score linked to the "New Contracts" objective, with a view to recognising better the contribution made by Management to the acquisition of new non-oil projects. The 2021 Remuneration Policy confirms the growing attention paid by Saipem to ESG (Environmental, Social & Governance) objectives and support for the strengthening of climate policies, consistent with the orientation consolidated at international level including, in particular, the Paris Climate Accords. Consistent with the efforts of institutions, clients, lenders and contractors, Saipem is seeking to complete the actions already in progress to devise a strategy and
implementation plan that will achieve the objective of net zero GHG emissions by 2050.
The Strategic Plan for 2021-2024 outlines the role of Saipem as a global player in the energy transition, with actions designed to help combat climate change, both directly and indirectly, and guarantee the market availability of a reliable partner for a sustainable business. The Plan also details the priorities and actions to be taken in order to play a decisive role in the market of the future, where the paradigm will comprise the commitment and sustainability objectives of the company, ensuring the sustainable growth of the Group and the creation of value for all stakeholders.
Via a structured and detailed analysis of materiality, directly involving representatives of the stakeholders, Saipem has identified the areas of greatest priority for the business, in which the company can make the most significant contribution in terms of value creation, the safety of personnel, the reduction of climate-altering emissions and technological innovation. Gender diversity is also very important in order to recognise more fully the value of our human capital.
Given all these factors, Saipem focuses attention on the following objectives:
≥ ensure the safety of personnel by continued monitoring of the injury frequency rate (TRIFR) and the introduction of an additional metric, the HLFR (High Level Frequency Rate), with a view to measuring all near misses that might have caused serious injuries and understanding better the most critical areas, so that suitable programmes can be implemented to constrain the underlying causes;
≥ reduce CO2 emissions, in order to help combat climate change in line with global and sector objectives;
The breadth of the objectives linked to ESG/Sustainability factors and the materiality of the strategic topics for the business represent a commitment made by the company to all stakeholders, consistent with the international principles adopted by
Saipem (e.g. Global Compact) and the reference framework represented by the UN 2030 objectives (Sustainable Development Goals, SDGs), as well as with the European guidelines intended to support economic recovery and sustainable development. The attention dedicated to these topics by the Board of Directors has also resulted in a steady increase in the weighting of sustainability parameters within the short-term incentive system, which has risen from 15% in 2019 to 30% in 2020 and 2021.
In compliance with the applicable regulations and the principles underpinning the corporate Code of Ethics, Saipem guarantees equal opportunities to all personnel with fair contractual conditions and remuneration. Saipem strives to guarantee an inclusive working environment, free from discrimination of any kind, in which different personal and cultural characteristics and orientations are recognised as a resource. In this regard, the company not only seeks to comply with and apply the regulatory framework in each country of operation, but also to develop corporate policies that guarantee equal opportunities for every type of worker, discourage prejudice, harassment and discrimination of any kind (linked for example to skin colour, nationality, ethnic origin, culture, religion, sexual orientation, age or disability), with full respect for human rights.
This context guarantees that the cornerstones of the Remuneration Policy – and, more generally, the Management of personnel – comprise the principle of internal fairness and the recognition of merit and distinctive and critical professional skills. In fact, Remuneration Policy is defined and implemented in a manner that is fully consistent with the HR strategic planning process and the results of the skill and performance assessments of each individual, at the same time ensuring alignment with specific job market needs and the employment laws and regulations applicable in the markets in which Saipem operates.
Always considering the specific local circumstances, Saipem also strives to give all personnel (regardless of their contracts, but always in compliance with the applicable current legislation) additional benefits in the form of supplementary pensions and healthcare, transportation services and supporting policies, welfare initiatives and family assistance, meals and training courses.
The COVID-19 pandemic that spread worldwide during 2020 also caused Saipem to rethink its work-related processes in order to safeguard the health of personnel, while also ensuring business continuity. In this light, the Human Resources Function made major efforts to rethink and digitalise the various work-related processes. Drawing on the skills of personnel and their ability to take personal responsibility, it was possible to continue business activity on a remote and innovative basis.
The Remuneration Policy for the Saipem Board of Directors and Senior Managers with strategic responsibilities is defined in accordance with legislation and company regulations and the Saipem Governance model, which defines the bodies and persons involved as the following: Shareholders' Meeting, Board of Directors and Compensation and Nominations Committee.
The Remuneration Committee that, as of February 13, 2012, was renamed the "Compensation and Nominations Committee", was established by the Board of Directors in 1999. Committee membership and appointments, its tasks and its operating procedures are regulated by a specific set of rules,
which were approved by the Board of Directors and published on the company website. In accordance with the most recent recommendations of the Corporate Governance Code, the Committee comprises three non-executive, independent directors. In line with the Corporate Governance Code (Article 5, recommendation 26), the Regulation also requires at least one Committee member to have adequate knowledge and experience of financial and compensation matters, which is evaluated by the Board at the time of appointment. In the case of operations involving the remuneration of the directors and senior managers with strategic responsibilities, the Compensation and Nominations Committee replaces in the Control and Risks Committee with regard to its Related-Party Transactions functions. From May 3, 2018, the Committee comprises the following non-executive, independent Directors: Paolo Fumagalli as Chairman; Federico Ferro-Luzzi and Paul Schapira. The Corporate Human Resources Manager or, alternatively, the People Development, Recruitment and Compensation Manager, performs the role of Committee Secretary.
15 meetings in 2020, average length: 1 hour and 51 minutes; average rate of participation: 100%
The Committee makes recommendations and provides advice to the Board of Directors, in accordance with the recommendations of the Corporate Governance Code, the last update of which was approved in January 2020 (Article 4, recommendations 19, 23 and 24 and Article 5, recommendation 25). In particular, it performs the following functions:
≥ suggests candidates for the role of Director to the Board if during the course of the financial year one or more Directorships become vacant (Article 2386, paragraph 1 of the Italian Civil Code), ensuring compliance with the regulations on the minimum number of independent Directors and on the quotas reserved for the least represented gender;
≥ provides input for the Board regarding the appointment of senior managers and of the members of the company's bodies whose appointment is the responsibility of the Board;
The Committee meets as often as necessary to perform its duties, normally on the dates scheduled on the yearly calendar of meetings approved by the Committee itself and is quorate when at least the majority of its members in office are present and decides with the absolute majority of those in attendance. The Chairman of the Committee convenes and presides over the meetings.
To fulfil its duties, the Committee has the right to access the necessary Company information and departments and to avail of external advisors who do not find themselves in situations that could compromise the impartiality of their opinion, within the limits of the budget approved by the Board of Directors. On a yearly basis, the Committee drafts a budget that it submits to the Board of Directors for approval. The Chairman of the Board of Statutory Auditors, or a serving statutory auditor designated by the Chairman, attends Committee meetings. Other statutory auditors may also participate, especially when the Board is dealing with matters for which the Board of Directors is obliged in its resolution to take account of the opinion of the Board of Statutory Auditors. At the invitation of the Committee Chairman, other parties may attend the meetings to provide information and make assessments within their field of competence in relation to individual agenda items. No Director can take part in Committee meetings where proposals are being made to the Board of Directors concerning his/her remuneration.
The Compensation and Nominations Committee carries out its activities according to an annual programme which consists of the following phases:
The Committee met a total of 15 times during 2020, 11 of which were held by video-conference in order to ensure business continuity despite the COVID-19 pandemic. These meetings were attended by all members. The Chairman of the Board of Statutory Auditors or a statutory auditor designated by the Chairman participated in all the meetings, which were duly minuted.
Specifically with regard to remuneration matters, the Committee focused its activities of the topics presented in the table entitled "Principal topics addressed during 2020" on the next page. The Committee has scheduled at least ten meetings in 2021. At the date of approval of this Policy Report, the first five meetings had already been held. These focused on: (i) assessment of the remuneration policies implemented in 2020 in order to determine policy proposals for 2021; (ii) analysis of the business results reported for 2020 and the definition of performance objectives for 2021 linked to the variable incentive plans; (iii) determination of the short-term incentive for the Chief Executive Officer-CEO; (iv) update of the Regulation for the Compensation and Nominations Committee; (v) examination of remuneration practices in order to structure the compensation of the Chief Executive Officer-CEO, the Chairman and the Directors to be appointed for the new mandate; (vi) definition of the number of treasury shares needed to service the short- and long-term incentive plans; (vii) allocation, in the context of the Long-Term Incentive Plan 2016-2018, of the 2021 shares relating to the deferred 2018 allocations made to the Chief Executive Officer-CEO; (viii) definition of the short-term incentive for the Internal Audit Manager. Consistent with the planned annual cycle of activities, subsequent meetings will examine the voting results of the 2021 AGM season, define the compensation of the Chief Executive Officer-CEO, the Chairman and the Directors appointed for the new mandate, and implement the Long-term Variable Incentive Plans for the Chief Executive Officer-CEO and SMSR. The Committee reports regularly, through its Chairman, to the Board of Directors and the Shareholders' Meeting convened to approve the annual financial statements on the performance of its duties, in accordance with its own Regulations, the
| Month | Topics | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| 1. Proposed 2020 indicators for the incentive plans | ||||||||||
| 2. Assessed implementation of the 2019 Policy | ||||||||||
| January | 3. Policy Guidelines 2020 | |||||||||
| 4. 2020 Remuneration Report Guidelines | ||||||||||
| 5. Examination of incentives for Management involved in major special transactions | ||||||||||
| 1. Company performance 2020 - Definition of ESG indicators | ||||||||||
| 2. Procedures for determining incentives for special transactions | ||||||||||
| February | 3. 2020 Remuneration Report | |||||||||
| 4. Consob Information Document for the Short-term Incentive Plan | ||||||||||
| 5. Proposed purchase of treasury shares to service the share-based short- and long-term incentive plans | ||||||||||
| 1. Short-Term Incentives 2020 - Actual results for 2019, Company performance form | ||||||||||
| 2. Share-based Long-Term Incentive Plan 2016-2018 - Allocation for 2017 - Actual results | ||||||||||
| 3. Definition of the Short-Term Incentive 2020 for the Chief Executive Officer-CEO | ||||||||||
| 4. Short-Term Incentive 2021 - Targets for company performance indicators 2020 | ||||||||||
| March | 5. Share-based Long-Term Incentive Plan 2019-2021: Targets for long-term indicators for 2020 allocation | |||||||||
| 6. Proposed incentives for special transactions | ||||||||||
| 7. Saipem 2020 Report on Remuneration Policy and Compensation Paid | ||||||||||
| 8. Consob Information Document for the Short-term Incentive Plan | ||||||||||
| April- | 1. Definition of the 2020 Short-Term Incentive for the Internal Audit Manager | |||||||||
| May | 2. Consideration of scope for changing the Management incentive system | |||||||||
| 1. Examination of possible effects of the COVID-19 emergency on Saipem incentive systems | ||||||||||
| 2. Proposed changes to the contract of the Chief Executive Officer-CEO - Continuation of the Short-term Incentive System |
||||||||||
| 3. Further consideration of the scope for changing the Management incentive system | ||||||||||
| June- | 4. Examination of the compensation of the board members of subsidiaries | |||||||||
| July | 5. Analysis of voting results of the 2020 AGM season | |||||||||
| 6. Proposed update of the Saipem performance indicators for 2020 | ||||||||||
| 7. Proposed update of the performance indicators for the Long-term Incentive Plans | ||||||||||
| 8. Long-term Incentive Plan 2016-2018: Assignment of 2020 shares in relation to the deferred 2017 allocation made to the Chief Executive Officer-CEO |
||||||||||
| 1. Proposed changes to the contract of the Chief Executive Officer-CEO - Change to the threshold (trigger) score for activating the performance multiplier for operations or opportunities not included in the Strategic Plan |
||||||||||
| October | September- 2. Long-term Incentive Plan 2019-2021: 2020 allocation to the CEO, determination of the number of share to allocate to SMSR and approval of the Regulations for 2020 allocations |
|||||||||
| 3. Positioning of the remuneration of the Internal Audit Manager | ||||||||||
| 1. Proposed change to the incentive curve for the short-term system | ||||||||||
| November- | 2. Further examination of possible effects of the COVID-19 emergency on Saipem long-term incentive systems | |||||||||
| December | 3. 2021 budget of the Compensation and Nominations Committee | |||||||||
| 4. Preliminary analyses for the definition of proposals for the compensation of Directors |
recommendations of the Corporate Governance Code and with the aim of establishing a channel for dialogue with its shareholders and investors.
In accordance with its remit, the Committee defined the structure and contents of the Remuneration Policy for the purpose of preparing this Section I of the Policy Report at the meetings held on January 12, January 27, February 16, February 26 and March 2, in accordance with the latest recommendations contained in the Corporate Governance Code. In reaching its conclusions, the Committee took account of the periodic assessment of the adequacy, overall consistency and concrete application of the 2020 Policy Guidelines, as well as the resolutions adopted in relation to remuneration by the Board of Directors and at the Shareholders' Meeting.
The Saipem 2021 Remuneration Policy for the Chairman, the Chief Executive Officer-CEO, the non-executive Directors, the Statutory Auditors and Senior Managers with strategic responsibilities was approved by the Board of Directors, acting on a proposal from the Compensation and Nominations Committee, at the meeting held on March 12, 2021, together with this Section I of the Policy Report. In order to prepare this Policy Report, the Committee referred to the remuneration benchmarks prepared by Willis Towers Watson, an independent international consultancy, for the preliminary analysis aimed at preparing the 2021 Remuneration Policy proposals. The compensation policies defined in accordance with the guidelines provided by the Board of Directors are implemented by the Chief Executive Officer-CEO, with support from the Human Resources function.
If there are exceptional circumstances and acting on a proposal from the Compensation and Nominations Committee after activation of the Related-Party Transactions Procedures, if applicable, the Board of Directors may – solely in relation to the Chief Executive Officer-CEO and the Senior managers with strategic responsibilities – make temporary exceptions to the Remuneration Policy regarding the elements shown in the "Remuneration elements for the CEO and SMSR" table on page 26, if the exceptions requested are consistent with pursuit of the overall long-term interests of the Company sustainability, or to ensure its ability to remain competitive.
Any exceptions are documented in Section II of the Report on Remuneration Policy and Compensation Paid for the following year.
The Saipem Remuneration Policy is defined in accordance with the governance model adopted by the Company and the recommendations included in the Corporate Governance Code, with the aim of attracting, motivating and retaining professional and managerial talents and aligning the interests of Management with the priority objective of creating value for the stakeholders over the long term. The Saipem Remuneration Policy contributes to the achievement of the corporate mission and strategy by:
the specific context and compensation benchmarks;
≥ definition of performance-based incentive systems linked to the attainment of a series of economic-financial, business development and operating targets set with a view to achieving sustainable results over the long term, in line with the Company's Strategic Plan and with the responsibilities assigned.
In line with the above aims, the remuneration paid to the Directors and the Senior Managers with strategic responsibilities is defined in accordance with the following principles and criteria.
The compensation of non-executive Directors is commensurate with the commitment required for participating in Board Committees established according to the By-laws, with differentiation between the compensation envisaged for the Chairman and that of the members of each committee, in consideration of the additional responsibilities assigned.
Unless resolved otherwise at the Shareholders' Meeting, non-executive Directors are excluded from participation in variable incentive schemes, including share-based incentive plans.
The remuneration structure for the Chief Executive Officer-CEO and for Senior Managers with strategic responsibilities is a balanced mix of a fixed element commensurate with the powers and/or responsibilities assigned and a variable element with a maximum limit designed to link remuneration to performance targets that are actually achieved. The Saipem Remuneration Policy envisages the use of merit matrices, in order to subordinate salary increases to an analysis of the pay positioning of personnel in terms of internal fairness and comparison with the reference market, in addition to assessment of their merit and skills possessed.
Overall consistency of remuneration compared with the applicable market benchmarks for similar positions or roles of a similar level of responsibility and complexity within a panel of companies comparable to Saipem, using specific benchmarks created with the support of international compensation data providers. The Senior Managers with strategic responsibilities were compared with similar positions in Italian industrial groups of comparable size to Saipem with a focus in the manufacturing, chemical, engineering and energy sectors and similar positions in the major European companies comparable to Saipem in terms of turnover and market capitalisation. This check on the positioning of remuneration is carried out using a system structured using remuneration bands.
The variable remuneration of those executive roles that strongly influence corporate results is characterised by the significant incidence of long-term incentive components, through appropriate deferral of their long- and short-term incentives over a period of at least three years, with part of the long-term incentives subject to a further two-year retention period, consistent with the long-term nature of the business pursued.
Objectives related to the variable remuneration for objectives that are predetermined, measurable and complementary to each other, in order to represent the priorities for the overall performance of the Company and divisions, in line with the Strategic Plan and with the expectations of shareholders and stakeholders, promoting a strong results-based orientation. These objectives are defined in order to ensure: (i) the assessment of annual performance at division and individual level using a balanced scorecard defined in relation to specific objectives for the area of responsibility and consistent with the objectives assigned; (ii) a significant incidence of ESG (Environmental, Social & Governance) objectives, in order to ensure the sustainability of the business; (iii) the recognition of over-performance; (iv) the definition of a Short-term Variable Incentive Plan in ways that focus Management action on the objectives for the year, while achieving sustainable results due to deferral of part of the incentive; (v) the orientation of Management towards operations or opportunities not included in the Strategic Plan, but which contribute to pursuit of the priority objective of creating value for the shareholders, identified using the criterion of importance by applying a multiplier to the individual performance score; (vi) the definition of a Long-term Variable Incentive Plan in a way that allows business performance to be assessed both in absolute terms, with reference to the ability to pursue economic-financial performance over the long term, and with respect to competitors, with reference to the ability to generate yield for investors, create more value than the main international competitors and ensure greater alignment with the interest of shareholders over the long term.
The incentives linked with variable compensation are paid following a scrupulous process of checking the results actually achieved, assessing achievement of performance targets assigned net of the effects of external variables, with a view to recognising the actual company performance attributable to Management action.
Benefits, with a preference given to pension and insurance benefits, in line with market compensation benchmarks and compliant with local regulations to supplement and enhance the compensation package, reflecting the roles and responsibilities assigned.
Adoption, through a specific Regulation approved by the Board of Directors, acting on the proposal from the Compensation and Nominations Committee, of clawback mechanisms that make it possible to request the return of variable components of the compensation already paid, or not to proceed with final allocation of the Shares at the end of the vesting period or request the return of the corresponding value of the Shares already paid or to withhold the corresponding value from the compensation due to the beneficiaries, when rights were accrued on the basis of data that was later proven to be manifestly incorrect, or the return of all incentives (or Shares/corresponding value) relating to the year (or years) with reference to which fraudulent alteration of the data used to calculate the results was ascertained in order to earn the right to the incentive and/or the commission of serious and intentional infringements of laws and/or regulations, the Code of Ethics or company rules relevant to or with an impact on the employment relationship, affecting the related fiduciary relationship, in any case without prejudice to any action permitted by law to protect the interests of the Company.
The Regulation provides for revocation of the allocation of Shares or the recovery of the equivalent monetary value of the Shares or the Variable Monetary Incentives within a maximum of three years from the date of payment or assignment, whenever the Incentives have been determined on the basis of results and/or performance subsequently revealed to be mistaken. The Regulation also provides for the application of recovery measures within a maximum of five years from the corresponding issue or assignment for persons who are shown to be responsible for altering, due to misconduct or gross negligence, the data used to report the results for assigned objectives, in order to earn the right to the incentive and/or in violation of laws and/or regulations, the Code of Ethics or company rules which are relevant to or with an impact on the employment relationship, and are of such significance as to compromise trust.
In such cases, following the outcome of audits carried out by the relevant company compliance and control functions regarding the existence of errors that impact the final results, the company must, subject to rectification of the data, review the results, and the relevant company bodies and functions must recalculate the incentives, which may lead to the possibility of total or partial recovery in relation to the results achieved and to the incentives due. Errors that do not impact the final determination of the incentive sum are to be considered unimportant.
Severance pay and no-competition agreements within pre-set limits and to safeguard interests Additional severance indemnities and no-competition clauses, for roles featuring greater competition risks, may be defined within a certain amount or for a certain number of years or months of remuneration, in line with the remuneration received.
Given the market changes and new business challenges, not least as a consequence of the COVID-19 pandemic, the 2021 Remuneration Policy Guidelines envisage focus on the definition of objectives for 2021 in line with the Strategic Plan adopted by the Company, as well as on simplification of the Short-term Variable Incentive Plan 2021-2023, in order to make it easier for investors to check actual results and therefore assess the effective alignment of compensation and performance, while also motivating Management by rewarding over-performance against the target.
The Remuneration Guidelines for the new mandate 2021-2024, approved by the Board of Directors on March 12, 2021, will apply to the Chairman, the non-executive Directors and the Chief Executive Officer-CEO appointed at the Shareholders' Meeting on April 30, 2021; those Guidelines include the definition of compensation commensurate with the
complexity of the role and the commitment required, in line with market benchmarks. The new Board of Directors, acting on a proposal from the Compensation and Nominations Committee, will be entitled, as in the past, to determine the compensation for the specific mandates granted and the membership of Committees.
For the current Chairman and non-executive Directors, the 2021 Guidelines reflect the resolutions adopted by the Board of Directors on June 28, 2018, following renewal of the company bodies, on the basis of the Shareholders' resolutions adopted on May 3, 2018. For the current Chief Executive Officer-CEO, the 2021 Guidelines reflect the resolutions adopted by the Board of Directors on June 28, 2018 and May 16, 2019, as well as on July 28, 2020 when the current short-term incentive system, approved at the Shareholders' Meeting held on April 29, 2020, was introduced.
For Senior Managers with strategic responsibilities, the 2021 Guidelines confirm the structure of the compensation package envisaged in the 2020 Guidelines.
For the Chief Executive Officer-CEO and the Senior managers with strategic responsibilities, the 2021 Guidelines envisage inclusion in the Short-term Variable Incentive Plan 2021-2023 of a new linear incentive curve based on a 50-150 point performance scale, corresponding to a multiplier linked to a 50-150% performance score. Consistent with the
| ROLE | REMUNERATION DATA PROVIDERS |
RATIONALE | BENCHMARK | |||
|---|---|---|---|---|---|---|
| Chairman Non-executive Directors |
Willis Towers Watson | Similar roles in Italian and European companies, mainly industrial in nature, that are comparable to Saipem in terms of turnover, capitalisation, geographical coverage, number of employees and governance model. |
Italian companies ASTM Atlantia ENEL Eni Fincantieri Interpump Italgas Leonardo Maire Tecnimont Poste Italiane Prysmian SNAM Terna TIM Webuild |
European companies Balfour Beatty Bilfinger Colas Eiffage Ferrovial SA Hochtief Petrofac SBM Offshore NV Subsea 7 Technip FMC Tecnicas Reunidas Wood Group |
||
| Chief Executive Officer -CEO |
Willis Towers Watson | Similar roles in leading Italian and European companies, mainly industrial in nature, that are comparable to Saipem in terms of turnover, capitalisation, geographical coverage and number of employees, with particular reference to those within the MEF constituency and European companies comparable to Saipem in terms of type of business. |
Società italiane ASTM Atlantia ENEL Eni Fincantieri Interpump Italgas Leonardo Maire Tecnimont Prysmian SNAM Terna TIM Webuild |
Società europee Balfour Beatty Bilfinger Colas Eiffage Ferrovial SA Hochtief Petrofac SBM Offshore NV Subsea 7 Technip FMC Tecnicas Reunidas Wood Group |
||
| Senior Managers with strategic responsibilities |
Willis Towers Watson | Similar roles in Italian industrial groups comparable in size to Saipem, with a focus on the manufacturing, construction, transportation, Oil&Gas and energy sectors. Similar roles in leading European companies comparable to Saipem, with a focus on the Oil&Gas, transportation, construction and energy sectors. |
Saipem strategy that focuses particular attention on the energy transition, the coefficient has been enhanced to 1.1 will be applied to the score obtained for the "New Contracts" objective, if the outstanding "Non Oil Related" element of the orderbook represents 75% or more of the entire Order portfolio at December 31, 2021, without exceeding the maximum score of 15 points. Lastly, consistent with the 2020 Remuneration Policy, a multiplier of 1.2 will again be applied to the individual performance score, if at least 100 points on a performance scale of 50-150 points, in the presence of operations or opportunities not included in the Strategic Plan but that contribute to pursuit of the priority objective of creating value for the shareholders, identified applying the criterion of importance without exceeding the maximum score of 150 points.
The remuneration envisaged for the current Chairman of the Board of Directors and non-executive Directors reflects the resolutions adopted by the Shareholders' Meeting on May 3, 2018 and the Board of Directors on June 28, 2018.
The Remuneration Guidelines for the new mandate 2021-2024, approved by the Board of Directors on March 12, 2021 for the Chairman of the Board of Directors and the non-executive Directors to be appointed at the Shareholders' Meeting on April 30, 2021, envisage the definition of compensation commensurate with the complexity of the role and the commitment required, in line with market benchmarks. The new Board of Directors, acting on a proposal from the Compensation and Nominations Committee, will be entitled, as in the past, to determine the compensation for the specific mandates granted and the membership of Committees.
The Policy Guidelines for the current Chairman of the Board of Directors reflect the resolutions adopted by the Board of Directors on June 28, 2018, which defined a fixed remuneration of €427,500, slightly lower than the market median, inclusive of €60,000 as compensation for the office of Director resolved at the Shareholders' Meeting held on May 3, 2018, to which is added compensation of €28,500 for the role of Chairman of the Sustainability, Governance and Scenarios Committee.
The Remuneration Guidelines for the new mandate 2021-2024, approved by the Board of Directors on March 12, 2021 for the Chairman of the Board of Directors to be appointed at the Shareholders' Meeting on April 30, 2021, envisage the definition of compensation commensurate with the complexity of the role and the commitment required, in line with market benchmarks presented in table "Market references" on page 24. The new Board of Directors, acting on a proposal from the Compensation and Nominations Committee, will be entitled, as in the past, to determine the compensation for the specific mandates granted.
The Shareholders' Meeting held on May 3, 2018 set the gross annual remuneration for current nonexecutive Directors at €60,000.
The Remuneration Guidelines for the new mandate 2021-2024, approved by the Board of Directors on March 12, 2021 for the non-executive Directors to be appointed at the Shareholders' Meeting on April 30, 2021, envisage the definition of compensation commensurate with the complexity of the role and the commitment required, in line with market benchmarks.
The Shareholders' Meeting held on April 29, 2020 set the gross annual remuneration of the Chairman at €70,000 and that of each Serving Statutory Auditor at €50,000.
The remuneration of the Board of Statutory Auditors of the Company is commensurate with the commitment required, the importance of the role and the size and sector characteristics of the Company, consistent with Article 5, recommendation 30 of the Corporate Governance Code.
Additional annual remuneration will continue to be paid to current non-executive Directors for their membership of Board Committees. The following amounts were resolved by the Board of Directors on June 28, 2018 and July 24, 2018:
The Remuneration Guidelines for the new mandate 2021-2024, approved by the Board of Directors on March 12, 2021 for the non-executive Directors to be appointed at the Shareholders' Meeting on April 30, 2021, envisage the definition of additional annual compensation for the membership of Board Committee commensurate with the complexity of the role and the commitment required, in line with market benchmarks.
For the current Chairman, Statutory Auditors and non-executive Directors, and those to be appointed at the Shareholders' Meeting held on April 30, 2021, no payments are envisage in the event of early termination of their mandates.
No benefits are envisaged for the current Chairman, Statutory Auditors and non-executive Directors, and those to be appointed at the Shareholders' Meeting held on April 30, 2021.
For the current Chief Executive Officer-CEO, the 2021 remuneration structure reflects the resolutions adopted by the Board of Directors on June 28, 2018, May 16, 2019 and July 28, 2020. In relation to the mandates assigned, this remuneration comprises that determined for the Directors at the Shareholders' Meeting, as well as any remuneration due for membership of the Boards of Directors of subsidiaries or affiliates.
The Policy Guidelines for the Chief Executive Officer-CEO to be appointed for the new mandate take into account the specific mandates granted in accordance with the Articles of Association, the indications contained in the chapter entitled "Aims and general principles of the Remuneration Policy" and the remuneration levels and market best practices shown in table "Market references" on page 24.
The fixed remuneration for the current Chief Executive Officer-CEO reflects the decisions adopted by the Board of Directors on June 28, 2018; with regard to the mandates assigned, this covers both the compensation decided for the Directors at the Shareholder' Meeting, and any compensation due for membership of the Boards of Directors of subsidiaries or affiliates. The total gross annual amount of €1,045,000 is below the market median. No forms of extraordinary compensation are envisaged in favour of the Chief Executive Officer-CEO.
The remuneration of the Chief Executive Officer-CEO to be appointed for the new mandate will be approved by the new Board of Directors acting on a proposal from the Compensation and Nominations Committee, considering the mandates granted and duties
assigned, as well as any variations will take into account the reference market benchmarks presented in table "Market references" on page 24.
For the current Chief Executive Officer-CEO, the Short-term Variable Incentive Plan 2021-2023 described in the 2020 Policy Report is confirmed. For the Chief Executive Officer-CEO appointed for the new mandate, the applicable Short-term Variable Incentive Plan 2021-2023 includes a new linear incentive curve based on a 50-150 point performance scale, corresponding to an incentive level linked to a 50-150% performance score. The Short-term Variable Incentive Plan 2021-2023 will be linked to the achievement of pre-set performance results for the previous year, each measured on a 50-150 performance scale, in relation to the weight assigned to them (performance on each objective below 50 points is considered zero). Consistent with the 2020 Remuneration Policy, the threshold level for overall performance is 70 points. The Plan envisages compensation based on the results achieved by Saipem in the previous year and determined with reference to an incentive level linked to the performance score: minimum (70 points), target (100 points) and maximum (150 points), corresponding respectively to 50%, 100% and 150% of the target incentive.
The 2021 targets resolved by the Board of Directors on March 12, 2021 for the purposes of the Short-term Variable Incentive Plan 2022 are consistent with the business model and the strategic guidelines. The structure and weight of the various objectives are shown in the table below in next page.
The 2021 Remuneration Policy confirms the growing attention paid by Saipem to ESG (Environmental, Social & Governance) objectives and support for the strengthening of climate policies, consistent with the orientation consolidated at international level including, in particular, the Paris Climate Accords. Consistent with the efforts of institutions, clients, lenders and contractors, Saipem is seeking to complete the actions already in progress to devise a strategy and implementation plan that will achieve the objective of net zero GHG emissions by 2050.
Consistent with the Saipem strategy that focuses particular attention on the energy transition, the coefficient has been enhanced to 1.1 will be applied to the score obtained for the "New Contracts" objective, if the outstanding "Non Oil Related" element of the orderbook represents 75% or more of the entire Order portfolio at December 31, 2021, without exceeding the maximum score of 15 points.
In addition, a multiplier of 1.2 will be applied to the individual performance score, in the presence of operations or opportunities not included in the Strategic Plan, but that contribute to pursuit of the priority objective of creating value for the shareholders, identified applying the criterion of importance. Application of the multiplier will be approved by the Board of Directors, acting on a proposal from the Compensation and Nominations Committee. The maximum individual performance score cannot exceed 150 points, which for the Chief Executive
Adjusted Free Cash Flow (1) (weight 30%) Adjusted EBITDA (1) (weight 30%)
FINANCIAL OBJECTIVES
STRATEGIC OBJECTIVES New Contracts (3) (weight 10%)
(1) The adjustments relate to non-recurring charges, used in Saipem's market communications, and mainly comprise: redundancy, tax litigation and arbitration disputes. (2) The HSE objective is focused on health, safety and the environment:
TRIFR (Total Recordable Injury Frequency Rate);
HLFR (High Level Frequency Rate); - Reduction in GHG emissions;
EPC Integration;
Digital asset.
The Balanced Gender Opportunity objective is measured using the female voluntary turnover rate recorded by the Company in the period Jan. 1, 2021-Dec. 31, 2021. (3) The coefficient of 1.1 will be applied to the score obtained for the "New Contracts" objective, if the outstanding "Non Oil Related" element (Drilling excluded) of the orderbook represents 75% or more of the entire Order portfolio at Dec. 31, 2021, without exceeding the maximum score of 15 points.
Officer-CEO corresponds to a maximum short-term incentive of 150% of fixed remuneration. The multiplier only applies to performance scores of at least 100 points on the 50-150 performance scale. The additional portion of the bonus deriving from application of the multiplier is deferred for 3 years and subject to another performance condition (average Saipem score over the three-year deferral period) which enables the deferred amount to be adjusted by +/-50%. If average performance over the three-year period is lower than 70 points, the deferred incentive is not paid.
| performance vs. EXPECTED TARGET |
INCENTIVE LEVELS* |
||||
|---|---|---|---|---|---|
| Minimum (70) | 50% | ||||
| Target (100) | 100% | ||||
| Maximum (150) | 150% |
(*) % to be applied to the annual on-target incentive established for CEO and SMSR.
The Chief Executive Officer-CEO appointed for the new mandate will participate in the share-based Long-term Variable Incentive (LTI) Plan 2019-2021 for all managers, with three annual allocations commencing from October 2019 and ending in October 2021. The Plan envisages the assignment without charge of ordinary Saipem shares (performance shares) subject to specific performance conditions measured at the end of the three-year reference period, after a thorough audit by the Compensation and Nominations Committee of the results actually achieved, in support of the resolutions
adopted by the Board of Directors in this regard. The Plan requires that the performance conditions be measured on the basis of the following parameters:
(9) Competitor added after the delisting of McDermott International Inc.
(10) Ades International Holding Plc, Parker Drilling Co and Shelf Drilling Ltd: competitors added after the start of Chapter 11 procedures for Diamond Offshore Drilling Inc, Valaris Plc and Noble Corp Plc.
The performance conditions operate independently of each other. This means that, in the presence of adequate performance on at least one of the objectives, part of the award will be earned regardless of the performance achieved on the other objectives. For all performance conditions, achievement of the maximum level will result in assignment of 160% of the Shares allocated. If performance is lower than the minimum level for each performance indicator no Shares will be assigned. For the current Chief Executive Officer-CEO and the Chief Executive Officer-CEO appointed for the new mandate, the incentive levels are equal to a target of 100% and a maximum of 160% of fixed remuneration; the maximum value at the end of the vesting period may not exceed four times the value of the Shares at the time of allocation. If the mandate is not renewed, it is envisaged that the Shares from each allocation will be definitively assigned at the end of the related vesting period, based on the performance conditions envisaged for the 2019-2021 Plan.
If the mandate is terminated early prior to the end of the vesting period in a bad leaver scenario, the Shares will not be assigned. If the mandate is terminated in a good leaver scenario, the value of the Shares will be recognised in monetary form based on the length of the period between allocation and termination, on the basis established in the Plan Regulation approved by the Board of Directors at the time of allocation, without prejudice to the fact that the amount may not exceed four times the value of the Shares at the time of allocation.
In the context of alignment with the long-term interests of the shareholders and the sustainability of the results achieved, the current Chief Executive Officer-CEO and the Chief Executive Officer-CEO appointed for the new mandate will participate in a co-investment scheme in which 25% of the Shares accrued cannot be transferred and/or sold for a period of 24 months from the end of the vesting period, at the end of which Saipem will assign, in addition to the shares subject to the additional co-investment period, one free Saipem share for every Share made unavailable.
| TSR DRILLING RANKING (WEIGHT 15%) |
MULTIPLIER | VESTING PERIOD |
||
|---|---|---|---|---|
| 1st place | 160% | 24% | ||
| 2nd place | 145% | 22% | ||
| 3rd place | 130% | 20% | ||
| 4th place | 115% | 17% | ||
| 5th place | 100% | 15% | ||
| 6th place | 70% | 11% | ||
| 7th place | 40% | 6% | ||
| 8th/13th place | 0% | 0% |
PERFORMANCE AT END incentive OF THREE-YEAR PERIOD (% FIXED REMUNERATION)
(*) If minimum performance level achieved for all indicators.
Minimum
All short- and long-term variable incentives include a clawback clause enabling the recovery of variable remuneration components found to have been paid out in error or as the result of intentional misconduct by beneficiaries, according to the conditions, methods and terms of application described in the "Aims and general principles of the Remuneration Policy" section of this Policy Report (page 22).
For the current Chief Executive Officer-CEO: the following payments totalling less than 2 years of remuneration are envisaged, in line with relevant practices and European Commission Recommendation 385 dated April 30, 2009, and to protect the company from potential competition risks:
a) Indemnities for early termination of office.
≥ In case of early termination of the 2018-2021 mandate or resignation caused by demotion, or on the sale, transfer for consideration or without charge or any other transfer of shares or debt instruments of any type, involving a change in the controlling shareholders of Saipem pursuant to
Article 2359 of the Italian Civil Code ("change of control"), if this change leads to a fundamental reduction in the mandates granted, an all-inclusive indemnity will be paid, in an agreed lump sum, pursuant to Article 2383, para. 3, of the Italian Civil Code, totalling €1,800,000. In addition, in the event of resignation as Chief Executive Officer-CEO, when this is not justified by demotion, said resignation must be communicated to the Board of Directors giving 4 months' notice or, alternatively, the Chief Executive Officer-CEO must pay an indemnity of €350,000.
b) No-competition agreement.
≥ No-competition agreement, to protect the company's interests, in consideration of the high Management profile of international standing in the Oil&Gas Services industry and the networks of institutional and business relationships built globally by the Chief Executive Officer-CEO. The no-competition agreement will be activated on termination of the mandate without renewal and regardless of the cause of termination. It provides for payment of a fee in recognition of the commitment undertaken by the Chief Executive Officer-CEO not to engage, for 18 months after termination of the mandate, in any activity competing with that carried out by Saipem in relation to its corporate objects and in the context of the main reference markets at the international level. After the first 12 months, the Chief Executive Officer-CEO may withdraw from the no-competition agreement, waiving the fee allocated for the residual duration of the agreement (six months). The fee, decided by the Board of Directors on June 28, 2018, amounts to €1,800,000, of which €1,200,000 for the initial 12 months of the agreement and €600,000 for the six months thereafter, in line with best practices in the Italian market. Any breach of the nocompetition agreement will lead to non-payment of the fee (or its return, if Saipem becomes aware of the infringement subsequent to payment), as well as the obligation to pay damages mutually and conventionally determined to be double the fee agreed, without prejudice to the right of Saipem to request specific performance of the agreement.
For the Chief Executive Officer-CEO to be appointed for the new mandate: an end-of-mandate indemnity and a no-competition agreement are envisaged in accordance with the recommendation of the Corporate Governance Code and not amounting, in total, to more than 2 years of fixed remuneration and target variable remuneration.
The current Chief Executive Officer-CEO will receive the benefits recognised to all managers (healthcare, insurance coverage, car for business and personal use) plus reimbursement of Rome-Milan travel expenses once a week if the journey is made.
The Chief Executive Officer-CEO to be appointed for the new mandate may receive the benefits recognised to all managers (supplementary pension fund, healthcare, insurance coverage for death or
permanent invalidity and work and non-work related injuries, car for business and personal use) plus the reimbursement of actual travel expenses from the place of residence to the place of work, once each week, if the place of residence is more than 400 kilometres from the offices of the company.
The fixed remuneration of SMSR is set based on roles and responsibilities assigned, taking into account average levels of remuneration at other major Italian and international companies for roles of a similar level of managerial responsibility and complexity, and may be adjusted periodically in the framework of the annual salary review process which is carried out for all managers.
Taking into account the relevant context and current market trends, the 2021 Guidelines envisage selective criteria designed to ensure adequate levels of competitiveness and motivation: (i) possibility of making adjustments, having regard for market benchmarks determined using a system structured with remuneration bands, to the fixed remuneration of personnel deemed especially strategic for the achievement of business results, persons whose responsibilities or roles have expanded and those whose critical professional skills have a major business impact, by applying merit matrices in order to subordinate remuneration increases to an analysis of the positioning of the persons concerned in terms of internal fairness and the reference market, as well as assessment of their merit and skills; (ii) possibility of making special, highly selective one-off payments (maximum of 25% of fixed remuneration) as consideration for top quality performance on projects of great importance or to meet retention needs.
The Short-term Variable Incentive Plan 2021-2023 includes a new linear incentive curve based on a 50-150 point performance scale, corresponding to an incentive level linked to a 50-150% performance score. The Short-term Variable Incentive Plan 2021-2023 envisages remuneration calculated with reference to Saipem and individual performance in the previous year, as measured on a 50-150 performance scale (below 50 points the performance of each target is deemed to be zero) with, consistent with the 2020 Remuneration Policy, a minimum individual incentive level of 70 points, below which no incentive is payable. The incentive level is differentiated, depending on the role assigned, and with on-target performance (100 points) earning a maximum 45% of fixed remuneration. There is close correlation between the new 50-150 point performance scale and the incentive level linked to the performance score: 50%-150%; the incentive system envisages correspondence between performance score and incentive percentage for scores of 100 points and above; accordingly, at maximum (i.e. performance = 150 points), the incentive level is a maximum 67.5% of fixed remuneration.
The performance objectives of SMSR are calculated on the basis of the objectives assigned to top Management and focus on economic-financial performance, operations, internal efficiency and sustainability (health and safety, environmental protection, Digital Transformation e Balanced Gender Opportunity), as well as on individual objectives assigned in relation to the area of responsibility for the role covered, in accordance with the performance plan of the Company.
For senior managers benefiting from the short-term incentive whose annual performance score is at least 100 points on the 50-150 point performance scale, the Plan envisages the allocation of an additional bonus – calculated as a percentage of fixed remuneration – that is deferred for three years. This additional bonus will be converted into Saipem shares that will be assigned at the end of the deferral period to the beneficiaries still employed by the Company at that time. The incentive percentage varies depending on the individual performance score achieved each year and, for on-target performance of 100 points, is a maximum of 15% of fixed remuneration, while a maximum performance score of 15011 points earns 22.5% of fixed remuneration. The Plan conditions are detailed in the information document made available to the public on the Company's website (www.saipem.com) pursuant to current regulations (Article 114-bis of Legislative Decree No. 58/1998 and the Consob implementing regulation). For further information on the characteristics of the Plan please refer to the "Short-term variable incentive" section of this Policy Report.
In addition, a multiplier of 1.2 will be applied to the individual performance score, in the presence of operations or opportunities not included in the Strategic Plan, but that contribute to pursuit of the priority objective of creating value for the shareholders, identified applying the criterion of importance. The multiplier only applies to performance scores of at least 100 points on the 50-150 performance scale. The aims of this element is to guide Management towards operations that may increase shareholder and investor value, reward the exceptional commitment required and facilitate the motivation and retention of resources with a significant impact on the successful outcome of those operations. Application of the multiplier will be decided by the Board of Directors and the beneficiaries will be identified by the Chief Executive Officer-CEO. The maximum individual performance score cannot exceed 150 points, which corresponds to a maximum short-term incentive of 67.5% of fixed remuneration. The additional portion of the bonus deriving from application of the multiplier is deferred for 3 years and subject to another performance condition (average Saipem performance score over the three-year deferral period) which enables the deferred amount to be adjusted by +/-50%. If average performance over the three-year period is lower than 70 points, the deferred incentive will not be paid.
As envisaged for the Chief Executive Officer-CEO, Senior managers with strategic responsibilities participate in the Long-term Incentive Plan approved by the Board of Directors on March 11, 2019. The 2019-2021 Long-Term Variable Incentive Plan (LTI) for all managers, with three annual allocations to be completed in October 2021, envisages the allocation without charge of ordinary Saipem shares (performance shares) on achievement of the performance conditions with regard to business objectives (measured over the three-year vesting period) and the performance of the Saipem share measured at the end of the three-year period. For the 2021 allocation, the Plan envisages measurement of the performance conditions using the following parameters:
The performance conditions operate independently of each other. This means that, in the presence of an adequate performance in at least one of the objectives, a part of the award will mature regardless of the performance achieved in the other objectives.
(11) Modification of the performance scale from 70-130 points to 50-150 points does not affect determination of the additional bonus in the form of shares, the maximum percentage for which remains 22.5%, consistent with the 2020 Remuneration Policy. (12) Competitor added after the delisting of McDermott International Inc.
(13) Ades International Holding Plc, Parker Drilling Co and Shelf Drilling Ltd: competitors added after the start of Chapter 11 procedures for Diamond Offshore Drilling Inc, Valaris Plc and Noble Corp Plc.
For all performance conditions, achievement of the maximum level will result in assignment of 160% of the Shares allocated. If performance is lower than the minimum level for each performance indicator no Shares will be assigned. For Senior Managers with strategic responsibilities, the incentive level for on-target performance is 65% of fixed remuneration, increasing to a maximum of 104% of fixed remuneration. The maximum value at the end of the vesting period may not exceed four times the value of the Shares at the time of allocation.
The Plan further contemplates a Retention Premium of 25% of the Shares allocated, recognised at the end of the three-year vesting period upon achievement of the performance conditions mentioned above. For a period of two years, the beneficiaries may not access 25% of the shares allocated and, at the end of that period, for every Share made unavailable, Saipem will assign an additional Share without charge as the Retention Premium. The Retention Premium aims to strengthen further the alignment of interests between Management and shareholders over the long term and act as leverage for the retention of Management. If the employment relationship terminates before the end of the vesting period in a good leaver scenario (including sale and/or loss of control by Saipem over the company that employs the beneficiary during the vesting period), the values of the Shares will be recognised in monetary form based on the length of
the period between allocation and termination, using a predetermined formula, without prejudice to the fact that the amount may not exceed four times the value of the Shares at the time of allocation. In the event of termination in bad leaver scenario, the beneficiary will lose all rights and will not be assigned any shares.
A clawback clause is envisaged for Senior managers with strategic responsibilities, with the conditions, methods and terms of application described in the "Aims and general principles of the Remuneration Policy" section of this Policy Report (page 22).
a) Indemnities for termination of employment.
In continuity with the remuneration policy implemented in 2020 and in accordance with the relevant collective labour agreement established at national level and supplementary agreements reached at company level for Saipem executives, Senior Managers with strategic
responsibilities participate in the supplementary pension fund (FOPDIRE14 or PREVINDAI15) and the Supplementary Healthcare Fund (FISDE16), receive death, disability and other insurance cover and are assigned a company car for business and personal use.
(14) Closed pension fund operating on a defined contribution, individual account basis, www.fopdire.it.
(15) Pension fund established in the form of an association recognised by public deed, with defined contributions on an individual capitalisation basis. www.previndai.it.
(16) Healthcare fund providing reimbursement of medical expenses for working and retired executives and their family members, www.fisde-eni.it.
Consistent with the new regulations, the Report on compensation paid is submitted for a consultative vote at the Shareholders' Meeting for the second year. This Report describes the compensation paid in 2020 to the (executive and non-executive) Directors, Statutory Auditors and Senior Managers with strategic responsibilities of Saipem, it also indicates the shares held by the Directors, Statutory Auditors and Senior Managers with strategic responsibilities of Saipem and contains the following information:
≥ 2020 allocation of Share-based Long-term Variable Incentive Plan 2019-2021;
in accordance with the related regulations in force. The Company has increased the disclosures about the achieved results of the short- and long-term incentive plans, providing the related data on an accruals basis; in particular, the results relating to 2020 are highlighted.
| References - Conditions for activation - Results | Compensation paid |
|---|---|
| Benchmarking of compensation consistent to Saipem characteristics and assigned roles |
Caio Francesco - Chairman: €456,000 ≥Fixed compensation: €427,500, including the compensation as Director of |
| Compensation for the role of Director established at the Shareholders' Meeting held on May 3, 2018. |
€60,000. ≥Compensation as Chairman of the Sustainability, Scenarios and Governance Committee: €28,500. |
| Compensation for the Chairman of the Board of | Cao Stefano - Chief Executive Officer-CEO: €1,045,000 ≥Fixed compensation for the 2018-2021 mandate: €1,045,000 annually, |
| Directors approved by the Board of Directors on June 28, 2018. |
including base compensation as Director of €60,000 determined at the AGM. |
| Cappello Maria Elena - Director: €79,500 | |
| Compensation for the Chief Executive Officer-CEO approved by the Board of Directors on June 28, 2018, May 16, 2019, July 28, 2020 and September |
≥Fixed compensation determined at the AGM: €60,000. ≥Compensation for serving on the Sustainability, Scenarios and Governance Committee: €19,500. |
| 24, 2020. | Carloni Claudia - Director: €79,500 |
| ≥Fixed compensation determined at the AGM: €60,000. | |
| Compensation for non-executive Directors serving on Board committees approved by the Board of |
≥Compensation for serving on the Sustainability, Scenarios and Governance Committee: €19,500. |
| Directors on June 28, 2018 and July 24, 2018. | Ferone Alessandra - Director: €84,535 (period serving in role: February 5, 2020 to December 31, 2020). |
| ≥Pro-rata fixed compensation determined at the AGM: €54,247. | |
| ≥Pro-rata compensation for serving on the Control and Risk Committee: €30,288. |
|
| Ferro-Luzzi Federico - Director: €99,000 ≥Fixed compensation determined at the AGM: €60,000. |
|
| ≥Compensation for serving on the Compensation and Nominations Committee: €19,500. |
|
| ≥Compensation for serving on the Sustainability, Scenarios and Governance Committee: €19,500. |
|
| Fumagalli Paolo - Director: €99,667 | |
| ≥Fixed compensation determined at the AGM: €60,000. ≥Compensation as Chairman of the Compensation and Nominations |
|
| Committee: €28,500. | |
| ≥Compensation for serving on the Related-Party Transactions Committee: €11,167. |
|
| Latini Pierfrancesco - Director: €9,222 (period serving in role: January 1, 2020 to February 5, 2020). |
|
| ≥Pro-rata fixed compensation determined at the AGM: €5,918. ≥Pro-rata compensation for serving on the Control and Risk Committee: |
|
| €3,304. | |
| Mazzilli Ines - Director: €102,500 ≥Fixed compensation determined at the AGM: €60,000. |
|
| ≥Compensation as Chairman of the Audit and Risk Committee: €42,500. | |
As described in more detail below, in the section on "Exceptions to the 2020 Remuneration Policy", new CEO objectives for 2020 have been approved: Adjusted Free Cash Flow (weight 20%); Adjusted EBITDA (weight 25%); New Contracts (weight 25%); ESG (HSE, Diversity Opportunities, Technological Innovation and Risk Management) (weight 30%). A coefficient of 1.1 will be applied to the score for the "New Contracts" objective, if the outstanding "Non Oil Related" element of the orderbook (Drilling excluded) is ≥70% at December 31, 2020. The resulting new score cannot be more than 32.5 points.
Incentives are based on the results achieved in the previous year and measured on a 70-130 point performance scale, with a minimum recognition threshold of 70 points for company performance. Performance score for 2020 CEO objectives: 76 points.
SMSR objectives: broken down on the basis of objectives assigned to Top Management, in relation to the area of responsibility for the role covered. Shares are allocated and incentives are paid based on the results achieved in the previous year and measured on a 70-130 point performance scale, with a minimum recognition threshold of 70 points for individual performance.
Vesting over three years for the share element of the short-term incentive.
Payment of the incentive under the Short-term Incentive Plan depends on achievement of the minimum performance (trigger) level for the Saipem CEO Objectives of at least 70 points.
Cao Stefano - Chief Executive Officer-CEO: the amount of €564,500 relates to the 2021 short-term incentive linked to 2020 performance. SMSR: the monetary element totals €1,709,063 and relates to the 2021 short-term incentive linked to 2020 performance. The maximum number of Shares allocated without charge in 2021, comprising the share element of the 2021 short-term incentive linked to 2020 performance, is 256,250 Shares.
Assignment without charge of ordinary Shares in Saipem SpA, differentiated depending on the level of the role, on achievement of the following performance conditions, measured at the end of the three-year reference period: relative TSR measured in terms of relative positioning with respect to two peer groups: Engineering & Construction (weight 35%) and Drilling (weight 15%); Adjusted Net Financial Position (weight 25%); Adjusted ROAIC (weight 25%). Three-year Vesting + Co-Investment of 2 years for the Chief Executive Officer-CEO. Three-year Vesting + Retention Premium of 2 years for strategic personnel.
Cao Stefano - Chief Executive Officer-CEO: 505,700 Shares without charge on the 2020 allocation under the Long-term Variable Incentive Plan 2019-2021 with vesting period October 27, 2020-October 27, 2023. SMSR: 1,379,900 Shares without charge on the 2020 allocation under the Long-term Variable Incentive Plan 2019-2021 with vesting period October 27, 2020-October 27, 2023.
Assignment without charge of ordinary Shares in Saipem SpA, differentiated depending on the level of the role, on achievement of the following performance conditions, measured at the end of the three-year reference period: Relative TSR measured in terms of relative positioning with respect to the reference peer group (weight 50%) and Net Financial Position (weight 50%). Three-year Vesting + Lock-up period of 2 years for the Chief Executive Officer-CEO.
Three-year Vesting + Co-investment for 2 years for strategic personnel.
Presentation of the proportion of fixed compensation and variable compensation paid during 2020.
CEO: including the 2020 elements of fixed remuneration and the short- and long-term incentive plans.
DIRS: including the 2020 elements of fixed remuneration and the short- and long-term incentive plans.
Cao Stefano - Chief Executive Officer-CEO: 397,500 Shares without charge on the 2020 assignment of Shares allocated in 2017 with vesting period July 24, 2017-July 23, 2020 and 412,726 Shares without charge on the 2021 assignment of Shares allocated in 2018 with vesting periods for the two allocations March 5, 2018 - March 4, 2021 and July 24, 2018-July 23, 2021.
SMSR: 742,000 Shares without charge on the 2020 assignment of Shares allocated in 2017 with vesting period July 24, 2017-July 23, 2020 and 577,682 Shares without charge on the 2021 assignment of Shares allocated in 2018 with vesting period July 24, 2018-July 23, 2021.
CEO: same benefits as those recognised to all managers (supplementary healthcare, insurance cover for death and invalidity risks, car for business and personal use) plus reimbursement of Rome-Milan travel expenses once a week if the journey is made.
SMSR: conditions specified in the national collective employment contract and supplementary in-house agreements applicable to executives (supplementary pension, supplementary healthcare, insurance cover for death and invalidity risks, car for business and personal use). Cao Stefano - Chief Executive Officer-CEO:the amount of €14,887 includes the value of the car benefit, the supplementary health insurance paid by the company and the taxable amount for weekly round-trip flights between Milan and Rome.
SMSR: the amount of €151,163 includes the value of the car benefit and the supplementary pension contributions and health insurance paid by the company.
| References - Conditions for activation - Results | Compensation paid |
|---|---|
| CEO: all-inclusive indemnity in case of early termination of the current mandate, excluding dismissal for just cause, and in case of resignation caused by demotion or change of control. No-competition agreement. |
SMSR: amount of €300,000 relating to the minimum-term agreements outstanding in 2020. |
| SMSR: termination indemnity: agreed upon termination of employment by mutual consent. Severance Payment: cases of change of control which result in termination of employment due to resignation or dismissal and/or demotion. No-competition agreements: activated upon termination of the employment relationship. Minimum-term agreements to protect know-how. |
| References - Conditions for activation - Results | Compensation paid |
|---|---|
The following information shows the shares held in Saipem SpA by the Directors, Statutory Auditors and Senior Managers with strategic responsibilities, as well as by their spouses, where not legally separated, and by their minor children, either directly or through subsidiaries, trust
companies or third parties, as determined from the Shareholders' Register, communications received and other information obtained from the persons concerned.
Cao Stefano - Chief Executive Officer-CEO: 537,125 shares held as of 31 December 2020.
Fumagalli Paolo - Director: (persons closely associated with the significant party) number of shares purchased and sold: 83,000.
Perotta Riccardo - Statutory Auditor: 18,400 shares held as of April 29, 2020, date of termination of the role.
SMSR: 327,680 shares held as of December 31, 2020.
This section describes the remuneration policies implemented in 2020 with regard to the Chairman of the Board of Directors, the non-executive Directors, the Statutory Auditors, the Chief Executive Officer-CEO and the Senior Managers with strategic
responsibilities. Based on the checks made by the Compensation and
Nominations Committee as part of the periodic assessment required by the Corporate Governance Code, implementation of the 2020 Remuneration Policy was consistent with the document approved by the Board of Directors on March 12, 2020, in accordance with the resolutions adopted by the Board of Directors on May 3, 2018, June 28, 2018, May 16, 2019, July 28, 2020 and September 24, 2020, regarding the remuneration of non-executive Directors serving on Board Committees and the remuneration of the Chairman and the Chief Executive Officer-CEO. In the opinion of the Committee, the 2020 Policy is in line with the market benchmarks identified.
As required under current legislation (Article 123-ter, para. 6, of Legislative Decree No. 58/1998), the Shareholders' Meeting held on April 29, 2020 cast a consultative vote on Section II of the 2020 Report on Remuneration Policy and Compensation Paid: 99.16% of all votes cast were in favour.
Market developments are monitored constantly and, subsequent to the Shareholders' Meeting, the Compensation and Nominations Committee analysed the results of voting and the feedback received from investors and proxy advisors. Based on the orientations identified, the Committee has paid particular attention to disclosure of the actual results achieved in relation to the outstanding incentive plans.
The Chairman was paid the compensation for the role envisaged by the Board of Directors on June 28, 2018. The amount included the compensation for the role of Director approved at the Shareholders' Meeting held on May 3, 2018. The Chairman was also paid the compensation envisaged for the role of Chairman of the Sustainability, Scenarios and Governance Committee.
The non-executive Directors were paid the fixed remuneration approved at the Shareholders' Meeting held on May 3, 2018.
The Chief Executive Officer-CEO was paid the compensation established by the Board of Directors on June 28, 2018. The amount included the compensation for the role of Director approved at the Shareholders' Meeting held on May 3, 2018, in continuity with the previous mandate.
The Statutory Auditors were paid the fixed compensation approved at the Shareholders' Meeting held on April 29, 2020.
In view of the emergency linked to the COVID-19 pandemic and its impact on the economic and social situation, including generalised uncertainty in the markets, it was decided to suspend work on revising the annual fixed remuneration of all executives in 2020. The amounts of fixed remuneration and, for employees, the indemnities specified in the relevant national collective employment contract for executives and in the supplementary in-house agreements, are indicated in the relevant items of Table 1 in the section on "Compensation paid in 2020".
The non-executive Directors were paid the additional compensation due for service on Board Committees that was approved by the Board of Directors on June 28, 2018. This was more than in the 2015-2018 mandate but less than the market median and took account of the distinction made between the Chairman and other members.
The above amounts are indicated in the relevant item of Table 1 in the section on "Compensation paid in 2020".
Acting on a proposal from the Compensation and Nominations Committee and in compliance with the Procedures for Related-Party Transactions – in line with 2020 Report on Remuneration Policy and Compensation Paid – on August 3, 2020 the Board of Directors resolved to revise the 2020 Saipem performance schedule, previously approved on March 12, 2020, following an assessment of the effects generated by the COVID-19 pandemic and consistent with the outlook provided to the market following the meeting of the Board of Directors held on July 28, 2020. This revision changed the weights allocated to the 2020 performance indicators, giving priority to the
ESG indicators and the indicator for New Contracts as, given the short-term uncertainties and the change in market conditions, these metrics provide the best basis for building an economic recovery and strengthening the sustainability of the business; in particular, consistent with the growing importance attached by the market to ESG objectives, more weight was given to safety (injury frequency rate - TRIFR) and the objectives linked to gender opportunity. Lastly, consistent with the acceleration of the Saipem strategy on the energy transition, a new coefficient of 1.1 will be applied to the score obtained for the "New Contracts" objective, if the outstanding "Non Oil Related" element of the orderbook represents 70% or more of the entire Order portfolio at December 31, 2020.
In addition, the minimum threshold was changed for activating a multiplier of 1.2 in the presence of operations or opportunities not included in the strategic plan, but that contribute to pursuit of the objective of creating value for the shareholders, as well as for allocating the share element – subject to deferral for three years – of the short-term incentive plan. The Board of Directors set the minimum threshold at 70 points, just for 2020.
This change did not have any effect in 2020, as the multiplier of 1.2 was not activated and no operations or opportunities arose that were not included in the strategic plan.
Given the global environment, hit suddenly by the COVID-19 emergency that gave rise to generalised uncertainty, the Board of Directors approved an exception to the Remuneration Policy in order to ensure the sustainability of the business and guide the efforts of Management towards new strategic priorities, as well as to support the exceptional efforts made to protect the business interests of Saipem in a year marked by particular complexity. This step was also necessary in order to strengthen the retention tools available and, therefore, reduce the risk that strategic personnel, who have already demonstrated their dedication and motivation in pursuit of Saipem's
challenging long-term goals, might be attracted to join competitors.
Despite the market context, Saipem has shown the qualities of resilience that distinguish it as a global company of excellence, not least due to remuneration systems capable of ensuring alignment of the interests of Management with those of shareholders and other stakeholders.
The performance of Saipem in 2020, evaluated on a like-for-like basis and approved by the Board of Directors, acting on a proposal from the Compensation and Nominations Committee, on March 12, 2021, generated a score of 76 points on the measurement scale used, which sets the minimum performance level at 70 points and the maximum at 130 points. The table shows the weights, economic results and performance level achieved by each objective, as represented by a weighted score. Consistent with the 2020 Remuneration Policy Guidelines and the contractual conditions for the 2018-2021 mandate of the Chief Executive Officer-CEO, approved by the Board of Directors on June 28, 2018, July 28, 2020 and September 24, 2020, the performance score achieved for 2020 of 76 points has allowed activation of the short-term incentive system envisaged for the Chief Executive Officer-CEO.
In particular, the resulting bonus for the Chief Executive Officer-CEO amounted to €564,500.
With regard to the variable remuneration of Senior Managers with strategic responsibilities, the monetary element of the 2021 short-term incentive in relation to 2020 performance will be paid in the current year, while allocation of the deferred shares element envisages their assignment in 2024, after the vesting period. This monetary element, determined in accordance with the Remuneration Policy, was linked to the performance of the company and the individual concerned, considering the individual objectives assigned in relation to the responsibilities held, in line
(*) Actuals for the New contracts objective take account of the 1.1 multiplier for the residual "Non Oil Related" orderbook.
with the Saipem 2020 performance plan. The deferred shares element of the incentive, determined in accordance with the Remuneration Policy, was linked to the individual performance achieved in relation to the individual objectives assigned, considering the responsibilities held, in line with the Saipem 2020 performance plan.
For variable remuneration purposes, the performance of Senior Managers with strategic responsibilities results in the payment of bonuses based on their specific results and the maximum effective incentive level of 47.24% of fixed remuneration, differentiated with reference to the position held and having regard for the maximum incentive of 67.5% of fixed remuneration. For the deferred shares element of the short-term incentive, the performance of Senior Managers with strategic responsibilities results in the allocation of shares based on their specific results and the maximum effective incentive level of 17.61% of fixed remuneration, differentiated with reference to the position held and having regard for the maximum incentive of 22.5% of fixed remuneration.
Consistent with the 2020 Remuneration Policy Guidelines and the contractual conditions relating to the 2018-2021 mandate of the Chief Executive Officer-CEO approved by the Board of Directors on June 28, 2018 and May 16, 2019, in the context of the Share-based Long-term Variable Incentive Plan 2019-2021 and applying the criteria and procedures determined by the Board of Directors on March 11, 2019 and approved at the Shareholders' Meeting held on April 30, 2019, on October 27, 2020 the Board of Directors approved the 2020 allocation of 505,700 ordinary Shares in Saipem SpA to the Chief Executive Officer-CEO, representing 100% of his fixed remuneration.
In the context of the Share-based Long-term Variable Incentive Plan 2019-2021 for Senior Managers with strategic responsibilities, 1,379,900 Shares were allocated to them for 2020 with reference to the target incentive levels established in the Plan for Saipem
Management. The number of Saipem Shares to be allocated to each beneficiary is determined with reference to a predefined percentage of fixed remuneration linked to the position held and the allocation price of the Saipem Shares, being their average price during the observation period between May 20 and September 20 in the year of allocation. The Shares allocated to the Chief Executive Officer-CEO and the Senior Managers with strategic responsibilities are shown in Table 1 of form 7 of Annex 3A to Regulation No. 11971/1999, as required by Article 84-bis (Annex 3A, form 7) of the Consob Issuers' Regulation, with related details shown in Table 3A of the section on "Compensation paid in 2020".
In order to provide complete information about the long-term incentive plans, the results of the 2020 assignment of Shares allocated in 2017 (with vesting period: July 24, 2017-July 23, 2020) for 2019 are shown below.
The Saipem performance in relation to the 2017 allocation of the Share-based Long-term Variable Incentive Plan 2016-2018, approved by the Board of Directors acting on a proposal from the Compensation and Nominations Committee at the meeting held on March 12, 2020, resulted in 100% accrual of the Shares allocated in 2017.
The table shows the weights, results and percentage accrual achieved by each indicator.
Consistent with the 2017 Remuneration Policy Guidelines and the contractual conditions relating to the 2015-2018 mandate of the Chief Executive Officer-CEO approved by the Board of Directors on June 15, 2015 and June 27, 2016, in the context of the Share-based Long-term Variable Incentive Plan 2016-2018 and applying the criteria and procedures determined by the Board of Directors on March 16, 2016 and approved at the Shareholders' Meeting held on April 29, 2016, on July 28, 2020 the Board of Directors approved the 2020 assignment of 397,500
ordinary shares in Saipem SpA to the Chief Executive Officer-CEO in relation to the Shares allocated in 2017. The Plan envisages that 25% of the shares accrued, totalling 99,375, will not be assigned definitively but subjected to a two-year lock-up period.
As determined for the Chief Executive Officer-CEO, the Senior Managers with strategic responsibilities were assigned a total of 742,000 shares in 2020 in relation to the Shares allocated in 2017. With regard to the Senior Managers with Strategic Responsibilities, the Plan requires 25% of the shares accrued to be locked up for a further two years, after which the beneficiaries will receive an additional share without charge for every share deferred.
The Shares assigned to the Chief Executive Officer-CEO and the Senior Managers with strategic responsibilities are shown in Table 1 of form 7 of Annex 3A to Regulation No. 11971/1999, as required by Article 84-bis (Annex 3A, form 7) of the Consob Issuers' Regulation, with related details shown in Table 3A of the section on "Compensation paid in 2020".
The Saipem performance in relation to the third and final 2018 allocation of the Share-based Long-term Variable Incentive Plan 2016-2018, approved by the Board of Directors acting on a proposal from the Compensation and Nominations Committee at the meeting held on March 12, 2021, resulted in 66.63% accrual of the Shares allocated in 2018. The table shows the weights, results and percentage accrual achieved by each indicator.
Consistent with the 2018 Remuneration Policy Guidelines and the contractual conditions for the position of Chief Executive Officer-CEO, in the context of the Share-based Long-term Variable Incentive Plan 2016-2018 and applying the criteria and procedures determined by the Board of Directors on March 16, 2016 and approved at the Shareholders' Meeting held on April 29, 2016, on March 12, 2021 the Board of Directors approved the 66.63% accrual of the shares
allocated in 2018, resulting in the 2021 assignment of 412,726 ordinary shares in Saipem SpA (with vesting periods in relation to the two allocations of March 5, 2018-March 4, 2021 and July 24, 2018-July 23, 2021) to the Chief Executive Officer-CEO in relation to the Shares allocated in 2018. The Plan envisages that 25% of the shares accrued, totalling 103,182, will not be assigned definitively but subjected to a two-year lock-up period.
As determined for the Chief Executive Officer-CEO, an 66.63% share accrual was approved for the Senior Managers with strategic responsibilities, resulting in the 2021 assignment of an estimated 577,682 shares (with vesting period July 24, 2018-July 23, 2021) in relation to the Shares allocated in 2018. With regard to the Senior Managers with Strategic Responsibilities, the Plan requires 25% of the shares accrued to be locked up for a further two years, after which the beneficiaries will receive an additional share without charge for every share deferred.
The Shares assigned to the Chief Executive Officer-CEO and the Senior Managers with strategic responsibilities are shown in Table 1 of form 7 of Annex 3A to Regulation No. 11971/1999, as required by Article 84-bis (Annex 3A, form 7) of the Consob Issuers' Regulation, with related details shown in Table 3A of the section on "Compensation paid in 2020".
Table 1 of the section on "Compensation paid in 2020" shows the taxable value of the benefits recognised in 2020; in particular, the amounts relate to the following benefits: (i) annual contribution to the supplementary pension fund FOPDIRE or PREVINDAI; (ii) annual contribution to the supplementary healthcare fund FISDE; (iii) assignment of a company car for business and personal use (the annual value is stated net of the contribution paid by the assignee); (iv) taxable value of the weekly return flights between Milan and Rome (only for the Chief Executive Officer-CEO).
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During 2020, no indemnities for termination of office were approved and/or paid to Directors or Senior Managers with strategic responsibilities.
Consistent with the 2020 Remuneration Policy Guidelines, Senior Managers with strategic responsibilities may receive specific compensation for signing no-competition agreements, up to a maximum of 12 months of total annual remuneration for each year of the agreement.
No payments for no-competition agreements were made in 2020.
Consistent with the 2020 Remuneration Policy Guidelines, Senior Managers with strategic responsibilities may be party to minimum-term agreements protecting know-how, with the goal of guaranteeing continuity in the achievement of
business objectives, up to a maximum of 12 months of total remuneration for each year of the agreement. A total gross amount of €300,000 was paid in 2020 under current minimum-term agreements.
Saipem agrees with the objectives of increasing the further disclosures about the remuneration of the Chief Executive Officer-CEO and monitoring constantly the ratio of his remuneration to that of the other employees; for this purpose, the annual change in the overall remuneration of the Chief Executive Officer-CEO and in the overall remuneration of the full-time employees of Saipem SpA is calculated, as shown in the following tables.
The annual change in compensation and in the performance of the Company has been monitored for 2018, 2019 and 2020; in addition, with regard to those years, the overall remuneration of the Chief Executive Officer-CEO was compared with the results of the Company using two economic-financial indicators:
The values of Adjusted Free Cash Flow and Adjusted EBITDA are shown in accordance with the applied accounting principles.
Free Cash Flow Adjusted and EBITDA Adjusted. The compensation structure adopted by Saipem remunerates adequately the skills, experience and contribution required from the various roles, considering the objectives assigned and the results achieved; compatible with this, the overall remuneration of the Chief Executive Officer-CEO is consistent with the economic-financial results of the Company. The Remuneration Policy for the employed population takes account of its positioning with respect to both the external market (external competitiveness) and the internal market (internal fairness).
The following table shows the compensation paid to the Directors and Statutory Auditors, who are listed by name, and that paid in aggregate to the Senior Managers with strategic responsibilities17. The compensation received from subsidiaries and/or associates is shown separately, where provided, unless waived or paid to the Company. All persons who held the above positions during the year are included in the table, even if they only held office for part of the year.
In particular:
≥ the "Fixed compensation" column shows the fixed emoluments and remuneration from employed work earned on an accruals basis during the year. The amounts are stated before deducting the social security contributions and taxes payable by the recipient. No attendance fees are paid.
The footnotes detail of the compensation, with separate indication of any employment-related allowances and entitlements;
(17) There is no current legal requirement for disclosure on an individual basis.
(€ thousand)
| Non-equity variable compensation |
|||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Name and Surname | Office held | Period of office | Expiry of term (*) | Fixed compensation | on Board Committees Compensation for service |
Bonuses and other incentives |
Profit sharing | Non-monetary benefits |
Other compensation | Total | of equity compensation Fair value |
Indemnities for ceasing to serve or termination of employment |
|
| Board of Directors | |||||||||||||
| Caio Francesco | Chairman (1) | 01.01-31.12 | 2021 | 428 (a) | 29 (b) | 456 | |||||||
| Cao Stefano | Chief Executive Officer-CEO (2) | 01.01-31.12 | 2021 | 1,045 (a) | 565 (b) | 15 (c) | 1,624 | 978 | |||||
| Cappello Maria Elena | Director (3) | 01.01-31.12 | 2021 | 60 (a) | 20 (b) | 80 | |||||||
| Schapira Paul | Director (4) | 01.01-31.12 | 2021 | 60 (a) | 53 (b) | 113 | |||||||
| Carloni Claudia | Director (5) | 01.01-31.12 | 2021 | 60 (a) | 20 (b) | 80 | |||||||
| Fumagalli Paolo | Director (6) | 01.01-31.12 | 2021 | 60 (a) | 40 (b) | 100 | |||||||
| Mazzilli Ines Maria Lina | Director (7) | 01.01-31.12 | 2021 | 60 (a) | 43 (b) | 103 | |||||||
| Ferro-Luzzi Federico | Director (8) | 01.01-31.12 | 2021 | 60 (a) | 39 (b) | 99 | |||||||
| Latini Pierfrancesco | Director (9) | 01.01-05.02 | 2021 | 6 (a) | 3 (b) | 9 | |||||||
| Ferone Alessandra | Director (10) | 05.02-31.12 | 2021 | 54 (a) | 30 (b) | 85 | |||||||
| Board of Statutory Auditors | |||||||||||||
| Busso Mario | Chairman (11) | 01.01-29.04 | 2020 | ||||||||||
| (I) Remuneration from the company preparing the financial statements | 23 (a) | 23 | |||||||||||
| (II) Remuneration from subsidiaries and associates and jointly controlled companies | 59 (b) | 59 | |||||||||||
| (III) Total | 82 | 82 | |||||||||||
| Perotta Riccardo | Statutory Auditor (12) | 01.01-29.04 | 2020 | ||||||||||
| (I) Remuneration from the company preparing the financial statements | 16 (a) | 16 | |||||||||||
| (II) Remuneration from subsidiaries and associates and jointly controlled companies | 42 (b) | 42 | |||||||||||
| (III) Total | 58 | 58 | |||||||||||
| Fiori Giovanni | Chairman (13) | 29.04-31.12 | 2023 | 47 (a) | 47 | ||||||||
| De Martino Giulia | Statutory Auditor (14) | 01.01-31.12 | 2023 | ||||||||||
| (I) Remuneration from the company preparing the financial statements | 50 (a) | 50 | |||||||||||
| (II) Remuneration from subsidiaries and associates and jointly controlled companies | 13 (b) | 13 | |||||||||||
| (III) Total | 63 | 63 | |||||||||||
| Rosini Norberto | Statutory Auditor (15) | 29.04-31.12 | 2023 | 34 (a) | 34 | ||||||||
| Senior Managers | (16) | ||||||||||||
| with strategic responsibilities (**) | 4,567 (a) 6,744 |
275 | 1,709 (b) 2,274 |
151 (c) 166 |
460 (d) 460 |
6,887 9,919 |
2,304 3,282 |
||||||
| (1) (2) (3) (4) |
Advisory Committee and, in any case, those who report directly to the CEO/the Chairman/the Board of Directors of Saipem SpA (thirteen executives). Caio Francesco - Chairman (a) Fixed compensation approved by the Board of Directors on June 28, 2018 (€427.5 thousand), including that for the office of Director established at the Shareholders' Meeting held on May 3, 2018 (€60 thousand). (b) Compensation as Chairman of the Sustainability, Governance and Scenarios Committee (€28.5 thousand). Cao Stefano - Chief Executive Officer-CEO (a) Fixed compensation for the 2018-2021 mandate approved by the Board of Directors on June 28, 2018 (€1,045 thousand), including the base compensation as Chief Executive Officer-CEO established at the Shareholders' Meeting (€60 thousand). (b) The amount, stated on an accruals basis, estimates the 2021 short-term incentive relating to 2020 performance, which will be paid subsequent to the approval date of this Report. (c) The amount includes the value of the car benefit, the supplementary health insurance paid by the company and the taxable amount for weekly round-trip flights between Milan and Rome. Cappello Maria Elena - Director (a) Fixed compensation determined at the AGM (€60 thousand). (b) Compensation for serving on the Sustainability, Governance and Scenarios Committee (€19.5 thousand), approved by the Board on June 28, 2018. Schapira Paul - Director (a) Fixed compensation determined at the AGM (€60 thousand). |
||||||||||||
| (5) | (b) Compensation for serving on the Compensation and Nominations Committee (€19.5 thousand) and on the Control and Risk Committee (€33.5 thousand), approved by the Board on June 28, 2018. Carloni Claudia - Director (a) Fixed compensation determined at the AGM (€60 thousand). (b) Compensation for serving on the Sustainability, Governance and Scenarios Committee (€19.5 thousand), approved by the Board on June 28, 2018. |
||||||||||||
| (6) | Fumagalli Paolo - Director (a) Fixed compensation determined at the AGM (€60 thousand). (b) Compensation for serving as Chairman of the Compensation and Nominations Committee (€28.5 thousand), approved by the Board on June 28, 2018, and on the Related-Party Transactions Committee (€11.167 |
||||||||||||
| (7) | thousand), approved by the Board on July 24, 2018. Mazzilli Ines Maria Lina - Director (a) Fixed compensation determined at the AGM (€60 thousand). (b) Compensation for serving as Chairman of the Control and Risk Committee (€42.5 thousand), approved by the Board on June 28, 2018. |
||||||||||||
| (8) | Federico Ferro-Luzzi - Director (a) Fixed compensation determined at the AGM (€60 thousand). (b) Compensation for serving on the Compensation and Nominations Committee (€19.5 thousand) and on the Sustainability, Governance and Scenarios Committee (€19.5 thousand), approved by the Board on June |
||||||||||||
| 28, 2018. (9) Latini Pierfrancesco - Director (a) Pro-rata fixed compensation determined at the AGM (€60 thousand). (b) Pro-rate compensation for serving on the Control and Risk Committee (€33.5 thousand), approved by the Board on June 28, 2018. |
|||||||||||||
| (10) Ferone Alessandra - Director (a) Pro-rata fixed compensation determined at the AGM (€60 thousand). (b) Pro-rate compensation for serving on the Control and Risk Committee (€33.5 thousand), approved by the Board on June 28, 2018. |
|||||||||||||
| (11) Busso Mario - Chairman of the Board of Statutory Auditors (a) Pro-rata fixed compensation determined at the AGM (€70 thousand). (b) Fixed compensation (€58.5 thousand). |
|||||||||||||
| (12) Perotta Riccardo - Statutory Auditor (a) Pro-rata fixed compensation determined at the AGM (€50 thousand). (b) Pro-rata fixed compensation determined at the AGM (€45.5 thousand). (13) Fiori Giovanni - Chairman of the Board of Statutory Auditors |
|||||||||||||
| (a) Pro-rata fixed compensation determined at the AGM (€70 thousand). | |||||||||||||
| (14) De Martino Giulia - Statutory Auditor (a) Fixed compensation determined at the AGM (€50 thousand). (b) Fixed compensation (€13 thousand). |
|||||||||||||
| (15) Rosini Norberto - Statutory Auditor (a) Pro-rata fixed compensation determined at the AGM (€50 thousand). (16) Senior Managers with strategic responsibilities |
(a) In addition to total gross annual remuneration of €4,567 thousand, allowances for domestic and foreign travel pursuant to the national collective employment contract for executives and supplementary in-house agreements and other employment-related payments totalled €13.63 thousand..
(b) The amount, stated on an accruals basis, estimates the 2021 short-term incentive relating to 2020 performance, which will be paid subsequent to the approval date of this Report.
(c) The amount includes the value of the car benefit and supplementary pension contributions and health insurance paid by the company. (d) The amount includes the minimum-term agreements and other employment-related indemnities.
The following table shows, on an individual basis, the long-term variable incentives based on financial instruments, other than stock options, for the Chief Executive Officer-CEO and, on an aggregated basis, for Senior Managers with strategic responsibilities. In particular:
2020 assignment of the Shares allocated in 2017;
2021 assignment of the Shares allocated in 2018;
The total of the "Fair value for the year" column agrees with the amount indicated in Table 1.
| (€ thousand) | Financial instruments assigned in previous years not vested during the year |
Financial instruments assigned during the year | Financial instruments vested during the year and not allocated |
Financial instruments vested during the year and available for allocation |
Financial instruments pertaining to the year |
|||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Name and Surname Office held |
Plan | Number and type instruments of financial |
Vesting period | Number and type instruments of financial |
at assignment date Fair value |
Vesting period | Assignment date | on assignment Market price |
Number and type instruments of financial |
Number and type instruments of financial |
in vesting date Value |
Fair value |
| Stefano Cao Chief Executive Officer-CEO |
Long-term Incentive Plan 2020 BoD October 27, 2020 |
505,700 | 1,033 | 3 years (2) Oct. 27, 20 | 1,398 | 52 | ||||||
| Long-term Incentive Plan 2019 BoD October 23, 2019 |
243,900 | 3 years (2) | 468 | |||||||||
| Long-term Incentive Plan 2018 BoD March 5, 2018 BoD July 24, 2018 |
103,182 | 3 years (3) (4) | 309,544 (4) | 758 (9) | 259 (11) | |||||||
| Long-term Incentive Plan 2017 BoD July 24, 2017 |
99,375 | 3 years (3) | 298,125 | 661 (10) | 199 | |||||||
| Senior Managers with strategic responsibilities (1) |
Short-term Incentive Plan 2021 BoD March 12, 2021 |
256,250 (5) 625,250 (12) 3 years (6) Mar. 12, 21 (7) | 2,44 | (13) | ||||||||
| Long-term Incentive Plan 2020 BoD October 27, 2020 |
1,379,900 | 2,818 | 3 years (8) Oct. 27, 20 | 1,398 | 143 | |||||||
| Long-term Incentive Plan 2019 BoD October 23, 2019 |
659,700 | 3 years (8) | 1,267 | |||||||||
| Long-term Incentive Plan 2018 BoD July 24, 2018 |
144,420 | 3 years (4) (8) | 433,262 (4) | 1,061 (9) | 414 (11) | |||||||
| Lon9g-term Incentive Plan 2017 BoD July 24, 2017 |
185,500 | 3 years (8) | 556,500 | 1,234 (10) | 480 | |||||||
| Total | 1,436,077 | 2,141,850 | 629,101 | 1,597,431 | 3,714 | 3,282 | ||||||
| (1) The definition of "Senior Managers with strategic responsibilities" identified in Article 65, para. 1-quater, of the Issuers' Regulation – which references Annex 1 to Consob Regulation No. 17221 dated March 12, 2010 on instructions regarding transactions with related parties, as amended – includes persons who, directly or indirectly, have the power and responsibility to plan, direct and control the activities of the Company, such as the (executive and non-executive) board directors of the Company. Saipem Senior Managers with strategic responsibilities, other than Directors and Statutory Auditors, are those who sit on the Advisory Committee and, in any case, those who report directly to the CEO/the Chairman/the Board of Directors of Saipem SpA (11 executives for the plan implemented in 2017, 12 for that implemented in 2018, 13 for that implemented in 2019, 13 for that implemented in 2020, 13 for that implemented in 2021). (2) At the end of the vesting period the plan requires the Chief Executive Officer-CEO to lock-up 25% of the accrued shares for a further two years (co-investment period), at the end of which he will receive an additional share without charge for every share invested. (3) At the end of the vesting period the plan requires 25% of the accrued shares to be locked-up for two years. (4) The number of financial instruments, included on an accruals basis, estimates the number of shares to be assigned at the end of the vesting period, which is subsequent to the approval of this Report. (5) Given the time required to make the calculations for the Short-term Incentive Plan for Management, which will be completed subsequent to the approval of this Report, the table prudently indicates the maximum number of shares available for allocation of the share element of the 2021 short-term incentive. (6) At the end of the vesting period, the plan envisages assignment of the shares to the beneficiaries still employed by the Company. (7) Given the time required to make the calculations for the Short-term Incentive Plan for Management, which will be completed subsequent to the approval of this Report the table shows the date on which the Board of Directors approved the actual results relating to the 2020 objectives for the Short-term Incentive Plan, for the purpose of allocating the share element of the 2021 short-term incentive. (8) At the end of the vesting period the plan requires the SMSR to lock-up 25% of the accrued shares for a further two years (Retention Premium), at the end of which the beneficiaries will receive an additional share without charge for every share invested. (9) As the vesting period ends subsequent to the approval of this Report, the table prudently shows an estimated value determined by multiplying the closing price for the shares of Saipem SpA recorded on the MTA managed by Borsa Italiana, €2.449, by the number of financial instruments assigned. The observation period for determination of the price comprised the 30 trading days prior to the date on which the Board of Directors approved the actual results relating to the 2020 objectives (10) The value was determined by multiplying the closing price for the shares of Saipem SpA recorded on the MTA managed by Borsa Italiana, being €2.217 on July 23, 2020 (end of the vesting period), by the number of financial instruments assigned. |
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| (11) The fair value in the table, stated on an accruals basis, corresponds with the fair value accounted in the financial statement at December 31, 2020. (12) The value at the moment of assignment was determined by multiplying the number of financial instruments assigned during the financial year for the closing price for the shares of Saipem SpA recorded on the date on which the Board of Directors approved the actual results relating to the 2020 objectives for the Short-term Incentive Plan. (13) The fair value will be shown in the 2022 Report since the value will be included in the financial statement at December 31, 2021. |
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The following table shows, on an individual basis, the short-term variable monetary incentives envisaged for the Chief Executive Officer-CEO and (as in aggregate) the SMSR (including all persons who held the above positions during the year, even if they only held office for part of the time).
In particular:
≥ the "Bonus for the year - payable/paid" column shows the short-term variable incentive earned in the year on the basis of performance approved by the competent corporate bodies in relation to the targets set for the previous year;
The total of the "Bonus for the year - payable/paid", "Bonus for prior years - payable/paid" and "Other bonuses" columns agrees with the amount shown in the "Bonuses and other incentives" column of Table 1.
(1) The definition of "Senior Managers with strategic responsibilities" identified in Article 65, para. 1-quater, of the Issuers' Regulation – which references Annex 1 to Consob Regulation No. 17221 dated March 12, 2010 on instructions regarding transactions with related parties, as amended – includes persons who, directly or indirectly, have the power and responsibility to plan, direct and control the activities of the Company, such as the (executive and non-executive) board directors of the Company. Saipem Senior Managers with strategic responsibilities, other than Directors and Statutory Auditors, are those who sit on the Advisory Committee and, in any case, those who report directly to the CEO/the Chairman/the Board of Directors of Saipem SpA (thirteen executives).
(a) The amount, stated on an accruals basis, estimates the 2021 short-term incentive relating to 2020 performance, which will be paid subsequent to the approval date of this
Pursuant to article 84-quater, para. 4, of the Consob Issuers' Regulation, the following table shows shares held in Saipem SpA by the Directors, Statutory Auditors and Senior Managers with strategic responsibilities, as well as by their spouses, where not legally separated, and by their minor children, either
directly or through subsidiaries, trust companies or third parties, as determined from the Shareholders' Register, communications received and other information obtained from the persons concerned. The table includes all persons that held office for all or just a part of the year.
The number of shares (all "ordinary") is indicated on an individual basis for Directors and Statutory Auditors and on an aggregated basis for the Senior Managers with strategic responsibilities. All shares are held as personal property.
| Name and Surname | Office held | Company | at end of previous year Number of shares held |
Number of shares purchased |
Number of shares sold | Number of shares held at end of current year |
|---|---|---|---|---|---|---|
| Board of Directors | ||||||
| Stefano Cao | Chief Executive Officer-CEO | Saipem SpA | 29,000 | 508,125 | 537,125 | |
| Paolo Fumagalli (1) | Director | Saipem SpA | 83,000 | 83,000 | ||
| Riccardo Perotta | Statutory Auditor | Saipem SpA | 18,400 (2) | 18,400 | ||
| Senior Managers with strategic responsibilities (3) |
Saipem SpA | 28,084 | 556,500 | 256,904 | 327,680 (4) | |
| (1) Purchases and sales by persons closely associated with the significant party - Board of Directors of Saipem SpA Paolo Fumagalli. (2) Shares held as of Aprile 29, 2020, date of termination of the role. (3) The definition of "Senior Managers with strategic responsibilities" identified in Article 65, para. 1-quater, of the Issuers' Regulation – which references Annex 1 to Consob Regulation No. 17221 dated March 12, 2010 on instructions regarding transactions with related parties, as amended – includes persons who, directly or indirectly, have the power and responsibility to plan, direct and control the activities of the Company, such as the (executive and non-executive) board directors of the Company. Saipem Senior Managers with strategic responsibilities, other than Directors and Statutory Auditors, are those who sit on the Advisory Committee and, in any case, those who report directly to the CEO/the Chairman/the Board of Directors of Saipem SpA (thirteen executives). (4) Only indicate the shares held by Senior Managers with strategic responsibilities employed at the end of the year. |
With reference to the 2019-2021 Share-based Long-Term Variable Incentive Plan approved at the Shareholders' Meeting held on April 30, 2019, in conformity with the conditions and objectives described in the Information Document available on the website www.saipem.com, the following table provides details of the 2020 allocation of the Long-term Variable Incentive Plan 2019-2021, pursuant to Article 84-bis (Annex 3A, form 7) of the Consob Issuers' Regulation.
With reference to the share element of the Short-term Variable Incentive Plan 2021-2023 approved at the Shareholders' Meeting held on April 29, 2020, in conformity with the conditions and objectives described in the Information Document available on the website www.saipem.com, the following table provides details of the 2021 allocation of the Short-term Variable Incentive Plan 2021-2023, pursuant to Article 84-bis (Annex 3A, form 7) of the Consob Issuers' Regulation.
| Box 1 - Financial instruments other than stock options Section 2 - Newly allocated instruments based on decisions made by the relevant company body to implement a shareholders' resolution |
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Name and Surname or category |
for named persons) (only indicate Office held |
Date of shareholders resolution |
Type of financial instruments |
Number of financial instruments |
Assignment date | Purchase price of instruments on assignment Market price |
Vesting period | |||
| Stefano Cao | Chief Executive Officer-CEO | April 30, 2019 | stock grant | 505,700 | Oct. 27, 20 | 1.398 | 3 year (2) | |||
| Long-term Incentive Plan 2020 - Senior Managers with strategic responsibilities (1) |
April 30, 2019 | stock grant | 1,379,900 | Oct. 27, 20 | 1.398 | 3 year (3) | ||||
| Long-term Incentive Plan 2020 - Other Executives |
April 30, 2019 | stock grant | 6,451,200 | Oct. 27, 20 | 1.398 | 3 year (3) | ||||
| Short-term Incentive Plan 2021 - Senior Managers with strategic responsibilities (1) |
April 29, 2020 | stock grant | 256,250 (4) | March 12, 21 (5) | 2.44 | 3 year (6) | ||||
| Short-term Incentive Plan 2021 - Other Executives |
April 29, 2020 | stock grant | 765,500 (4) | March 12, 21 (5) | 2.44 | 3 year (6) | ||||
| (1) The definition of "Senior Managers with strategic responsibilities" identified in Article 65, para. 1-quater, of the Issuers' Regulation – which references Annex 1 to Consob Regulation No. 17221 dated March 12, 2010 on instructions regarding transactions with related parties, as amended – includes persons who, directly or indirectly, have the power and responsibility to plan, direct and control the activities of the Company, such as the (executive and non-executive) board directors of the Company. Saipem Senior Managers with strategic responsibilities, other than Directors and Statutory Auditors, are those who sit on the Advisory Committee and, in any case, those who report directly to the CEO/the Chairman/the Board of Directors of Saipem SpA (13 executives for the plan implemented in 2020 and for the plan implemented in 2021). (2) At the end of the vesting period the plan requires the Chief Executive Officer-CEO to lock-up 25% of the accrued shares for a further two years (co-investment period), at the end of which he will receive an additional share without charge for every share invested. (3) At the end of the vesting period the plan requires the SMSR to lock-up 25% of the accrued shares for a further two years (retention premium), at the end of which the beneficiaries will receive an additional share without charge for every share invested. (4) Given the time required to make the calculations for the Short-term Incentive Plan for Management, which will be completed subsequent to the approval of this Report, the table prudently indicates the maximum number of shares available for allocation of the share element of the 2021 short-term incentive. (5) Date on which the Board of Directors approved the actual results relating to the 2020 objectives for the Short-term Incentive Plan, for the purpose of allocating the share element of the 2021 short-term incentive. (6) The amount, stated on an accruals basis, estimates the share element of the 2021 short-term incentive relating to 2020 performance At the end of the vesting period, the plan envisages assignment of the shares to the beneficiaries still employed by the Company. |
Società per Azioni Share Capital €2,191,384,693 fully paid up Tax identification number and Milan, Monza-Brianza, Lodi Companies' Register No. 00825790157
Headquarters: San Donato Milanese (Milan) - Italy Via Martiri di Cefalonia, 67 Information for Shareholders Saipem SpA, Via Martiri di Cefalonia, 67
20097 San Donato Milanese (Milan) - Italy
Relations with institutional investors and financial analysts Fax +39-0244254295 E-mail: [email protected]
Relazione finanziaria annuale (in Italian) drawn up in accordance with Italian Legislative Decree No. 127 of April 9, 1991
Annual Report (in English)
Relazione finanziaria semestrale consolidata al 30 giugno (in Italian) Interim Financial Report as of June 30
(in English)
Ready for the transition - Enabling a green future - Sustainability Report 2020 (in English)
Also available on Saipem's website: www.saipem.com
Website: www.saipem.com Operator: +39-024421
Layout and supervision: Studio Joly Srl - Rome - Italy Printing:
saipem spa Via Martiri di Cefalonia, 67 20097 San Donato Milanese (MI)
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