Board committees

The system of Corporate Governance adopted by the Company foresees - since 2000 - the establishment, within the Board of Directors, of Board Committees with investigative, advisory and/or recommendation functions concerning particularly "sensitive" and economically, financially and strategically significant matters, in order to have both a discussion of opinions and a series of checks in order to ensure the Board takes conscious and effectively informed decisions.

Taking into account of the recommendations of the Self-Regulatory Code of the Italian Stock Exchange, to which Pirelli belongs, and national and international best practices, the Board of Directors of the Company in its meeting of July 10, 2014, established for the duration of the term of office of the Board, the following Committees:

Committee for Control, Risks, Sustainability and Corporate Governance
comprising the following Directors:
  • Anna Maria Artoni - Chairman;
  • Andrey Kostin;
  • Elisabetta Magistretti (*).
* Director with adequate financial and accounting experience

Remuneration Committee
comprising the following Directors:
  • Luigi Roth - Chairman (*);
  • Ivan Glasenberg;
  • Manuela Soffientini.
* Director with adequate experience of financial and remuneration issues

Appointments and Successions Committee
comprising the following Directors:
  • Marco Tronchetti Provera - Chairman;
  • Anna Maria Artoni;
  • Didier Casimiro;
  • Paolo Pietrogrande.

Strategies Committee
comprising the following Directors:
  • Marco Tronchetti Provera - Chairman;
  • Didier Casimiro;
  • Andrey Kostin;
  • Paolo Fiorentino;
  • Luigi Roth;
  • Igor Sechin;
  • Manuela Soffientini.



The system of Corporate Governance adopted by Pirelli & C. S.p.A. since 2000 provides for the establishment of a Committee for Internal Control and Corporate Governance.

The Board of Directors of the Company, in its meeting on July 10, 2014, confirmed the establishment of this Committee renamed Committee for Internal Control, Risks, Sustainability and Corporate Governance.

The Committee has consultative and recommendation functions and has the mission to ensure, with appropriate investigation of the risk management system on the one hand and the efficiency, effectiveness and correctness of the internal control system and the corporate governance framework in general on the other.

The Committee consists of three members, exclusively non-executive, and on the basis of the approach recommended by the Self-Regulatory Code of the Italian Stock Exchange, all independent.

The Committee is appointed by the Board of Directors (which also appoints the Chairman) and remains in office for the entire term of office of the Board of Directors.

Moreover, the Committee is also assigned the tasks of the Committee for Related Parties Transactions required under Consob regulations and by the Procedure for Related Parties Transactions adopted by the Company, with the sole exception of issues pertaining to the remuneration of directors and managers with strategic business responsibilities, entrusted to the Remuneration Committee.

At least one member of the Committee has adequate experience in accounting and finance, as assessed by the Board of Directors on appointment.

The entire Board of Statutory Auditors is entitled to attend Committee meetings.

Operation


The Committee meets whenever its Chairman deems it appropriate or on request of at least one of its members, the Chairman of the Board of Directors or, if appointed, the Managing Director and, nevertheless, with appropriate frequency for the proper conduct of its duties.

The Committee appoints the Secretary of the Committee and/or the individual meetings.

Usually Committee meetings are convened by notice sent, also by the Secretary of the Committee, on behalf of the Committee Chairman.

The documentation and information available (and in any case, that necessary) are transmitted to all members of the Committee sufficiently in advance in order to be able to express an opinion at the meeting.

For the validity of Committee meetings the presence of a majority of members in office is required and decisions are taken by majority of members present. Committee meetings may be held using telecommunication means and are regularly recorded in minutes by the Secretary and transcribed into a specific register.

The Committee - which in executing its functions can make use of external consultants - has adequate financial resources to fulfil its duties with absolute independence of expenditure.

The Committee also has the right to access company departments and information for the execution of its assigned tasks, making use of the support of the Secretary to this end.

Activities and tasks


The Committee has investigative, advisory and/or recommendation functions to ensure both discussion of opinions and a series of checks in order to guarantee adequate risk management and efficiency, effectiveness and correctness of the internal control and corporate governance system.

The Committee, in particular, has the following tasks:

  • assists the Board of Directors in:
    • defining the policy guidelines of the internal control and risk management system, so that the principal risks facing the Company and its subsidiaries are properly identified and adequately measured, managed and monitored;
    • determining the level of compatibility of these risks with business management that is consistent with the identified strategic objectives;
    • identifying a director with executive authority assigned to supervise the functioning of the internal control and risk management system according to the characteristics of the business and its risk profile;
    • assessing the effectiveness and effective functioning of the internal control system at least once annually;
    • describing the key elements of the internal control system in the Corporate Governance Report, expressing its own opinion on the overall adequacy of that system;
  • expresses its opinion on proposals for the nomination, dismissal, assignment of duties and remuneration of the Internal Audit Manager and assures that he obtains the resources necessary to discharge his duties;
  • assesses, in conjunction with the Board of Statutory Auditors, the administrative officers of the Company, and the financial reporting manager, (a) the proper use of accounting standards and their uniform application within the Group during preparation of the consolidated financial statements, (b) any letter by the statutory auditor containing suggestions to Company management and any report on key issues revealed during statutory audits of the Company accounts;
  • on request by the director assigned for this purpose, expresses opinions on specific aspects related to identification of principal business risks and the design, realisation and management of the internal control system;
  • examines the audit plan prepared by the Internal Audit Manager and the periodic reports prepared by him;
  • monitors the independence, effectiveness and efficiency of the Internal Audit Department;
  • if deemed appropriate, asks the Internal Audit Department to perform audits of specific operating units;
  • reports to the Board of Directors on its activities when the annual report and the half-yearly report on the adequacy of the internal control system are approved, if not more frequently;
  • monitors compliance with and periodic revision of the rules of corporate governance and compliance with the standards of conduct that might be adopted by the Company and its subsidiaries. In particular, it has the prerogative to propose the terms and conditions for carrying out the Board of Directors annual self-assessment;
  • defines and proposes “sustainability” guidelines to the Board of Directors and monitoring compliance with the related rules of conduct adopted by the Company and its subsidiary;
  • assists the Board of Directors in preparing and then examining and approving the Sustainability Report;
  • performs the other duties assigned to it by the Board of Directors, including supervision of the procedural and substantial fairness of transactions.

Moreover, the Committee is also assigned the tasks of the Committee for Transactions with Related Parties - within the limits established by the current regulatory provisions of the Procedure for Transactions with Related Parties adopted by the Company - with reference to transactions with related parties of the Company or its subsidiaries and with the sole exception of issues pertaining to the remuneration of directors and managers with strategic business responsibilities, entrusted to the Remuneration Committee.

In this regard, the Committee:

  • periodically assesses (at least every three years) any changes to the Procedure for Transactions with Related Parties, formulating its opinions to the Board of Directors;
  • for Transactions of Major Significance it is entitled to request information and make comments to those charged with conducting negotiations or investigation of the transactions;
  • in the case of transactions with related parties of Major and Minor Significance, it formulates justified opinions on the interest of the Company in completing the transaction as well as the convenience and substantial correctness of the related conditions and on the proposal to adopt "Framework resolutions of Major Significance" and "Framework resolutions of Minor Significance".
Last Revised: 25 Jul 2014