TELECOM ITALIA: RECOMMENDATIONS FROM THE BOARD FOR A NEW CORPORATE GOVERNANCE
27 Februar 2014 - 8:57PM
Italian Regulatory (Text)
PRESS RELEASE
TELECOM ITALIA: RECOMMENDATIONS FROM THE BOARD FOR A NEW CORPORATE
GOVERNANCE Board with a majority of independent directors
Shareholders invited to take them into account, starting with the
upcoming submission of slates for the renewal of the Board
Threshold to submit candidates set at 0.5% of share capital
entitled to vote Ordinary shareholders' meeting called for 16
April
Milan, 27 February 2014
Today's meeting of the Board of Directors of Telecom Italia,
chaired by Aldo Minucci, unanimously approved the text of the
report to the shareholders' meeting on the appointment of the new
Board. The document, which was developed from the proposals of
Chief Executive Officer Marco Patuano, formulates suggestions and
recommendations to the shareholders in light of the candidacies for
the upcoming renewal of the Board of Directors, to ensure that the
company has an adequate governance structure. In short, the Board's
report, the contents of which are shared with the Board of
Statutory Auditors, suggests: 1) The reduction to 11 or 13 members
for the composition of the next Board of Directors. 2) A term of
office of three financial years (until approval of the financial
statements at 31 December 2016) and remuneration proportional to
the new composition of the board. 3) A delegated powers structure
based on a non-executive Chairman and a separate Chief Executive
Officer, strongly focussed on the work of the board as a whole
based on the investigative activities of its committees. 4) That
the Chairman be chosen from among the appointed Directors who
fulfil the requirements of independence and represents a an
impartial guarantor of all the shareholders. 5) A Control and Risk
Committee of 5 members (currently 4) and a Nomination and
Remuneration Committee comprised of 3 members, with different
chairs to be assigned to independent Directors, preferably from the
minority slates. It suggests that an Executive Committee should not
be constituted. 6) Ensuring the new Board of Directors a
substantial level of independence from both the management and the
reference shareholder. It therefore recommends that in each slate
there
should be a clear majority of candidates qualifying as independent
according to the criteria of the Corporate Governance Code of Borsa
Italiana. The assessment of independence should be carried out
examining substance over form: maximum transparency is suggested in
the description of the connecting relations, in the broadest sense,
of the individual candidates with the relative majority
shareholders, the remaining major shareholders, those who submit
the slate, and the related executive management, as well as the
Telecom Italia Group, extending the period of time considered to at
least 3 years. 7) Ensuring an adequate mix of professional skills
and competencies. The competences deemed opportune on the Board are
those regarding the telecommunications sector or closely related
businesses, finance, organisation, risk management and internal
control. Experience in CEO and CFO roles in major companies is
preferred, although the contribution of academics with expertise in
financial and taxation matters, risk management and law is also
deemed useful. An international dimension would be welcome, with
the inclusion of non-Italians or people with experience gained
abroad in the slates of candidates. 8) That, when the slates are
submitted, the characteristics of the candidates are illustrated
and the reasons they are suitable to hold office as directors of
Telecom Italia are argued. Moreover, regarding the candidates
qualified as independent, the reasons they so qualify should be
explained. 9) Submitting the slates of candidates (and obviously
the proposals on the number, duration and remunerations)
sufficiently in advance of the deadline as per law. Finally, it
suggests that the next Board defines any amendments to be made to
the Bylaws and/or the remaining corporate governance instruments in
force in order to implement the recommendations summarized above
and in any case the best practices. The proposal contained in the
document to renew Telecom Italia's corporate governance stems from
the desire to meet the demands arising from the debate conducted
during the last shareholders' meeting held on 20 December 2013. The
recommendations listed are the fruit not only of the experience it
has accrued during its term of office, which is now coming to an
end, but also of in-depth benchmarking against comparable Italian
and international companies, direct comparison with some of the
major shareholders and authoritative representatives of the world
of institutional investors, proxy advisors, and Assogestioni.
Finally, account was also taken of the contributions made by
individual Directors and shareholders, who spontaneously supplied
suggestions and professional contributions. Adopting an
interpretation of the Bylaws text more favourable for minorities,
and which, according to Consob, is more in line with the rationale
behind the regulation on slates voting, the Board of Directors has
indicated the minimum shareholding required to submit candidates is
set at 0.5% of the share capital entitled to vote. The
Shareholders' Meeting is called to appoint the new Board of
Directors, reserving the right to complete the agenda in the
meeting on 6 March next. The Shareholders' Meeting will therefore
be held on 16 April 2014 at the location of Rozzano (Milan). The
explanatory report of the Board of Directors on corporate
governance will be published on the company website
(www.telecomitalia.com/assemblea).
Telecom Italia Press Office
+39 06 3688 2610 http://www.telecomitalia.com/media
Telecom Italia Investor Relations
+39 02 8595 4131
http://www.telecomitalia.com/investorrelations
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