The corporate governance structure of the Enel Group complies with the principles set forth in the Corporate Governance Code for listed companies2, as last amended in July 2015, and is inspired by Consob’s recommendations on this matter and, more generally, international best practice.
The corporate governance system is essentially aimed at creating value for the shareholders over the medium-long term, taking into account the social importance of the Group’s business operations and the consequent need, in conducting such operations, to adequately consider all the interests involved.
2 The code is available in its current edition on Borsa Italiana’s website (http://www.borsaitaliana.it/comitato-corporate-governance/codice/2015engclean.en.pdf).
Board of Directors
It is responsible for managing the Company and has powers over the strategic, organizational and control guidelines for the Company and the Group.
It is responsible for: the appointment or removal of members of the Board of Directors and Board of Statutory Auditors as well as their compensation and responsibilities; the approval of financial statements and the allocation of net earnings; the purchase and sale of treasury shares; stock-based compensation plans; amendments to the Company’s bylaws, and the issue of convertible bonds.
Board of Statutory Auditors
It is responsible for monitoring: the Company’s compliance with the law and bylaws, as well as compliance with proper management principles in the carrying out of the Company’s activities; the process of financial disclosure and the adequacy of the Company’s organizational structure, internal auditing system, and administration and accounting system; the audit of the stand-alone and the consolidated financial statements and the independence of the external auditing firm; and, lastly, how the corporate governance rules provided by the Corporate Governance Code are actually implemented.
The external audit of the accounts is entrusted to a specialized firm enrolled in the relevant registry and appointed by the Shareholders’ Meeting, upon a reasoned proposal by the Board of Statutory Auditors.
Board of Directors
The Board of Directors was appointed by the ordinary shareholders’ meeting on May 4, 2017 and consists of nine members. Patrizia Grieco, Francesco Starace, Alfredo Antoniozzi, Alberto Bianchi, Paola Girdinio and Alberto Pera were taken from the list presented by the Ministry of the Economy and Finance shareholder (at that time holding 23.59% of the Company’s capital) and voted by the majority of the capital represented at the meeting (about 49.98% of the voting capital), while Cesare Calari, Anna Chiara Svelto and Angelo Taraborrelli were taken from the list presented by a grouping of 21 institutional investors (at the time 1.88% of the Company’s capital) and voted by the minority of the capital represented at the meeting (about 49.43% of the voting capital).
In January 2018, the Board of Directors approved a Diversity Policy that describes the optimal features of the composition of the Board itself, in order for it to exercise its functions in the most effective way.
In 2017, the Board of Directors met 15 times with an average duration of 3 hours for each meeting, an average director attendance rate of 100%, and was constantly involved in issues related to governance, sustainability, the Code of Ethics and Model 231.
The Board of Directors set up within the Board itself the following four committees:
- Nomination and Compensation Committee: with an appropriate preliminary investigation, this committee is responsible for supporting the Board of Directors, through proper inquiry, the assessments and decisions of the board on the size and composition of the board itself, as well as the remuneration of the executive directors and of the executives with strategic responsibilities;
- Control and Risks Committee with an appropriate preliminary investigation, this committee has the task of supporting, through an adequate review process, the assessments and decisions of the Board of Directors regarding the Internal Control and Risk Management System and the approval of periodic financial reports;
- Corporate Governance and Sustainability Committee: this committee assists with preliminary functions, both proposing and consultative in nature, the Board of Directors on its assessments and decisions related to the corporate governance of the Company and the Group and to sustainability issues;
- Related Parties Committee: this committee has been assigned the essential task of issuing reasoned opinions on the interest of Enel – as well as of the companies that Enel controls, either directly or indirectly, and that may be involved in the transactions – in the completion of transactions with related parties, expressing an assessment on the beneficial nature and essential fairness of the relevant conditions, after receiving timely and adequate information in advance.
With regard to succession plans for executive directors, in September 2016, the Board of Directors, upon proposal of the Nomination and Compensation Committee, together with the Corporate Governance and Sustainability Committee, shared the contents of a specific “contingency plan” aimed at regulating the steps to be taken to ensure that the Company’s activities are regularly managed in the event of early cessation of the chief executive officer before the expiry of the ordinary term of office (the so-called “crisis management” case).
(1) Calculations based on financial years.
(2) % of total number of directors.
In January 2018, the Board of Directors, upon proposal of the Corporate Governance and Sustainability Committee and of the Nomination and Compensation Committee, in implementation of the provisions of the Italian Consolidated Financial Act, approved a Diversity Policy that describes the optimal features of the composition of the Board itself, in order for it to exercise its functions in the most effective way taking decisions with the concrete contribution of several qualified points of view capable of examining the issues under discussion from different perspectives.