Responsibilities, functions and powers of the Board of Directors
The Board of Directors is the central body within the Corporate Governance system of Saipem SpA and the Saipem Group. Article 20 of the Articles of Association states that the management of the Company is the exclusive responsibility of the Board of Directors. Article 2365 of the Italian Civil Code and Article 20 of the Articles of Association grant the Board the power, normally the responsibility of the Extraordinary Shareholders’ Meeting, to resolve on motions concerning:
- mergers by incorporation of companies whose shares or stakes are owned entirely by the Company, pursuant to Article 2505 of the Italian Civil Code;
- merger by incorporation of companies whose shares or stakes are at least 90% (ninety per cent) owned by the Company, pursuant to Article 2505-bis of the Italian Civil Code;
- the proportional de-merger of companies whose shares or stakes are entirely or at least 90% (ninety per cent) owned by the Company, pursuant to Article 2506-ter of the Italian Civil Code;
- transfer of the Company’s headquarters within Italy;
- incorporation, transfer and closure of secondary offices;
- share capital reductions in the case of Shareholder’s withdrawals;
- the issue of corporate bonds and other debentures, barring the issue of bonds convertible into Company’s shares;
- the adoption of modifications to the Articles of Association to comply with the provisions of law. In addition to the powers granted by Article 2381 of the Italian Civil Code and taking into account the instructions of the Corporate Governance Code of listed companies, the Board of Directors is responsible for:
- setting a corporate governance system and regulations for the Company and the Group. Specifically, having sought the opinion of the Audit and Risk Committee, it implements procedures to ensure that the following operations are carried out in a correct and transparent manner, both in terms of procedures and substance: operations with related parties and operations where a Director has an interest, either directly or through a third party. The Board also adopts, at the proposal of the CEO, procedures for the management and release of Company information in general, and sensitive information in particular;
- establishing internal Board Committees with consultative and advisory functions, appointing their members, defining their responsibilities, approving their regulations and setting their remuneration;
- granting and revoking powers to Board Directors, setting their limitations and methods of exercise; having reviewed the proposals put forward by the Compensation Committee and following consultation with the Board of Statutory Auditors, setting the compensation commensurate with the powers granted. The Board has the power to issue directives to delegated bodies and carry out operations within its remit;
- setting the guidelines for the organisational, administrative and accounting structure of the Company and main Group subsidiaries6;
- annual evaluation of the adequacy of the organisational, administrative and accounting model, placing particular emphasis on the internal control system and the management of risks, based on the reports/information received from the CFCO, the Audit and Risk Committee and the Internal Audit department;
- defining, based on indications provided by the Audit and Risk Committee, guidelines for the internal control and risk management system, defining the nature and level of risk consistent with the Company’s strategic objectives, ensuring that main business risks associated with the Company and its subsidiaries are identified, measured, monitored and properly managed. It ascertains on an annual basis the adequacy, effectiveness and operation of the internal audit and risk management system;
- defining strategies and objectives for the Company and the Group, including sustainability policies. The Board reviews and approves industrial and financial strategic plans for the Company and the Group, in addition to all the Company’s strategic agreements and monitors their implementation;
- reviewing and approving the preliminary financial statements, the budget, interim and six-monthly reports, and preliminary results for the Company and the Group. The Board reviews and approves the Sustainability Report;
- receiving information from Directors with executive powers at Board Meetings, at least quarterly, regarding: activities under their responsibility, Group activities and major operations carried out by the Company or its subsidiaries;
- approving, having received a reasoned opinion from the Audit and Risk Committee, transactions of greater importance with related parties, in compliance with the procedure ‘Transactions involving interests held by Board Directors and Statutory Auditors and transactions with related parties’; it receives at least quarterly from the CEO a report detailing transactions of greater and lesser importance, in line with the provisions of the aforementioned procedure;
- reviewing and granting preliminary approval to transactions that involve interests held by Board Directors and Statutory Auditors, pursuant to Article 2391 of the Italian Civil Code and the provisions of the aforementioned procedure ‘Transactions involving interests held by Board Directors and Statutory Auditors and transactions with related parties’;
- approving possible joint-venture agreements, following the due diligence report on potential partners having been obtained by the Anti-corruption Legal Support Unit;
- receiving information from internal corporate Committees every six months;
- evaluating the general management and performance of the Company and the Group, based on the information received from Directors with executive powers, comparing actual interim and yearly results against budget forecasts;
- resolving on the most significant and strategic economic and/or financial Company operations, reviewing the most relevant Group industrial and financial operations, focusing specifically on those transactions in which one or more Directors may have a vested interest, on their own or a third party’s behalf, and transactions with related parties. The following are considered to be significant operations:
- purchase or sale of goods and services other than investments, exceeding €1 billion and those whose duration is greater than 20 years;
- acquisition, disposal or transfer of holdings exceeding €25 million;
- acquisition, sale or financial leasing of land and/or buildings exceeding €2.5 million;
- capital expenditure on technical assets differing from previous ones exceeding €300 million, or of a lower amount but of strategic importance or posing a particular risk;
- issue of financing to companies where the share held is not a controlling stake for amounts exceeding €200 million if the loan is proportional to the share of the holding, or of any amount if the loan is not proportional to the share of the holding;
- issue of personal or other guarantees for amounts exceeding €200 million, or of any amount if in favour of companies where the share held is not a controlling stake and the loan is not proportional to the share of the holding;
- incorporation of subsidiaries or Company branches;
The Shareholders’ Meeting endorsed the competition ban provided for in Article 2390 of the Italian Civil Code.
Pursuant to Article 2391 of the Italian Civil Code, Directors shall inform the other Directors and the Statutory Auditors of interests they may have, on their own behalf and on behalf of third parties, in any specific Company operation.
At Board Meetings, the Chairman reminds the Board of Directors that, pursuant to Article 2391 of the Italian Civil Code, Board Directors must voice any interests they may have, directly or through a third party, related to any items on the Agenda before they are discussed. Directors have to state the nature, origin and relevance of these interests, if any.
The Chairman organises the activities of the Board of Directors and ensures that the Directors and Statutory Auditors are provided with all necessary documentation and information in a timely manner to enable them to make decisions. Meeting documents are sent preferably no later than the notice of meeting (at least five days before the meeting). To this end, in 2013 a new IT platform named ‘BoardVantage’ was launched to enable the sharing and exchange of documents, notes and messages amongst the company departments and the Board of Directors, or amongst members of the Board. The system ensures the highest confidentiality through appropriate access credentials. The Secretary of the Board of Directors ensures the timely and accurate delivery of pre-meeting information and can be contacted by Board Directors and Statutory Auditors to provide clarifications and additional information. To improve the Board’s knowledge of the Company’s operations and dynamics, the COOs of the Business Units are periodically invited to Board meetings to illustrate the most significant projects, strategies and market conditions in their respective areas.
(6) Based on the criteria ‘exceeding the 5% threshold in terms of contribution to the various Consolidated Financial Statements items for the following drivers: (i) revenues, (ii) purchases, services and other costs’. The following are considered ‘Most strategic companies’: Saipem SA, Saipem (Portugal) Comércio Marítimo, Sociedade Unipessoal Lda, Saipem Canada Inc, and Snamprogetti Saudi Arabia Ltd.
Board review/Professional Figures
In 2013, the Board of Directors of Saipem SpA decided to have a consulting company carry out the third annual Board review of this mandate and the eighth since the adoption of the Board self-review process.
The Board review was carried out in compliance with the guidelines recommended by criteria 1.C.1, lett. g) and h) of the new Corporate Governance Code issued by Borsa Italiana for listed companies, and also to international best practices. Again in 2013, Saipem’s Board of Directors had the review carried out by a consulting company specialised in Corporate Governance practices and also independent both in terms of professional focus on the sole Board of Directors and because in the last two years it had no relations with Saipem or its subsidiaries, except for its dealings with the Board itself. Saipem’s Board of Directors, with the support of the Compensation and Nomination Committee, entrusted the task of performing the Board review to the company Crisci & Partners - Shareholders and Board Consulting.
The review of the Board and its Committees was carried out using a tailor-made questionnaire together with individual interviews with each Board member held in January and February 2014. Before the interviews, the external Consultant, studied the minutes and documentation of the Board and Committee meetings held in 2013.
Both the questionnaire and individual interviews focused on: (i) the operations and improvement of the Board in 2013; (ii) documentation, information flow and meetings of the Board of Directors; (iii) strategic role and monitoring of the Board; (iv) relations between the Board and the management; (v) adequacy of size and composition of the current Board; (vi) role, competencies and operations of Board Committees; (vii) considerations and suggestions of outgoing Board Directors advising Shareholders in choosing the composition of Saipem’s new Board of Directors.
The review expressed an overall positive opinion of the Directors in 2013 on the adequacy, structure and operation of the Board and its Committees.
Also considered adequate were the information flow, Board meetings and monitoring of the overall management and strategies over the previous year. The Board judged positively the improved compliance to best practices it achieved in terms of Board operations and Corporate Governance functioning; the latter was further strengthened by additional governance competencies added mid-year to the Board and the Secretary’s Office.
The dialogue between the CEO and the Board was considered to be transparent and always constructive. Activities performed by the Committees were deemed adequate, as was their interaction with the Board.
During the review process, the Board highlighted areas for improvement. Only some of these will be addressed by the current Board, in view of the forthcoming expiry of their mandate; indications for further improvement measures will be left for the new Board to address. Amongst these is the recommendation to expand the current monitoring role of the Board to play a larger part in shaping the business plans and strategies of the Company, over and above its current monitoring function. This, it was suggested, could be facilitated by organising an annual off-site Board meeting to address plans and strategies.
In view of its renewal, Saipem’s current Board, in compliance with the recent provision of the Corporate Governance Code of Borsa Italiana, deemed it expedient to advise Shareholders on the composition and mix of competencies that should be considered when choosing the professional figures to be appointed to the new Board of Directors. In this respect, it reviewed: (i) what ‘Industry’ expertise could be of particular use; (ii) what type of experience and professional skill should be preferred; (iii) what competencies are absolutely necessary in the new Board of Directors. Profiles and professional figures identified from these discussions were passed on to the Compensation and Nomination Committee, which, having added their own considerations, produced the document ‘Saipem’s Board of Directors advice for Shareholders on the size and composition of the new Board of Directors’. This document was discussed, approved by the Board and made available to Shareholders.
The experience and perceptions gained by the consultant responsible for carrying out Saipem’s Board review, Crisci & Partners during the review process, led him to concur with the evaluation and considerations expressed by Board members on the workings of the Board itself and its strict compliance, as of today, with the Corporate Governance Code of Listed Companies and with the national and international best practices currently in place at companies comparable to Saipem.
Composition, appointment and replacement of Board of Directors
The Board of Directors, comprising nine members, was appointed by the Shareholders’ Meeting on May 4, 2011 for a three-year period, its mandate expiring at the Shareholders’ Meeting called to approve the Financial Statements at December 31, 2013. At their meeting of May 9, 2011, the Board of Directors had appointed Alberto Meomartini as Chairman, Pietro Franco Tali as Deputy Chairman - CEO, and Hugh James O’Donnell as Managing Director for Business Support and Transversal Activities (Deputy CEO). Following the resignation of Pietro Franco Tali from all offices on December 5, 2012, the Board of Directors appointed Umberto Vergine as CEO, resolving against co-opting a new Director.
All current Board members served on the Board since May 4, 2011, with the exception of the Deputy CEO Hugh O’Donnell, who was first appointed Board Director on December 21, 2000 and Umberto Vergine, who has been a Board member since October 27, 2010.
On April 30, 2013, the Shareholders’ Meeting completed the number of Board of Directors by appointing Fabrizio Barbieri. On July 30, 2013, Hugh O’Donnell resigned the office of Managing Director for Business Support and Transversal Activities (Deputy CEO) and from the Board of Directors; on the same day, the Board of Directors co-opted Piergaetano Marchetti to the office of Board Director and appointed him Deputy Chairman responsible for coordinating the review and improvement of the corporate governance and control systems.
The appointment of Directors occurs pursuant to Article 19 of Articles of Association, through voting from lists, so as to allow the appointment of minority interest representatives and to ensure gender balance. Lists are filed at the Company’s registered headquarters at least twenty-five days prior to the Shareholders’ Meeting (first call) and are published in compliance with current legislation and Consob regulations. Voting lists include professional résumés for all candidates, their declarations accepting the nomination, stating that there are no grounds for ineligibility and/or incompatibility, and that they meet the integrity and/or independence requirements. Lists can be presented by Shareholders, who, individually or with others, hold voting shares representing at least 1% of the share capital, as per Consob Resolution No. 18452 of January 30, 2013. Lists that feature three or more than three candidates must include both genders, in compliance with current legislation on gender balance7. When the number of the least represented gender must, by law, be at least three, the lists from which most Board members are selected must include at least two candidates from the least represented gender.
Seven tenths of Directors are appointed from the list that has obtained the majority of votes (rounded down if necessary). The remaining Directors shall be selected from the other lists, provided they are not in any way, not even indirectly, linked with the Shareholders who have presented or voted for the list that has obtained the majority of votes. Therefore, votes obtained for each list will be successively divided by one, two, three and so on, until the remaining number of Directors to be appointed has been reached. The ratios obtained will be progressively attributed to candidates from each list, in the order attributed to each candidate within that list. Candidates will be classified in decreasing order according to their respective ratios, and those who have received the higher ratios will be appointed. In the event that more than one candidate obtains the same ratio, the candidate on the list with no Director yet appointed or on the list with the lowest number of Directors appointed will be elected. If these lists have yet to elect a Director, or if they have already appointed an equal number of Directors, the candidate on the list with the highest number of votes shall be appointed. In the event that the vote is still tied, the Shareholders’ Meeting will vote again, but only amongst the candidates under ballot, and the candidate who receives the majority of votes will be elected.
Should this procedure fail to appoint the minimum number of independent Directors required by the Articles of Association, the ratio of votes is calculated for each candidate from said lists by dividing the votes received by each list by the order number of each candidate. Candidates who do not meet independence requirements with lowest ratios from all lists are replaced, starting from the last one, by independent candidates from the same list (in the order they appear on the list), or by persons who meet the independence requirements appointed by the Shareholders’ Meeting through a majority vote as required by law. In the event that candidates from different lists obtain the same ratio, the candidate on the list with the highest number of Directors already appointed will be replaced, or the candidate from the list that received the fewest votes, or should the number of votes be the same, the candidate who obtains the fewest votes by the Shareholders’ Meeting in an ad-hoc ballot. Should this procedure fail to meet the requirements of regulations on gender balance, the ratio of votes is to be calculated for each candidate taken from the lists by dividing the votes received by each list by the order number of each candidate. The candidate of the most represented gender with the lowest ratio amongst candidates from all lists is replaced, provided the minimum number of independent Directors is met, by the candidate from the fewest represented gender with the higher order number in the same list of the replaced candidate, or by a person appointed by the Shareholders’ Meeting through a majority vote as required by law. If candidates from different lists obtain the same minimum ratio, the candidate from the list which has appointed the greater number of Director is replaced, or the candidate from the list that obtained the fewest votes, or, if votes are equal, the candidate who obtains the fewest votes by the Shareholders’ Meeting in an ad-hoc ballot.
This voting procedure is applicable only when the entire Board of Directors is to be renewed. Should the need arise for one or more Directors to be replaced during their mandate, the procedure as per Article 2386 of the Italian Civil Code is applied. Should the majority of Directors become unavailable, the entire Board of Directors shall be considered void. A Shareholders’ Meeting shall be called by the outgoing Board to elect a new one. In any case, current legislation must be complied with vis-à-vis the minimum number of independent Directors and gender balance quotas.
When this Board was elected in 2011, two lists of candidates were put forward, one by Eni SpA and the other by Institutional Investors. Candidates declared that they met the integrity requirements prescribed by regulations, and possessed the professional expertise, competence and experience to carry out their mandate efficiently and effectively and that they were able to dedicate sufficient time and resources to their office. Pursuant to Criteria 1.C.2 of the Code, information regarding offices of Directors or Auditors held by members of the Board of listed companies, financial or insurance companies or companies of considerable size is provided below under ‘Cumulation of offices’.
The Board comprises the Chairman Alberto Meomartini (non-executive and not-independent Director), the Deputy Chairman Piergaetano Marchetti (non-executive and independent Director), the CEO Umberto Vergine (executive and non-independent Director), and the Directors Gabriele Galateri di Genola (non-executive and independent Director), Nicola Greco (non-executive and independent Director), Maurizio Montagnese (non-executive and independent Director), Mauro Sacchetto (non-executive and independent Director) and Michele Volpi (non-executive and independent Director).
Alberto Meomartini, Gabriele Galateri di Genola, Nicola Greco and Umberto Vergine were proposed as candidates by Eni, whose list obtained 49.05% of voting shares.
Maurizio Montagnese, Mauro Sacchetto and Michele Volpi were proposed as candidates by Institutional Investors – Allianz Global Investors Italia Sgr SpA and others – obtaining 28.30% of voting shares.
The professional résumés of all Directors are posted on the Company’s website www.saipem.comunder the section ‘Corporate Governance’. Article 19 of Articles of Association has been adjusted to comply with new Article 37, paragraph 1, letter d) of Market Regulations, whereby the Board of Directors of a listed subsidiary subject to management and coordination by another listed company shall be comprised of a majority of independent Directors, identified as such in compliance with the law and current regulations. This amendment took effect from the appointments made at the Shareholders’ Meeting of May 4, 2011. Following the introduction of Law No. 120 of July 12, 2011 (effective from August 12, 2011) and Consob Regulation No. 18098 of February 8, 2012, this article has been further amended to ensure gender balance in management and control bodies of listed companies.
Board Directors, following their appointment and annually thereafter, shall state that they fulfil both the independence and integrity requirements pursuant to current legislation, and the Board of Directors verifies that these subsist.
At their meeting of March 14, 2014, the Board of Directors, based on the declarations provided and on information at the Company’s disposal, ascertained that Board Directors meet both the independence and integrity requirements, and that no reasons for ineligibility or incompatibility subsist. The Board of Statutory Auditors verified that the Board correctly applied all the relevant criteria and procedures to assess the independence of its members.
(7) Reference Law No. 120 of July 12, 2011.
Induction of the Board of Directors
Immediately after the appointment of the current Board on May 4, 2011, Saipem set up a board induction programme to enable new Directors to acquire in-depth knowledge of the Company’s activities and organisation, its market and relevant sectors. The programme, which also involved new members of the Board of Statutory Auditors, comprised of a series of meetings, in which the Company’s top management presented Saipem’s organisation, its various Business Units and main subsidiaries, providing a thorough analysis of the issues of major interest to the Directors and Statutory Auditors.
In recent years, several Board meetings were held at venues other than the Company’s offices and on-board Saipem’s vessels, namely ‘Castoro Sei’.
Cumulation of offices
Pursuant to items 1.c.2 and 1.c.3 of the Corporate Governance Code, to ensure that Directors can devote enough time to their office, the Board of Directors on March 28, 2007 expressed the following guidelines on the number of offices a Director may hold:
- an executive Director shall not hold: (i) the office of executive Director at other listed companies, either in Italy or abroad, in financial companies, banks, insurance companies or companies with net equity in excess of €1 billion; and (ii) the office of non-executive Director or Statutory Auditor (or member of other control body) in more than three of the aforementioned companies;
- besides the appointment at this Company, a non-executive Director shall not hold: (i) the office of executive Director in more than one of the aforementioned companies and the office of non-executive Director or Statutory Auditor (or member of other control body) in more than three of the aforementioned companies; and/or (ii) the office of non-executive Director or Statutory Auditor in more than six of the aforementioned companies.
Offices held at companies of the same Group are excluded from the limit of cumulation. Should the aforementioned limits be exceeded, Directors shall immediately inform the Board of Directors, who, after assessing the position and, in light of the Company’s interests, shall invite the Director to take the relevant decisions. Based on the information received, listed hereunder are additional directorships or auditor posts held by Saipem’s Board Directors in other companies.
Chairman of the University Commission of the Confederation of Italian Industry ‘Confindustria’, of ‘Istituto di Economia e Politica dell’Energia e dell’Ambiente’ (IEFE) of ‘Bocconi University’, of ‘Consorzio Speed Mi Up’ (Bocconi University, the Milan Chamber of Commerce and Municipality); Deputy Chairman of the Milan Chamber of Commerce, the Milan ‘Polytechnic Business School’ (MIP); Board Member of ‘Bocconi University’ in Milan, the ‘LUISS Carli University’ in Rome, the Management Board of ‘Giunta di Confindustria’; Member of the Executive Board of ‘Fondazione Sodalitas’, of the Board of Directors and the Executive Board of ‘Fondazione Fiera di Milano’, of the Technical Committee ‘Progetto Speciale EXPO 2015’.
Chairman of the ‘Corriere della Sera’ Foundation; Member of the Board of Directors of ‘RCS Media Group’, of ‘Artemide SpA’; Member of the Technical Committee for the Corporate Governance Code of Listed Companies, of the Board of ‘Rivista delle Società’ and ‘Concorrenza e Mercato’, of the Executive Board of ‘Centro di Documentazione Ebraica’ (CDEC), of ‘Istituto per la Storia del Movimento di Liberazione in Italia’ (IMSLI), of the Foundation ‘Scienze Religiose Giovanni XXIII’.
Gabriele Galateri di Genola
Chairman of ‘Assicurazioni Generali SpA’ (listed company), of ‘Istituto Italiano di Tecnologia’, of ‘Fondazione Marcianum’ in Venice, of the Corporate Governance Committee of Borsa Italiana; Board Director of ‘Telecom Italia SpA’ (listed company), of ‘Italmobiliare’ (listed company), of ‘Azimut-Benetti SpA’, of ‘Lavazza SpA’, of ‘Edenred SA’ (listed company); Member of the International Advisory Board of ‘Columbia Business School’.
Managing Director of ‘Permasteelisa Group’; Member of the Board of Directors of ‘Salini-Impregilo SpA’ (listed company); Member of the Supervisory Committee of ‘Josef Gartner GmbH’.
Chairman of the Board of Directors of ‘Sagat SpA - Aeroporto di Torino’, of ‘Sagat Handling SpA’, of ‘Intesa Sanpaolo Group Services ScpA’; Chairman of the Managing Board of ‘Turismo Torino e Provincia’; Deputy Chairman of the Executive Board of ‘GTA - Gruppo Turistico Alberghiero aderente all’Unione Industriale di Torino’.
Managing Director of ‘Betafence NV’; Member of the Board of Directors of ‘Piper Jaffray’ (listed company).
Board of Directors’ Meetings
The Company’s Articles of Association do not specify how often the Board should meet, although Article 21 states it has to occur at least quarterly as follows: ‘The Directors inform the Board of Directors and the Board of Statutory Auditors promptly or at least every quarter on Company activities, major economic and financial transactions involving the Company or its subsidiaries; in particular they report those operations in which they have an interest, on behalf of themselves or third parties, or those operations that are subject to the influence of the controlling party’.
In 2013, the Board of Directors met on sixteen occasions, their meetings lasting 3.45 hours on average; four meetings had been scheduled to take place in the first half of 2014; as of March 14, 2014, the Board has held three meetings. The general public is informed of the dates of Board Meetings when periodical statements and reports, required by current legislation, are to be approved.
The Board of Directors sets down the formalities pertaining to the calling of Board Meetings; in particular, meetings are convened by the Chairman, who also prepares the agenda for the meeting, through notices sent by post, fax or e-mail at least five days prior to the date of the meeting; in exceptional circumstances, notice is sent at least 24 hours prior to the time of the meeting. The Articles of Association allow for meetings to be held via video-conference link. Directors and Statutory Auditors are provided in advance with documents pertaining to items to be discussed and/or resolved on at the meeting.
In 2013, an average of 90.6% of Board Directors and 84.4% of independent Directors attended Board Meetings. The COO is invited to attend Board of Directors’ meetings on a regular basis to report on the status of operations and the strategic prospects, and occasionally other senior managers involved in specific matters. Generally Board of Directors’ meetings are also attended by the Company’s CFCO.
The Secretary to the Board of Directors is present at every Board Meeting (this office is held by the Saipem’s Senior Vice President General Counsel, Company Affairs and Corporate Governance).
Consistent with international best practices, which recommend avoiding the concentration of duties in one person, the Board of Directors resolved, at their meeting of July 29, 2008, to separate the roles of Chairman and Chief Executive Officer (CEO), the latter being the administrator who, by virtue of powers granted and their actual exercise, is the principal person responsible for the management of the Company.
The Corporate Governance Committee of Borsa Italiana believes that the separation of the aforementioned roles can strengthen the characteristics of impartiality and balance required of a Chairman of the Board, to whom the law and procedure entrust the tasks of organising the work of the Board, as well as acting as a link between executive and non-executive Directors.
The separation of the roles of Chairman and Chief Executive Officer (CEO) makes the appointment of a lead independent Director unnecessary.
Umberto Vergine (CEO) is the only executive Director.
The Board vested the CEO, the person ultimately responsible for the Company’s management, with all ordinary and extraordinary powers to manage the Company, except for the undelegable powers and those of the Board itself. The Chairman is a non-executive Director and is vested with all powers granted to him by law and the Company’s Articles of Association.
To the CEO report the COO (Chief Operating Officer), the CFCO (Chief Financial and Compliance Officer), the Senior Managers responsible for the following departments: Institutional Relations, Communication, Integrated Risk Management, Procurement Contract and Industrial Risk Management, Business and Technology Development, QHSE and Human Resources.
The Chairman chairs the Shareholders’ Meeting, convenes and chairs Board of Directors’ meetings and ensures the implementation of resolutions carried by the Board itself.
Consob Resolution No. 17221 of March 12, 2010 (adoption of ‘Related Parties’ Regulations) amended through Resolution No. 17389 of June 23, 2010, had amended Article 37, paragraph 1, letter d) of Market Regulations, providing that the shares of a subsidiary subject to management and coordination by another company may only be admitted to trading if its committees are composed of independent Directors. For companies subject to management and coordination by another listed company, as in Saipem’s case, the Board of Directors shall also be composed of a majority of independent members.
On December 13, 2010, the Board of Directors amended Article 19 of the Articles of Association, providing that the majority of Directors shall meet the independence requirements set by Consob for Directors of companies subject to management and coordination by another listed company. Hence, the Shareholders’ Meeting of May 4, 2011 elected the new Board of Directors for the period 2011-2013, and, in compliance with Article 37, paragraph 1, letter d) of Market Regulations, five out of nine members appointed were independent Directors. The current number of independent Directors is six, following the appointment by co-optation of Piergaetano Marchetti at the Board Meeting of July 30, 2013.
Upon his appointment, the Board of Directors also ascertained that Mr. Marchetti met the relevant independence requirements. The Directors who do not comply with the independence requirement are the executive Director Umberto Vergine, and non-executive Directors Alberto Meomartini and Fabrizio Barbieri (appointed at the Shareholders’ Meeting of April 30, 2013).
Following their appointment, the Board of Directors ascertains annually that Board Directors still comply with the independent requirements. At the Board Meeting of March 14, 2014, it was ascertained that all Board Directors comply with the independence requirements. The Board of Statutory Auditors has assessed the application of criteria and procedures adopted by the Board of Directors to ascertain the independence of its members and found them to be compliant. This evaluation is carried out in accordance with the criteria set forth in Article 148, paragraph 3 of Law No. 58/1998 and Criteria 3.c.1 of the Corporate Governance Code.
Independent Directors have not deemed it necessary to meet without the other Directors in view of the fact that they take an active part in Committee meetings.
Article 123-ter of Law No. 58/1998 has made it compulsory for listed companies to publish a ‘Remuneration Report’, whose contents and methods of publication are governed by Consob, through Article 84-quater of Issuers Regulations issued on December 23, 2011.
This Consob resolution took effect on December 31, 2011, making it compulsory to issue this new Remuneration Report from 2012.
For all issues relating to the remuneration of Directors, Statutory Auditors and senior managers with strategic responsibilities please refer to the ‘Remuneration Report’, which is available to the public at Saipem’s registered office or on the Company’s website www.saipem.comunder the section ‘Corporate Governance - Documents’ at least 21 days prior to the General Shareholders’ Meeting called to approve the Financial Statements for the year 2013. At the General Shareholders’ Meeting, Shareholders will be required to cast a non-binding vote on the first section of the Remuneration Report, pursuant to current legislation.