Intesa Sanpaolo adopts the dual management and control model, consisting of a Supervisory Board and a Management Board.
Detailed information on the corporate governance system is provided in the “Report on Corporate Governance and Ownership Structures – Remuneration Report” @.
The Supervisory Board
In addition to the supervisory duties – which under the traditional management and control model are the responsibility of the Board of Statutory Auditors – the Supervisory Board also performs tasks that traditionally lie with the Shareholders' Meeting, such as the appointment and removal of members of the Management Board, taking responsibility-related action with regard to members of the Management Board and approval of the Parent Company financial statements.
As regards strategic supervision, the Supervisory Board is entrusted with other functions that strengthen its steering duties and recognise the joint involvement of its members in the main governance decisions of the Bank and the Group.
Reports are submitted, at least on a quarterly basis, to the Supervisory Board on operations during the period and comparison with the system, on significant balance sheet, income statement and financial transactions, and on transactions with related parties.
The Management Board
This Board has sole responsibility for corporate management. It ensures the implementation of strategic guidelines and risk governance policies defined and approved by the Supervisory Board, with which it cooperates, to the extent of its own duties, in performing the strategic supervisory role. For this purpose, the Management Board resolves on all transactions considered useful or appropriate in achieving the corporate purpose, relating to both ordinary and extraordinary administration. The Management Board is responsible for certain matters of greater importance, beyond those strictly envisaged in the regulations. On such matters, joint decision-making makes it possible to actively involve Board Members who therefore participate with independent judgement in the Bank’s key operational governance issues.
Internal Committees of the Supervisory Board
Up to 31 December 2014, the Supervisory Board had set up six Committees: Remuneration Committee, Nominations Committee, Control Committee, Strategy Committee, Financial Statements Committee and Committee for Transactions with Related Parties.
In application of the new Supervisory regulations framework, from 1 January 2015 the Supervisory Board began a comprehensive review of the Committees system which envisages the setup of two new Committees: the Risks Committee and the Internal Control Committee, with dissolution of the Control Committee, the Financial Statements Committee and the Strategy Committee, whose duties are mainly taken over by the Risks Committee. The Nominations Committee, the Remuneration Committee and the Committee for Transactions with Related Parties of Intesa Sanpaolo S.p.A. and Associated Entities of the Group are instead reconfirmed.
Characteristics of the Supervisory Board and its Committees (2014 figures)
|Body||N° of members||Independent*||% of women||Age||Age||Age||N° of meetings||Attendance|
|Financial Statements Committee||5||4||60%||20||99%|
|Committee for Transactions with Related Parties||4
* Independence requirements met according to the Corporate Governance Code.
The Chairman of the Supervisory Board is non-executive and is independent pursuant to criteria established in the Consolidated Law on Finance, and is non-independent pursuant to the Corporate Governance Code.
All the Supervisory Board members are non-executive. The Supervisory Board remains in office for three financial years.
Characteristics of the Management Board (2014 figures)
|Body||N° of members||Executive||% of women||Age <=30||Age 30-50||Age >50||N° of meetings||Attendance|
* Includes the Managing Director as Chief Executive Officer and in relation to his/her role as head of operational management of the Bank and the Group, three Executive Members from the Group's Management and two “external” Deputy Chairpersons, whose executive status derives from their participation, with voting rights, in the Group’s managerial committees and from assignment to specific duties.
The Chairman of the Management Board – independent according to Consolidated Law on Finance criteria – qualifies as a non-executive member. In fact, he/she has no operating powers and the current organisational structure of the Bank separates his/her duties from those of the Managing Director.
Leadership and Member duties
High quality leadership is Intesa Sanpaolo’s trump card. Our Group is governed by a team of top level Members whose quality and expertise are a source of inspiration for top management and the other managers.
As regards the Supervisory Board, four Members are entered in the auditors’ register and have exercised auditor activities for at least three years. In general terms, the duties of the Board - relating to banking and/or insurance and/or financial business, the structure of the economic and financial system, regulation of financial activities and markets, risk management and control methods, accounting and financial issues and remuneration policies, internal control and corporate organisation – are all complementary and ensure adequate resources for the size and complexity of the Bank and the Group. In reference to risk management, the Supervisory Board approves the definition of the maximum acceptable risk level for the Group (its "risk appetite") and the correlated system of limits at the level of overall risk and specific risks (the "Risk Appetite Framework"). For this activity, the Board receives support from in-depth studies performed by the Committees, each to the extent of their duties.
In terms of the professional experience of Members, five of these have held this office since 2007, three have gained experience since 2010 and one member joined the Board in June 2012.
As regards the Management Board, all Members have overall experience of at least three years in qualified professional activities suitable for such office. The Chairman has more than five years’ experience (he held other offices in leading listed Italian companies), whilst the Managing Director has specific managerial experience having held management roles in various departments of the Bank (Head of the Planning and Control Department, Head of the Risk Management Department, Head of the Value Governance Area, Chief Financial Officer, etc.). In addition, the presence of executive Members from the Group’s management has contributed to increasing Board professionalism, with particular regard to banking business, the structure of the economic and financial system, banking and finance regulations and risk management and control methods.
Training and updating of Members
Once again in 2014, members’ attendance at Board and Committee meetings was high and constant, ensuring a systematic contribution to all activities and an increased business and corporate awareness of the Bank and the Group, as well as the main new legal and regulatory aspects.
For this purpose, at the initiative of the Chairmen of the Supervisory and Management Boards, specific in-depth induction seminars were held in relation to: control system gap analysis; performing the self-assessment process; supervisory regulations on corporate governance and on the control system in order to ensure full updating of the Articles of Association to the new regulatory structure; presentation and analysis of the results of the comprehensive assessment conducted by the European Central Bank.
Governance Body self-assessment
With regard to the periodic verification of their adequacy in terms of powers, size, composition and operations, until 2013 the Members performed an annual self-assessment using internal tools only. In 2014, the Boards decided to make use of a specialist external advisor appointed to provide support to the governance Bodies in reviewing the self-assessment processes used thus far and their formalisation into specific internal Regulations which were later adopted. The Self-Assessment Regulations were prepared in application of the Supervisory regulations and in compliance with European Banking Association “Guidelines on Internal Governance” and “Guidelines on the Assessment of the Suitability of Members of the Management Body and Key Function Holders”, issued in September 2011 and November 2012 respectively, which also take into account national and international best practices on this matter.
The self-assessment process is divided into a preparatory stage (information gathering, issue of questionnaires, interviews with individual members) to survey the operating, efficiency and effectiveness profiles of the Body and opportunities for improvement.
The information gathered at the preparatory stage is then processed and consolidated into a document showing the qualitative and quantitative results of the self-assessment, the compliance and performance levels and the areas of excellence and for improvement indicated by Members. This document is then submitted to the Boards for examination and joint discussion.
Details of the successful outcome of the 2014 assessment can be found in the “Report on Corporate Governance and Ownership Structures – Remuneration Report” @.
The internal control and risk management system
The internal control system has been designed to achieve constant identification, governance and control of the risks involved in our activities. It is structured on three levels:
- the first is represented by the line controls which are carried out by the operational structures, are built into our procedures and are part of back-office activities;
- the second is entrusted to the Chief Risk Officer and, in addition to the legal area, includes controls on risk management, compliance with standards, anti-money laundering risk, credit granting process, and internal validation;
- the third is the internal audit, carried out by the Internal Auditing Department, which operates independently and separately from the operational structures, to identify anomalous trends, violations of procedures and regulations, and to assess the good order of the overall internal control system.
Also taking into account the Management Board’s proposals and making use of the support of specific Committees, the Supervisory Board defines and approves the risk governance policies at Group level and the guidelines for the internal control system, including those relating to values and principles of the Code of Ethics, whilst both Boards make use of the Chief Risk Officer’s action, reporting directly to the Chief Executive Officer.
The Supervisory Board and the Management Board also approve the Sustainability Report, which reports to stakeholders on activities carried out during the year and demonstrates the Bank’s ability to pursue its objectives in line with stated values and with corporate development plans. The Report illustrates the results of stakeholder engagement activities and the materiality matrix, which represents the “significant” areas of operations resulting from the integration into corporate strategic plans of considerations of an economic, social and environmental impact.
All members of the Supervisory Board and the non-executive Management Board Members receive remuneration which is fixed for the entire period of office and not based on financial instruments, nor on incentives related to economic results, in order to guarantee independence in the performance of their activities, which must not depend on expectations of higher remuneration based on the results achieved by the Bank.
The remuneration policies for Management Board Members, approved by the Shareholders’ Meeting on recommendation of the Supervisory Board, are aimed at increasing the Bank and Group's competitiveness, attracting qualified professionals suited to the management requirements, aligning the interests of Members to achieve the objective of creating value for shareholders in the medium/long-term with a view to prudent risk management and responsibility towards all stakeholders and, finally, at promoting sustainability of the remuneration policies over time.
Remuneration of the executive Management Board Members – including the Managing Director – and of top management consists of a fixed portion and a variable portion. Limitations are based on a fair balance of fixed and variable components and, for the latter, weighting systems for the risks are applied, as well as evaluation mechanisms designed to ensure a connection to effective, long-term performance.
Divisions and Business Units, Governance Areas and Head Office Departments
In terms of organisational logic and to ensure that Group governance has the necessary coherence, the Parent Company is divided into seven Business Units, comprising the aggregation of business lines with similar characteristics in terms of products and services provided and in terms of the regulatory framework, six Governance Areas, Head Office Departments and Staff Units under the direct responsibility of the Managing Director and CEO that carry out steering, coordination, control, support and service duties at Group level @.
Share capital subscribed and paid-in totals 8,724,861,778.88 euro, divided into 16,778,580,344 shares of a nominal value of 0.52 euro each, of which 15,846,089,783 ordinary shares (equal to 94.44% of share capital) and 932,490,561 non-convertible savings shares (equal to 5.56% of share capital).
Relations with shareholders and the financial community
In its relations with the market, Intesa Sanpaolo adopts a specifically transparent form of conduct, especially with regard to annual and interim financial results and to Group strategies. This also takes place via meetings with the national and international financial community, in a framework of constant dialogue with the market based on correct and timely communication.
During 2014, in a still very difficult economic scenario, communications with the financial community continued to focus on sustainable profitability and the Group’s solidity as a safe point of reference for stakeholders. To guarantee access to all, again in 2014 this information was made available quickly, easily and economically through a number of channels: Internet, conference calls via a toll-free number and the free distribution of financial statements on request. The Investor Relations section of the website @ has a well-organised content and theme updates, always providing stakeholders with extensive, systematic information.
In order to contribute to the creation of sustainable value over time, regular and frequent meetings were held with the financial community that consolidated long-term relations based on mutual trust.
For Intesa Sanpaolo the Shareholders’ Meetings are one of the main opportunities for contact and dialogue with its shareholders, as well as an occasion for the disclosure of news, in accordance with the principles of non-selective disclosure and rules on price sensitive information.
The Meeting is called by the Management Board or upon request by the shareholders in accordance with the law, through a notice published on Intesa Sanpaolo’s website and, in abridged form, in at least one national newspaper (generally “Il Sole 24 Ore” and other national and international newspapers).
Right to attend and vote:
Each ordinary share confers the right to cast one vote.
Savings shares, which may be in bearer form, do not confer the right to vote in ordinary and extraordinary shareholders’ meetings but entitle the holder only to attend and vote at the Special Meeting of savings shareholders.