Remuneration of Directors

The compensation of the Directors is established by the Shareholders’ Meeting for each Director (Article 24.1 of the Bylaws).
Extra compensation for the members of the Committees formed within the Board of Directors in compliance with the Governance Code of Borsa Italiana was resolved, following the evaluation by the Board of Statutory Auditors, in compliance with Article 2389, paragraph 3, of the Civil Code and with Article 24.2 of the Bylaws, by the Board itself; the overall compensation for the Chairman and the CEO is also identified by the Board of Directors based on the proposal submitted by the Remuneration Committee and following the evaluation by the Board of Statutory Auditors.

The total emoluments received by the members of the Board of Directors during the year are indicated in the note to the financial statements.

As proposed by the “Remuneration Committee”, the Board of Terna adopted its own “Remuneration Policy” at its meeting held December 13, 2011, in implementation of the provisions of Article 7 of the Governance Code. Following the entry into force of the regulatory provisions of implementation under Article 123 ter of the Consolidated Law on Finance issued with the CONSOB resolution no. 18049 dated December 23, 2011 (published in the Official Journal no. 303 on December 30, 2011), in its meeting held March 20, 2012, Terna’s Board, as proposed by the “Remuneration Committee”, approved the updating of the adopted Policy to be submitted to the shareholders for an advisory and non-binding vote pursuant to Article 123 ter, paragraph 6 of the Consolidated Law on Finance.
All information on Company Policy concerning remuneration of members of administration bodies, of general directors and executives with strategic responsibilities with reference to at least the subsequent fiscal year and the procedures used for the adoption and implementation of said Policy will be summed up in the “Annual Report on Remuneration”, published by Terna in fulfillment of the provisions of Article 123 ter of the Consolidated Law on Finance and of the aforesaid CONSOB resolution which, inter alia, introduced Article 84 quater to the Issuer Regulations, which will be submitted to the annual Shareholders’ Meeting. With respect to the “Annual Report on Remuneration”, also the information required by article 7 of the Governance Code, which Terna adopted, will be summarized.

The “Annual Report on Remuneration”, based on the provisions of the rules under reference, provides an adequate representation of each of the entries that comprise the remuneration, including action provided for in the event a member leaves the position or the employment relation is terminated, highlighting the consistency with the Company Policy on remuneration approved in the previous fiscal year, and analytically illustrates the compensation paid by the Company and by subsidiaries or affiliated companies during the fiscal year of reference, for any reason and in any form whatsoever, on the basis of the provisions in Article 123 ter of the Consolidated Law on Finance and the abovementioned CONSOB resolution.

Finally, based on the provisions of Article 84 quater, paragraph 4, of the Issuer Regulations, the Report shall include information concerning compensation plans provided for by Article 114 bis and information on shareholdings in Terna and in subsidiaries held by members of the administration and control bodies, by general directors, and by other executives with strategic responsibilities, as well as by spouses not legally separated and by minor children, directly or through subsidiaries, trust companies or through a third parties.