GOVERNANCE
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Board of Directors

BOARD OF DIRECTORS

Role of the Board of Directors

In 2008, eight meetings of the Board of Directors were held. Attendance by Directors was high, with over 90% of board members being present. There was also a high presence of independent directors (over 85%). Board meetings lasted 2 hours, on an average.
Board meetings may be attended by other Company officers or even outside parties, whenever such attendance may be necessary or useful in providing the Board specialist or expert advice with regard to the items on the agenda.
In this month of January, the Company informed the market of its calendar of corporate events for the year 2009, indicating the dates of Board meetings to approve the economic and financial information, and of the general Shareholders' Meeting. The Board of Directors met one time in February 2009.

According to TI Media's model, the Board of Directors plays an active role both in the strategic guidance of the Company and in controlling its operations. It has the power to establish strategic guidelines and is required to participate directly in decisions that have a major impact on the activities of the Company and Group.
Specifically, in accordance with the Company's Corporate Governance Code, the responsibilities of the Board of Directors include, but are not limited to:

  • examining and approving the strategic, business and financial plans and budget of the Company and the Group;
  • examining and approving strategic transactions and establishing general criteria for identifying them (see infra);
  • checking the adequacy of the organizational, administrative and accounting structure of the Company and the Group, with particular reference to the internal control system;
  • drafting and implementing the Company's corporate governance rules and defining the Group's corporate governance guidelines;
  • determining the limits and procedures for the exercise of the related powers, as well as the intervals at which the delegated bodies are required to report to the Board in respect of their assigned tasks;
  • appointing the Chairmen and Managing Directors of the subsidiaries with strategic importance;
  • generally supervising business performance, periodically checking actual results against planned ones.

In accordance with and to supplement these principles, the Board of Directors (without prejudice to the functions and powers conferred upon it by law, the By-laws, proxies or internal procedures) has adopted and published criteria for identifying strategic transactions that require approval by the Board of Directors (a complete copy of the document is available online at www.telecomitaliamedia.it in the Governance section). Such transactions include:

  • agreements of any type with competitors of the Telecom Italia Media Group that, due to their subject, commitments or conditions or limits imposed by them could have a long-term or significant impact on the freedom of the Group's strategic decisions; agreements established with direct competitors of the Telecom Italia Media Group that impact the Group's overall operations or areas thereof (e.g., partnerships, joint ventures, etc.);
  • initiatives and transactions that: (i) result in the entry into (or exit from) geographical and/or product markets; (ii) exceed the total amount of the industrial investments outlined in the budget by more than 25%;
  • industrial investments and divestments amounting to more than Euro 100 million; transactions that, while being carried out or upon completion, result in commitments and/or purchases and/or disposals of the same nature and amount;
  • purchases and disposals of companies or branches of companies that are of strategic importance to overall business operations or have a value exceeding Euro 100 million; transactions that, while being carried out or upon completion, result in commitments and/or purchases and/or disposals of the same nature and amount;
  • purchases and disposals of controlling interests or investments in associates for amounts exceeding Euro 100 million, or (even for lesser amounts) in companies specializing in the Group's core business; entering into agreements concerning the exercise of rights attached to such interests; transactions that, while being carried out or upon completion, result in commitments and/or purchases and/or disposals of the same nature and amount;
  • obtaining loans from or providing guarantees to companies in which the Company does not have a controlling interest for amounts exceeding Euro 100 million; transactions that, while being carried out or upon completion, result in commitments and/or purchases and/or disposals of the same nature and amount;
  • atypical and unusual transactions as defined by CONSOB.

The Board of Directors of TI Media (being the Parent Company) is also responsible for approving the aforementioned transactions when proposed by subsidiary companies.

Pursuant to the Corporate Governance Manual, all the related-party transactions effected by the Company, both directly and indirectly through subsidiaries, and including intercompany transactions, must fully comply with the principles of substantive and procedural correctness. The Board of Directors is in charge of overseeing compliance with the said principles, through the Internal Control and Corporate Governance Committee.
The Board of Directors is also tasked with adopting specific principles regulating decision-making responsibilities, internal organizational procedures, and checks and balances, as well as reporting tools for related-party transactions.

The Board of Directors is in charge of assessing the appropriateness of the Company's general accounting, administrative and organizational layout in light of the information received from management from time to time, as well as, with specific regard to the appropriateness of the internal control system, the findings of the Internal Control and Corporate Governance Committee.
In the performance of activities related to its ultimate responsibility for the internal control system, the Board is assisted by the aforesaid Committee as well as:

  • the consortium Telecom Italia Audit & Compliance Services which has been appointed as the Internal Control Manager, falling under the Internal Auditing function;
  • with specific reference to internal controls for financial reporting purposes, the Executive in Charge of Financial Reporting.

Pursuant to the guidelines established by the Board of Directors, the Director specifically appointed to oversee internal controls (the Deputy Chairman-Managing Director Giovanni Stella) is tasked with defining specific instruments and procedures for the related system, especially so as to ensure that the latter is updated in light of changes in operating conditions and/or the statutory and regulatory framework.
Lastly the Group Compliance Officer is invested with liaison and coordination responsibilities in respect of the plans designed to improve the Group's internal control system, and, in such capacity, is in charge of overseeing risk management methods, with the support of and in concert with Telecom Italia Audit & Compliance Services within the organizational framework of which he operates.

The evaluation of operations is assessed from time to time, on the basis of ongoing reporting to Non-executive Directors and the Board of Statutory Auditors, coordinated by the Chairman of the Board of Directors, during various meetings, and more specifically, by comparing results against budgeted targets, when drawing up financial statements.

As contemplated in the Company's Corporate Governance Manual, in 2007, the Board of Directors launched a self-assessment process to evaluate its own performance, and, towards this end, decided to avail of the services of an outside consultant, Egon Zehnder International. In concert with the Internal Control and Corporate Governance Committee, the consultant gathered data for this purpose from individual directors, through questionnaires and one-to-one interviews. The data in question was then analyzed to allow for a self-assessment of the structure, functioning and efficiency of the Board of Directors, with a view to pinpointing areas for improvement as well as acquiring an understanding of how individual directors perceived the following aspects:

  • consistent compliance with corporate governance best practices;
  • appropriateness of the professional skills represented on the Board, as well as the number of Independent Directors appointed to the Board;
  • leadership, organization, information and efficient functioning of the Board of Directors;
  • orientation of performance, and consideration for shareholders, stakeholders and the Market.

The consultant's findings were submitted to the Board of Directors on November 7, 2007. In 2008, applying the lessons learned during the comprehensive and fruitful experience acquired during the previous year, the Committee directly coordinated the Board's self-assessment process, and, on February 26, 2009, provided all directors with the questionnaires to be filled in with the data to be subjected to analysis at the Board's earliest convenience. As recommended by Egon Zehnder in his 2007 report, the aforesaid questionnaire is aimed at measuring the actual level of performance and functioning achieved by Board of Directors during 2008.

Last update: 08/04/2010, 15:10