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The Board of Directors plays a central role in the governance structure, being entrusted with the management of the company to create value for shareholders through the approval and implementation of policies ensuring a steady return over time, by diversifying risks whilst preserving the assets from the cyclical nature of the business.
The Board is composed of a minimum of three to a maximum of seven members, appointed by the ordinary Shareholders’ Meeting for three financial years.
Board’s members must have the requisite of integrity and competence.

Integrity requires that candidates cannot be appointed as Board’s members if they are

  • ineligible for, or revoked from such office due to prohibition, incapacity or bankruptcy judgement;
  • directors of companies which received a bankruptcy judgement;
  • found guilty of a crime and given an irrevocable sentence.
Competency provides that candidates must have at least seven years of experience carrying out management and control activities a) within the Augustea Group or with companies operating in similar business or b) in other companies, where they have acquired proven management experience.
Augustea by-laws state that Board’s members can be “executive” or “non-executive” directors.

Executive directors are the Chief Executive Officer of the company and the directors having individual management powers or a specific role in developing corporate strategy or those with senior management functions in the company.

All those directors who do not fall within any of the aforementioned categories are considered non-executive directors. Their number must be large enough to guarantee them a significant weight in Board’s decisions.

The Corporate Governance system which Augustea adopts provides that at least one member of the Board must fulfill the independence requirement established for members of control bodies of listed company. Independence entails the following are met:

  • not to exercise - directly, indirectly or on behalf of third parties -  any control over the Company;
  • not to own equity investments that allow a director to exercise control or influence the management;
  • not to be employed or not to have – or have had in the previous year – directly, indirectly or on behalf of third parties economical relations with the Company or other group companies such as to affect his autonomy of judgement;
  • not to be a spouse, not legally separated, or a relative or similar within the second degree, in a straight line or in a collateral line,  of an executive director or of a shareholder exercising direct or indirect control over the Company.

Fulfilment of the “independence” requirement is declared by the director appointed at the time of acceptance of appointment, and is ascertained by the Board during the first subsequent meeting. The independent director undertakes to notify the Board promptly of any change of circumstances which might compromise his/her independence.

When appointing independent directors consideration is given to the appropriateness of periodic rotation, of positions and between companies, to ensure transparency, eliminate any potential incompatibility and prevent the establishment of relations which over the length of the term in office could prejudice the impartiality and objectivity of directors’ opinions.

The age limit for executive directors is 65 years and 75 years for non-executive directors; from 2011 specific departures are authorised until expiry of the term in office.

Every Director is bound both by a duty of professional privilege for information received in the course of his/her term in office and by a duty to protect the interests of the Company; they may not pursue personal aims through their decisions nor use business opportunities open to the Company to their own advantage. A Director in a situation of conflict of interest, even potential, must inform the Board of Directors at the first reasonable opportunity and abstain from participating in the vote.

In accordance with the Italian Civil Code, the Board of Directors delegated part of its managing powers to the Chief Executive Officer(s) and appointed two internal Committees with consultative and proactive functions. Whilst both the Chief Executive Officer(s) and the Chairman may act on behalf of the Company, their roles are clearly separated.

 

Read more about the Board of Directors' powers and composition.

Last updated on April, 2016