Corporate Governance

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Terna’s governance structure is based on the traditional accounting and control model and is in compliance with the provisions of Italian legislation regarding listed companies. Terna adopted the Self-regulation Code of listed companies published by Borsa Italiana in March 2006 and in 2007 the Company approved and implemented adjustments in its corporate governance system in order to fulfill the commitments provided for by the Code.

Therefore, the Company’s corporate governance system is in line with the principles included in the Self-regulation Code (available at www.borsaitaliana.it), with the relevant recommendations issued by CONSOB, and in general with international best practices.

This corporate governance model aims at creating value for shareholders, while being aware of the social importance of the Group’s activities and of the need to appropriately considering all the interests involved in carrying them out.

The task of managing the Company is entrusted to the Board of Directors, which is appointed by the shareholders’ meeting. The Board of Directors is responsible for establishing strategic and organizational guidelines for the Company and the Group, as well as ensuring that the controls necessary for monitoring the performance of the Company and its subsidiaries are in place.

Board of Directors

In compliance with the Bylaws, the Board is entrusted with the broadest powers for the company’s ordinary and extraordinary management and in particular, it has the power to take all action it deems necessary for implementing and reaching corporate goals, excluding only the action that the law and the Bylaws reserves for the shareholders’ meeting.

Chairman of the Board of Directors

In compliance with the Bylaws, the Chairman has the company’s legal representation power, chairs the shareholders’ meeting, summons and chairs the Board of Directors and verifies the implementation of the Resolutions passed by the Board itself.

Chief Executive Officer

Also in compliance with the Bylaws, the CEO has the company’s legal representation power and corporate signature and is also entrusted, according to the Board’s Resolution, with all the powers for managing the company, with the exception of those differently established by law, by the Bylaws or reserved to the Board of Directors.

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BOARD OF DIRECTORS IN OFFICE AS OF 31/12/11
Office Members Executive Non executive Independent Internal Control Committee Remuneration Committee Committee for Related Party Transactions
Chairman Luigi Roth          
CEO Flavio Cattaneo          
Director Fabio Buscarini        
Director Francesco Pensato          
Director Paolo Dal Pino  
Director Matteo Del Fante        
Director Salvatore Machì    
Director Romano Minozzi    
Director Michele Polo      

The Board of Directors in office as of December 31, 2011 was appointed on May 13, 2011 and consists of nine members.

On May 30, 2011, Director Andrea Camporese, non independent and non executive member, resigned from his positions for personal reasons. As his replacement, Terna S.p.A.’s Board of Directors appointed Francesco Pensato by cooptation and upon indication by Cassa Depositi e Prestiti; he will remain in office until the next shareholders’ meeting.

Further information on Terna’s corporate governance can be found in the “Corporate Governance Report”, which was approved by the Board of Directors on March 20, 2011 and available on the Company’s website, www.terna.it, in the Investor Relations section, accessible from the homepage.

Terna’s new organizational structure

As of April 1, 2012 the Terna Group has a new organizational structure.

Announced in February 2011 during the analyst presentation of the 2011-2015 Strategic Plan, the reorganization is functional to developing the opportunities of the business objectives outlined in the Strategic Plan and focuses on the expertise and know-how acquired by Terna’s people in managing large works and on its knowledge of the electricity market.

In the new structure, the Terna Group is divided in Terna S.p.A., the Parent Company, that is the owner of the concession and of the assets, and into two entirely owned operational companies: Terna Rete Italia and Terna Plus, each one with its own CEO and its Board of Directors.

Terna has the task of establishing the company’s strategic policies, govern processes, guarantee compliance with concessions and define the investment plan. While allowing the two new companies independent management, the Parent Company will exercise control through group guidelines that will be defined according to department and may be based on orientation, control, authorization and exclusiveness.

Terna Rete Italia is responsible for carrying out concession activities and for the operation, maintenance and development of the National Electricity Transmission Grid. The Company, with nearly 3,000 people, has also the task of implementing the projects established by the Parent Company in the Development Plan.

Terna Plus is responsible for non-traditional activities, particularly battery storage systems and energy efficiency as well as scouting development opportunities abroad (in particular the Balkans).

The two subsidiaries operate fully respecting the policies and guidelines defined by the Parent Company, according to the logic of the hierarchic-functional dual reporting: hierarchic reporting to the respective CEOs and functional reporting to the corresponding corporate structures. The CEOs of the subsidiaries determine the priority activities according to the logic and guidelines defined by the Parent Company’s staff structures.

The new corporate and organizational structure was presented on April 3, 2012 by the Top management to the executives and through waterfall model presentations to all the Group’s personnel.