Composition

  • The Board of Directors of the Company, as established by the Bylaws, consists of no less than seven and no more than 23 members who serve for 3 years and may be re-elected.
  • None of the serving directors was found to hold a higher number of offices than the maximum specified in the Policy.

The Board of Directors of the Company, as established by the Bylaws, consists of no less than seven and no more than 23 members, who serve for 3 years (unless a lesser period is specified by the Shareholders' Meeting upon their appointment) and may be re-elected.

The Board of Directors in office as of 31 December 2010 is composed of 19 Directors6 and was appointed by the 29 April 2008 Shareholders' Meeting for three financial years, ending with the Shareholders' Meeting summoned to approve the 31 December 2010 financial statements. The Shareholders' Meeting for approval of the 2010 financial statements will therefore proceed to renew the Board of Directors; the reader is referred to the Directors' Report to the Shareholders' Meeting, available on the company's website, for more details. The average age of the Directors in office as of 31 December 2010 is about 64.

By voting on a slate7, the minority shareholders were able to nominate four Directors, i.e. one fifth of the total (Directors Carlo Angelici, Cristiano Antonelli, Franco Bruni and Umberto Paolucci).

Two slates were presented to the Shareholders' Meeting held on 29 April 2008: one of participants in the Pirelli & C. Shareholders' Agreement (which obtained 93% of the votes of voting capital8) and one of a group of institutional investors9 (who obtained 5.5% of the votes of voting capital10). Those proposing the slates made the candidates' profiles available so that the candidates' personal and professional characteristics, as well as some candidates' qualifications as independents, were made known prior to voting.

The curriculum vitae, containing the personal and professional characteristics of each director, presented when the slates were filed, were promptly published on the Company website where they remain available in an updated version.

The composition of the Board of Directors at the date of this Report is identified in Table no. 3.

It should be noted that during the year Deputy Chairman Carlo Alessandro Puri Negri and Director Berardino Libonati ceased to serve.

Following the resignation of Deputy Chairman Puri Negri, in accordance with article 2386 of the Civil Code, in its 29 July 2010 meeting the Board appointed Vittorio Malacalza as Director, appointing him to the post of Vice Chairman on 14 October 2010.

Following the death of Director Berardino Libonati on 30 November 2010, the Board decided to put all decisions before the Shareholders' Meeting, in view of the imminent expiration of the entire Board's term of office.

Maximum accumulation of directorships in other companies

On 29 April 2008, as recommended by the Self-Regulatory Code11, the Board of Directors confirmed the validity and applicability of the Policy12, adopted by the Board during the previous mandate13, which established that serving as a director or auditor of more than five companies other than those directed and coordinated by Pirelli & C. S.p.A., or controlled by or affiliated with the same company, is not considered compatible with the role of director of the company if the companies are (i) listed companies included in the FTSE/MIB index (or equivalent foreign indices), or (ii) companies that undertake banking or insurance activities; moreover, it is not considered compatible for a director to hold more than three executive positions in companies described in (i) or (ii).

Offices held in more than one company in the same group are considered a single office, and executive positions prevail over non-executive ones.

The Board of directors retains the right to form a different opinion, and this will be made public in the annual report on corporate governance, together with the congruent grounds for doing so.

In its 8 March 2011 meeting the Board of Directors, having acknowledged the changes made to the Consolidated Banking Act, including abrogation of the so-called "special list" of retail finance companies (former art. 107 of Legislative Decree 385 of 199314), resolved to implement this change in its policy regarding the maximum number of directorships, which previously included the companies in the list appearing above among the total, and therefore eliminated reference to these companies. At the foot of this Report the document appears containing the Company's Policy regarding the maximum number of directorships Company directors may hold in other companies.

6 After the death of Prof. Berardino Libonati on 30 November 2010, the Board of Directors put off all resolutions until the Shareholders' Meeting in view of the fact that the entire Board's term of office is ending. At the Date of the Report there is therefore one vacant seat on the Board.
7 Slate voting is required under article 10 of the Bylaws.
8 Figure obtained from the Minutes of the 29 April 2008 Shareholders' Meeting, available at the company's website.
9 The minority slate was presented by: ARCA SGR SPA (rubrica Fondo Azioni Italia – Rubrica Fondo Arca BB), BNP PARIBAS ASSET MANAGEMENT SGR SPA (BNL Azioni Italia), MONTE PASCHI ASSET MANAGEMENT SGR SPA (Ducato Geo Italia), PIONEER INVESTMENT MANAGEMENT SGR P.A. (Pioneer Azionario Crescita), PIONEER ASSET MANAGEMENT S.A., EURIZON CAPITAL SGR SPA (San Paolo Azioni Italia – Sanpaolo Italian Equity Risk – Sanpaolo Opportunità Italia – Nextra Rendita), EURIZON CAPITAL S.A. (SPI Obiettivo Industria – SPI Obiettivo Europa – SPI Obiettivo Euro – SPI Obiettivo Italia), FIDEURAM INVESTIMENTI S.G.R. S.p.A. (IMI Italy), FIDEURAM GESTIONS S.A. (Fonditalia Global – Fonditalia Equity Italy – Fonditalia Euro Cyclical – Fideuram Fund Equity Italy – Fideuram Fund Europe Listed Industrials Equity), INTERFUND SICAV (Interfund Equity Italy – Interfund Equity Europe Industrials), AMBER MASTER FUND SPC (Managed by Amber Capital LP).
10 Figure obtained from the Minutes of the April 29 2008 Shareholders' Meeting, available at the company's website
11 Self-Regulatory Code: Criterion of application 1.C.3.
12 The aforementioned Policy is annexed to this Report, and is also available in the Governance section of the Company's website.
13 Board of Directors meeting of 7 November 2007.
14 Changes introduced by Legislative Decree no. 141 of 13 August 2010.
15 See Call notice for Shareholders' Meeting on 27 March 2008.
16 See Call notice for Shareholders' Meeting to approve the 2010 Financial Statements.
17 Self-Regulatory Code: Criterion of application 1.C.2.