The Board Evaluation process of the Board of Directors aims to assess its function and that of its internal committees expressing an opinion on the activities carried out and identifying any elements that may improve the function of said corporate bodies, both in terms of efficacy and efficiency. The activity is carried out with the support of an independent advisor.
In line with the provisions of the Corporate Governance Code, Snam’s Board of Directors has implemented self-assessment of the Board of Directors itself and its Committees for the 2021 financial year, to which the 9 current Directors participated.
The purpose of the work was to carry out a structured review of the effectiveness of the Board of Snam from an operational point of view and to identify opportunities for further improvement in order to better perform the role of policy and control of a complex and evolving entity.
Following the awarding procedure by tender and the relevant investigation by the ESG Committee, the Board of Directors has decided to take advantage of an external advisor, Spencer Stuart Italia S.r.l., a company that has wide and long-standing experience in the corporate governance sector and that supported the Board of Directors of Snam throughout its term of office. The self-assessment of Board of Directors and Committees of Snam for the 2021 financial year, was carried out by two senior partners of Spencer Stuart, experts in board effectiveness activities.
The Board Review focused on the size, composition and real functioning of the Board and its Committees, taking into account the role played by the Board in defining strategies and monitoring management performance and the adequacy of the internal control and risk management system.
Again this year, the Directors have made themselves available to contribute to this process in order to identify possible areas of improvement for the optimization of Board dynamics.
In the interviews it was possible to analyze what was reported in the questionnaires, to increase the debate and to receive directly comments and suggestions. Starting from the actions taken following the self-assessment process carried out in the previous year, for this year the focus was on:
• end-of-term financial statements, with evidence of the actions actually implemented and identification of possible areas of improvement for further optimization of Board dynamics;
• size and composition of the Board, in order to collect the input and comments of the Directors in office, useful for drafting the guidelines on the professional figures whose presence on the Board is considered appropriate, to be presented to the Shareholders for the election of the new Board.
Regarding the issue of composition, the advisor also prepared a specific analysis document with benchmarks regarding a panel of companies belonging to the FTSEMib index, to support the process of defining the Guidelines to the Shareholders on the future dimension and composition of the Board of Directors.
Looking at the results, also this year of term of office was very intense and the Board of Directors was called upon to carry out an extraordinary activity because of the continuing health emergency situation caused by the pandemic, due to its various upsurges and waves, and in relation to business issues, especially those connected with the energetic transition.
Overall, the Directors expressed their satisfaction and appreciation in relation to the size, composition and functioning of the Board of Directors and its Committees.
In particular, the Board operated with continuity with the aim of strengthening the leadership position of the company in the way towards the energetic transition and, at the same time, of consolidating the governance structure that, during the term of office, saw the Board engaged - among other things - in significant amendments to Snam’s Articles of Association such as the inclusion of the purpose “Energy to inspire the world”, the pursuit of sustainable success purposes, the representation of the less represented gender.
The Directors have shown commitment and constant attendance, albeit mostly from a distance, considering the high number of meetings held during the year.
The Directors underline that the work of the Committees is positive and constitutes the basis for discussion at the Board. Satisfaction is expressed with regard to the practice of holding joint meetings, as a moment of analysis and investigation of the various aspects of the issues. Overall, the members of the Committees feel that they have played their role well and operated autonomously and authoritatively, effectively supporting the Board with their investigations on issues within their competence.
The Board’s debate benefits from the absolute spirit of independence - not only formal - of the Directors. The Board’s attitude is constructive and has seen an important improvement during the year under review, also thanks to the more intense mutual connections and the organization of the offsite in Trieste and at the Malborghetto plant.
The productive attitude of the Directors allowed for a progress of the works characterized by a heated board debate.
The self-assessment has confirmed the accessibility of documentation through a dedicated portal that makes available presentations, press reviews and all information material relating to Board and Committee meetings. The Board invested on the issue of timing of sending documentation during the term of office; where material was sent close to meetings, it was due to the extraordinary nature of some situations and/or the short time between meetings.
During the activities carried out at the end of the triennium, some of areas of improvement were identified for the continuation of the term of office, which may also be taken into consideration in view of the next term of office:
to provide, as soon as possible and in absolute compliance with the rules, for the organization of board meetings in person favouring also informal meetings, induction and updating sessions on key issues through visits to the plants and off-site days;
to provide for a broad sharing of strategic issues within the Board of Directors, illustrating the prior analysis and detailed study carried out by management and the Committees and valorizing the contributions made by all Directors;
to keep the Board constantly updated on the progressive implementation steps of the various project streams linked to the energetic transition of both the core business and the new businesses (biomethane, hydrogen, energetic efficiency, sustainable mobility), also through dedicated ad-hoc meetings, such as a “strategy day” or a strategic summit;
The self-assessment on the size, composition and functioning of the Board and Committees was successfully completed at the Board meeting on March 16, 2022.
12 April 2022 - 09:00 CEST