Generali Group

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          This section answers a number of questions about the Shareholders’ Meeting.

          The structure of the 2018 LTI Plan, designed to sustain the achievement and progress in execution of the Group Strategic Plan, has been set in continuity with the LTI Plans adopted by the Group since 2013.

          The core features of the Plan, and underlying rationale, are summarized as follows:

          • Performance goals are set upfront on an annual and 3-year perspectives in order to monitor and reach the 3-year strategic goals and to assess and verify the progress in the execution of the strategy through-out the whole period of the Plan. The aim is to combine the need respectively to foster long-term results in a sustainable perspective and to ensure the solidity and consistency in achieving results required within the on-going financial turnaround & industrial transformation of the Group.
          • In particular, the threshold entry gate (Regulatory Solvency Ratio) and the 3-year goals of the Key Performance Indicators (Operating Return On Equity and Total Shareholders Return) are set at the beginning of the LTI Plan and maintained across the period consistently with the strategic plan ambition and 3-year strategic goal targets in place.
          • Progress in results for each performance condition is monitored and verified by the Board of Directors annually with a final assessment of the execution and the achievement of the strategic goals at the end of the 3-year period.
          • The shares are not allocated until the end of the 3 years of the plan, after the completion of this overall assessment. Moreover, after the 3-year period, malus and clawback provisions may be applied to further consider the sustainability and effectiveness of results achieved in the longer term during the additional lock-up period on the shares.

          According to this framework, the Plan rules provide for an annual assessment of the results, but also an assessment of the actual achievement of the defined goals on an overall 3-year basis. The assessment is carried out by the Board of Directors (upon consultation with the Remuneration Committee) within the framework of the Group governance rules on remuneration.  This discretion (which, in any event, has never been used to date by the Company) is exercised in compliance with the well-established case law opinion according to which discretionary evaluations may not be undisputable and arbitrary but must be made through a motivated application of strict parameters of reasonability.  

          In particular, the Regulatory Solvency ratio above 120% constitutes the access threshold and entry gate to allow the granting of shares. This assessment is performed every year and its overall consistency is verified by the Board of Directors at the end of the 3-year performance period.

          Regarding the Operating Return On Equity (ROE) and Total Shareholders Return (TSR), a first measure of the achievement of each objective is performed at the end of each year of performance and then reassessed by the Board of Directors at the end of the 3-year period overall:

          • on one side, the weighted average of the annual ROE results achieved across the 3-year of performance is verified against the 3-year overall strategic goal set up to 13% for the entire period;
          • on the other side, the TSR positioning of the Group in respect to our competitor peer group is monitored and verified each year providing for a maximum level of payment only in case of first ranking in each year of the performance period of the plan, not allowing to compensate the different positioning achieved across the 3 years;
          • moreover, the maximum granting of shares in case of TSR positioning against peers below median is limit at 21% of the award (37.5 out of 175%) in line with market standards and investors recommendations considering also the challenging peer group of reference defined according to the STOXX Euro Insurance index;
          • finally, the TSR results is assessed not only considering a relative comparison versus peers but also verifying an absolute positive results so that no granting of shares in connection to TSR is provided in case of negative results (≤ 0%) in the performance year of reference and the consistency of this principle is verified at the end of the 3-year period.

          The 2018 LTI plan is designed in coherence with the current and on-going strategic plan cycle. Looking forward, on November, 2018 the Group will communicate to the market the new Strategic Plan goals for the period 2019 – 2021. This ambition will be fully recognized and embedded in the design and execution of a new incentives system for the Group.

          At the time of the appointment of the Group CEO/Managing Director in 2016, the Board of Directors decided to maintain his entitlement to the Group Long Term incentive (LTI) Plans assigned to him also in case of revocation of the mandate/non-reappointment at the end of his current mandate.

          This provision was introduced and approved by shareholders since last year. The terms and rationales are summarized as follows:

          • this provision was part of the overall remuneration package set for the Group CEO (at the time of his appointment) in order to be held indemnified in case of his inculpable termination. The request has been granted by the Board of Directors upon a decision (i) aimed at securing a solid and fast internal succession of the Group leadership as a consequence of the resignation of the former Group CEO and (ii) led within the remuneration policy framework already approved by the Shareholders, which set a clear prevalence of variable compensation with long term focus in respect of the fixed and other remuneration elements approved by shareholders in the remuneration policy in force at the time;
          • this provision applies only in “good leaver” cases, i.e. where the termination of the relationship is due to a decision taken by the Company (regardless of the Group CEO’s conduct and will). Conversely, this provision does not apply if the Group CEO resigns or is removed (or not reappointed) for cause. This to further pursue the retention aim and purpose of our Group Long Term incentive approach that constitutes 56% of the overall remuneration package of the Group CEO;  
          • this provision provides the granting of shares to the Group CEO only upon the completion of the performance period of the Plan, in full respect of all the Plan conditions (ie: Entry Gate, Malus & Clawback, Holding Period, etc.) and only if the underlying results have been achieved.  That enables a total alignment between the long term interest of the Company to the achievement of the final targets of the Plan and the interest (and thus the conduct) of the Group CEO; in other terms, this provision eliminates the risk of the Group CEO being focused on the achievement of results only on the short term (as he would be in case of application of a pro-rata temporis criterion). Conversely, having this specific provision, the Group CEO is always incentivized to work in view of the long term results (that is because, also in case he is removed or not appointed, he will benefit of the long term results achieved, which will reflect on his share allocation upon the plan termination);
          • this long term alignment of interests is essential for reinforcing the commitment to the achievement of long term and long lasting Group strategic goals and targets. More specifically, it ensures a long term focus on sustainable results even above a period of 3 years for the Group CEO, considering both commitments of (i) execution of the on-going 2016-2018 strategic plan and (ii) design and definition of the upcoming 2019-2021 strategic plan to be communicated to the market in November 2018;
          • finally, this provision creates the basis to ensure a complete alignment of interests between the Group CEO and the Company also in case the labour relationship terminates (and possibly, also in case of establishment of a new relationship with another employer), as the Group CEO would not have an interest in conflict with Generali but, rather, he would benefit from the Group’s success on the long term.

          As per our strict Group governance, any decision of the Board of Director is made, after a deep analysis by the Remuneration Committee, in the complete interest of the Company and its shareholders and is supported by market evidence, due diligence and recommendations by independent advisors on remuneration, legal, labour law, corporate governance matters and regulatory provisions, under the control and supervision of internal Control functions, independent Board of Statutory Auditors and external Auditor advisor.

          The Articles of Association and the meeting regulations are available on this page.

          The Shareholders' Meeting Notice was published on 15 March 2018 in the web site on this page and in the newspapers "Milano Finanza" and "Il Piccolo" on the same date.

          As for attendance and voting, the authorised financial intermediary holding Generali shares must be instructed to send a notice to the company concerning attendance. This notice includes the number of shares held in custody at the end of the seventh market day before the date of the Shareholders' Meeting in first or single call (i.e. record date, which this year is 6 April 2018). Shareholders qualifying as such after the record date are not entitled to attend and vote at the Shareholders' Meeting. The notice must be delivered to Assicurazioni Generali by the end of the third market day before the date of the Shareholders' Meeting in first or single call. Shareholders may attend and vote also if the notice from the authorised intermediary is delivered after the deadline, provided it is delivered by the start of the Shareholders' Meeting.

          Pursuant to the Legislative Decree no. 27/2010, as amended, the rights to attend and to vote at the Shareholders' Meeting may be exercised by Shareholders who – at the end of the seventh business day before the day of the Shareholders' Meeting (i.e. the record date) – are holders of shares of the issuer and have notified their intention to attend the Shareholders' Meeting to the authorised intermediary. This right is not forfeited if shares are transferred wholly or in part after the record date, which, for this Shareholders' Meeting, is 6 April 2018. Any registration of purchase or sale after that date is not relevant for the purpose of entitlement to attend and vote at the Shareholders' Meeting.

          Shareholders may either attend personally or appoint a proxy in writing. Shareholders with voting rights may appoint a single proxy for each Shareholders' Meeting (subject to the exemptions established in art. 135-novies of Legislative Decree no. n. 58/1998), without prejudice to the option to appoint substitute proxies. It is also possible to appoint the Designated Representative of the Company. The proxy is also valid for the subsequent calls of the Shareholders' Meeting. The proxy is not valid if the name of the representative is not stated; the proxy and the related voting instructions may be revoked. The proxy must be in writing and the proxy form is available on the website of Assicurazioni Generali and at the registered office.

          The Designated Representative of the Company is the organisation the Company may appoint for each Shareholders' Meeting, pursuant to article 135-undecies of the Code on Financial Intermediaries, that Shareholders may appoint as proxy, providing voting instructions on some or all the items of the agenda, by the second business day before the Shareholders' Meeting. Proxies must be appointed using the appropriate form, which may be downloaded from the website and is free of charge for Shareholders. For this Shareholders' Meeting, the Designated Representative is Computershare S.p.A., as specified in the Shareholders' Meeting Notice.

          Reports are available to the public at the registered office, on the website (section Governance – Annual General Meeting – AGM 2018) and on the storage mechanism used by the Company, known as "eMarket SDIR", by the deadline set for the issues of the Shareholders' Meeting Notice of call or as required by the applicable laws. 

          Pursuant to applicable laws and regulations, listed insurance and reinsurance companies are required to publish the remuneration report within a set period. This report includes three sections: the first section describes the remuneration policy for members of the corporate bodies and managers having strategic responsibilities and of the control functions, the second section describes how the policy has been implemented, detailing also the actual fees paid, the third is relevant contains the reports of control functions verifications executed by Audit, Compliance and Risk Management functions. In this framework, the Shareholders’ Meeting is called upon to pass a binding resolution on the first part only, and it merely needs to be informed about the second section.

          Pursuant to the Legislative Decree no. 27/2010, the Shareholders' Meeting minutes must be available within 30 days from the day of the Meeting. Within 5 days from the day of the Shareholders' Meeting, a summary must be published on the website, detailing the outcomes of the votes, the number of shares represented in the Shareholders' Meeting and the percentage of the share capital represented by the shares for which votes have been cast, the number of votes in favour, the number of votes against the resolutions and the number of abstentions.

          No it is not. Pursuant to article 123-bis, paragraph 3, of the Legislative Decree no. 58 of 24 February 1998, the board of directors of the company is called upon to adopt the Corporate Governance Report. This document, as a consequence, is not subject to discussion and approval by the Shareholders’ Meeting.

          In line with last year, a new long-term incentive plan based on Assicurazioni Generali shares - the 2018 Group LTI - has been submitted to the approval of the Shareholders' Meeting. The plan is spread out over a total period of 6 calendar years, is linked to specific Group performance targets (Return on Equity and relative Total Shareholders’ Return) and is subject to the verification of the achievement of minimum level in terms of Regulatory Solvency Ratio. The plan is based on a 3-year performance period and additional sale-restriction period of two years on half of the granted shares (minimum holding period). The plan provides for a maximum number of 11,500,000 shares equal to 0.73% of the current share capital.

          As has taken place in the recent past, the agenda for this meeting also included a proposal for an amendment to the Articles of Association, which serves to implement the long-term incentive plan.

          ISVAP Regulation no. 17/2008 stipulates that upon each amendment to the Articles of Association, the insurance companies deliberate on an update of the clause of the latter that, pursuant to such regulation, states the amount of share capital and other equity elements.