As part of the performance evaluation process in connection with the remuneration and incentivization policy, the Mediobanca Group devotes special and increasing attention to the achievement of environmental, social and governance (ESG) objectives. These are structured according to individual scope ofresponsibility, and taking account the incentivization systems applied to the individuals and/or divisions concerned.
Provision has also been made fortwo quantified and measurable ESG objectives to be included among the KPIs for the scorecards forming part of the new 2023-26 Long Term Incentive Plan, in which the objectives have a total weight of 20% (10% each):
- Climate Change: % reduction in the portfolio’s carbon intensity (portfolio decarbonization);
- Diversity & Inclusion: % of women in management positions at Group level.
Equivalent ESG indicators about Climate Change and D&I are included among those that will entitle staff to have their shares matched as part of the Employee Share Ownership and Coinvestment Scheme in force over the 2023-26 Strategic Plan horizon.
Financial ESG and sustainability criteria are also included in the annual scorecards (Short Term Incentives) for the Chief Executive Officer and Group General Manager of Mediobanca, to be assessed over the oneyear time horizon for the performance. Their weighting is up to 10% of the quantitative component, and they referto the annual ESG objectives contained in the Strategic Plan forthe Group’s principal businesses, with financial KPIs related to, for example, growth in the volume of ESG products (new loans; CIB, Compass and CheBanca!), or deeper penetration rates for SFDR Article 8/9 ESG funds in clients’ portfolios (both affluent/premier and private banking).
The CEO’s and Group General Managers’ annual scorecards also include non-financial ESG and CSR objectives, the impact of which on the financial component ranges from a 5% decrease to a 7.5% increase for each objective identified. If only one non-financial, ESG-related KPI is included, it is still weighted in such a way as to correct two-thirds of the total. For FY 2023-24, the focus is on the following issues: “Our People” and “Our community”, including as sub-divided into various projects (for details, see Section 7 c), “Mediobanca CEO and Group General Manager”).
Performance evaluation is also supported by quantitative indicators and measurable evidence provided in detail to the Board of Directors to assist them in making the correct assessment.
The short-term incentive scheme for other senior figures (strategic management and Material Risk-Takers KPI ESG heading up the main business lines, including the CEOs/general managers of the main Group legal entities) also includes, both individually and as part of the scorecards used to define the divisional bonus pools, and where appropriate to the scope under consideration, the presence of quantitative, measurable ESG indicators with weightings of up to 10%. These include, without limitation: higher volumes of green products (new loans) and deeper penetration of ESG funds in clients’ portfolios; number of green and sustainability bonds issued; monitoring and accounting for assets in portfolios from an ESG standpoint; integrating ESG evaluations into the fund investment process. Other targets include: increasing green-/ ESG-linked bond issues and lending activities; assessment of suppliers according to ESG criteria; target levels for electricity from renewable resources; and cutting CO2 emissions. Non-financial ESG objectives have also been set for these figures, with a focus chiefly on People Strategy issues (diversity, training, succession planning, work/life balance; staff conditions), possibly also structured as projects.
The rest of the Group staff are assigned a Group objective (with a weighting of between 5% and 10% of the total) to evaluate the performance delivered in terms of the adoption of socially responsible behaviour on a management basis, in line with the Group’s Corporate Social Responsibility policies, with reference in particular to protection of the environment, corporate diversity, and defence of human and social rights.
Remuneration policy neutrality
The Remuneration Policy reflects gender neutrality principles to ensure equal treatment regardless of gender and any other form of diversity, basing evaluation and remuneration criteria exclusively on professional ability. The Group is committed to offering remuneration in line with the market, which reflects each employee’s role, capabilities contribution to company performance objectively measured, and professional experience, thus guaranteeing that the principle of equal opportunities is applied in practice.
The Mediobanca Group pursues the appropriate balance between genders at all levels of the company, focusing in particular on senior and management positions where the gender gap is most felt. Each announcement for selection processes encourages all candidates in possession of the requisite qualifications and/or experience to apply. The same principle underpins the assessment process for internal opportunities arising within each individual Group company (transfers between organizational units) or within the Group (intra-Group transfers).
In its regular review of the policies in force, the Board of Directors, with Remuneration Committee’s support and with the CSR Committee’s involvement, analyses the gender neutrality of the Remunerations Policy, examining the gender pay gap in particular and its development over time.
See also our Mediobanca Group human resources management policy