Outline of the remuneration structure for Directors and managers
  FIXED COMPENSATION VARIABLE COMPENSATION
EMPLOYEE CATEGORY BASE (Upfront) PENSION PLAN CONTRIBUTION SHORT TERM INCENTIVE (Annual scorecard) LONG TERM INCENTIVE (Strategic Plan 19 -23)
      5Y deferral - 60% deferred* 5Y deferral - 60% deferred*
  CASH CASH CASH SHARES CASH SHARES
Executive Directors 100% 100% 47% 53% 47% 53%
Non Executive Directors 100%          
Chairman 100% 100%        
Executives Senior Management 100% 100%  47% 53% 47% 53%
      4 Y Deferral - 40/60% deferred*    
Other Executives  (Material Risk Takers) 100% 100% 50% 50%    

* If variable amount equal or higher of € 435.000 

Compensation paid to the members of the management and control bodies, general managers and other key managers

Chairman’s remuneration

The Chairman of the Board receives fixed remuneration only.

Remuneration of non-executive directors

The general meeting establishes fixed fees for the non-executive Directors without any incentives linked to the bank’s performance. They also receive third-party liability insurance coverage.

  New Board compensation
Compensation approved by shareholders in AGM 2,500,000
No. of members 15
Board of Directors
Compensation payable to each Director
Additional compensation payable to Deputy Chair
1,535,000
100,000
35,000
Executive Committee (2 members)
Compensation payable to each member
160,000
80,000
Appointments Committee (4 members)
Compensation payable to each member
Additional compensation payable to Committee chairperson
110,000
25,000
10,000
Risks and Related Parties Committee (5 / 4 members) *
Compensation payable to each member
Additional compensation payable to Committee chairperson
420,000
80,000
20,000
Remuneration Committee (5 members)
Compensation payable to each member
Additional compensation payable to Committee chairperson
160,000
30,000
10,000
Corporate Social Responsibility Committee (4 members)
Compensation payable to each member
40,000
10,000

* “Combined” compensation payable for both Committees (which have only one different member between them).

Remuneration of Mediobanca’s CEO and General Manager

Mediobanca’s CEO and General Manager receive:

  • a base salary;
  • an annual short-term incentive subject to the gateways established in the policies and linked to the achievement of the quantitative/financial performance and qualitative/non-financial performance indicators in individual scorecards which the Board of Directors approves each year upon the proposal of the Remuneration Committee.
    • Each manager’s scorecard sets performance targets within their respective scope of responsibility. For instance, the targets may refer to risk-adjusted profitability; group revenue or the revenue of certain divisions; the profitability or income generated by the individual areas for which they are responsible. Alternatively, they may coincide with other capitalization, liquidity or new business initiative objectives in line with the guidelines in the strategic plan. These performance targets are weighted according to their materiality determined by the Board and considering the effective degree of decisional autonomy.
    • To link to the long-term incentive plan (see below), the annual performance-based pay for the achievement of quantitative/financial objectives is capped at 150% of the annual base salary, although the Board has the power to adjust the cap upward to 160% in order to reward the achievement of non-financial objectives.
    • 60% of performance-based pay is deferred over five years, with 45% paid in cash and 55% in equity. All deferred pay is subject to the performance targets and malus conditions established in the policies. Half of the up-front component is paid in cash and the other half is paid in Mediobanca shares.
  • When it approves the multiannual strategic plan, the Board of Directors may also approve a long-term incentive plan for the CEO and General Manager linked to the achievement of the objectives in the strategic plan.

    Based on their individual scorecards, the pay-out for the achievement of quantitative/financial and qualitative/non-financial targets ranges from 20% to 40% of the CEO’s and General Manager’s gross annual base salary for each year of the plan. The final amount at the end of the plan, based on overall performance, is calculated considering each of the targets in the scorecard and their relative weight.

    At the end of 2019, the Board of Directors approved the long-term incentive plan linked to the 2019-2023 strategic plan. Learn more
     
  • The CEO and General Manager receive directors’ fees but not for serving on the Board Committees. They also receive third-party liability insurance coverage like the other directors, participate in the supplementary pension fund and are eligible for the Mediobanca group’s other management benefits.
  • Until the end of the vesting/holding periods, the CEO is required to hold, even after any stock grants as performance-based pay are effectively vested, a number of Mediobanca shares worth twice the amount of base salary and the General Manager is required to hold shares worth one time such amount (i.e.,  the stock ownership requirement). The equivalent amount of shares – to be reached within five years of the first stock grant – must be held for the entire term of office in order to align senior managers’ interests with those of the shareholders.

Variable remuneration settlement as at FY22

P19 Remunerazione

CEO compensation FY21

P19 Compemsation2
CEO - FY 22 STI scorecards
OBJECTIVE WEIGHT KPI TARGET Δ KPI MAXIMUM
Profit before Taxes (PBT) from Group banking activities/capital absorbed
Optimization of return on capital allocated to core activities)
30% Vs.budget 11% target
Net interest income Focus on main source of Group revenues 20% Vs.budget 1% target
Total fees/banking revenues (Focus on share of capital-light revenues as %
of total income)
20% Vs.budget 3% target
Cost of risk (Focus on the Group’s principal income source and asset quality) 30% Vs.budget 13.5% target
ESG objective 10% Vs.budget  
a) CIB Client loan stock vs corporate clients with ESG/green characteristics      21% target
b) ESG new loans vs retail clients (Consumer Banking– WM Premier)       17% target
c) ESG products in WM Premier customer portfolios     8% target

Non financial KPI (CEO)

  • "People Strategy and Human Capital”, with the aim of managing the development and performance of the CSR initiatives related to valorizing diversity and inclusion, involving staff in the Group’s social initiatives, focus on talent, increasing staff engagement, and promoting work-life balance; 
  • Planet and Environment”, in order to focus on the Group’s ESG initiatives related to environmental sustainability (drivers: carbon neutrality; alignment to green regulations and international principles and standards; governance of commercial and product initiatives in this area).
     

GM compensation FY21

P19 Compemsation1
General Manager - FY 22 STI scorecards
OBJECTIVE WEIGHT KPI DARGET Δ KPI MAXIMUM
Profit before Taxes (PBT) from Group banking activities/capital absorbed
(Optimization of return on capital allocated to core activities)
30% Vs.budget 11% target
Cost of Funding Focus on Group funding optimization 17.5% Vs.budget 7% target
Cost/income ratio in banking activities (Balanced growth in revenues and costs) 17.5% Vs.budget 3% target
Growing AUM/AUA Focus on high-quality deposits, WM Division  25% Vs.budget 32% target
ESG objectives 10% Vs.budget  
a) Client loan stock vs corporate clients with ESG/green characteristics      21% target
b) ESG new loans vs retail clients (Consumer Banking – WM Premier)      17% target
c) ESG products in WM Premier customer portfolios     8% target

Non financial KPI (GM)

  • People Strategy and Human Capital”, the same one assigned to the Chief Executive Officer; 
  • Digital Strategy & Innovation”, with focus on the technological and digital transformation underway within the Group, with the following drivers: development of digital proposition, development of solutions to support interactions with clients, technology and security updates.
     

 

As required by article 78 of Consob resolution 11971 of 14 May 1999, as amended, section 2 of the 2021 remuneration policy lists, for 2020/2021 and naming each recipient, the amounts paid, the stock grants and other equity-based incentive plans benefiting the members of the management and control bodies, the general managers and, at aggregate level, other key managers. Anyone who, in the course of the year, held the aforesaid offices, even for a fraction of the year, is included. Furthermore, additional aggregate quantitative information has been published pursuant to the Bank of Italy’s supervisory requirements.

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