The executive directors and identified staff are entitled to severance pay for early termination of office that takes account of their long-term performance but cannot exceed 5 million euro gross in any event. It cannot be awarded in the event of conduct that has caused damage to the bank.
The severance pay for early termination of office for the executive directors and identified staff is set at a maximum of 24 months' remuneration capped at 5 million euro gross. This is an additional amount to any sum due for indemnity for failure to give notice and for termination entitlements and is referred to as severance pay. A non-competition agreement may also apply.
The criteria were approved by shareholders in the ordinary general meeting of 28 October 2018 as required by the regulations and the articles of association. No compensation is paid however for directors who leave office for any reason.
Guiding principles for setting the severance pay amount
- it is set based on regulatory and legal provisions, collective or individual contractual arrangements, and practices adopted in the individual markets
- it takes account of the bank’s long-term performance and is not paid if the conduct of the individual staff member has in any way damaged Mediobanca’s capital strength, profitability, earnings, financial situation or reputation, regardless of whether or not such conduct involves fraud or wilful misconduct
- it is paid as part of the processes designed to minimise the current and future financial and reputational risks that the bank may be exposed to as a result of any disputes.