Intesa Sanpaolo adopts the dual management and control model, consisting of a Supervisory Board and a Management Board.

Detailed information on the corporate governance system is provided in the “Report on Corporate Governance and Ownership Structures – Remuneration Report” @.

The Supervisory Board 

In addition to the supervisory duties – which under the traditional management and control model would be the responsibility of the Board of Statutory Auditors – the Supervisory Board also performs tasks that traditionally lie with the Shareholders' Meeting, such as the appointment and removal of members of the Management Board, taking responsibility-related action with regard to members of the Management Board and approval of the Parent Company financial statements.

As regards strategic supervision, the Supervisory Board is entrusted with other functions that strengthen its steering duties and recognise the joint involvement of its members in the main governance decisions of the Bank and the Group.

At least quarterly, reports are submitted to the Supervisory Board on operations during the period and comparison with the system, on significant balance sheet, income statement and financial transactions, and on transactions with related parties.

The Management Board

This Board has sole responsibility for corporate management. It ensures the implementation of strategic guidelines and risk governance policies defined and approved by the Supervisory Board, with which it cooperates, to the extent of its own duties, in performing the strategic supervisory role. For this purpose, the Management Board resolves on all transactions considered useful or appropriate in achieving the corporate purpose, relating to both ordinary and extraordinary administration. The Management Board is responsible for certain matters of greater importance, beyond those strictly envisaged in the regulations. On such matters, joint decision-making makes it possible to actively involve Board Members who therefore participate with independent judgement in the Bank’s key operational governance issues.

Internal Committees of the Supervisory Board

The Supervisory Board is governed by the legal and regulatory provisions and by the Articles of Association. For effective implementation of these duties, the Supervisory Board receives support from internal Committees and, more specifically:

  • Risk Committee supporting the strategic supervision function;
  • Internal Control Committee and Surveillance Body pursuant to Legislative Decree 231/2001 to support the control function, which is also vested with the functions of Surveillance Body, pursuant to the Organisational, management and control Model governed by Legislative Decree 231/2001;
  • Nominations Committee;
  • Remuneration Committee;
  • Committee for transactions with related parties of Intesa Sanpaolo and associated entities of the Group.

Characteristics of the Supervisory Board and its Committees (2015 figures)

BodyN° of membersIndependent*% of women

Age
<=30

Age
30-50

Age
>50

N° of meetingsAttendance
Supervisory Board 19 16 26% 0 3 16 14 97%
Internal Control Committee 5 5 40%       48 98%
Remuneration Committee 3 3 0%       17 100%
Nominations Committee 5 3 0%       5 96%
Risks Committee

5
(1 alternate)

4 33%       38 93%
Related Party Transactions Committee 5 5 40%       15 95%

* Independence requirements met according to the Corporate Governance Code.
The Chairman of the Supervisory Board is non-executive and is independent pursuant to criteria established in the Consolidated Law on Finance, and is non-independent pursuant to the Corporate Governance Code.
All the Supervisory Board members are non-executive. The Supervisory Board remains in office for three financial years.

Characteristics of the Management Board (2015 figures)

BodyN° of membersExecutive% of women

Age
<=30

Age
30-50

Age
>50

N° of meetingsAttendance
Management Board 8* 6**  12.5% 0 1  7  21  100%

* The Board was appointed by the Supervisory Board, at its meeting on 9 May 2013, which set at 10 the number of members; effective as from - respectively, 16 March 2015 and 14 July 2015 - Giuseppe Morbidelli and Carla Ferrari resigned from the post of Member of the Management Board.

** Includes the Managing Director as Chief Executive Officer and in relation to his/her role as head of operational management of the Bank and the Group, three Executive Members from the Group's Management and two “external” Deputy Chairpersons, whose executive status derives from their participation, with voting rights, in the Group’s managerial committees and from assignment to specific duties.

The Chairman of the Management Board – independent according to Consolidated Law on Finance criteria – qualifies as a non-executive member: in fact he/she does not have assigned operating powers and the current organisation of the Bank keeps his/her duties separate from those of the Managing Director.

Leadership and Member duties

High quality leadership is Intesa Sanpaolo’s trump card. Our Group is governed by a team of top level Members whose quality and expertise are a source of inspiration for top management and the other managers.

As regards the Supervisory Board, four Members are entered in the auditors’ register and have exercised auditor activities for at least three years. In general terms, the duties of the Board - relating to banking and/or insurance and/or financial business, the structure of the economic and financial system, regulation of financial activities and markets, risk management and control methods, accounting and financial issues and remuneration policies, internal control and corporate organisation – are all complementary and ensure adequate resources for the size and complexity of the Bank and the Group. In reference to risk management, the Supervisory Board approves the definition of the maximum acceptable risk level for the Group (its "risk appetite") and the correlated system of limits at the level of overall risk and specific risks (the "Risk Appetite Framework"). For this activity, the Board receives support from in-depth studies performed by the Committees, each to the extent of their duties.

In terms of the professional experience of Members, five of these have held this office since 2007, three have gained experience since 2010 and one member joined the Board in June 2012.

As regards the Management Board, all Members have overall experience of at least three years in qualified professional activities suitable for such office. The Chairman has more than five years’ experience (he held other offices in leading listed Italian companies), whilst the Managing Director has specific managerial experience having held management role in various functions of the Bank (Head of the Planning and Control Department, Head of the Risk Management Department, Head of the Value Governance Area, Chief Financial Officer, etc.). In addition, the presence of executive Members from the Group’s management has contributed to increasing Board professionalism, with particular regard to banking business, the structure of the economic and financial system, banking and finance regulations and risk management and control methods.

Training and updating of Members

Once again in 2015, members’ attendance at Board and Committee meetings was high and constant, ensuring a systematic contribution to all activities and an increased business and corporate awareness of the Bank and the Group, as well as the main new legal and regulatory aspects.

In this perspective, at the initiative of the Chairmen of the Supervisory and Management Boards, specific in-depth seminar sessions were held, which included insights pertaining to the architecture review process of the Bank's corporate governance.

Governance Body self-assessment

In continuity with the previous financial year, the Boards decided to make use of a specialist external advisor appointed to provide support to the governance Bodies in reviewing the self-assessment processes used thus far and their formalisation into specific internal Regulations which were later adopted. The Self-Assessment Regulations were prepared in application of the Supervisory regulations and in compliance with European Banking Association “Guidelines on Internal Governance” and “Guidelines on the Assessment of the Suitability of Members of the Management Body and Key Function Holders”, issued in September 2011 and November 2012 respectively, which also take into account national and international best practices on this matter.

The self-assessment process is divided into a preparatory stage to survey the operating, efficiency and effectiveness profiles of the Body and opportunities for improvement.

The information gathered at the preparatory stage is then processed and consolidated into a document showing the qualitative and quantitative results of the self-assessment, the compliance and performance levels and the areas of excellence and for improvement indicated by Members. This document is then submitted to the Boards for examination and joint discussion.

Details of the successful outcome of the 2015 assessment can be found in the “Report on Corporate Governance and Ownership Structures – Remuneration Report” @.

The internal control and risk management system

The internal control system has been designed to achieve constant identification, governance and control of the risks involved in our activities. It is structured on three levels:

  • the first is represented by the line controls which are carried out by the operational structures, are built into our procedures and are part of back-office activities;
  • the second is entrusted to the Chief Risk Officer and, in addition to the legal area, includes controls on risk management, compliance with standards, anti-money laundering risk, credit granting process, and internal validation;
  • the third is the internal audit, carried out by the Internal Auditing Department, that operates independently and separately from the operational structures, to identify anomalous trends, violations of procedures and regulations, and to assess the good order of the overall internal control system.

Also taking into account the Management Board’s proposals and making use of the support of specific Committees, the Supervisory Board defines and approves the risk governance policies at Group level and the guidelines for the internal control system, including those relating to values and principles of the Code of Ethics, whilst both Boards make use of the Chief Risk Officer’s action, reporting directly to the Chief Executive Officer.

The Supervisory Board and the Management Board also approve the Sustainability Report, which reports to stakeholders on activities carried out during the year and demonstrates the Bank’s ability to pursue its objectives in line with stated values and with corporate development plans. The Report illustrates the results of stakeholder engagement activities and the materiality matrix, which represents the “significant” areas of operations resulting from the integration into corporate strategic plans of considerations of an economic, social and environmental impact.

Remuneration

All members of the Supervisory Board and the non-executive Management Board Members receive remuneration which is fixed for the entire period of office and not based on financial instruments, nor on incentives related to economic results, in order to guarantee independence in the performance of their activities, which must not depend on expectations of higher remuneration based on the results achieved by the Bank.

The remuneration policies for Management Board Members, approved by the Shareholders’ Meeting on recommendation of the Supervisory Board, are aimed at increasing the Bank and Group's competitiveness, attracting qualified professionals suited to the management requirements, aligning the interests of Members to achieve the objective of creating value for shareholders in the medium/long-term with a view to prudent risk management and responsibility towards all stakeholders and, finally, at promoting sustainability of the remuneration policies over time.

Remuneration of the executive Management Board Members – including the Managing Director – and of top management consists of a fixed portion and a variable portion. Limitations are set based on a fair balance of fixed and variable components and, for the latter, weighting systems for the risks are applied, as well as evaluation mechanisms designed to ensure a connection to effective, long-term performance.

Operational Structure

Divisions and Business Units, Governance Areas and Head Office Departments

In terms of organisational logic and to ensure that Group governance has the necessary coherence, the Parent Company is divided into seven Business Units, comprising the aggregation of business lines with similar characteristics in terms of products and services provided and in terms of the regulatory framework, six Governance Areas, Head Office Departments and Staff Units under the direct responsibility of the Managing Director and CEO that carry out steering, coordination, control, support and service duties at Group level @.

THE NEW ARTICLES OF ASSOCIATION OF INTESA SANPAOLO APPROVED

Intesa Sanpaolo's Extraordinary Shareholders' Meeting of 26 February 2016 approved the new Articles of Association for the adoption of the one-tier governance system, based on a Board of Directors consisting of a minimum of 15 to a maximum of 19 members, of whom 5 also forming part of the Management Control Committee.

The Articles of Association will enter into force with the renewal of the corporate bodies by Intesa Sanpaolo's Ordinary Shareholders' Meeting of 27 April 2016.

Nine years on from the adoption of the dual governance model, the Bank's shareholders have embraced the opportunity for change, especially in light of the outcomes of the self-assessment processes carried out by the two Boards and of the works of the Commission especially set up within the Supervisory Board which, in the first half of 2015, analysed the benefits and advantages underlying the different governance models.

The Management Board and the Supervisory Board have therefore identified the one-tier governance model as the most suitable to actually ensure management efficiency and the effectiveness of Intesa Sanpaolo's controls.

For more details on Intesa Sanpaolo's new corporate governance system, please refer to the documentation made available to the shareholders at the Extraordinary Shareholders' Meeting of 26 February 2016.

Shareholder Base

As at 31/12/2015, share capital subscribed and paid-in totals 8,731,874,498.36 euro, divided into 16,792,066,343 shares of a nominal value of 0.52 euro each, of which 15,859,575,782 ordinary shares (equal to 94.44% of share capital) and 932,490,561 non-convertible savings shares (equal to 5.56% of share capital).

As at 31 December 2015, Intesa Sanpaolo’s shareholder base is composed as follows (holders of shares exceeding 2%):

(*) for asset management

Relations with shareholders and the financial community

In its relations with the market, Intesa Sanpaolo adopts a specifically transparent form of conduct, especially with regard to annual and interim financial results and to Group strategies. This also takes place via meetings with the national and international financial community, in a framework of constant dialogue with the market based on correct and timely communication.

During 2015, in a still very difficult economic scenario, communications with the financial community continued to focus on sustainable profitability and the Group’s solidity as a safe point of reference for stakeholders. To guarantee access to all, again in 2015 this information was made available quickly, easily and economically through a number of channels: Internet, conference calls via a toll-free number and the free distribution of financial statements on request. The Investor Relations section of the website @ has a well-organised content and theme updates, always providing stakeholders with extensive, systematic information.

In order to contribute to the creation of sustainable value over time, regular and frequent meetings were held with the financial community that consolidated long-term relations based on mutual trust.

Shareholders’ Meeting

For Intesa Sanpaolo the Shareholders’ Meetings are one of the main opportunities for contact and dialogue with its shareholders, as well as an occasion for the disclosure of news, in accordance with the principles of non-selective disclosure and rules on price sensitive information.

The Meeting is called by the Management Board or upon request by the shareholders in accordance with the law, through a notice published on Intesa Sanpaolo’s website and, in abridged form, in at least one national newspaper (generally “il Sole 24 Ore” and other national and international newspapers).

Right to attend and vote

Each ordinary share confers the right to cast one vote. Savings shares, which may be in bearer form, do not confer the right to vote in ordinary and extraordinary shareholders’ meetings but entitle the holder only to attend and vote at the Special Meeting of savings shareholders.