Pursuant to the Bylaws and unless preempted by the Shareholders’ Meeting, the Board of Directors has the right to select its Chairman. It can also delegate its powers to one of its members and appoint an Executive Committee and other committees with specific functions, defining their tasks, powers and rules of operation.
Moreover, the Governance Agreements require that Delmi nominate the candidate to the post of Chairman and EDF nominate the candidate to the post of Chief Executive Officer. Pursuant to the Bylaws, the Chairman must be chosen among the candidates identified with odd numbers on the slate filed by the shareholder who owns an absolute majority of the common shares and the Chief Executive Officer among the candidates identified with even numbers on the same slate. The abovementioned Agreements, as incorporated into the Bylaws, define the powers of these two officers, setting forth a clear separation between the functions of the Chairman and those of the Chief Executive Officer.
Under the Bylaws, the Chairman and the Chief Executive Officer represent the Company vis-à-vis third parties and in judicial proceedings. Under the Bylaws, as mentioned earlier, both also have the power to call meetings of the Board of Directors and set the agenda for each meeting. The Chairman, or the person designated to replace the Chairman when he is absent or otherwise unavailable, chairs meetings and coordinates the Board’s activities.
As was the case for his previous term of office, the current Chairman, Giuliano Zuccoli, was elected by the Shareholders’ Meeting convened on April 2, 2008. On the same date, the Board of Directors reelected Umberto Quadrino Chief Executive Officer, who served in this capacity during the previous terms of office of the Board of Directors.
Consistent with the recommendations of the Code and with the practice followed for the previous three years, upon being elected on April 2, 2008, the Chairman was not provided with operational authority, as he was given jurisdiction over institutional, guidance and control issues.
The Chief Executive Officer was given the most ample powers to manage the Company. Consequently, acting without the support of an additional signatory, he can carry out any actions that are consistent with the corporate purpose, subject to statutory limitations and excluding those transactions that, as indicated above, the Bylaws and resolutions adopted by the Board of Directors have placed under the Board’s sole jurisdiction.
At its February 19, 2007 meeting, the Board of Directors delegated to the Chief Executive Officer the task of overseeing the functionality of the system of internal controls, asking him also to identify the main corporate risks and ascertain that the system is adequate, effective and efficient, as explained in greater detail in the System of Internal Controls section of this Report.
Therefore, based on the foregoing considerations, only Umberto Quadrino, the Company’s Chief Executive Officer, qualifies as an Executive Director according to the Code.
Pursuant to law and the Code, the Bylaws require that the officers to whom power has been delegated report to the Board of Directors and the Board of Statutory Auditors on at least a quarterly basis to explain the work performed in the exercise of their powers. In addition, the Chief Executive Officer has been following for some time the specific practice of including in the Agenda of each meeting of the Board of Directors, irrespective of the time that elapsed from the previous meeting, a report by the CEO on the Company’s operations and on major transactions executed by the Company and its subsidiaries that did not require the prior approval of the Board of Directors.