Caltagirone Editore : Corporate Governance and ownership structure report

CORPORATE GOVERNANCE AND OWNERSHIP STRUCTURE REPORT

pursuant to Article 123-bis of the Consolidated Finance Act

Issuer: Caltagirone Editore S.p.A.

Website: www.caltagironeeditore.com

Year: 2020

Date of approval of Report: March 8, 2021

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Contents
Consolidated Finance Act/CFA: Legislative Decree No. 58 of February 24, 1998 (as subsequently amended). ..	4
1. ISSUER PROFILE ..................................................................................................................................................	5
2. INFORMATION ON THE OWNERSHIP STRUCTURE (as per Article 123bis, paragraph 1, CFA)...........	5
a) Shareholders (as per Article 123-bis, paragraph 1, letter a), CFA)..................................................	5
b) Restriction on the transfer of shares (as per Article 123-bis, paragraph 1, letter b), CFA).............	5
c) Significant holdings (as per Article 123-bis, paragraph 1, letter c), CFA).......................................	5
d) Shares which confer special rights (as per Article 123-bis, paragraph 1, letter d), CFA)...............	5
e) Voting mechanism (as per Article 123-bis, paragraph 1, letter f), CFA)..........................................	5
f) Voting restrictions (as per Article 123-bis, paragraph 1, letter f), CFA)...........................................	5
g) Shareholder agreements (as per Article 123-bis, paragraph 1, letter g), CFA)................................	5
h) Change of control clause (as per Article 123-bis, paragraph 1, letter h), CFA) and statutory
provisions on takeovers (as per Article 104, paragraph 1-ter and 104-bis, paragraph 1). ...................	6
i) Power to increase the share capital and authorisation to purchase treasury shares (as per Article
123-bis,paragraph 1, letter a), CFA) .....................................................................................................	6
l) Direction and co-ordination activities (as per Article 2497 and subsequent of the Civil Code) .......	6
m) Director indemnity in the case of dismissal without just cause (in accordance with Article 123-
bis, paragraph 1, letter i) of the CFA .....................................................................................................	6
n) Appointment and replacement of Directors (as per article 123-bis, paragraph 1, letter l), CFA) ...	6
3. COMPLIANCE (as per Article 123-bis, paragraph 2, letter a), CFA) ................................................................	6
4. BOARD OF DIRECTORS ......................................................................................................................................	6
4.1. APPOINTMENT AND REPLACEMENT (ex Article 123-bis, paragraph 1, letter l), CFA) ......	6
4.2. COMPOSITION (as per Article 123-bis, paragraph 2, letter h), CFA) .........................................	7

4.3. ROLE OF THE BOARD OF DIRECTORS (as per Article 123-bis, paragraph 2, letter d), CFA)

.................................................................................................................................................................8

4.4. EXECUTIVE BODIES....................................................................................................................	8
4.5. OTHER EXECUTIVE DIRECTORS ...........................................................................................	10
4.6. INDEPENDENT DIRECTORS ....................................................................................................	10
4.7. LEAD INDEPENDENT DIRECTOR...........................................................................................	10
5. PROCESSING OF CORPORATE INFORMATION.........................................................................................	10
6. INTERNAL COMMITTEES TO THE BOARD (as per Article 123-bis, paragraph 2, letter d) CFA)..........	10
7. APPOINTMENTS COMMITTEE .......................................................................................................................	11
8. REMUNERATION COMMITTEE......................................................................................................................	11
9. REMUNERATION OF DIRECTORS .................................................................................................................	11
10. CONTROL AND RISKS COMMITTEE...........................................................................................................	11
11. INTERNAL CONTROL AND RISK MANAGEMENT SYSTEM .................................................................	12

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11.1. DIRECTOR IN CHARGE OF THE INTERNAL CONTROL AND RISK MANAGEMENT
SYSTEM................................................................................................................................................	12
11.2. INTERNAL CONTROL MANAGER .........................................................................................	12
11.3. ORGANISATIONAL MODEL pursuant to Legislative Decree 231/2001.................................	12
11.4. INDEPENDENT AUDIT FIRM.................................................................................................	12
11.5. EXECUTIVE OFFICER FOR FINANCIAL REPORTING .....................................................	12
11.6. COORDINATION OF THE PARTIES INVOLVED IN THE INTERNAL CONTROL AND
RISK MANAGEMENT SYSTEM ........................................................................................................	13
12. DIRECTORS' INTERESTS AND RELATED PARTY TRANSACTIONS ...................................................	13
13. APPOINTMENT OF STATUTORY AUDITORS ............................................................................................	13
14. COMPOSITION AND OPERATION OF THE BOARD OF STATUTORY AUDITORS (as per Article
123-bis, paragraph 2, letter d) and d-bis) CFA) ......................................................................................................	15
15. RELATIONS WITH SHAREHOLDERS ..........................................................................................................	15
16. SHAREHOLDER MEETINGS (as per Article 123-bis, paragraph 2, letter c), CFA) ...................................	16
17. FURTHER CORPORATE GOVERNANCE PRACTICES (as per Article 123-bis, paragraph 2, letter a),
CFA)............................................................................................................................................................................	16
18. CHANGES SUBSEQUENT TO THE YEAR-END ..........................................................................................	16
19. CONSIDERATIONS ON THE LETTER OF DECEMBER 22, 2020 OF THE CHAIRMAN OF THE
CORPORATE GOVERNANCE COMMITTEE ....................................................................................................	16
Tables ..........................................................................................................................................................................	17
Table 1: Information on shareholders.....................................................................................................................	17
Table 2: Structure of the Board of Directors and Committees..............................................................................	18
Table 3: Structure of the Board of Statutory Auditors ..........................................................................................	19
Attachment 1: Offices held (Indicates offices held in other listed companies and in financial, banking and
insurance companies or companies of a significant size.) .......................................................................................	20
"Principal characteristics of the risk management and internal control system in relation to the financial
disclosure process" in accordance with article 123-bis, paragraph 2, letter b), of the Consolidated Finance Act
.....................................................................................................................................................................................	21

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GLOSSARY

Code/2018 Self-GovernanceCode: the Self-Governance Code of listed companies approved in July 2018 by the Corporate Governance Committee and promoted by Borsa Italiana S.p.A., ABI, ANIA, Assogestioni, Assonime and Confindustria.

Civ. cod/ c.c.: the Italian civil code.

Board: The Board of Directors of Caltagirone Editore S.p.A..

Issuer: Caltagirone Editore S.p.A.

Year: 2020

Consob Issuers' Regulation: the Regulation issued by Consob Resolution No. 11971 of 1999 (as subsequently amended).

Consob Markets Regulation: the Regulation issued by Consob through resolution No. 20249 of 2017 (as subsequently amended).

Consob Related Parties Regulation: the Issuer Regulations following Consob Resolution No. 17721 of March 12, 2010 (as subsequently amended) in relation to related parties.

Report: the corporate governance and ownership structure report which the company must prepare as per Article 123-bis of the CFA.

Consolidated Finance Act/CFA: Legislative Decree No. 58 of February 24, 1998 (as subsequently amended).

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1. ISSUER PROFILE

Caltagirone Editore S.p.A. operates as a "holding" company with investments in the publishing (daily newspapers and free press), advertising, telecommunications and internet sectors. Following the Extraordinary Shareholders' Meeting of April 23, 2018, the company extended its corporate scope to hold investments in companies and entities operating in differing sectors.

The present report illustrates the corporate governance adopted by the Issuer. This system is based on the needs of a holding company and is based, therefore, on the systems of controls of the activities of the companies in which it is present through the operating subsidiaries of the Issuer.

The system is therefore centred on: (i) the central role of the Board of the Issuer in strategic direction; (ii) the transparency of the operational decisions; (iii) the effectiveness of the internal control which is undertaken through the existing control structure within the individual operating units and the individual subsidiaries and the supervision of the Control and Risks Committee appointed by the Board.

Caltagirone Editore S.p.A. is defined as an SME in accordance with Article 1, paragraph 1, letter w- quater 1), of the CFA and Article 2 of the Consob Issuers' Regulation, as per the list published by Consob on its website. The capitalisation for the three-year period 2018 - 2020 is presented below

	2018	2019	2020
CAPITALISATION	159,812,500	137,762,500	116,250,000

2. INFORMATION ON THE OWNERSHIP STRUCTURE (as per Article 123 bis, paragraph 1, CFA)

at 31/12/2020

a) Shareholders (as per Article 123-bis, paragraph 1, letter a), CFA)

Subscribed and paid-in share capital of Caltagirone Editore at December 31, 2020: Euro 125,000,000.00.

Classes of shares that make up the share capital: Ordinary Shares with voting rights. (See Table 1 of the appendix)

Other financial instruments which attribute the right to subscribe to newly issued shares were not issued. No share incentive plans have been introduced which resulted in an increase, including free, of the share capital.

1. Restriction on the transfer of shares (as per Article 123-bis, paragraph 1, letter b), CFA) There are no restrictions on the transfer of securities.
2. Significant holdings (as per Article 123-bis, paragraph 1, letter c), CFA)

The shareholders with holdings above 3% of the share capital, as per the shareholder registry, the communications received in accordance with article 120 of the CFA and the other information available at the date of this report are reported in Table 1 of the appendix.

1. Shares which confer special rights (as per Article 123-bis, paragraph 1, letter d), CFA) There are no shares which confer special control rights.
   No special powers have been attributed to specific roles.
2. Voting mechanism (as per Article 123-bis, paragraph 1, letter f), CFA)

No system of share participation has been created for employees, and therefore there is no particular mechanism for the exercise of voting rights by these latter.

1. Voting restrictions (as per Article 123-bis, paragraph 1, letter f), CFA) There are no restrictions on voting rights.
2. Shareholder agreements (as per Article 123-bis, paragraph 1, letter g), CFA)

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