Remuneration policy

Non-Executive Chairman

The remuneration package for the Chairman only consists of a fixed component, as determined by the Board of Directors on 28 April 2021 (upon the proposal and with the approval of the Nomination and Remuneration Committee) and is set at the gross amount of 600,000 euros per annum. The Chairman does not receive any remuneration for the office of Director or member of the Sustainability Committee (pursuant to Art. 2389, subsection 1 of the Italian Civil Code). The Chairman does not enjoy any severance treatment nor benefits; he is entitled to the reimbursement of the expenses incurred in the performance of his duties, in accordance with the Bylaws.

Chief Executive Officer

Please find below a description of the remuneration package attributed to the Chief Executive Officer and General Manager in charge, as established by the Board of Directors on 21 January 2022 (upon the proposal and with the approval of the Nomination and Remuneration Committee) with reference to the position of General Manager and to the office of Chief Executive Officer.

• Fixed component

The fixed remuneration for the Chief Executive Officer is set at a gross amount of 1,400,000 euros per annuums, divided between the remuneration for the executive position (1,300,000 euros) and the remuneration for the office of Chief Executive Officer (100,000 euros).

The Chief Executive Officer does not receive remuneration for the office of Director, nor as a possible member of Committees.

• Short-term variable component

For each financial year, the Chief Executive Officer is assigned a short-term variable component (MBO), linked to the achievement of the objectives set annually by the Board of Directors, corresponding to a target of 100% of his fixed remuneration (1,400,000 euros); each objective is measured individually, with a parametric scale as described in the paragraph "Short-term Incentive System" of the Remuneration report.

• Long-term variable component

The Chief Executive Officer is a beneficiary of the 2022-2024 Stock Option Plan as described in the Remuneration Report. For further details, please see the information document on the initiative, available on the following 2022-2024 Stock Option Plan Information Document.

• Severance payment

As per policy, in the event of termination of the Chief Executive Officer position without just cause or resignation for just cause, anticipated with respect to the natural expiration of the directorship relation, or in the event of a change of control (i.e. any extraordinary operation involving a change of control of the Company pursuant to Article 2359 of the Civil Code), the CEO is entitled to an indemnity equal to the remuneration due for the office will be paid until the natural expiration of the mandate, with a maximum of 24 months' salary (calculated as the sum of fixed and MBO components).With respect to the withdrawal by the Company from the employment contract in the absence of just cause or resignation for just cause or in the event of a change of control (i.e. any extraordinary operation involving a change in control of the Company pursuant to Article 2359 of the Italian Civil Code), the CEO, in his position as General Manager, will be entitled to the severance payment established by the law and by the CCNL (National Labour Contract), with recognition of additional monthly payments up to a maximum of 24 (calculated on the fixed component)

• Clawback

In the three years following the payment of the bonus of the variable remuneration components, a clawback clause for the amounts paid may be activated, as per policy.

• Benefits and Welfare

In relation to his managerial role, the Chief Executive Officer enjoys the benefits specified for the management of the Company (health insurance cover through the TIM Group Executives supplementary healthcare assistance; supplementary pension cover through membership of the TIM Group Executive complementary pension fund; insurance cover for work-related and non-work-related accidents, life and invalidity benefit due to illness; a company car for mixed use; check-up). The Chief Executive Officer also benefits of the "professional risks insurance policy" entered into by the Company and applying to all Directors & Officers. Coverage of housing costs at the workplace is also envisaged for the entire duration of the employment relationship.

The structure of the remuneration package for Key Managers with Strategic Responsibilities, excluding the Chief Executive Officer, is as follows:

• Fixed component

Fixed remuneration of the Key Managers is in line with the market median, with the possibility of targeting even higher values, with selective adjustment criteria

• Short-term variable component (MBO)

Key Managers benefit of an annual incentive plan, with a target pay opportunity equal to 50% of their fixed remuneration.

For further details, please see the specific section of the Remuneration Report.

• Long-term variable component

The Key Managers with Strategic Responsibilities were beneficiaries of the 2022-2024 Stock Option Plan described in the Remuneration Report.  For further details, please see the information document on the initiative, available on the following  link 2022-2024 Stock Option Plan Information Document.

• Severance and Non-competition package, benefits and lump sum

The treatments provided for by the law and the CCNL are applied. The additional allowances may not exceed 24 months’ salary (calculated as the sum of the gross annual pay and the MBO).

In the event of termination of the employment relationship without just cause for dismissal or – for some managers – in the event of a change of control (or any extraordinary operation involving a change of control of the Company pursuant to Article 2359 of the Italian Civil Code), the Chief Executive Officer will be responsible for identifying  the managers  that – due to the importance and strategic nature of the role covered – may receive severance pay, to which a non-competition agreement may be associated, depending on the importance and strategic nature of the role covered, equal to their salary for a maximum period of one year, calculated on the fixed remuneration.

Key Managers enjoy benefits similar to those envisaged for general corporate management: a company car for mixed use, i insurance cover for work-related and non-work-related accidents, life and invalidity benefit due to illness;), supplementary health coverage, supplementary pension fund and check-up. The Company is also covered by a "professional risk policy" for all its Directors & Officers.

The assignment of bonuses unrelated to performance objectives is excluded. The Company exceptionally reserves the right to pay lump sums during the hiring phase in order to facilitate the acquisition of resources possessing specific skills deemed essential for the achievement of the strategic business objectives and who have accrued the right to specific remuneration treatments delayed by their previous employers.