Remuneration policy

TIM Group’s remuneration policy is designed to support the achievement of the objectives set out in the Company’s strategic Plan, while ensuring the Company’s competitiveness on the labor market and its ability to attract, retain and motivate personnel.

The remuneration policy aims at:

• adopting an appropriate balance between the performance parameters of the short-term and long-term incentive schemes to achieve the Company’s strategic objectives
• making the Company attractive in the labor market, with particular reference to young people
• supporting people's engagement
• safeguarding the principles of internal equality, including with respect to gender
• safeguarding coherence at Group level, while considering the diversity of the markets of reference

The definition of the remuneration policy is supported by the analysis of market practices in terms of both remuneration levels and composition of remuneration packages, taking as reference both companies in the Telco sector at an international level (peer group Industry TLC) and Italian companies, comparable in terms of size and/or stock market capitalization (peer group FTSE MIB).T

The components of individual remuneration are:

• Fixed remuneration (which is the only form of remuneration provided for the Directors without specific positions, the Chairman and the Statutory Auditors)
• Short term variable remuneration
• Long term variable remuneration
• Benefits and welfare.

The integration of the various compensation components allows to appropriately balance the monetary and nonmonetary tools, with the aim of increasing the satisfaction of recipients at a sustainable cost.

The Nomination and Remuneration Committee ensures the implementation of the remuneration policy approved by the Shareholders' Meeting and defines the policy guidelines for the following year.

Among the Committee’s activities, the following may be mentioned:

• review of the results of the shareholders' vote on the remuneration policy
• fine tuning of the Peer Group adopted as a reference for the definition of the remuneration policy and the updating of the remuneration benchmarks
  
• analysis for the definition of the Remuneration Policy for the following year (short and medium/long-term variable incentive systems)
  
• engagement with leading institutional investors and proxy advisors
  
• finalization of the results of the previous year's performance objectives.
  

The Committee also deals with issues related to

• young people and generational turnover in TIM, monitoring the incentive system for millennials in critical roles
• gender gap and inclusion, through analysis and monitoring activities.

Non-Executive President

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, as established by the Board of Directors (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 annual amount, divided between the remuneration for the executive position and the remuneration for the office of Chief Executive Officer.

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 the fixed remuneration; each objective is measured individually, with a parametric scale.

• Long-term variable component

The Chief Executive Officer is the beneficiary of Long-Term Incentive Plans described in the Remuneration Report. For further details, please refer to the information document and the Remuneration Reports published annually by the Company.

• 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 the position as General Manager, will be entitled to the severance payment established by the law and by the applicable CCNL (National Labour Contract), with recognition of additional monthly payments up to a maximum of 24 (calculated on the fixed component)

• Clawback

In the five 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 their 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  set out 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 are eligible for an annual incentive plan, with economic, financial, and sustainability objectives established by the Board of Directors, and functional objectives consistent with their role.

For further details, please refer to the Report on remuneration and compensation paid published yearly by the Company.

• Long-term variable component

The Key Managers  are beneficiaries of the Long-term incentive Plans described in the Remuneration Report. For further details, please see the relevant information document and the Report on remuneration and compensation paid published yearly by the Company.

• Severance and non-competition package

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.

• Clawback

In the five years following payment of the variable remuneration components, the clawback clause may be activated for the amounts paid in accordance with the policy.

• Benefits and welfare

Key Managers enjoy benefits similar to those provided for senior management: management: company car for mixed use, insurance policy (occupational/non-occupational accidents, life and disability due to illness). Where necessary, a leasing service is provided, activated directly by the Company. The “professional risk policy” taken out by the Company and applicable to Directors & Officers also applies to Key managers.

The overall annual remuneration of the Board of Directors pursuant to art. 2389(1) of the Italian Civil Code was established by the Shareholders’ Meeting on 23 April 2024 in a maximum gross amount of 1,300,000 euros.

The Board of Directors held on 24 April 2024 allocated such remuneration, assigning a gross fixed annual amount of 100,000 euros to each Director (excluding the President and the Chief Executive Officer; please see the relevant sections of TIM’s website. There is no remuneration linked to the Company’s results, nor severance pay.

The Board of Directors has also established the remuneration for the Directors’ participation to the Committees; the related composition is described in the relevant section of TIM’s website.

Situation as of December 31, 2025

Source: Board of Directors' minutes of April 24, 2024, post April 23, 2024 meeting that appointed the Board of Directors (for the three-year period 2024/2026)