Board Committees

As part of a broader project for the reorganization of its control and governance system, Sisal Lottery Italy S.p.A. (“Sisal” or the “Company”) approved the creation of the following Board Committees:

A brief description of the composition and functions of each of the above Committees is provided below.
 

• Paola Bonomo, as Chairman (Independent Director);
• Lucia Morselli (Independent Director);
• Giampiero Mazza (non-executive and non-independent Director meeting the professional requirements for the office of Appointments and Remuneration Committee member).

1. Formulate opinions to the Board of Directors on the composition thereof and of the subsidiaries’ governing bodies, and, possibly, on the professional figures whose presence is deemed appropriate within such bodies;
2. Propose to the Board of Directors candidates for the office of the Company’s and its subsidiaries’ Director in the case referred to in Article 2386, first paragraph, of the Italian Civil Code, if an independent Director needs to be replaced;
3. Indicate candidates for the office of the Company’s and its subsidiaries’ independent Director to be submitted to the ordinary General Meeting of Shareholders, taking into account any indications received from Shareholders with voting rights in said General Meeting of Shareholders;
4. Submit proposals to the Board for the remuneration of the Company’s and its subsidiaries’ Directors and Key Management Personnel, identified as the first line of the Group’s Chief Executive Officers, providing that no Director may participate in the formulation of proposals to the Board of Directors relating to their remuneration.

The Control, Risks and Sustainability Committee carries out investigative, consultative and proactive functions to support, among other things, the assessments and decisions of the Board of Directors regarding the Company’s Internal Control and Risk Management System.

The Committee is also entrusted with the objective of assisting and supporting the Board of Directors in regard of sustainability.

Composition

The Committee comprises 3 non-executive directors - one acting as Chairman - the majority of whom are independent. In addition, at least one member of the Control, Risks and Sustainability Committee should have adequate experience in accounting and financial matters.
 

The Committee comprises the following Directors:

All of whom may be qualified as non-executive independent Directors and have adequate knowledge and experience in financial or risk management matters.

1. Assist the Board of Directors in performing its duties relating to the Control System;
2. Together with the manager in charge of financial reporting and with the firm in charge of auditing the Company’s accounts, assess the correct use of the accounting principles and, in relation to the Group, the uniformity thereof for the purposes of preparing the consolidated financial statements;
3. Express opinions on specific aspects concerning the identification of the main business risks, as well as the design, implementation and management of the Control System;
4. Examine the work plan prepared by the Internal Audit and Risk Management Department, as well as the regular reports prepared by the same, assessing the completeness and adequacy thereof;
5. Evaluate the proposals made by independent auditing firms to obtain the assignment of the audit of the Company’s accounts, as well as the work plan prepared and results presented in the report and in letters of suggestions, if any;
6. Supervise the effectiveness of the legal audit process;
7. Perform any additional tasks assigned to it by the Board of Directors;
8. Provide reports on the activities carried out and on the adequacy of the Internal Control and risk management system to the Board of Directors at least once every six month, one of such reports being provided at the time of approval of the financial statements;
9. Support the risk management assessments and decisions of the Board of Directors with adequate investigations.

1. Assist the Board of Directors in carrying out its tasks relating to the definition of Sustainability strategies, policies and plans, drawing up guidelines and general contents in agreement with the Head of the department responsible for the issues being dealt with. All of the foregoing while abiding by the guidelines set forth by international organizations on an ongoing basis;
2. Evaluate the consistent execution of defined plans for the purpose of preparing an annual sustainability report;
3. Perform additional tasks, including supporting tasks, as assigned by the Board of Directors;
4. Provide reports on the activities carried out to the Board of Directors at least once every six month, one of such reports being provided at the time of approval of the Sustainability report.

The Related Parties Committee is a Board committee entrusted with the tasks set out in the Procedure for Related Party Transactions, including the prior assessment of compliance of any related party transactions carried out by the Company directly, or through subsidiaries in the interest of the same, as well as the assessment of the cost-effectiveness and correctness of the related terms and conditions, within the framework of a sound and prudent management of the Company.

Composition

The Related Parties Committee comprises 3 non-executive independent directors, namely:

The Related Parties Committee is entrusted with the task of ensuring compliance with the rules governing the approval and execution of transactions with related parties put in place by the Company directly, or through identified subsidiaries, in order to ensure transparency, impartiality and substantive and procedural correctness of such transactions in the interest of a sound and prudent management of the Company.
 

The Company prepared a Procedure for Related Party Transactions (hereinafter the “RPT Procedure”), for the purpose of identifying a process relating to the management of such transactions. Related party transactions are governed in compliance with International Accounting Standards (IAS) adopted for the preparation of the Company’s financial statements, in particular with reference to IAS 24, as well as in compliance with the rules laid down in the Regulation concerning Related Party Transactions issued by Commissione Nazionale per le Società e la Borsa (Italian companies and stock exchange authority).
 

The RPT Procedure, placed under the responsibility of the CFO of Sisal, regulates the scope of application, effectiveness, process to identify Related Parties and keep and update the Register of Related Parties and Transactions between Related Parties. The RPT Procedure also contains provisions regarding the process to be followed for the investigation, assessment and approval of significant transactions, with the involvement of the Related Parties Committee and thereafter of the Board of Directors, as well as the description of the types of transaction excluded from the scope of application of the RPT Procedure.