FinecoBank S p A : Report on Corporate Governance and Ownership Structures 2023

REPORT

ON THE CORPORATE GOVERNANCE AND OWNERSHIP STRUCTURE

pursuant to Article 123-bis of the Legislative Decree no. 58 of February 24, 1998 (traditional management and controlo model)

Name of Issuer:

"FINECOBANK S.P.A."

Website:

finecobank.com

Financial year of reference of the Report:

January 1, 2023 / December 31, 2023

Date of approval of the Report:

March 12, 2024

This is an English translation of the original Italian document. The original version in Italian takes precedence.

		Contents
GLOSSARY	5
INTRODUCTION	10
1. PROFILE OF THE ISSUER	11
1.1. THE CORPORATE GOVERNANCE MODEL	12
1.1.1	Shareholders' Meeting	14
1.1.2	Board of Directors	14
1.1.3	Board committees	15
1.1.4 Board of Statutory Auditors	15
1.1.5	External Auditors	16

2. INFORMATION ON OWNERSHIP STRUCTURES (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 1,

	TUF)	17
A)	SHARE CAPITAL STRUCTURE (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 1, LETTER A) OF
THE TUF)	17
B)	RESTRICTIONS ON THE TRANSFER OF SECURITIES (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH
1, LETTER B) OF THE TUF)	18
C)	SIGNIFICANT HOLDINGS IN CAPITAL (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 1, LETTER
C), OF THE TUF)	18
D)	SECURITIES CONFERRING SPECIAL RIGHTS (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 1,
LETTER D), OF THE TUF)	20
E)	EMPLOYEE SHAREHOLDINGS: MECHANISM FOR EXERCISING VOTING RIGHTS (PURSUANT TO
ARTICLE 123-BIS,PARAGRAPH 1, LETTER E), OF THE TUF)	20
F)	RESTRICTIONS ON VOTING RIGHTS (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 1, LETTER F),
OF THE TUF)	20
G)	SHAREHOLDER AGREEMENTS (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 1, LETTER G), OF
THE TUF)	20
H)	CHANGE OF CONTROL CLAUSES (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 1, LETTER H), OF
THE TUF) AND ARTICLES OF ASSOCIATION PROVISIONS ON TAKEOVER BIDS (PURSUANT TO ARTICLE
104, PARAGRAPH 1-TER,AND 104-BIS,PARAGRAPH 1, OF THE TUF)	20
I)	DELEGATIONS TO INCREASE SHARE CAPITAL AND AUTHORISATIONS TO PURCHASE TREASURY
SHARES (PURSUANT TO ARTICLE 123-BIS,PARAGRAPH 1, LETTER M) OF THE TUF)	20
L)	MANAGEMENT AND COORDINATION ACTIVITIES (PURSUANT TO ARTICLE 2497 ET SEQ OF THE
ITALIAN CIVIL CODE)	21
3.	COMPLIANCE (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 2, LETTER A) OF THE TUF)	22
4.	BOARD OF DIRECTORS	23
4.1	ROLE OF THE BOARD OF DIRECTORS	23
4.1.1	Duties	23
4.1.2	Competing activities	31

4.2. APPOINTMENT AND REPLACEMENT (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 1, LETTER L),

PART 1, OF THE TUF)

31

4.3 COMPOSITION (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 2, LETTER D), AND D)-BIS OF THE

TUF) 34

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4.3.1 Diversity criteria and policies in the composition of the Board and the company

organisation	41
4.3.2. Maximum number of positions held in other companies	43

4.4 FUNCTIONING OF THE BOARD OF DIRECTORS (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 2,

LETTER D) OF THE TUF)	48
4.5	ROLE OF THE CHAIRMAN OF THE BOARD OF DIRECTORS	50
4.6	EXECUTIVE DIRECTORS	51
4.6.1 Managing Directors: Managing Director and General Manager	51
4.6.2 The Chairman of the Board of Directors	52
4.6.3 Reporting to the Board of Directors by Directors/Delegated Bodies	52
4.6.4 Other executive directors	53
4.7	INDEPENDENT DIRECTORS AND LEAD INDEPENDENT DIRECTORS	53
4.7.1 Lead Independent Director	56
5. PROCESSING OF COMPANY INFORMATION	57

6. INTERNAL COMMITTEES OF THE BOARD OF DIRECTORS (PURSUANT TO ARTICLE 123-BIS,

PARAGRAPH 2, LETTER D) OF THE TUF)

60

6.1 CORPORATE GOVERNANCE AND ENVIRONMENTAL AND SOCIAL SUSTAINABILITY COMMITTEE

62

6.1.1 Composition and functioning of the Corporate Governance and Environmental and Social

Sustainability Committee

62

6.1.2 Functions of the Corporate Governance and Environmental and Social Sustainability Committee 63

6.1.3	Activities performed	64
7. SELF-ASSESSMENT AND SUCCESSION OF DIRECTORS - APPOINTMENTS COMMITTEE	68
7.1	SELF-ASSESSMENTAND SUCCESSION OF DIRECTORS	68
7.2		APPOINTMENTS COMMITTEE	69
7.2.1 Composition and functioning of the Appointments Committee	69
7.2.2 Functions of the Appointments Committee	70
7.2.3	Activities performed	71
8. REMUNERATION OF DIRECTORS - REMUNERATION COMMITTEE	74
8.1		REMUNERATION OF DIRECTORS	74
8.2		REMUNERATION COMMITTEE	74

8.2.1 Composition and functioning of the Remuneration Committee (pursuant to Article 123-bis,

paragraph 2, letter d), TUF)	74
8.2.2 Functions of the Remuneration Committee	75

9. INTERNAL CONTROL AND RISK MANAGEMENT SYSTEM - RISK AND RELATED PARTIES

	COMMITTEE	77
9.1	CHIEF EXECUTIVE OFFICER	90
9.2	RISK AND RELATED PARTIES COMMITTEE	92

9.2.1 Composition and functioning of the Risk and Related Parties Committee (pursuant to

	Article 123-bis, paragraph 2, letter d) of the TUF)	92
9.2.2 Functions assigned to the Risk and Related Parties Committee	95
9.2.3	Activities performed	98
9.3	HEAD OF THE INTERNAL AUDIT FUNCTION	100
9.4	ORGANISATIONAL MODEL PURSUANT TO LEGISLATIVE DECREE 231/2001	103

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9.5	AUDITING FIRM	105
9.6	FINANCIAL REPORTING OFFICER	106

9.7 COORDINAMENTO TRA I SOGGETTI COINVOLTI NEL SISTEMA DEI CONTROLLI INTERNI DI

GESTIONE DEI RISCHI	107
10.	DIRECTORS' INTERESTS AND RELATED-PARTY TRANSACTIONS	110
11.	BOARD OF STATUTORY AUDITORS	113
11.1 APPOINTMENT AND REPLACEMENT OF STATUTORY AUDITORS	113

11.2. COMPOSITION AND FUNCTIONING OF THE BOARD OF STATUTORY AUDITORS (PURSUANT TO

ARTICLE 123-BIS(2)(D)AND (D-BIS)OF THE TUF)	115
12. RELATIONS WITH SHAREHOLDERS	127

13. SHAREHOLDERS' MEETINGS (PURSUANT TO ARTICLE 123-BIS, PARAGRAPH 2, LETTER C) OF THE

	TUF)	130
13.1	LEGITIMATION, PROCEDURES FOR TAKING THE FLOOR AND VOTING	131
13.2	PROCEEDINGS OF SHAREHOLDINGS' MEETINGS	131

13.3 SIGNIFICANT CHANGES IN CAPITALISATION AND COMPOSITION OF THE COMPANY STRUCTURE

132

14.	ADDITIONAL CORPORATE GOVERNANCE PRACTICES	133
15.	CHANGES SINCE THE END OF THE REPORTING YEAR	134

16. CONSIDERATIONS ON THE LETTER OF DECEMBER 14, 2023 FROM THE CHAIRMAN OF THE

CORPORATE GOVERNANCE COMMITTEE

135

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GLOSSARY

Shareholders'	Shareholders' Meeting of the Issuer.
Meeting:
Shareholders:	the owners of FinecoBank shares.
Borsa Italiana:	Borsa Italiana S.p.A.
FinecoBank CFO:	the Chief Financial Officer of FinecoBank.
Civil Code:		the Italian Civil Code approved by Royal Decree no. 262, of 16
			March 1942, as amended.
Corporate Governance	the Corporate Governance Code for listed companies approved in
Code:			July 2018 by the Corporate Governance Committee and endorsed
			by Borsa Italiana, ABI, Ania, Assogestioni, Assonime and
			Confindustria. From January 1, 2021, the Corporate Governance
			Code was replaced by the New Corporate Governance Code.
New		Corporate	the New Corporate Governance Code for listed companies
Governance Code:	approved in January 2020 by the Corporate Governance
			Committee and promoted by Borsa Italiana, ABI, Ania,
			Assogestioni, Assonime and Confindustria, applicable from the
			first financial year starting after December 31, 2020. The New
			Corporate Governance Code replaces the previous Corporate
			Governance Code approved in July 2018.
Board	of	Statutory	the Board of Statutory Auditors of the Issuer.
Auditors:
Corporate Governance	the Board committee established in compliance with Article 4 of
and	Environmental	the Corporate Governance Code and the Supervisory Regulations
and		Social	on Corporate Governance, established on April 28, 2020.
Sustainability
Committee:
Appointments	the Board committee established in compliance with Articles 4
Committee:		and 5 of the Corporate Governance Code and the Supervisory
			Regulations on Corporate Governance, established on April 28,
			2020.
Remuneration	the Board committee established in compliance with Articles 4
Committee:		and 6 of the Corporate Governance Code and the Supervisory
			Regulations on Corporate Governance.
Risk	and	Related	the Board committee established in compliance with Articles 4
Parties Committee:	and 7 of the Corporate Governance Code and the Supervisory
			Regulations on Corporate Governance, as well as regulations on

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		related parties and associated persons.
Board/Board	of	the Board of Directors of the Issuer.
Directors:
CONSOB:		Commissione Nazionale per le Società e la Borsa (public authority
		regulating Italian financial markets) with headquarters in Rome,
		Via G.B. Martini no. 3.
Ministerial	Decree	Decree no. 169 of November 23, 2020 of the Ministry of
169/2020:		Economy and Finance containing the "Regulation on
		requirements and suitability criteria for corporate officers of
		banks, financial intermediaries, credit consortium, electronic
		money institutions, payment institutions and depositor guarantee
		schemes".
CRD Directive:		the CRD IV Directive - as amended by Directive (EU) 2019/878
		(CRD V) - on access to the activity of credit institutions and the
		prudential supervision of credit institutions, amending Directive
		2002/87/EC and repealing Directives 2006/48/EC and
		2006/49/EC.
CRD IV Directive:	Directive 2013/36/EU of the European Parliament and of the
		Council of June 26, 2013, on access to the activity of credit
		institutions and the prudential supervision of credit institutions
		and investment firms, as modified in CRD V.
CRD V Directive:	Directive (EU) no. 878/2019/EU of the European Parliament and
		of the Council, of May 20, 2019, amending the CRD IV Directive
		as regards exempted entities, financial holding companies, mixed
		financial holding companies, remuneration, supervisory measures
		and powers and capital conservation measures.
Mifid II Directive:	Directive 2014/65/EU of the European Parliament and of the
		Council of May 15, 2014, on markets in financial instruments,
		enacted on January 3, 2018, and replacing the previous European
		regulations in this area.
Supervisory		the Supervisory Regulations for Banks set out in Bank of Italy
Regulations:		Circular No. 285 of 17 December 2013 and subsequent updates.
Supervisory		the Supervisory regulations for banks on organisation and
Regulations	on	corporate governance as per Bank of Italy Circular no. 285 of
Corporate		December 17, 2013, Part I, Title IV, Chapter 1 and subsequent
Governance:		amendments.
Issuer or FinecoBank	FinecoBank S.p.A., an issuer of securities to whom the Report
or Bank or Company or	refers, registered in the Register of Banks and Parent Company of
also Parent Company:	the FinecoBank Banking Group - Banking Group Register no.

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			3015, with registered office in Piazza Durante 11, Milan,
			Headquarters in Via Rivoluzione d'Ottobre 16, Reggio Emilia,
			VAT no. 12962340159, Tax code and Milan-Monza-Brianza-Lodi
			Companies Register no. 01392970404, Economic and
			Administrative Index (REA) no. 1598155, member of the
			National Guarantee Fund and the Interbank Fund for the
			Protection of Deposits.
Group	Entities or	the Italian or foreign companies, directly or indirectly controlled
Entities:			by FinecoBank, belonging to the FinecoBank Banking Group.
Year:			the financial year of reference of the Report.
Fineco		Asset	the Irish company wholly owned by FinecoBank and engaged in
Management		the management of collective investment undertakings.
Designated	Activity
Company or FAM:
GDPR:			EU Regulation 2016/679 of the European Parliament and of the
			Council of April 27, 2016 (General Data Protection Regulation)
			on the protection of natural persons with regard to the processing
			of personal data and on the free movement of such data, repealing
			Directive 95/46/EC.
Global Policy:	the "Global Policy for the management of transactions with
			persons in potential conflict of interest of the FinecoBank Group",
			as described in Paragraph 10 of this Report.
Group or FinecoBank	the group consisting of the Parent Company FinecoBank and its
Group:			Subsidiaries; currently corresponding to the FinecoBank Banking
			Group.
FinecoBank	Banking	the group consisting of the Parent Company FinecoBank as well
Group	or	Banking	as its Entities.
Group:
BCE Guide:		the European Central Bank's "Guide to fit and proper assessment"
			published in December 2021, which revises and replaces the
			previous version updated in May 2018. The purpose of the Guide
			is to explain in more detail the policy guidelines, supervisory
			practices and processes applied by the European Central Bank in
			assessing the suitability of members of the management bodies of
			significant credit institutions and to specify the ECB's main
			expectations (the "ECB Guide").
Instructions		instructions on Regulations for Markets organised and managed
accompany	the Stock	by Borsa Italiana, in force at the date of approval of this Report.
Exchange Regulations:

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MTA:		the main Stock Exchange organised and managed by Borsa
		Italiana, where FinecoBank shares are also traded.
Joint EBA and ESMA	the joint guidelines of September 26, 2017 of ESMA and the EBA
Guidelines:		on the assessment of the suitability of members of corporate
		bodies and key personnel under CRD IV and Directive
		2014/65/EU ("MIFIR II"), last updated on July 2, 2021.
Paragraph:		the paragraphs of this Report.
Fit & Proper Policy:	the policy concerning the rules adopted by the Bank on the
		verification of the suitability requirements for corporate officers
		and heads of FinecoBank's main corporate functions, pursuant to
		the applicable legislation and regulations, approved by the Board
		of Directors on March 16, 2021 and subsequently amended.
Assonime Principles:	the "Principles for Listed Companies' dialogue with Investors"
		published by Assonime in Circular no. 23 of July 19, 2021, which
		- together with the relevant annotations - outline roles and
		responsibilities in defining policy and managing dialogue with
		investors in general, in line with the functions and tasks that the
		New Corporate Governance Code assigns to those involved in the
		governance system.
Corporate	Bodies	the Regulations approved by the Board of Directors governing the
Regulations:		functioning and responsibilities of the Company's Board of
		Directors and Board of Statutory Auditors and related information
		flows, in compliance with laws, regulations and the Articles of
		Association. The document is available on the Issuer's website
		www.finecobank.com (section "About Us/Governance/Company
		Boards").
Stock	Exchange	the Regulations for Markets organised and managed by Borsa
Regulations:		Italiana, approved by the shareholders' meeting of Borsa Italiana,
		in force at the date of approval of this Report.
Issuer Regulations:	the Regulations issued by CONSOB with resolution no. 11971 of
		May 14, 1999 (as amended), on issuers.
Market Regulations:	the Regulations issued by CONSOB with resolution no. 20249 of
		December 28, 2017, on markets.
Related-Party	the Regulations issued by CONSOB with resolution no. 17221 of
Regulations:		March 12, 2010 (as amended), containing provisions on
		transactions with related parties.
Report:		this Report on corporate governance and ownership structures that
		companies are required to prepare pursuant to Article 123-bis of

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	the Consolidated Finance Act (hereinafter TUF).
Subsidiaries:	Italian and foreign companies controlled directly and/or indirectly
	by FinecoBank, pursuant to Article 2359 of the Italian Civil Code,
	Article 93 of the TUF and Article 23 of the Consolidated Banking
	Act (hereinafter TUB), whether or not they belong to the Banking
	Group.
External Auditors:	KPMG S.p.A., with registered office in Milan, Via Vittor Pisani
	25, VAT No. 0070900159, tax code and registration number in the
	Milan Register of Companies 0070900159, R.E.A. 512867, a
	company registered in the special register of statutory auditors,
	appointed to perform the statutory audit of the Issuer's accounts.
Articles of Association:	the Articles of Association of the Company in force at the date of
	approval of this Report (available on the Company's website).
TUB:	Legislative Decree no. 385 of September 1, 1993, as amended
	(Consolidated Banking Act/TUB).
TUF:	Legislative Decree no. 58 of February 24, 1998, as amended
	(Consolidated Finance Act/TUF).

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INTRODUCTION

The Report has been prepared pursuant to Article 123-bis of the TUF, in compliance with the "Format for corporate governance and ownership structure reports" of Borsa Italiana S.p.A., 9th edition, January 2022, as well as Supervisory Regulations on Corporate Governance. The information in this Report refers to the 2023 financial year, unless otherwise indicated.

The Report, approved by the Company's Board of Directors by resolution of March 12, 2024, is published at the same time as the Directors' Report on Operations on the Issuer's website in the "About Us/Governance" section and is also available on the website of the authorised storage mechanism managed by Spafid Connect S.p.A. (www.emarketstorage.it).

The Report was submitted to the Independent Auditors for the verifications of competence in order to express an opinion on the consistency of the financial statements and compliance with the law pursuant to Article 123-bis, paragraph 4, of the TUF. The results of the activity carried out by the Independent Auditors are reported in the reports drawn up by the latter pursuant to Article 14 of Legislative Decree No. 39 of January 27, 2010 and Article 10 of Regulation (EU) 537/2014, attached to the Company's annual financial statements and consolidated financial statements for 2023.

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