Chrysler 2010 Annual Report Download - page 89

REPORT ON
OPERATIONS
CORPORATE
GOVERNANCE
88
CORPORATE GOVERNANCE
FOREWORD
The Fiat Group adopted and adheres to the Corporate Governance Code for Italian Listed Companies issued in March 2006, with additions and amendments
related to the specific characteristics of the Group.
In accordance with legal and regulatory requirements, the Company prepares an “Annual Report on Corporate Governance” which provides a general
description of the Group’s corporate governance system together with information on its ownership structure and adherence to the provisions of the
Corporate Governance Code, including key governance practices and the principal characteristics of the system of risk management and internal control
over financial reporting. The Report, which is available in the Corporate Governance area of the Group website (www.fiatspa.com), is divided into four
sections: the first contains a description of the governance structure; the second gives information on the ownership structure; the third provides an analysis
of implementation of specific provisions of the Code and describes the principal characteristics of the system of risk management and internal control
over financial reporting, in addition to the principal governance practices adopted; and, the fourth consists of summary tables and corporate governance
related documents, as well as a side-by-side comparison showing the principles of the Code and how they have been implemented. This section provides
a summary of aspects relevant to the Report on Operations.
The Corporate Governance Code is available on the website of Borsa Italiana S.p.A. (www.borsaitaliana.it).
DIRECTION AND COORDINATION
Fiat S.p.A. is not subject to the direction and coordination of any other company or entity and is fully independent in the definition of its general strategic
and operating guidelines. Pursuant to Article 2497-bis of the Civil Code, its Italian subsidiaries, with a few specific exceptions, have named Fiat S.p.A. as
the entity which exercises direction and coordination over them. That activity consists in indicating the general strategic and operating guidelines of the
Group and takes concrete form in the definition and updating of the internal control system, corporate governance model and corporate structure, the
issue of a Code of Conduct which is adopted throughout the Group, and the establishment of general policies for the management of human and financial
resources, purchasing of production materials, and marketing and communication. Furthermore, coordination of the Group includes specialized companies
which provide centralized cash management, corporate and accounting, and internal audit services.
Direction and coordination undertaken at Group level enables subsidiaries, which retain full management and operating autonomy, to realize economies of
scale by availing themselves of professional and specialized services with improving levels of quality and to concentrate their resources on the management
of their core business.
BOARD OF DIRECTORS
Pursuant to the By-laws, the Board of Directors may be composed of between nine and fifteen members. At the Annual General Meeting held on 27 March
2009, Shareholders elected fifteen Board members whose term of office expires on the date of the General Meeting held to approve the 2011 Financial
Statements. Under Article 11 of the By-laws, Board members are appointed through a voting list system which ensures that minority shareholders can elect
a director. The minimum equity interest required for submission of a list of candidates is established by Consob with reference to the Company’s market
capitalization for the last quarter of the final financial year of the mandate. Each list must indicate at least one candidate that satisfies the legal requirements
of independence, in addition to the requirements of the corporate governance code adhered to by the Company.
The voting list system was used for the election of the Board of Directors for the first time at the General Meeting of 27 March 2009.
On that occasion, the Company invited shareholders who, individually or jointly with others, owned at least 1% of ordinary shares (as established by
Consob with reference to Fiat’s average market capitalization for the fourth quarter of 2008) to submit, at least 15 days prior to the date of the Annual
General Meeting, lists of candidates who satisfied the requirements of law and the Company’s By-laws. EXOR S.p.A., holder of 30.45% of ordinary shares,
was the only shareholder to submit a list of candidates and, therefore, all candidates on the list were elected.