Chrysler 2013 Annual Report Download - page 106

105
Report on
Operations
Effective 1 January 2011, the Company adopted procedures for transactions with related parties to ensure full transparency and substantial and
procedural fairness in transactions with related parties, as defined under IAS 24. The Procedures define “significant transactions” which require
the prior approval of the Board – subject to the binding opinion of the Internal Control and Risk Committee, which is the committee responsible
for related-party transactions, with the exception of those matters relating to compensation, for which the Compensation Committee is
responsible – and must be publicly disclosed in the form of an information document.
Other transactions, except those falling within the residual category of minor transactions – i.e., transactions less than €200,000 in value or,
for transactions with legal entities having consolidated annual revenues in excess of €200 million only, transactions less than €10 million in
value – are defined as “non-significant” and may be entered into with the prior non-binding opinion of the above committee. The Procedures
also establish exemptions, including: transactions taking place in the ordinary course of business and entered into at standard or market terms;
transactions with or between subsidiaries and transactions with associates, provided that no other parties related to the Company have a
significant interest; and transactions of minor value.
The task of implementing the Procedures and disseminating them to Group companies is assigned to the manager responsible for the
Company’s financial reporting, who must also ensure coordination with the administrative and accounting procedures required under Article
154-bis of Legislative Decree 58/1998.
As established in the “Guidelines for Significant Transactions”, transactions having a significant impact on the Company’s earnings and financial
position are subject to prior examination and approval by the Board.
Accordingly, the powers attributed to the executive directors specifically exclude decision-making authority for significant transactions, pursuant
to the criteria for significance established by Consob. A reasonable period in advance of the Company undertaking a significant transaction, the
executive directors are to provide the Board a summary report on their analysis of the strategic compatibility, economic feasibility and expected
return.
As provided under Articles 70 (8) and 71 (1-bis) of the Consob Issuer Regulations, on 30 October 2012 the Board of Directors approved the
opt-out from the obligation to publish an information document for significant transactions (e.g., significant mergers, spin-offs, share capital
increases by means of in-kind contributions of assets, acquisitions and disposals).
Pursuant to Article 12 of the By-laws, after consultation with the Board of Statutory Auditors, the Board of Directors appoints one or more
managers responsible for the Company’s financial reporting. If more than one manager is attributed that responsibility, it is to be carried out
jointly and with joint responsibility. It is a requirement that the individual(s) appointed have several years of accounting and financial experience
within a large company. In implementation of that provision, the Board of Directors appointed the Chief Financial Officer as the manager
responsible for the Company’s financial reporting, vesting him with the relevant powers.
At 31 December 2013, the Board of Directors was composed of three executive directors and six non-executive directors (i.e., directors
without specific executive powers or responsibilities within the Company or the Group), four of whom qualified as independent on the basis
of the criteria approved by Shareholders on 4 April 2012 and adopted for past elections. All of those independent directors (Joyce Victoria
Bigio, René Carron, Gian Maria Gros-Pietro and Patience Wheatcroft) also meet the independence requirements established under Legislative
Decree 58/98.
The Chairman and Chief Executive Officer are executive directors. They also hold executive responsibilities at subsidiary companies: John
Elkann is Chairman of Editrice La Stampa S.p.A. and Sergio Marchionne, in addition to being Chairman of the principal subsidiaries, is also
Chairman and Chief Executive Officer of Fiat Group Automobiles S.p.A. and of Chrysler Group LLC. Luca Cordero di Montezemolo also qualifies
as an executive director by virtue of his position as Chairman of Ferrari S.p.A.