Tiscali 2007 Annual Report Download - page 50

from the customer base acquired via Pipex – by offering the lat-
ter a complete package of integrated IP services at competitive
prices; (ii) expand its network coverage to around 1,800 sites in
2008 and approximately 2,100 by 2009, hence roughly 30 mil-
lion lines. In particular, it is expected that in the UK we will reach
around 1,000 sites in 2008 (of which 740 equipped to supply
the IPTV service) and about 1,100 in 2009 (approximately 17
million lines). Thanks to a “virtual unbundling” agreement reached
with Telecom Italia, in Italy the Group will begin marketing its own
services on around 1,000 sites, about 13 million lines, from early
2008, while its own network will be ready as from the second
half of the 2009 so as to reach approximately 800 sites directly
by the end of 2008 and around 1,000 sites in 2009.
Confirming the strategies and economic-financial objectives
described in the plan, the Board meeting held on 28/29 Febru-
ary entrusted the new Chief Executive Officer, Mario Rosso, with
the exploration of the options for the further generation of value
for the shareholders, associated with the process for the consol-
idation of the telecommunication sector underway in Europe.
The directors believe that the previously mentioned agreements
of trading and financial nature stipulated during 2007, together
with the share capital increase taking place in January 2008,
offer the group the necessary financial flexibility to reach the goals
in the plan. In this respect, the Group’s future skill to reach the
goals and the assumptions in the plan, generating positive cash
flows and economic results, is fundamental. This condition influ-
ences the evolution of Tiscali’s financial position to a remarkable
extent. Therefore, it also influences its financial, economic and
equity equilibrium.
Corporate governance report
Foreword
In pursuance of Article 124 bis of Italian Legislative Decree
No. 58/1998, as implemented by Article 89
bis of the Issuers’
Regulations, adopted by Consob under resolution No. 11971
of 14 May 1999, and the current Instructions to the Regula-
tions for Markets organized and run by Borsa Italiana S.p.A.,
Section IA.2.6, listed companies are obliged to draw up an
annual disclosure report on their
Corporate Governance sys-
tem and on compliance with the Code’s recommendations (as
defined below). This report must be made available to the
shareholders at least 15 days before the shareholders’ meet-
ing for the approval of the annual financial statements and for-
warded at the same time to Borsa Italiana S.p.A. who will make
it available to the general public. The report is also published
in the “
investor relations ” section on the Company website:
www.tiscali.com.
Fulfilling the prescribed obligation and with the intention of
providing extensive corporate disclosure to the shareholders
and the investors, Tiscali S.p.A.’s (“Tiscali” or the “Company”)
Board of Directors has drawn up this report (the “Report”), in
compliance with the guidelines published by Borsa Italiana
S.p.A. and in light of the indications provided by Assonime in
this connection.
Therefore, the Report is split into two parts. The first part fully
illustrates the corporate governance model adopted by Tiscali
and describes the directors and officers, as well as the share-
holding structure. The second part by contrast provides detailed
disclosure regarding compliance with the Code’s recommen-
dations by means of a comparison between the choices made
by the Company and said recommendations of the Code.
Part I:
Corporate Governance structure
1.General principles
The term Corporate Governance defines the series of process-
es for managing the corporate activities with the aim of creat-
ing, protecting and increasing the value for the shareholders
and investors over time. These processes must ensure the
achievement of the corporate objectives, the maintenance of
socially responsible conduct, transparency and responsibility
vis-à-vis the shareholders and the investors.
In order to ensure the transparency of management’s opera-
tions, correct market disclosure and protection of the socially
relevant interests, the corporate governance system adopted
by Tiscali fully draws on the recommendations of the Code of
Conduct (the “Code”), drawn up by the
Corporate Governance
Committee
, March 2006 edition. The Company adopts prac-
tices and principles of conduct, formalized in procedures and
codes, in line with Borsa Italiana S.p.A.’s indications, CON-
SOB recommendations and with the
best practice seen at
national and international level; furthermore, Tiscali has
equipped itself with an organizational structure suitable for cor-
rectly handling business risks and potential conflicts of inter-
est which may occur between Directors and shareholders,
majority and minority.
2.Adopted model
In relation to the system of management and control, the Com-
pany has adopted the traditional model, which envisages the
presence of the Board of Directors and the Board of Statutory
Auditors. Notwithstanding the fact that recent company law
reforms have given public limited companies the right to adopt
models that depart from the traditional structure, the company
has, at present, decided to keep its system of corporate gover-
nance unchanged in order to guarantee continuity and consis-
tency with the consolidated structure, allowing a distinct division
of roles and powers between governing bodies, in consideration
of the provisions of the Code of Conduct for Listed Companies.
3.Directors and Auditors, and the company appointed to audit
the accounts
REPORT ON OPERATIONS
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