Directors' remuneration

Directors' remuneration is determined, for each financial year, by the Ordinary General Shareholders'Meeting called to approve year-end financial statements. The Shareholders' Meeting also determines the fee for the independent directors called to serve on the Nominations and Remuneration Committee or of the Control and Risk Committee.
2020 Remuneration Report

Pursuant to Article 123-ter of Legislative Decree no. 58 dated 24 February 1998
(published on March 30, 2020)
2020 Ordinary and extraordinary Shareholders' meeting

1The variable component assigned to the Chief Audit Officer is linked to objectives that do not depend on financial performance indicators. These objectives
are formalised in the annual audit plan and are linked to the degree of efficiency and effectiveness of the audit activities.
2 The variable remuneration referred to the company target will not be paid out, for the reference year, regardless of the corporate performances recorded, if
there is a fatal accident involving a Group employee or an accident causing a level of permanent disability greater or equal to 46%.

3 As Executive Directors with a strategic importance for the purposes of the achievement of the 2018-2022 Business Plan.
4 Press release issued on 8 March 2018 in the context of the presentation to the Market of the 2018-2022 Business Plan.
5 The weight of the total variable component, made up of the short-term incentive (MBO System) and the long-term incentive (LTI System) for remuneration, on an annual basis, may vary between 45% and 50% of the target total remuneration depending on the strategic relevance of the role for the purposes of achievingthe 2018-2022 Business Plan.
ERG believes that the full compatibility of its activities with the health and safety of the workers and the safeguard of communities, natural resources and the environment is an essential requirement to make its plants and operations acceptable and to achieve its growth objectives.

Therefore, ERG is committed to ensuring that all Companies of the ERG Group operate with the highest respect for the health and safety of employees and third parties, as well as for the environment, defined in its broadest sense6.
Consistently with the provisions of the Code of Ethics of the ERG Group, a sustainability clause based on workplace accidents has been added to the MBO System.

Sustainability Clause 2019
6 Code of Ethics of the ERG Group, 2018 version.
7 No. accidents*1,000,000/worked hours.
8 No. days lost*1,000/worked hours.

In the last two years, ERG has rewarded its shareholders with total dividends of approximately EUR 284 million (including a non-recurring component of approx. EUR 60 million) and a share performance of 27.5%, almost 22 points higher than the FTSE All Share average.
Source: ERG 2020 Report on the policy regarding remuneration and fees paid