The ERG Group Tax Strategy, approved by the ERG S.p.A. Board of Directors on 10 November 2020, is designed to pursue the long-term growth of the company's assets, protect the Group's reputation and preserve the interests of its shareholders and other stakeholders.

In particular, the Board of Directors defined and approved the ERG Group Tax Strategy with the goal of establishing the principles and guidelines that guarantee the consistent management of the ERG Group's taxes.

More specifically, the ERG Group Tax Strategy seeks to:

  • guarantee the correct and prompt calculation and payment of taxes due by law and the fulfilment of connected obligations (tax compliance); 
  • mitigate tax risk, understood as the risk of infringing tax regulations or abusing the principles and purposes of tax legislation (abuse of rights).

As with the Group's Code of Ethics and Sustainability Policy, the ERG Group Tax Strategy is inspired by the principles of legality, correctness, transparency, honesty, integrity, the safeguarding of the company's assets and the creation of sustainable value over time.

The Italian and foreign subsidiary companies directly or indirectly controlled by ERG S.p.A. shall recognise the ERG Group's Tax Strategy, guaranteeing its dissemination and application. 

The Tax Control Framework (TCF) is an objective in our ESG Plan. In particular, we have adopted and implemented the TCF as follows:

  • as of 1 January 2021 (with effect from on fiscal year 2020) by ERG S.p.A. and its Italian subsidiaries;
  • as of 1 January 2023 (with effect from on the 2022 tax year) by the Group's French companies.

In particular, the Tax Control Framework will be adopted and implemented in Germany as of 1 January 2024.

The TCF is governed by specific regulations that, in addition to defining the governance rules, is based on the following key elements:

  • a Risk & Control Matrix which describes the tax risks potentially applicable to company processes relevant for tax purposes and the relative risk mitigation controls in place;
  • a system of data flows between the Tax organisational unit and the Group's other organisational units;
  • a system of information flows between the foreign subsidiaries and the Tax organisational unit;
  • a process of periodic updating and monitoring of the adequacy and effective application of the TCF;
  • a process of periodic reporting to the Control, Risk and Sustainability Committee containing the results of the updates and monitoring activities carried out.

The CFO is responsible for the implementation and operation of the TCF and is in charge of ensuring the update and monitoring of the TCF, as well as drawing up an annual Report.

The following are prepared annually:

  • plan for the testing, monitoring and assessment activities of the Tax Control Framework;
  • Annual Report, preliminarily shared and analysed within the Tax Control Framework Committee (see below) and subsequently submitted for examination and opinion to the Control, Risk and Sustainability Committee.

As part of the Tax Control Framework, an additional management assurance/control mechanism is envisaged to strengthen the Control System. In particular, a Tax Control Framework Committee with mixed competences was established:

  • it performs preliminary analyses, and provides specific recommendations, on the testing, monitoring and assessment activities of the TCF;
  • it analyses the annual report in advance, providing any specific recommendations;
  • it monitors the actual implementation of the improvement plan for any shortcomings resulting from the testing, monitoring and evaluation of the TCF.

The Tax Control Framework also provides for a whistleblowing system with two dedicated communication channels (one e-mail address and one regular mail address), adopting appropriate tools to ensure the confidentiality of the whistleblower's identity and the reported person in handling the report.