Remuneration policies and incentive systems

Our remuneration policies reflect our goal of attracting, motivating and retaining people who create concrete advantages for the Group because of their technical and managerial expertise and their different profiles in terms of background, gender and experience. We believe that an effective remuneration policy can strengthen their commitment and compliance with organisational goals consistent with our mission, culture and values. The pillars of our remuneration approach are as follows: equity and consistency, alignment with corporate strategy, competitiveness, value merit and performance, governance and compliance.

The Group governance as regards remuneration is focused on Group Executives (Group CEO, members of the Group Management Committee and the Global Leadership Group) and entails a wage structure that is aligned with market practices and legal requisites. The principles of the remuneration policy are extended to the entire Group organisation, taking account of business type and specific local laws.

Managers are offered a salary consisting of a fixed sum - according to role and responsibility, also taking account of experience, the quality of the contribution made to the achievement of business results and the level of excellence achieved in carrying out the roles assigned to them - and a variable sum, which rewards the short- and mid/long-term results they have achieved. Their total remuneration package is completed by a series of benefits.

The basic salary of employees in non-managerial positions is linked to National Collective Bargaining Agreements and supplementary agreements in force at each company. The remuneration package consists of a fixed sum, a variable sum and a series of benefits, which include a supplementary pension scheme, a welfare package, Long Term Care and other benefits for employees and their families.

In general, at the various levels female employees receive a lower gross annual salary than their male counterparts. (In Italy, for example, the overall remuneration received by female employees is 32% lower than that of their male colleagues). In non-managerial roles, the main reason for this is maternity leave and the greater number of part-time contracts held by women, who on average have also worked for the company for less time. French female office workers are the exception to the rule, earning 3.5% more than their male colleagues.

In Italy, the gross annual remuneration paid to newly hired office workers (i.e. those at the 4th pay level according to the insurance industry national collective bargaining agreement) at Generali is around 15% higher compared with the average in the insurance sector, while in Austria, Germany, the Czech Republic, Spain and Switzerland it is aligned with the average in the national insurance sector. In France, where remuneration is set according to gender, compared with the average remuneration paid for the same role by other companies in the insurance sector, remuneration for new hires at Generali is 17% higher for men and 9.6% higher for women.

Generally speaking, staff assessments are carried out periodically by managers who evaluate the results attained by employees according to parameters such as working performance, development of knowledge and skills, and professional development. The performance and talent management process requires managers to assess the potential of their staff as well as their performance.

The incentive systems award results achieved in the short- and mid-long term. Performances are evaluated through a multitemporal and multi-dimensional approach that takes account of the results achieved by individuals, by the departments in which they operate and, as regards the Top Management, the overall results of the Company/Group as well as those of competitors, who constitute the peer panel of reference.

The incentive systems for the Top Management are based on the achievement of annual and multi-year goals, such as the Short-Term Incentive (STI) – the annual bonus system for the Group CEO, the members of the Group Management Committee (GMC) and the members of the Global Leadership Group (GLG) - and the Long-Term Incentive (LTI) – the multi-year program for Group executives and selected key resources, paid out in Generali shares upon the approval of the General Meeting.

For managers our incentive systems are based on the attainment of annual goals through the balanced scorecard system. This tool was adopted in order to translate the strategies of the Group industrial plan into a series of operating goals that are able to significantly impact on the Group’s global performances and which are diversified according to the various skills and spheres of action of the recipients. The goals assigned are both quantitative – economic, financial, risk, return measures - and qualitative, and make it possible to monitor multiple aspects of the corporate performance.

In general there are no systems for the recognition of bonuses to middle managers and office workers and any eventual variable components are subject to an individual performance assessment. There are no long-term incentive programmes.

In Germany, Generali Deutschland Service GmbH represents an exception as it offers office workers bonuses connected with the attainment of energy consumption reduction targets.

Assicurazioni Generali S.p.A. - C.F. e P.IVA 00079760328