Policies and Procedures

Policy for managing the Dialogue with Shareholders and Bondholders in general

HERA has always valued discussion and promoted, in the most appropriate forms, an open and active dialogue with Shareholders and Bondholders in general. In accordance with its Articles of Association, the purpose of the Company is to implement a business model which aims at creating long-term value for its Shareholders through the creation of a shared value with its Stakeholders and increase the level of understanding of the activities carried out by the Company and the HERA Group.

In compliance with the recommendations in this regard of the Corporate Governance Code to which the Company adheres, at the meeting of 1 December 2021, the Board of Directors of HERA adopted, on the proposal of the Chairman, formulated in agreement with the Chief Executive Officer, this “Policy to manage the Dialogue with Shareholders and Bondholders in general” to ensure that the dialogue that the Company and the HERA Group have with Shareholders and Bondholders is inspired by the principles detailed in the Policy itself and can take place in compliance with community and national regulations on market abuse, as well as in line with international best practices.

Procedures for transactions with Related Parties

The Board of Directors of Hera Spa, at its meeting of 10 October 2006, approved, in compliance with the provisions of the then-current Corporate Governance Code, the Guidelines on significant transactions, transactions with related parties and transactions in which a director bears an interest (Guidelines) in order to ensure that they are carried out in a transparent manner and in compliance with the criteria of substantive and procedural fairness.

Subsequently, the Board of Directors of Hera Spa approved the new Procedure on transactions with related parties in compliance with the provisions of the Consob Regulations adopted by Resolution 17221 of 12 March 2010 and subsequent amendments and additions (Consob Regulations), subsequently updated on 21 December 2015.

This new Procedure was intended to repeal and replace in its entirety the rules governing transactions with related parties contained in the Guidelines, while the provisions of the Guidelines concerning significant transactions and transactions in which a director bears an interest remained in force.

In the Procedure, the Board of Directors fully incorporated the definitions of related party, related party transaction, as well as all the definitions functional to the same, contained in the Consob Regulations and its annexes.

The Procedure was updated on 30 June 2021 (in order to adapt it to the amendments – introduced by Consob Resolution 21624 of 10 December 2020 – to the Consob Regulations on transactions with related parties adopted by Resolution 17221 of 12 March 2010 and subsequent amendments and additions), and most recently on 26 June 2024 with effect from the same date (in order to better detail the paragraphs relating to the validity of meetings and the composition of the Committee for transactions with related parties).

In particular, the Procedure identifies:

1) the types of related party transactions provided for in the Procedure:

• transactions of greater importance, i.e. transactions with at least one of the materiality indexes determined by the Consob Regulations above the 5% threshold;
• minor transactions, i.e. transactions with related parties that are neither of major importance nor of small amount;
• framework resolutions, or that series of transactions between related parties;
• ordinary transactions, i.e. transactions that (a) are part of the ordinary course of the Company’s operating or related financial activity; and (b) are concluded on terms: (i) similar to those usually applied to unrelated parties for transactions of a corresponding nature, magnitude and risk, (ii) based on rates regularly applied or on imposed prices, or (iii) corresponding to those applied to persons with whom the Company is required by law to contract for a certain consideration;
• transactions of a small amount, or transactions the maximum foreseeable amount of consideration or value of which does not exceed, for each transaction:

• the sum of EUR 1 million in the case of transactions in which the related party is a legal person;
• the sum of € 300 thousand in the case of transactions whose related party is a natural person;

• transactions with related parties carried out by subsidiaries;

2) the approval process for transactions of major and minor importance depending on whether they are:

• transactions of minor importance falling within the competence of the Board of Directors, which are approved by the Board of Directors after obtaining the reasoned but non-binding opinion of the Related Party Transactions Committee (hereinafter referred to as the Committee) on the interest, convenience and material fairness of the transaction;
• transactions of greater importance falling within the competence of the Board of Directors, in which the Committee must be involved in the negotiations and in the investigation phase and the transaction can be approved only after a reasoned favourable opinion of the same on the interest, convenience, material fairness of the transaction or with the favourable vote of the majority of unrelated independent directors;
• transactions of minor and major importance falling within the competence of the Shareholders Meeting, whose resolution proposals follow the same procedural procedure as those provided for transactions falling within the competence of the Board of Directors, described in the previous two points, but must in any case obtain the favourable opinion of the Committee.

The Procedure provides that the Committee entrusted with the task of ensuring, through the issue of a specific opinion, the substantial correctness of the operation with related parties, coincides in its composition with the Control and Risk Committee.

The Procedure also identified cases of exclusion from the application of the Procedure itself, as well as regulated the methods of communicating to the public the transactions carried out.

Starting from May 2014, a specific operating instruction applies to Hera and its subsidiaries, subsequently updated on 31 March 2016, and most recently on 6 May 2022 prepared in order to detail the provisions of the Procedure and describe the rules, roles and responsibilities, as well as the operating activities implemented by the Company.

Page updated 5 May 2025