|
HOME | |
CONTACTS | |
JOB | |
FAQ | |
LINK | |
|
  |
 |
  |
 |
|
 |
|
 |
 |
 |
 |
Organisational, Management And Control Model
Definitions
The Decree
Organization, Management and Control models
Adoption of the Model
Identification of processes involving risks
Persons concerned
Distribution, Notices and Training
Supervisory and Control Body
Terms of management of the Financial Resources
Disciplinary provisions
Appendix A (Offences against public administration)
Appendix B (Criminal and administrative offences regarding companies and consortia)
Appendix C (Offences of abuse of privileged information and market manipulation)
Complete Document (772 Kb)Definitions
Decree:
Legislative Decree No. 231 of 8 June 2001, entitled "Regulation on the administrative liability of legal entities and of companies and associations, including associations without legal personality pursuant to Article 11 of Law No. 300 of 29 September 2000"(including corporate crimes and crimes against the public administration such as corruption and misappropriation), published in Official Gazette No. 140 dated 19 June 2001, as amended.
Persons concerned:
The Model is specifically addressed to Directors, Employees, Associates and Consultants, within the limits of the provisions of Article 5 of the Decree.
Entity:
Legal entities, companies or associations, including associations without legal personality
Company:
In this Organizational Model: Arnoldo Mondadori Editore s.p.a.
Administrative offences:
Offences established by Law No. 62 of 18 April, 2005, to which the Decree, insofar as compatible, is applicable.
Group:
All the subsidiary companies of Arnoldo Mondadori Editore s.p.a., pursuant to Article 2359 of the Civil Code.
Organizational Model:
The set of principles, rules, provisions, organizational structures and relevant duties and responsibilities designed to prevent offences under Articles 6 and 7 of the Decree, supplementing the Company's current Organizational and Control instruments (Code of Ethics, Operating Provisions, Service Orders, Organization Charts, Powers of Attorney, Proxies and Operating Manuals). The model establishes the Supervisory and Control Body and defines the disciplinary system.
Supervisory and Control Body:
A Body established pursuant to Article 6 of the Decree, whose function is to supervise the operation of and compliance with the Model, and to introduce amendments to the Model.
Principles of Conduct:
The general principles of conduct governing persons concerned must respect in their duties as part of the Organizational Model.
Processes involving risks:
Company activities or phases thereof that may create opportunities to commit offences.
Protocol:
A procedure for the prevention of offences and for the identification of people involved in stages of corporate processes that involve risks.
Corporate Offences:
Regulatory provisions introduced by Legislative Decree No. 61 of 11 April 2002 "Regulation of criminal and administrative offences concerning commercial companies" (Published in Official Gazette No. 88 dated 15 April 2002).
Disciplinary System:
The set of sanctions against persons who fail to comply with the Organizational Model.
Proxies System:.
The archive of the proxies and powers of attorney which sets out the delegation of powers within Arnoldo Mondadori Editore s.p.a.
Top Management (i.e. those who occupy top positions)
The Chairman, Vice-Chairman, Managing Director, other members of the Board of Directors, and executives reporting directly to the Managing Director.
General Part
1.0 The Decree
Official Gazette No. 140 dated 19 June 2001 published Legislative Decree No. 231 of 8 June 2001 entitled "Regulation on the administrative liability of legal entities and of companies and associations, including associations without legal personality pursuant to Article 11 of Law No. 300 of 29 September 2000" (hereinafter, the Decree) which introduced a system of administrative liability of companies into our legal system .
The Decree was issued in the context of implementation of international obligations into national legislation.
The original text, which referred to a corporate offences committed against the Public Administration, was been subsequently supplemented by further legislative provisions which have extended the list of offences that can involve the administrative liability of the Company.
Company liability - similar to penal liability - arises when a person linked by a functional relationship with the Company, commits one of the offences specifically provided for in the Decree. The liability of the Company also arises when one of the offences specified in the provisions of the Decree is committed by an individual who has business relations with the Company.
The Company can be considered liable if the offence is committed either in its interest or to its advantage, while it shall not be considered liable if the offender has operated exclusively in his own interest or in the interest of a third party.
The type of functional relationship between the Company and the person who has committed the offence may involve collaboration or employment, within the limits provided by the Decree.
When the offender is an individual who performs duties of a representative, administrative or management nature for the Company or one of its financially and functionally independent organizational departments, or is an individual who exercises, including de facto, management or control of such a department, the law has provided for a presumption of guilt of the Company, in consideration of the fact that such an individual is expressing, representing and implementing the Company's management policy. No such presumption of guilt of the Company when the offender is an individual under the management or supervision of one of the parties indicated in the previous paragraph.
The liability of the Company is additional to, and does not replace, the liability of the individual, which is governed by common criminal law.
The disciplinary system established by the law usually provides for the imposition of monetary penalties on the Company.
In addition to the monetary penalty, disqualification penalties may be applied for the most serious cases and in particular in the types of offences involving Public Administration (set out in Appendix A), such as: disqualification from carrying out business activities, suspension or cancellation of authorizations, licenses, or concessions instrumental or linked to offences committed, disqualification from entering into contracts with the Public Administration, exclusion from discounts, financing, subsidies or grants and the possibility of the cancellation of those already granted, and a ban on advertising goods or services.
Furthermore, the legislation provides that any that such disqualification measures may also at the request of the Public Prosecutor, be imposed even as a precautionary measure, during the investigation stage where serious evidence of the liability of the Company exists and where valid and specific evidence indicates a real risk that this type of offences may be committed.
The provisions are also applicable to foreign companies operating in Italy, regardless of whether their own national legal systems contain similar provisions.
Should specific conditions arise, when applying disqualification penalties that result in suspension of the Company's business activities, the Judge may appoint an external administrator to supervise the Company's business activities for the duration of the disqualification period.
2.0 Organization, Management, and Control models
The Decree provides for the Company's exemption from liability provided that:
a) the managing body has adopted and effectively implemented "Organization, management and control models" in order to prevent offences;
b) the task of supervising the functioning and the respect of the models and their amendment has been assigned to a Company body with its own powers of initiative and control;
c) persons who have committed offences or administrative offences acted by fraudulently eluding such organization, management and control models;
d) the supervisory body was not negligent or ineffective in the performance of its duties.
The Organizational Model consists of a set of general (Principles of Conduct), and operative (Protocols) rules, which when observed - in all activities concerned with procedures exposed to risk - act to prevent illegal, improper and irregular conduct.
The main purpose of the Principles of Conduct and the Protocols is to provide persons concerned with guidelines for their conduct with regard to processes exposed to risks and individualize the responsible and related persons.
The Organizational Model establishes an obligation to inform on the body responsible for its supervision and functioning, and provides a disciplinary system to sanction non-compliance by persons concerned of the Principles of Conduct and the Protocols.
3.0 Adoption of the Model
Arnoldo Mondadori Editore s.p.a. has taken the necessary action to adapt its existing control system to the provisions of the Decree.
By adopting the Model, Arnoldo Mondadori Editore s.p.a. aims to provide itself with a set of Principles of Conduct and Protocols that, together with the system of assigning responsibilities and delegating authority and other Organizational and internal control systems, is in keeping with the purposes and requirements of the Decree, with respect to both the prevention of offences, control over the implementation of the Model, and the imposition of any sanctions.
One of the purposes of the Organizational Model is to create awareness among persons concerned who undertake procedures exposed to risk of the possibility of committing offences that would involve sanctions for them and for Arnoldo Mondadori Editore s.p.a.
In particular, Arnoldo Mondadori Editore s.p.a. intends to inform persons concerned of their responsibilities and the conduct they are required to adopt when carrying out their duties and/or tasks in areas exposed to risk, as identified in the Annexes below.
The Model supplements the Organizational and control systems that are already in place:
- Code of Ethics: (approved by the Board of Directors on 13/05/2002) this lists the main principles of corporate philosophy that should guide the decisions and conduct of all individuals who operate, on any basis and at any level, for and in the interest of Arnoldo Mondadori Editore s.p.a., and with which they must comply, in accordance with the laws and regulations currently in force in all the countries where the Company operates, and guarantees the proper conduct of business activities, the reliability of management, and ensures a reputable image;
- Annual report on information for the market in compliance with the "Instructions accompanying the Regulations for the Markets organized and managed by Borsa Italiana S.p.a.";
- Analyses of management and corporate risks of business activities where there is a risk of offences being committed, carried out by means of discussions with Area Managers;
- Proxies System which the Board of Directors passes powers to the Executive Committee, the Chairman, the Vice Chairman, the Managing Director and the various Proxies, conferring on them the necessary powers to conduct corporate operations. The System can also be used to establish conformity between formal and substantive Organization.
The Proxies System comprises:
§ proxies (internal authority) which define the responsibilities and limits to signing authority of corporate officers in relation to specific operations;
§ powers of attorney (drawn up by Notary for external authority) that are issued to authorise corporate officers to sign documents that formally bind the Company. The powers of attorney, with individual and/or joint signature, identify the individuals in possession of the relevant authority, by type of operation, limit of amount and time period, and on condition that any charges are included in the approved budget for the year;
- Service Orders, which, duly recorded, constitute the cornerstone of Company management. They are used to adapt (establish, modify or abolish) corporate Organizational units in order to ensure that business activities are managed in an orderly and efficient manner, complying with the strategies and guidelines issued by the Top Management. Service Orders identify the organizational unit in question, place it within (reporting to other units) or and outside the Organizational Structure, identify the individual in charge of the units and define/modify duties, responsibilities and internal authority;
- Organizational Structure: this is a chart illustrating the Service Orders. It depicts the various Corporate Units (Departments/Companies) that make up the Group, their hierarchical/functional position and the name of the individual in charge of each one;
- Operational Regulations: these govern corporate processes.
- Each Operational Regulation, which is dated, recorded and signed by the Managing Director, indicates the corporate areas to which it applies, identifies the various macro-phases of the Process, sets out the appropriate directives for the individuals in charge and directs all staff to comply with the rules contained in it;
- Operating Manuals: These are produced to satisfy the requirements of complex computer system users, representing an extremely useful Organizational tool. Users can knowingly manage their own data and obtain and/or supply information to other Company Units while strictly complying with security and confidentiality conditions;
The Operational Regulations, with respect solely to regulated Processes, combined with the Service Orders and the system of proxies and powers of attorney, make it possible to reconstruct operating procedures, the units concerned, and responsibilities arising at specific moments.
Moreover, the Confindustria Guidelines, as amended, and the specific action already taken by Arnoldo Mondadori Editore s.p.a. in relation to control and corporate governance activities, all played a part in developing the Model.
The Model consists of a General Section, containing an introduction to its principles together with the aims that Arnoldo Mondadori Editore s.p.a. intends to achieve with its adoption, anda series of Appendixes that set out the specific types of offences provided for by the Decree.
The Model was adopted by the Board of Directors of Arnoldo Mondadori Editore s.p.a. by resolution dated 11 December 2003.
This reviewed version was adopted by the Board of Directors of Arnoldo Mondadori Editore s.p.a. by resolution dated 13 November 2006, following a verifying and updating procedure.
Any subsequent amendments and/or additions to the text of a substantive nature that may be necessary, including the adoption of further Appendixes that govern new types of offences, are the responsibility of the Board of Directors.
Adoption of the Model by the Group shall be implemented in accordance with the following criteria:
- Arnoldo Mondadori Editore s.p.a. is responsible for defining the Model, the structure of which must be incorporated by every individual Group company;
- every Group company is responsible for the definition of its own Model in relation to the type of business activities it performs;
- the Board of Directors of each individual Group company is required to adopt the Model by specific resolution;
- the respective Supervisory and Control Bodies responsible for each Subsidiary company are entrusted with ensuring that their Model is applied and updated. br>
4.0 Identification of processes involving risks
According to article 6, par. II, point. A) of the Decree, the Organizational Model must "identify the activities in the context of which offences can be committed". To this end Arnoldo Mondadori Editore s.p.a. analyzed Company activities, training procedures, and decision implementation within each Company area and their internal control systems.
This analysis was carried out with the assistance of external consulting companies and professionals, by means of the examination of the Company documents (activities, principal processes, Organization scheme, proxies, Organizational provisions, etc) and a series of interviews with the heads of the various Company structures.
The work of analysis and development of the Organizational Model took place over different phases and by methods enabling reconstruction all actions taken.
On conclusion of this activity, Arnoldo Mondadori Editore s.p.a.:
-
a) identified the Company activities in which criminal and administrative offences could be committed ;
b) indicated the persons and Company position involved;
c) analysed potential risks and methods of committing criminal or administrative offences;
d) defined and, where necessary, adapted the internal control system.
Arnoldo Mondadori Editore s.p.a. then decided to regulate processes with reference to the following specific types of criminal and administrative offences provided for by the Decree: Articles 24 and 25 (offences against the Public Administration), Article 25 ter (corporate offences) and Article 25 sexies (market abuse).
In view of the nature of its corporate activities which render the commission of such offences highly unlikely, Arnoldo Mondadori Editore s.p.a. has decided not to issue Appendices in relation to the following offences:
-
- art. 25 bis of the Decree ("Criminal Offences Concerning the Forgery of Currency, Public Credit Cards and Revenue Stamps";
- Article 25 quarter of the Decree: "Offences concerned with terrorism or subversion of democracy";
- Article 25 quinquies of the Decree: "Offences against individuals".
Referring to L. 146 of the 16th March, 2006, "Ratification and implementation of the Convention and Protocols of United Nations against the transnational organized crime, adopted by the General Assembly on 15 November and 31 May", transnational crime is considered "crime punished by imprisonment for a period not less than 4 years, where an organized criminal group is involved, and:
-
a) the crime occurred in more than one country;
b) the crime occurred in one country but a substantial part of its planning, management and control took place in another country;
c) the crime occurred in one country, but involved an organized criminal group engaged in criminal activities in more than one country;
d) the crime occurred in one country, but with substantive effects in another country".
- associative crime (criminal organization (art. 416 c.p.c.); criminal mafia-type association (art. 416 bis c.p.c.); criminal organization with intent to trade in contraband of foreign-manufactured tobaccos (art. 291 quarter DPR 23 January 1973, no.43); criminal organization in traffic of narcotic and psychotropic substances (art. 74 DPR 9 October 1990, no. 309);
- money laundering (money laundering art. 648 bis c.p.c.) and use of money, goods or utilities of illegal origin (art. 648 ter c.p.);
- complicity in illegal immigration as provided by art. 12 of the Consolidated Law on regulation of immigration and foreigner status, Legislative Decree 25th July 1998, no. 286 as amended);
- obstruction of justice (inducing other not to declare or to make false declarations to Judicial Authorities (art. 377 bis c.p.) and personal complicity.
Although no critical issues with respect to the transnational crimes set out above arose during the risk analysis, and thus Arnoldo Mondadori Editore s.p.a. decided not to dedicate a specific appendix to these offences, it has decided to postpone explicit exclusion pending a further assessment, including in response to legislative updating (e.g. national money laundering).
5.0 Persons concerned
The Model is directed at all individuals who work for and with Arnoldo Mondadori Editore s.p.a., within the limits of the provisions of Article 5 of the Decree, regardless of their relationship with the Company, and in particular at those who a) occupy representative, administrative, or management posts in the company, or b) are managed or supervised by such persons.
6.0 Distribution, Notices and Training
The Board of Directors, by means of the Company structure as indicated above, shall inform all the persons concerned of the existence and contents of the Organizational Model.
The Personnel, Administration and Information Technology Department is responsible for informing all persons concerned of the existence and contents of the Model.
The Personnel, Administration and Information Technology Department is responsible, in cooperation with the other Company departments and the Supervisory and Control Body, for circulating the Model and ensuring that individuals are aware of it and are trained in its use, including with respect to any subsequent updates and additions.
In particular:
- the Code of Ethics has been published on the Company intranet and on the Group's internet site and a copy has been given to all newly recruited employees and to Company associates;
- the Organizational Model is published on the corporate intranet;
- all contracts with associates and suppliers and any contracts relating to general business relations with Arnoldo Mondadori Editore s.p.a. have been reviewed to ensure that they include specific reference to the Code of Ethics and the Decree; non-compliance with the rules therein constituting a possible breach of contractual obligations;
- the Service Orders are distributed to all interested parties;
- Operational Regulations are distributed to all interested parties.
The training activities - intended to prevent the commission of criminal and administrative offences by means of increased awareness of the Decree, the Principles of Conduct and the Protocols, is adapted to the roles of persons concerned, to the risk level of their operating area, and to their position as representatives, administrators and management of Arnoldo Mondadori Editore s.p.a.
A written record is kept of participation in the training courses.
7.0 Supervisory and Control Body
In accordance with the provisions of the Decree and with the resolution by which it adopted the Model, the Board of Directors of Arnoldo Mondadori Editore s.p.a., has appointed and established its own Supervisory and Control Body (SCB), granting it all the powers necessary to ensure that the Model functions, is effective, and ensure that it is updated.
The Board of Directors is responsible for the appointment of the SCB and any eventual revocation (for valid reason).
The SCB must guarantee that it will act continuously.
Members of the SCB must meet the requirements for Managing Directors and Statutory Auditors of financial intermediaries according to art. 113 Consolidated Law on Banking.
SCB members must possess appropriate professional requirements, and must not perform roles that are incompatible with their monitoring function conflict of interests.
The SCB reports directly to the Board of Directors.
In view of the specific professional abilities required from time to time to perform certain monitoring activities, SCB may request the cooperation of internal or external resources.
The SCB may adopt its own procedures for its supervisory and control activities. Persons concerned will be notified of such procedures, and working groups may be established on specific subjects.
The SCB periodically presents an intervention plan to the Board of Directors, identifying activities that are to be undertaken and areas that will be verified.
For the specific purpose of monitoring and control activities, the Board of Directors, in view of the activities of SCB, grants the SCB a yearly budget for expenses incurred in its activities, with full administrative autonomy.
This budget will updated from time to time, according to specific requirements.
The SCB will notify the Board of Directors of any overspending of the budget.
Should the Supervisory and Control Body be temporarily unable to carry out its responsibilities for a period of more than two months, the Board of Directors shall appoint a substitute Body. The substitute body's mandate will cease when the original body is able to resume its responsibilities.
The Supervisory and Control Body shall remain in office until its mandate from the Board of Directors expires, after which the mandate may be renewed.
-
7.1 Supervisory and Control Activities
exercising powers of control and inspection
The Supervisory and Control Body may at any time, acting at its own discretion and in an independent manner, proceed with inspection activities to verify effective and correct application of the Model.
In carrying out its duties, the Body may ask to consult any documents relating to the activities of individual Departments and persons in charge of the processes involving risk that are being controlled and/or inspected, making copies, conducting interviews and, if necessary, requesting written reports.
When carrying out its activities, the Supervisory and Control Body must cooperate with and keep the head of the relevant department constantly informed of developments.
In particular, provision is made for:
-
- inspections of the individual documents. For this purpose the Supervisory and Control Body will periodically verify documents and contracts regarding processes exposed to risks, by methods provided for therein;
- inspections of Protocols. For this purpose SCB will periodically verify the effectiveness and the implementation of the Model provided in this Organizational Model;
- assessment of the level of awareness of the Organizational Model including by analysis of the requests for clarification and reports received.
On completion of these verifications, the Supervisory and Control Body may make observations or provide advice to persons concerned.
The activity of the Supervisory and Control Body must be documented, even in summary form. The Supervisory and Control Body must maintain the confidentiality of documentation, including with accordance with the provisions of data protection law.
-
7.2 Reports of disciplinary system infringements
If infringement is particularly serious the SCB will inform the Board of Directors.
-
7.3 Monitoring on the effectiveness and the constant updating of the Model
-
7.4 Relations between Subjects and the Supervisory and Control Body
The SCB may be convened by the Board of Directors of Arnoldo Mondadori Editore s.p.a. to report on its activity and may ask to confer with the Board.
Persons concerned should refer to the Supervisory and Control Body for clarification in the event of interpretation problems or any queries arise concerning the Model .
-
7.5 Information flow to the SCB
The SCB must be informed, by means of reports from persons concerned who must comply with the rules provided by the Organizational Model, of events that could give rise to the liability of Arnoldo Mondadori Editore s.p.a. pursuant to the Decree, or infringements of the Organizational Model. Arnoldo Mondadori Editore s.p.a. guarantees compliance with the general confidentiality obligation established by law.
The top management must also notify the SCB of:
- all information concerning compliance, functioning, and the amendment and updating of the Organizational Model;
- corporate changes concerning the proxies system or the Company structure of Arnoldo Mondadori Editore s.p.a.;
- extraordinary company operations of Arnoldo Mondadori Editore s.p.a.;
- any new Company activity.
Persons concerned must transmit to the SCB all information regarding judicial orders issued by the Magistracy, by Judiciary Police, or any other Authority, attesting to investigations or legal activity in relation to one of the significant circumstances indicated by the Decree with respect to Arnoldo Mondadori Editore s.p.a. and/or the persons concerned, guaranteeing at all times compliance with its confidentiality obligations under law.
The methods and timing of the informative flows to SCB will be stated in detail by the SCB.
8.0 Terms of management of the Financial Resources
According to article 6, par. 2, lett.c) of the Decree regarding the statement of the terms of management of adequate financial resources suitable to prevent the commission of offences, Arnoldo Mondadori Editore s.p.a. in view of the complexity of its financial management considers it appropriate, in addition to this Organizational Model, to issue a specific Operating Order "Process of Management of Financial Resources" governing for each individual type of transaction, the persons involved and their powers, the instruments adopted, and the links with the banking and the administrative/accounting systems.
The updates to the said Operating Order must be submitted in advance to the SCB in order to assess their for maintaining and improving the offence prevention system.
9.0 Disciplinary provisions
-
9.1 General principles
This system is intended to sanction non-compliance with the Principles of Conduct and of the Protocols set out in the Organizational Model in combination with the provisions of National Collective Labour Contracts (CCNL) for the categories applied to employees.
The imposition of disciplinary sanctions for infringement of the Principles of Conduct and the of the Protocols indicated in the Organizational Model is independent of any possible introduction of a criminal proceedings and the outcome of the legal proceedings in relation to one of the offences provided for in the Decree.
-
9.2 General criteria for the imposition of sanctions
-
a) subjective element involved in the action, whether intent, fault, negligence and malpractice;
b) importance of the obligations breached;
c) level of hierarchical and/or technical responsibility;
d) presence of aggravating or extenuating circumstances, with particular attention to professionalism, previous work record, previous disciplinary record, and the circumstances prevailing when the offence occurred.
e) any sharing of responsibility with other individuals who have contributed to the failure to comply with regulations;
f) conduct that can compromise, in only potentially, the effectiveness of the Organizational Model.
Whenever various offences are punished by different sanctions, the most severe sanction will be applied.
-
9.3 General principles
I Infringements
Disciplinary measures may be applied for:
-
a) non-compliance with the provisions contained in the Model;
b) a failure to report, or the submission of an untruthful report on activities carried out regarding the method of documentation, storage or control of the acts provided for by the Protocols, in such a way as to hamper their transparency and verifiability;
c) breach and/or avoidance of the control system by means of removal, destruction or alteration of the documentation provided for by the Protocols or by obstructing controls or blocking access to information and documentation to responsible parties, including the Supervisory and Control Body;
d) failure to comply with regulations relating to signatures and delegated authority;
e) failure on the part of superiors to check that the individuals for whom they are responsible have properly and effectively applied the provisions of the Model.
II Sanctions
The disciplinary committee may use the following measures based on the gravity of the infringement.
-
a) Verbal warning;
b) Written warning;
c) A fine within the limits provided for in the respective CCNL for each grade;
d) Suspension of remuneration and from service within the limits provided for in the respective NCBC for each grade;
e) Instant dismissal.
a) Verbal warning
A verbal warning may be given in the case of slight infringements of the Principles of conduct and Protocols of the Model, or for procedural errors due to negligence.
b) Written warning
A written warning may be given in cases of repeated infringements listed in (a) above.
c) Fines
Apart from cases of repeated infractions for which a written warning may be given, a fine may be applied in situations in which, given the management or technical responsibilities, or in other serious circumstances, the behaviour and/or negligence is such that it could compromise, even at a high level, the effectiveness of the Organizational Model.
d) Suspension of remuneration and from service
The disciplinary measure of suspension of remuneration and/or from service may be used in cases of grave infringements in the Principles of Conduct and/or Protocols which may expose the Company to liability towards third parties, as well as in cases of repeated infringements which may result in fines.
e) Instant dismissal
This disciplinary sanction may be imposed for grave infringements that undermine the reciprocal trust with the Company and do not therefore allow, even temporarily, the continuation of a working relationship. The following are examples and are not intended to be exhaustive:
i. infringements of the Principles of Conduct and Protocols with an external relevance and/or fraudulent omission of the same, carried out with intention of committing a crime or an administrative offence under the Decree.
ii. breach and/or avoidance of the control system by means of removal, destruction or alteration of the documentation provided for by the Protocols or by obstructing controls or blocking access to information and documentation to responsible parties, including the Supervisory and Control Body.
If the employee is in danger of committing a dismissible offence the Company may suspend the person concerned from work as a precautionary measure, with immediate effect. If the Company decides to proceed with dismissal this will take effect from the day in which the employee was suspended.
-
9.4 General principles
I Infringements
Disciplinary measures may be applied for serious infringements comprising:
-
a) non-compliance with the Principles of conduct and Protocols contained in the Model;
b) a failure to report, or the submission of an untruthful report on activities carried out regarding the method of documentation, storage or control of the documents provided for by the Protocols in such a way as to hamper their transparency and verification;
c) breach and/or avoidance of the control system by means of removal, destruction or alteration of the documentation provided for by the Protocols or by obstructing controls or blocking access to information and documentation to responsible parties, including the Supervisory and Control Body
d) non-observance of the provisions relating to power of signature and to systems of delegation, except in cases of extreme necessity and/or urgency, in which case a supervisor must be informed without delay;
e) lack of supervision, checks and vigilance on the part of superiors towards their staff regarding the correct and effective application of the Principles of Conduct and Protocols contained in the Model;
f) failure to comply with the obligation of inform the SCB, and/or to the line manager regarding possible infringements of the Organizational Model carried out by other employees of whom the superior has direct proof and certainty;
g) where applicable, in the lack of training and/or updating and/or failure to inform personnel working in the sector of processes and systems regulated by the Protocols.
The disciplinary commission may use the following measures based on the gravity of the non-compliance, taking into consideration the particular nature of reciprocal trust in the working relationship:
a) written censure;
b) instant dismissal.
Where the manager has power of proxy and delegated power to represent the Company outside the workplace the issue of a written censure, such powers of proxy could be revoked.
a) Written censure
This sanction may be applied in cases of involuntary infringements of the Principles of Conduct and Protocols contained in the Model. b) Instant dismissal
This sanction may be used in cases which result in damage that undermines the reciprocal trust in relationships and does not therefore allow, even temporarily, the continuation of a working relationship.
The following are examples and are not intended to be exhaustive:
-
i. infringements of the principles of conduct and Protocols with an external relevance and/or fraudulent omission of the same, carried out with the intention of committing a crime or an administrative offence under the Decree.
ii. breach and/or avoidance of the control system by means of removal, destruction or alteration of the documentation provided for by the Protocols or by obstructing controls or blocking access to information and documentation to responsible parties, including the Supervisory and Control Body
If the manager is in danger of committing a dismissible offence the Company may suspend the subject from work as a precautionary measure, with immediate effect. If the Company decides to proceed with dismissal this will take effect from the day in which the employee was suspended.
-
9.5 General principles
I Infringements
The disciplinary measures in this paragraph may be applied in cases of infringement on the part of the above named persons comprising:
a) non-compliance with the Principles of conduct and Protocols contained in the Model;
b) breach and/or avoidance of the control system by means of removal, destruction or alteration of the documentation provided for by the Protocols or by obstructing controls or blocking access to information and documentation to responsible parties, including the Supervisory and Control Body;
c) infringements of the provisions relating to power of signature and to the system of proxy/delegation, except in cases of extreme necessity and/or urgency, in which case the Board of Directors must be promptly informed;
d) Failure to comply with the obligation to inform the SCB and/or to the superior about conduct intended to commit a crime or an administrative offence under the Decree.
This list is illustrative only and should not be considered exhaustive.
II Safeguarding measures
Depending on the gravity of the infringement, on the decision of the Board of Directors, and on the advice of the Board of Statutory Auditors, safeguarding measures may be taken within existing laws, which may include the revocation of delegated power and/or the subject's appointment.
In the most serious cases the Board of Directors, on the advice of the Board of Auditors, may propose at the shareholders' meeting to proceed with dismissal.
Independently of the application of safeguarding measures, the Company has the power to take action for liability and compensation for damage.
III Coexistence of several working relationships with the same person
In the case of infringements committed by a person indicated in this section who has the status of an employee, the penalties applied will be decided by the Board of Directors, which reserves the right in every case to apply any disciplinary measures pursuable, based on the existing employment relationship with the Company and in accordance with applicable laws.
-
9.6 Associates and Consultants
In any event, any right to request compensation for damages on the part of the Company shall not be affected.
I Infringements
The measures provided for in this paragraph may be applied in cases of infringement on the part of the above named persons:
a) the fraudulent evasion of the Principles of conduct and Protocols pertinent to the object of the task, having external relevance and/or carried out with the intention of committing a crime or an administrative offence under the Decree.
b) the breach and avoidance of control systems carried out by theft, the destruction or falsification of documents provided for by the protocols, or the obstruction of persons and of the SCB from inspecting or accessing information and documentation requested.
c) missing, incomplete or inexact documentation of activities undertaken, such to impede their transparency and verifiability.
Appendix A (Offences against public administration)
A. Introduction
This Appendix deals with offences against the Public Administration, as identified in Articles 24 and 25 of the Decree.
The following list refers to the examples considered in the Decree.
Descriptions of the individual types of practice governed by criminal law are contained in
Annex A_1. (omissis)
-
- Embezzlement from the State (Article 316 a of the Criminal Code);-
- Misappropriation of funds from the State (Article 316 b of the Criminal Code);
- Defrauding the State or other public bodies (Article 640, paragraph 2, No. 1, of the Criminal Code):
- Aggravated fraud concerning public funds (Article 640 a of the Criminal Code);
- Computer fraud (Article 640 b of the Criminal Code);
- Extortion (Article 317 of the Criminal Code);
- Corruption in respect of an official act (Article 318 of the Criminal Code);
- Corruption in respect of an act contrary to official duties (Article 319 of the Criminal Code);
- Corruption in respect of judicial acts (Article 319 b of the Criminal Code);
- Corruption of persons engaged in public service (Article 320 of the Criminal Code);
- Instigation to corruption (Article 322 of the Criminal Code).
The disciplinary system applicable to the Company for offences against Public Administration is of of a financial and disqualification nature.
The Law defines attempts at such offences as per article 26.
B. Identification of processes involving risks
The offences referred to in the previous paragraph are based on the existence of relations with the Public Administration, as defined in paragraph C below.
An analysis of the various Company areas has identified the main processes in respect of which these types of offences may be committed.
Within the above process of review, the critical phases and the individuals/Company departments involved have been identified.
The Organizational and control system (Board of Directors, including Independent Directors, the Board of Statutory Auditors, the Internal Control Committee, Operational Regulations, Proxies, Service Orders, Internal Reviews, etc.) has identified the necessity, for Arnoldo Mondadori Editore S.p.A., of adopting the following Protocols:
-
- Protocol A_1 "Relations with Public Officials during inspections, controls and assessments";
- Protocol A_2 "Recourse to soft loans";
- Protocol A_3 "Managing the destruction of obsolete company assets";
- Protocol A_4 "Accepting outside appointments";
- Protocol A_5 "Managing of relationships with the Public Administration"
C. Relations with the "Public Administration"
For the purposes of this document, the expression "Public Administration" is intended to refer to authorities, bodies, and agents that are responsible for administrating matters of public interest.
The expression Public Institution means, for instance, not exhaustively:
-
- the public administration (Financial Administration, Guaranty and Supervisory Authorities Judiciary Authorities, companies and public administration, the Region, the Provinces, the Municipals, their consortia and association, the university institutions, the Chamber of Commerce, Industry, Handcraft and Agriculture, the public entities not economic of the national, the regional and local administrations, the companies and the entities of the national sanitary service. A public function is also carried out on the part of members of the European Community Commission, the European Parliament, the Court of Justice and the European Community Court of Auditors, employees and agent contractually engaged according to the statute of European Community Officials.
- Public Officer means a subject, public employee or private, that concur to form the will of the Public Entity or represents it in relations with third parties; a subject with power of proxy. For example, but not exhaustively: , judicial officers, technical consultants to Judges, collectors for municipal companies, postmen and telegraph messengers, hospital sanitary inspectors, municipal advisors, municipal technicians, sanitary officials, public notaries, and employees of public entities are all considered public officers .
- persons in charge of public functions or services means persons who carries out duties acknowledged as functional to a specific public interest, characterised as regards content by the lack of the authority and power to issue certificates inherent in the public function, having only an accessory or complementary role.
D. Principles of conduct
Relations with the Public Administration must be conducted on the part of each Subject in accordance with the principles of fairness, propriety and transparency.
Relations with the Public Administration must not in any way compromise the integrity or reputation of either party.
Subjects must avoid engaging in conduct that is against the law and in particular conduct that constitutes any of the types of offence referred to in this Appendix.
Subjects are particularly prohibited from engaging in any conduct that involves:
-
- making promises or improperly giving money or other benefits of any sort to public officials (unless gift of modest value at certain times of the year*) or persons in charge of a public service or persons indicated on the part of the latter;
- giving gifts or other presents of anything other than modest value and, in any case, other than the type of business gifts usually given at particular times of the year;
- accepting gifts, presents, pressure, orders or instructions of any kind from public officials or persons in charge of a public service.
In order to adopt the conduct described above, the Company functionaries who, as a result of their position, duties or mandate, work with the Public Administration must:
-
- identify the official inside the Public Administration with whom, because of their specific responsibilities, they must deal according to l. 241/1990;
- keep a written record, where possible, of the business relationship they have with the official referred to above;
- draw up a complete report to their hierarchical responsible manager without delay on the individual phases of the procedure.
- inform, without delay, to their superior of possible conduct of persons operating in the public field which is intended to obtain favours, illegal payments or donations of money and other utilities, also towards third parties.
- For an example of "gifts or other benefits other than customary gifts of modest value" see Article 3, Ministerial Decree 28.11.2000 - Code of Conduct for employees of public administrations.
* For instance "gifts or other benefits that are not habitual and of modest value": Art. 3, DM, 28.11.2000 - Code of Conduct of employees of the public administrations.
Appendix B (Criminal and administrative offences regarding companies and consortia)
A. Introduction
This Appendix deals with the corporate offences according to Art. 25 ter of the Decree.
Hereunder follows the list of types considered by the Decree. The description of significant conduct for the purposes of criminal law is referred to Annex B_1 (omissis)
-
- false in company statements (art. 2625 c.c.);
- false in company statements to the detriment of partners and creditors (art. 2622 c.c.);
- falsity in relations with and in communication to Auditing companies (art. 2624 c.c.);
- obstruction of inspection (art. 2625 c.c.);
- unlawful restitution of an award (art. 2626 c.c.);
- illegal sharing of profits and reserves (art. 2627 c.c.);
- illegal transactions in shares or shares in subsidiaries (art. 2628 c.c.);
- transactions to the detriment of creditors (art. 2629 c.c.);
- failure to notify conflicts of interests (art. 2629 - bis);
- fictitious constitution of share capital (art. 2632);
- unlawful distribution of corporate assets by liquidators (art. 2633 c.c.);
- unlawful influence over shareholders' meetings (art. 2636 c.c.);
- market rigging (art. 2637 c.c.);
- obstruction of public supervisory authorities in the exercise of their functions (art. 2638 c.c.).
Law 262/2005 doubled the financial sanctions to the Company provided by the original text of Art. 25 ter of the Decree.
B. Identification of processes involving risks
The analysis of the Company areas highlighted the main processes concerned by possible types of offences regarding Companies or Consortia.
During the analysis the critical phases and Company personnel involved were identified.
With respect to the existence of organizational models suitable to prevent the types of offences, set out at Art. 25 of the Decree, the general corporate activities of Arnoldo Mondadori Editore s.p.a. and those related to training and data processing to insert into balance sheets, reports and other statutory company statements addressed to shareholders or to the public, are subjected - according to legislative obligations arising from self regulation of corporate governance system and from managing of administrative procedures - to a series of verification and control procedures carried out by internal and external bodies, and to specific Organizational procedures.
In particular:
a. according to art. 155 of Legislative Decree 24th February 1998, n. 58 the balance sheet and the consolidated balance sheet are verified by an Auditing company listed in Special Register held by Consob, with respect to:
- regularly keeping of company accounts and correct records of financial position and results of operation in the account books during the course of the accounting year;
- correspondence of the balance sheets and of the consolidated balance sheet with the results of account books and with the results of audits;
- conformity of the balance sheet and of the consolidated balance sheet with applicable legislation.
b. according to article 149 of the above said Legislative Decree no. 58 of 24th February 1998, the Board of Statutory Auditors has supervisory powers with respect to:
-
- compliance with the law and the Articles of Association;
- respect for principles of proper administration;
- the adequacy of the Organizational structure of the Company and the internal auditing control and the accounting system for their tasks, and on their reliability for correctly representing financial position and results of operation;
- on procedures of implementation of the corporate governance rules provided by the codes of conduct drafted by companies regulated market management companies or by relevant associations, which the Company declares that it observes;
- the adequacy of orders given by the Company to subsidiaries pursuant to article 114, paragraph 2.
A Committee for Internal Audit was formed as a sub-committee of the Board of Directors with the task of providing consultancy and proposals to the Board of Directors, and to support the Board in verifying the adequacy of control system activities The control systems is the set of procedures designed to assess the effectiveness of Company operations, the reliability of financial information, the respect of legal regulations, and the protection of Company assets.
Specifically, the Committee has the following tasks: (i) assess the adequacy of the internal control system; (ii) assess the work plan drawn up the internal control staff and receive their periodically reports; (iii) assess proposals by Auditing companies with a view to awarding the audit contract, and assessing the audit working plan and proposals set out in reports and letters of offer ; (iv) report periodically to the Board of Direction on its activities and the adequacy of the internal control system: (v) fulfil any further tasks that my be requested by the Board of Directors, particularly on the relationship with the Auditing company and the Board of Statutory Auditors.
The Board of Directors has appointed a head of Internal Audit, granting him responsibility, with related powers, for planning and managing the internal auditing of the Company and of its subsidiaries, verifying the conformity of the corporate activities to applicable law, to Company directives and the procedures adopted to provide sound and efficient management, and to identify, prevent and manage, as far as possible, Company risks and frauds detrimental to the Company.
The head of Internal Audit is hierarchically responsible to the Managing Director and reports to the latter, to the Committee for the Internal Audit, and to the Board of statutory Auditors.
d. in relation to amendments introduced by Law no. 262/2005 on the protection of savings, Arnoldo Mondadori Editore s.p.a. will provide by lawful the terms and methods of law to appoint an executive to draft the company accounting documents and adopt adequate administrative and accounting procedures/instruments for planning the balance sheet, the consolidated balance sheet, and each other financial statement.
The Organizational and control model therefore does not require the preparation of specific protocols.
C. Principles of Conduct
In the procedures involving risk according to this Appendix parties concerned must:
- pursue the objective of the corporate interest in the management and the exercise of Company activities;
- conduct themselves in accordance with the regulations and law;
- comply with legal provisions on the integrity and the effectiveness of the company capital and of statutory reserves;
- maintain conduct with respect to the control activities of corporate bodies, he Auditing company and of the partners, that enables the latter to perform their institutional activities; - maintain conduct that does not obstruct or impede public authorities in the exercise of their duties;
- not to influence, by means of false statements or simulated activities or other stratagems, the price of unlisted financial instruments or for those for which no application for admission to trading on a regulated market has been presented;
- avoid compromising the integrity, reputation and the image of Arnoldo Mondadori Editore s.p.a.
Appendix C (Offences of abuse of privileged information and market manipulation)
A. Introduction
This Appendix deals with the matter of criminal and administrative offences of abuse of privileged information and market manipulation (so called, Market Abuse), covered by the Consolidated Law on Finance (C.L.F.) No. 62 of 18th April 2005 (of the so-called 2004 Community Law), that consequently supplements the Decree's provisions.
The types of offences considered by Art. 25 sexies of the Decree (that refers to the offences set out at Articles 184 and 185 of C.L.F.) and of Article 187 quinquies of T.U.F is as follows:
-
§ Abuse of privileged information (art. 184 e 187 bis C.L.F.);
§ Market Manipulation (art. 185 e 187 ter C.L.F.).
A description of the relevant conduct is provided in Annex C_1 (omissis)
In addition to Articles 184 and 185 of the Consolidated Law on Finance with criminal sanctions, the law also provides at Articles 187 bis and 187 ter of the C.L.F two types of privileged information abuse and of market manipulation punishable as administrative offences.
While Art. 187 bis has an identical text to the penal provision of Art. 184 C.L.F., the administrative offence of Art. 187 ter is more detailed but its main core can be perfectly superimposed onto the corresponding text of Article 185 of the C.L.F.
Therefore the prevention of market abuse is entrusted to a "double track" penalty system with both financial and administrative sanctions.
In both offences the administrative liability of the Company is confirmed.
The disciplinary system applicable to the Company for the market abuse offences is purely financial, there being no provision for any disqualification sanction.
In event that (Art. 25 sexies, par. II), committing the offence creates a product or a relevant profit to the advantage to the legal entity, the sanction could be increased to ten times the value of the product or of the profit obtained.
The following definitions apply the application of this Appendix:
-
§ confidential information: "whichever confidential information about Arnoldo Mondadori Editore s.p.a., its subsidiaries or other issuing companies who in the exercise of their function become aware of privileged information";
§ privileged information* : "precise information, that has not been disclosed, concerning directly or indirectly, one or more financial instruments issuing entities or to one or more financial instruments** , that, if disclosed, can perceptibly influence the prices of those financial instruments*** " (art. 181 C.L.F.).
Information is considered precise if:
"a) it refers to a set of circumstances existing or that could reasonably arise, or to an event that has occurred or that could reasonably occur.
b) is specific enough to permit to draw conclusions on the possible effects of the whole of circumstances set at point a) on prices of financial instruments".
Privileged information is also confidential information, while the contrary may not be true.
If not differently specified Information means herein below both confidential information and privileged information.
*In order to provide a more detailed notion of privileged information with reference to insider trading offence on the one hand, and to the need to inform the public on the other hand, herein below follow the instruction contained in Consob Report n. DME/6027054 dated 28th of March 2006.
"… it should be pointed out that the community directive on market abuses and, consequently, the new text of CLF use the same definition of "privileged information" to indicate information on the basis of which, on the one hand, an insider trading offence could be committed and, on the other hand, there is a requirement to inform the public. Nevertheless, the two notions of privileged information - despite the same content -are not perfectly identical in relation the function in different cases of the identification of the abuse and of the fulfilment of obligations to inform. The disclosure imposed on issuing companies according at Art. 114 of the C.L.F. limits its content to privileged information "directly regarding issuing companies", i.e. legally attributable to them according to the corporate governance rules of a legal or internal organization nature applicable to the issuing companies, or privileged information that directly regards issuing companies, and communicated by third parties. A similar restriction is not provided for the concept relevant to the purposes of the insider trading discipline. Art. 66 of RE textually reproducing the level 2 community directive (Directive 2003/124/CE), also explains that the disclosure obligation is considered fulfilled "when a set of circumstances or an event occurs, even if not yet formalized, and the the public has been informed without delay". This provision considers as a necessary and sufficient condition for the purposes of the disclosure obligation the actual occurrence of events and circumstances, even if not formalized; it differs from the provision of art. 181 C.L.F. that defines precise characterized information when it refers to a set of circumstances or events that have occurred or that could reasonably occur. Given this premises, the addition of the locution "not formalized yet" intends to clarify that events or sets of circumstances that have substantially occurred but not been made official are included in the area subject to the provision. For example, a merger or transfer transaction, completely detailed in its contents, without reserve of further negotiations, even if not submitted to the condition precedent of ratification by the competent body of the issuing quoted company, can constitute a type of not formalized operation that must be communicated".
**"Financial Instruments" according to article 1, par. 2 of C.L.F. are:
a)shares and other representations of capital tradable on capital markets;
b)bonds, governmental debentures and other securities tradable on capital markets;
b bis) financial instruments tradable on capital markets as provided by the Civil Code;
c) shares in common investment funds;
d) securities negotiable on money markets;
e) any other traded security that enables the purchaser to obtain the instruments identified in previous points and the relevant indices;
f) "futures" on financial instruments, interest rates, currency, goods and related indexes", and where execution occurs by means of payment of spreads for cash;
g) cash and futures swaps on interest rates, currencies, and goods and on share indexes including where execution occurs by means of payment of spreads for cash;
h) futures linked to financial instruments, interest rates, currency, goods and the relevant indices, even where execution occurs by means of payment of spreads for cash;
i) option contracts to put and call instruments indicated in the previous points and, currency option contracts, rates option contracts, goods and related indices option contracts, even where execution occurs by means of payment of spreads for cash;
j) a combination of contracts and securities indicated in the previous points.
***It means: "information that a rational investor may reasonably use as one of the elements as the basis of its investment decisions".
B. Identification of processes involving risks
With reference to the requirements of Legislative Decree no. 58 of24 February 1998, and to the prevention of offences according to the present Appendix, Arnoldo Mondadori Editore s.p.a. has adopted an Internal Dealing Code and the following operative provisions:
-
- Provisions on company reports and communication to third parties of price sensitive documents and information: this sets out the obligation of Arnoldo Mondadori Editore s.p.a. s.p.a. and its subsidiaries relating to information concerning its scope of operation provided to the parent company and communicated by the latter to the market;
- Provision on internal circulation and communication to the public of privileged information according to Art. 181 of the Legislative Decree 24th February n. 58: this regulates methods of monitoring and of the internal and public communication of privileged information.
-Operative provisions for the management of the Register of persons who have free access to privileged information according to article 115 bis of the Legislative Decree 24th February n. 58: this provides the criteria for keeping the Register on paper and data carrier, the proceeds of data management and searching, the proceeds of informative flows to Subjects and the regulations for the same.
For this purpose, Appendix C sets out the Principles of Conduct which persons concerned are required to observe.
C. Principles of Conduct
Each person concerned must conduct their relationships with Financial Markets in accordance with the transparency and integrity principles of the markets, taking account of confidentiality on the one hand, and the duty to inform and transparency towards the market on the other hand.
With respect to the nature of the information, persons concerned:
-
a) must:
- observe the most diligent confidentiality in the exercise of activities on financial instruments;
- adopt, with respect to Information acquired in fulfilment of their function, all the physical and logical security measures that Arnoldo Mondadori Editore s.p.a. has introduced according to the aforementioned law provisions;
- process this information adopting all the necessary precautions in order to ensure that the circulation of information in the Company complies with the provisions of this Appendix C;
- divulge the Information to third parties only for strictly professional reasons, adopting measures to ensure that the persons who have free access to Information acknowledge the duties imposed by law, by statute and by regulations.
- Journalists, in relation to the diffusion of information as part their professional activity, are obliged to observe the self-regulation rules provided by their professional Association (Charter of the Duties on Economics Information);
b) Must not:
- divulge to other internal personnel or outside of Arnoldo Mondadori Editore s.p.a., through any communication channel, information or rumours that do not correspond to the truth, or information of uncertain truthfulness, or that is potentially able to provide false or misleading indications in relation to listed issuing companies;
- disseminate false information or carry out simulated transactions or others stratagems liable to cause a perceptible alteration in the price of financial instruments.
With reference to the issues and the circumstances to be considered in order to identify conduct and actions liable to constitute market manipulation please see, for non-exhaustive examples, to Annex C 1.
With reference to the possible re-purchase of its own shares Arnoldo Mondadori Editore s.p.a. complies with provisions of CE Regulation 2273/203 and to Consob instructions.
D. Information flows to the Supervisory and Control Body
Persons concerned must promptly inform the Supervisory and Control Body of any anomaly or extraordinary events, in particular those regarding information on significant events of extraordinary transactions such as, by way of example, but not limited to:
-
1 Management changes: Vice-Chairman and Managing Director
2 Relevant variations of organizational corporate structure of the Company: Personnel, organizational and informational systems
3 Participation in the establishment of companies and joint venture agreements in general: Finance, Administration and Control
4 Purchase, selling and divestment of shares, companies, and business divisions: Finance, Administration and Control
5 Commencement and signing of cooperation agreements and participation with third parties with strategic importance: Vice Chairman and Managing Director
6 Finance contracts in force and issue of bonded loans: Group Finance
7 Masterplan of specific investments: Merger & Acquisition
8 Company adjustment and reorganization including though merger and demerger operations: Finance, Administration and Control
9 Transactions with the share capital: Finance, Administration and Control
Last updated 09/02/2007