UBI Group’s remuneration and incentive policies are oriented towards the pursuit of long-term strategies and objectives, sustainable growth, the ability to maintain capital levels appropriate to the risks assumed, along with levels of liquidity required to handle the activities undertaken.
Among the main principles of the remuneration and incentive policies, in line with what the Group has adopted for the management and development of resources, are:
- fairness, meaning the provision of equal opportunities to each employee, based upon possession of the required characteristics, the roles and responsibilities held;
competitiveness, meaning an analysis of the salary positioning compared to the market benchmark;
- meritocracy, which is expressed by developing recognition of everybody’s merits;
standardisation, through the consistent and transversal use in the Group of coherent logic and parameters;
consistency over time, with reference to medium-long term objectives and risk management policies pursued by the Group.
The Remuneration Package
The remuneration package for personnel is split into three main components: fixed remuneration, variable remuneration and benefits.
Fixed remuneration recognises the experience accrued, levels of responsibility and skills required to cover each role. In view of this, the guidelines provide that fixed remuneration is balanced between positions that have similar levels of responsibility within the Group and that the value of the salary for a position is consistent with the value of market salaries for positions of similar complexity, taking into account the valuations of coverage of the role.
Variable remuneration is aimed at supporting the capacity to generate value for the Group and rewards the achievement of measurable, usually quantitative, risk-adjusted objectives related to internal and external customer satisfaction. It is determined using tools designed to involve and orient personnel towards the mid to long-term business and Group strategies, as well as recognising the value of teamwork and individual contributions. The incentive systems are subject to specific conditions of activation in order to guarantee levels of capital stability, liquidity and generation of value for the Group.
Benefits, in addition to the national collective bargaining provisions, are tools to protect the health and welfare of personnel and are split into pension, health and insurance plans, childcare support and supply of meals, sports and recreational activities, as well as conditions for better access to various products and services offered by the Bank. Within the Group, there are also provisions and regulations governing the criteria and procedures for the allocation of company cars for private and business use and accommodation for guest use, to support the need for geographical mobility and personnel management.
Incentive system for Top Management and high level Managers of the Audit Functions
In coherence with the provisions of existing regulations, the perimeter of Top Management and high level Managers of the Audit Functions is identified annually through a structured methodology which takes into consideration the organisational positions in terms of responsibility, impacts on the business and main processes, relevant hierarchical levels, incidence on the Bank’s risk profile and individual remuneration levels.
Mechanisms are defined for those positions aimed at aligning Management interests with those of the main Stakeholders and aimed at supporting the Group's ability to generate value, rewarding the achievement of risk-adjusted objectives and maintaining adequate levels of capital and liquidity.
The method of providing any bonuses, in compliance with the Supervisory Provisions of the Banca d’Italia, occurs by ensuring that a significant share of the bonus accrued is deferred over time and subjected to performance terms and a share of 50% is allocated to financial instruments with an appropriate retention period in order to align the incentives with the medium-long term interests.
As regards personnel belonging to the Corporate Audit Functions the incentive system is based on parameters linked to the position covered and the risks overseen, excluding the assignment of objectives of an economic/financial nature but applying the same activation conditions as the rest of the Personnel, also linked to metrics of an economic, financial and/or capital nature.
Governance and Transparency
In order to ensure appropriateness and compliance with the relevant regulations of the remuneration policies and practices adopted and their proper functioning, the remuneration and incentive policies are examined by the Compliance, Risk Management and Audit Functions that operate within their respective powers.
It is also envisaged that, at least annually, the Supervisory Board, within which a dedicated Remuneration Committee is set up, adopts and reviews the remuneration policy, verifying its correct implementation and defining the remuneration systems for Top Management and the Audit Functions, so that they are consistent with regulatory requirements and with the overall choices of the Bank in terms of acceptance of risk, strategies, long-term objectives, corporate governance and internal controls.
For all recipients of incentive systems, there is provision for a specific communication process through the use of different instruments such as Regulations, Circulars, use of the corporate intranet, with the aim of providing as much complete and transparent information as possible.