annual report - FIAT SpA

CORPORATE GOVERNANCE
FOREWORD
The Fiat Group adopted and adheres to the Corporate Governance Code for Italian Listed Companies issued in March
2006, with additions and amendments related to the specific characteristics of the Group.
In accordance with legal and regulatory requirements, the Company prepares an "Annual Report on Corporate
Governance" which provides a general description of the Group’s corporate governance system together with
information on its ownership structure and adherence to the provisions of the Corporate Governance Code, including
key governance practices and the principal characteristics of the system of risk management and internal control over
financial reporting. The Report, which is available in the Corporate Governance area of the Group website
(www.fiatspa.com), is divided into four sections: the first contains a description of the governance structure; the second
gives information on the ownership structure; the third provides an analysis of implementation of specific provisions of
the Code and describes the principal characteristics of the system of risk management and internal control over
financial reporting, in addition to the principal governance practices adopted; and, the fourth consists of summary
tables and corporate governance related documents, as well as a side-by-side comparison showing the principles of
the Code and how they have been implemented. This section provides a summary of aspects relevant to the Report on
Operations.
The Corporate Governance Code is available on the website of Borsa Italiana S.p.A. (www.borsaitaliana.it).
DIRECTION AND COORDINATION
Fiat S.p.A. is not subject to the direction and coordination of any other company or entity and is fully independent in the
definition of its general strategic and operating guidelines. Pursuant to Article 2497-bis of the Civil Code, its Italian
subsidiaries, with a few specific exceptions, have named Fiat S.p.A. as the entity which exercises direction and
coordination over them. That activity consists in indicating the general strategic and operating guidelines of the Group
and takes concrete form in the definition and updating of the internal control system, corporate governance model and
corporate structure, the issue of a Code of Conduct which is adopted throughout the Group, and the establishment of
general policies for the management of human and financial resources, purchasing of production materials, and
marketing and communication. Furthermore, coordination of the Group includes specialized companies which provide
centralized cash management, corporate and accounting, and internal audit services.
Direction and coordination undertaken at Group level enables subsidiaries, which retain full management and operating
autonomy, to realize economies of scale by availing themselves of professional and specialized services with improving
levels of quality and to concentrate their resources on the management of their core business.
BOARD OF DIRECTORS
Pursuant to the By-laws, the Board of Directors may be composed of between nine and fifteen members. At the Annual
General Meeting held on 27 March 2009, Shareholders elected fifteen Board members whose term of office expires on
the date of the General Meeting held to approve the 2011 Financial Statements. Under Article 11 of the By-laws, Board
members are appointed through a voting list system which ensures that minority shareholders can elect a director. The
minimum equity interest required for submission of a list of candidates is established by Consob with reference to the
Company’s market capitalization for the last quarter of the final financial year of the mandate. Each list must indicate at
least one candidate that satisfies the legal requirements of independence, in addition to the requirements of the
corporate governance code adhered to by the Company.
The voting list system was used for the election of the Board of Directors for the first time at the General Meeting of 27
March 2009.
On that occasion, the Company invited shareholders who, individually or jointly with others, owned at least 1% of
ordinary shares (as established by Consob with reference to Fiat's average market capitalization for the fourth quarter
of 2008) to submit, at least 15 days prior to the date of the Annual General Meeting, lists of candidates who satisfied
the requirements of law and the Company's By-laws. EXOR S.p.A., holder of 30.45% of ordinary shares, was the only
shareholder to submit a list of candidates and, therefore, all candidates on the list were elected.
Under Article 16 of the By-laws, all directors with executive responsibilities are vested, separately and individually, with
the power to represent the Company and under Article 12 the Vice Chairman, if appointed, shall act as Chairman if the
latter is absent or unable to carry out his role. In application of this provision, the Board of Directors has, as in the past,
adopted a model which delegates broad operating powers to the Chairman and the Chief Executive Officer by which
they are authorized, separately and individually, to perform all ordinary and extraordinary acts that are consistent with
Report on Operations Corporate Governance 60