The top key topics of our remuneration policy

The Remuneration Policy has been designed with the aim of fulfilling the constant needs for:

• attracting, withholding and motivating people having the professional skills required by the growth perspective of Moncler Group’s business;

• matching the interests of the Company and its management with Shareholders’ ones;

• promoting the creation of profits for the Shareholders within a mid-long term.

The Remuneration Policy of Executive Directors and Key-Managers is inspired to the following principles:

• the fixed component and the variable component of remuneration are adequately balanced based on the Company’s strategic objectives and its policy on risk management, with reference to its business field and the characteristics of the activities it conducts;

• the remuneration variable component is paid within maximum limits;

• the performance targets are defined, measurable, and aimed to create value for the Shareholders in the medium/long term;

• the variable component consists of a portion linked to short-term criteria and a portion linked to long-term criteria. The second portion is much greater than the first, and is deferred by an adequate lapse of time, that is linked to the achievement of long-term objectives;

• no compensation for the early termination of the directorship relationship or the failure to renew it (parachute agreements) are provided for. The provision of a compensation for early termination of the employment relationship of Key-managers (parachute agreements) is subject to prior assessment and approval by the Board of Directors, having heard the Nomination and Remuneration Committee;

• the variable component may include remuneration plans based on stocks in accordance with the following recommendations of the Corporate Governance Code.

Structure of the MBO of the Excecutive Directors and Key-Managers

In the short-term variable component, Management By Objectives (MBO), strategic goals are translated into a set of KPIs based on a Balance Scorecard system on 4 dimensions:

• Finance
• Customer
• Process
• Learning and Growth

For the top line of management KPIs are mainly focused on quantitative targets related to the overall Group performance, in particular Group Ebitda. Financial indicators are declined in a double perspective: collective and individual, to increase the alignment to the business outcomes and improve the boost capacity of the system. Only performances over the target are rewarded, with increasing payout, as per the scheme below:

For Group Directors and Strategic Executives the MBO scheme is:

– 60% Group Ebitda
– 30% Free Cash Flow
– 10% Sustainability Plan accomplishment.

Claw-back and Malus Condition clauses are also in place.

To learn more about our policy on remuneration and related compensation information for the top management, refer to the Remuneration Report.

In light of what has been approved by the Shareholders’ Meeting, the Board of Directors of May 10, 2016, pursuant to Article 2389, paragraph 3, of the Italian Civil Code and Article 22, paragraph 2, of the By-laws, having heard the opinion of the Nomination and Remuneration Committee and it regards the definition of the performance goals related to the variable component of the compensation, has approved additional compensations for the Executive Directors and the other Directors granted with specific charges. The compensations are divided as follows:

– a fixed gross compensation of Euro 1,500,000.00 per year for the Chairman and Managing Director Remo Ruffini; Euro 120,000.00 per year for the Executive Director Luciano Santel and Euro 300,000.00 per year for the Executive Director Sergio Buongiovanni;
– a variable gross compensation of Euro 1,000,000.00 per year for the Chairman and Managing Director Remo Ruffini; Euro 50,000.00 per year for the Executive Director Luciano Santel and Euro 100,000.00 per year for the Executive Director Sergio Buongiovanni.

The Executive Directors Remo Ruffini, Luciano Santel and Sergio Buongiovanni, in addition to the compensation mentioned above, receive as well the following compensations in Industries S.p.A.:

– a fixed gross annual compensation of 10,000.00 euro to Remo Ruffini, in his capacity of Chairman and Managing Director and to Sergio Bongiovanni, in his capacity of Director;

– For Luciano Santel:

i. a fixed gross compensation of Euro 190,000.00 per year to Luciano Santel, in his capacity of Managing Director and a fixed gross compensation of Euro 230,000.00 per year, in his capacity of Chief Corporate & Supply Officer; and

ii. a variable gross compensation of Euro 70,000.00 in his capacity of Managing Director and of Euro 100,000.00 per year, in his capacity of Chief Corporate & Supply Officer.

With reference to the financial year 2017, the variable compensation (MBO) of the Chairman and Managing Director Remo Ruffini and of the Executive Directors Sergio Buongiovanni and Luciano Santel, in light of results of the EBITDA achieved, benefits, in accordance with the Remuneration Policy currently in force, from the effect of the over performances and the relevant applicable multipliers. Therefore, such variable gross compensation is increased by Euro 500,000.00 for Remo Ruffini, Euro 167,500.00 (of which Euro 45,200.00 relating to Moncler and Euro 90,400.00 relating to Industries S.p.A.) for Luciano Santel and Euro 122,300.00 for Sergio Buongiovanni.

The Chairman and Managing Director Remo Ruffini and the Executive Directors Luciano Santel and Sergio Buongiovanni have also been beneficiaries of the plans named “2014-2018 Stock Option Plan for Top Management & Key People” and “2016-2018 Performance Shares Plan”.