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Remuneration

The Report on remuneration policy and remuneration paid is prepared by the Remuneration Committee and is approved by the Board of Directors.

The Report, approved by the Board of Directors on March 18, 2020, as per the recommendation of the Remuneration Committee, in accordance with applicable legal and regulatory requirements, defines and illustrates:

in the first section, the Policy for the remuneration of Directors, Statutory Auditors and Managers with strategic responsibilities, for the new term 2020-2023, subject to Shareholders’ approval at the Annual Meeting called on May 13, 2020 (binding vote), with votes in favour equal to 95.28% of the participants;
in the second section, the remuneration paid in 2019 to Eni Directors, Statutory Auditors, Chief Executive Officer and General Manager and other Managers with strategic responsibilities, subject to Shareholders’ examination at the Annual Meeting called on May 13, 2020 (consultative vote), with votes in favour equal to 96.23% of the participants.

The Remuneration Policy described in the first section of the Report has been prepared in line with the recommendations on remuneration of the Italian Corporate Governance Code for listed companies, which Eni adopted, as well as with recommendations by the Corporate Governance Committee.

The two sections of the Report are preceded by an Executive Summary in order to provide a prompt overview of the key elements of the Policy approved for the new term.

The Executive Summary also provides some additional information on the context in which remuneration choices have been made (with reference to the performance measures used to support the policies set out in the Company’s Strategic Plan, performance indicators, including sustainability objectives, the results of the vote on the Remuneration Report at last Shareholders’ Meetings).

Finally, the Report lists the shareholdings held by Directors, Statutory Auditors, Chief Executive Officer and General Manager and other Managers with strategic responsibilities and explains how the terms of the 2017-2019 Long Term Incentive Plan were applied in 2019, in accordance with applicable regulation.

The documents submitted for assembly approval on May 13, 2020 are shown below.

Remuneration	Remuneration structure and market benchmarks
Purpose and conditions	Attract and retain individuals of high managerial standard, and motivate them to achieve sustainable long-term objectives
Criteria and parameters	Remuneration Policy for the 2020-2023 term retains the same maximum amount as in the 2017-2020 Policy (adjustable). CEO: Eni Peer Group (Apache, BP, Chevron, ConocoPhillips, Equinor, ExxonMobil, Marathon Oil, Occidental, Shell e Total) also used for measuring the performance of the LTI Share Plan. MSRs: Roles of the same level of managerial responsibilities in industrial corporations at national and international levels.
Remuneration	Fixed remuneration
Purpose and conditions	Reward skills, experience and responsibility
Criteria and parameters	Chief Executive Officer: Maximum fixed remuneration is set at the same level as in the 2017-2020 term, and can be reduced based on delegated powers assigned over the term, positions held and type of employment relationship, in line with professional profile and experience of the candidate. Managers with strategic responsibilities (MSRs): Fixed remuneration is based on the role assigned potentially adjusted to median market remuneration level.
Maximum amounts	CEO: Max. fixed remuneration: €1,600,000
Remuneration	Short-Term Incentive Plan
Purpose and conditions	Motivate managers to achieve annual budget targets in a perspective of medium/long-term sustainability (Plans with malus/clawback mechanisms)
Criteria and parameters	2020 targets for CEO: 1) Economic and financial results: EBT (12.5%) and Free cash flow (12.5%) 2) Operating results and sustainability of economic results: hydrocarbon production (12.5%) and exploration resources (12.5%) 3) Environmental sustainability and human resources: GHG emissions intensity (12.5%) and Severity Incident Rate (12.5%) 4) Efficiency and financial strength: ROACE (12.5%) e Debt/EBIthA (12.5%) 2020 targets for MSRs: Business and individual targets set on the basis of those assigned to the CEO/GM and the responsibilities assigned to them. Assessment - performance scale: 70 ÷ 150 points (target=100) - below 70 points the performance is considered to be equal to zero - the minimum incentive threshold is equal to overall performance of 85 points - 1.1 multiplier applicable to overall performance score in the event of un-budgeted portfolio transactions of strategic relevance Incentives - Incentive base: defined as a percentage of fixed remuneration, and differs depending on the level of assigned role. - Incentive vested: between 85% and 150% of incentive base, made up of a portion paid annually (65%) and a deferred portion (35%) determined as a function of the average of Eni annual performance results over the three-year deferral period, between 28% and 230% of the awarded deferred portion
Maximum amounts	CEO: - Incentive base: max amount equal to 150% of fixed remuneration. - Payable annual amount: - threshold 83% of fixed remuneration - target 98% of fixed remuneration - max. 146% of fixed remuneration. - Payable deferred portion: - threshold 38% of fixed remuneration - target 68% of fixed remuneration - max 181% of fixed remuneration. MSRs - Incentive base: up to a max amount equal to 100% of fixed remuneration. - Payable annual amount: up to a maximum amount equal to 98% of fixed remuneration. - Payabal deferred portion: up to a maximum amount equal to 121% of fixed remuneration.
Remuneration	2020-2022 Long-Term Equity-based incentive Plan
Purpose and conditions	Encourage long-term value creation for shareholders and sustainability (Plans with malus/clawback mechanisms)
Criteria and parameters	Number of shares awarded Determined by the ratio between the monetary value and the price of the award, calculated as the average of the daily prices recorded in the four months before the month in which the Board approves the award. Performance parameters over a 3-year period 1) TSR neutralized with respect to stock market performance (25%); 2) Net Present Value (NPV) of proven reserves (20%); 3) Organic Free Cash Flow (FCF) (20%) 4) Environmental Sustainability and Energy Transition (35%) 4.1) Decarbonisation (15%) 4.2) Energy transition (10%) 4.3) Circular economy (10%) Performance measurement over a 3-year period - Relative parameter (TSR, NPV): compared with Peer Group - Absolute parameters (FCF, Decarbonisation, Energy transition and Circular economy): measured against targets set in the Strategic Plan Number of shares granted at the end of the vesting period Determined as a function of performance over 3 years applying a variable multiplier between 40% (threshold) and 180% of the number of awarded shares. Restriction period For managers still in service, 50% of the shares granted at the end of the vesting period are to remain restricted for one year from the granting date.
Maximum amounts	CEO: - Value of awarded shares: up to a max amount equal to 150% of total fixed remuneration. - Value of granted shares: - threshold 60% of fixed remuneration - target 174.75% of fixed remuneration - max 270% of fixed remuneration. MSRs - Value of awarded shares: depending on the level of the role, up to 75% of fixed remuneration. - Value of granted shares: depending on the level of the role, up to 135% of fixed remuneration. N.B.: the monetary values are net of the impact of any changes in the stock price.
Remuneration	Non-monetary benefits
Purpose and conditions	Retain managers in the Company
Criteria and parameters	Benefits, mainly insurance and welfare related, defined in national collective bargaining agreement and in supplementary Company-level agreements (including GM and MSRs).
Maximum amounts	- Supplementary pension scheme - Supplementary healthcare scheme - Insurance - Automobile for business and personal use
Remuneration	Payments due in the event of termination of office or employment
Purpose and conditions	Protect the Company from potential litigation and/or competitive risks associated with terminations without just cause
Criteria and parameters	Payments due in the event of termination of office or employment CEO To be defined based on position and work relationship, according to the following criteria: - administrative office (CEO) – an indemnity in the event of non-renewal of the office or early termination without just cause, as well as resignation prior to the expiry of the term justified by a reduction of delegated powers; - executive employment relationship (including the position as GM) – an indemnity in the event of consensual termination set in accordance with the Company parameters and policy, within the limits of the protections laid down by national collective bargaining agreement for senior managers. Indemnities are not due in the event of dismissal for «just cause» and resignation not justified by a reduction of delegated powers. Non-compete agreement CEO Optional agreement to protect the Company’s interests, with payment based on the extension of period and commitments undertaken. Non-compete agreement MSRs Only for cases of termination presenting high-competitive risks relating to the nature of the position; payment based on current remuneration levels and the extension of period and commitments undertaken.
Maximum amounts	CEO (max amounts) - CEO: max 2 years of fixed rem. - Possible executive work relationship (GM): max 2 years of fixed rem. And short term incentive Possible payment for non-compete agreement CEO (max amounts): - Fixed component: max 1 year of fixed remuneration; - Variable component: function of average performance of the three previous years: - 0 for below the target performance - €500,000 for on target performance - €1,000,000 for max performance. the fee for the option cannot be higher than €300,000.

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Remuneration structure and market benchmarks

Attract and retain individuals of high managerial standard, and motivate them to achieve sustainable long-term objectives

Fixed remuneration

Reward skills, experience and responsibility

Short-Term Incentive Plan

Motivate managers to achieve annual budget targets in a perspective of medium/long-term sustainability

2020-2022 Long-Term Equity-based incentive Plan

Encourage long-term value creation for shareholders and sustainability

Non-monetary benefits

Retain managers in the Company

Payments due in the event of termination of office or employment

Protect the Company from potential litigation and/or competitive risks associated with terminations without just cause

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