Model 231 – Supervisory Body

Italian Legislative Decree 231/2001 (the “Decree”) introduced the principal that companies shall bear the administrative liability for crimes committed in their interest or to their benefit when such crimes are carried out by a party or parties in an executive management role or by a party or parties subject to their management or supervision.

In order to prevent such crimes envisaged by the Decree from being committed, the Board of Directors of Novellini S.p.A. adopted an Organisation and Management Model (“Model 231”) on 18/12/2014.

The Model 231 is part of Novellini S.p.A.’s broader corporate policy which is attentive to compliance with the ethical management principles which led to the preparation of the Code of Ethics, which was also drawn up pursuant to the aforementioned Decree. The Novellini “Model 231” is a dynamic, shared document. Dynamic because it is sensitive to any regulatory or organisational change. Shared because its implementation involves every member of staff and every Italian company in the Group.

The Organisation, Management and Control Model is a structured, organic system of principles, internal rules, operating procedures and control activities designed to ensure that the Company’s operations are carried out in a diligent and transparent way in order to prevent any behaviour which might lead to or involve the types of crimes and offences provided for by Italian Legislative Decree 231/2001, as amended. Specifically, pursuant to article 6(2) of Italian Legislative Decree 231/01, the Organisation and Management Model 231 meets the following needs:

• To identify the activities in the context of which a crime might be committed;
• To provide for specific protocols aimed at scheduling the creation and the implementation of the entity’s decisions in relation to the crimes to be prevented;
• To identify methods to manage financial resources which are suitable for preventing a crime from being committed;
• To provide for information obligations with regard to the body responsible for supervising the operation of and compliance with the Model;
• To introduce a disciplinary system which is suitable for sanctioning or penalising any behaviour or action which does not comply with the measures indicated in the Model.

In complying with article 6 of Italian Legislative Decree 231/01 and the guidelines drawn up by the most representative industry associations regarding how to interpret and apply the Decree and, in particular, the guidelines provided by Confindustria, Novellini has defined the general principles, the structure and the components of its Organisation, Management and Control Model.

A special Supervisory Body, appointed by the Board, has the tasks of supervising the operation of and compliance with the Model and of ensuring the Model is updated where necessary.

The Supervisory Body carries out the tasks provided for by articles 6 and 7 of Italian Legislative Decree 231/01 and, specifically, performs:

• Supervisory and control activities;
• Monitoring activities with regard to the implementation of the Code of Ethics;
• Activities to amend and update the Organisation and Control Model 231;
• Reporting with regard to corporate bodies;
• Information flow management activities.

Reports of any alleged breach of the Model 231 or of the Code of Ethics, or requests for further information, can be sent to the Supervisory Body by post at the Novellini S.p.A. headquarters. - Via Mantova 1023 - 46030 Borgo Virgilio Loc. Romanore (MN), Italy, for the attention of the Supervisory Body.

Novellini S.p.A. has adopted the so-called traditional administrative system based on the establishment of two bodies appointed by the Shareholders’ Meeting:

• The Board of Directors
• The Board of Statutory Auditors

Accounting control is, as per the law, entrusted to the audit firm.