Functions of the Board of the Statutory Auditors

According to the law, the Board of Statutory Auditors is entrusted with monitoring the following:
• compliance with the law and the bylaws;
• respect for the rules of correct administration;
• the adequacy of the organisational structure of the Company for the aspects within its competence, of the internal control and risk management system, as well as its functioning;
•the adequacy of administration-accounting system, and of the reliability of the latter to correctly represent the operating results and on the the accounting audit activity;
• the ways in which the corporate governance rules specified in the codes of conduct prepared by companies that manage regulated markets or professional associations, which the company declares to follow, are actually implemented;
• the adequacy of the instructions issued by the Company to its subsidiaries regarding the reporting of price sensitive information.

Pursuant to the Legislative Decree 39/2010, the Board of Statutory Auditors acts in its capacity as Internal Control and Audit Committee and in particular:
(i) to inform the Board of Directors on the outcome of the accounting audit and to transmit to the board its additional report referred to in article 11 of (EU) Regulation no. 537/2014, with its opinion;
(ii)to monitor the financial disclosure process and to submit recommendations and proposals aimed at ensuring its integrity;
(iii) to verify the effectiveness of internal control systems, quality and risk management and, where applicable, of internal audit in respect of financial disclosure, without compromising its independence;
(iv)  to monitor the audit of the annual and consolidated financial statements, also taking into account the results and the outcome of any quality controls carried out by CONSOB pursuant to Article 26, paragraph 6 of (EU) Regulation no. 537/2014, where available;
(v) to verify and monitor he independence of the auditing firm, in particular with regard to the issuance of services in favour of Pirelli other than external auditing;
(vi) to be responsible for the procedure concerning the selection of the auditor or the auditing firm and present a justified recommendation about the auditing firms to be appointed pursuant to Article 16 of (EU) Regulation no. 537/2014.

The Board of Statutory Auditors carries out its duties by exercising all of the powers conferred upon it by law and, since it can rely on a constant and analytical information flow from the Company, during and beyond the regular meetings of the Board of Directors and its Committees.

In fulfilling its functions, the entire Board of Statutory Auditors, besides participating in all the Board of Directors and Shareholders' Meetings, can also take part in the tasks of the Audit, Risks and Corporate Governance Committee, of the Committee for transaction with related Parties and the Remuneration Committee. The Chairman of the Statutory Auditor is invited to participate to the Appointment and Succession Committee, Strategies Committee and Sustainability Committee.

Also, in accordance with the legislative decree No. n. 254 of 30 December 2016 on the non-financial informations, the Board of Statutory Auditors supervises the compliance with the provisions of the aforementioned decree in relation to the preparation of the Non-Financial Statement ("DNF") by the Board of Directors and informs the Shareholders' Meeting of the results of the aforementioned supervisory activities.

Moreover a Standing Auditor is called to be a member of the Supervisory Body in accordance with the legislative decree No. 231/2001.