Internal Control System

Pirelli’s internal control system is represented by the set of structural and process factors which are able to achieve the following objectives: (i) the efficiency and effectiveness of the operating activities; (ii) the dependability of information; (iii) protecting the corporate equity and (iv) respect of and compliance with the laws and regulations to assure correct information and an adequate control structure for all the Group’s activities, with particular attention focused on the areas considered potentially at risk.

In particular, the internal control system permits monitoring of compliance with the rules and procedures which govern the performance of the Company’s business activities in its various forms.

Pirelli’s internal control system was developed as a direct process aimed at achieving values of substantial and procedural fairness, transparency and accountability, assuring: efficiency, transparency and traceability of transactions and, more in general, of management- related activities; dependability of the accounting and management data and financial information; compliance with the laws and regulations; protecting the Company’s integrity, also to prevent fraud damaging the Company and the financial markets.

The following represent the key rules underlying the Company’s internal control system: (i) separation of roles when performing the principal activities involved in individual operating processes; (ii) traceability of the choices made; (iii) management of the decision-making processes based on objective criteria.