When a state-owned utility’s chief financial officer walks away from a multi-million-euro payout, it’s not just an accounting footnote—it’s a signal flare in Italy’s ongoing struggle to reconcile public accountability with executive compensation. On April 24, 2026, Terna S.p.A., Italy’s national electricity transmission grid operator, announced that its outgoing Chief Financial Officer, Francesco Di Foggia, had formally agreed to waive approximately €7.1 million in deferred compensation tied to his tenure as director general. Instead, Di Foggia will receive a gross sum of €108,750 in his new role as administrator, a figure that represents less than 2% of the original entitlement. The move, framed by Terna as a gesture of institutional responsibility, arrives amid heightened scrutiny over pay packages at state-controlled enterprises and raises urgent questions about whether such gestures constitute meaningful reform or merely performative optics in a sector where transparency remains elusive.
The decision carries weight beyond the balance sheet. Terna, which manages over 74,000 kilometers of high-voltage power lines across Italy and plays a critical role in the nation’s energy transition, has long been a focal point in debates about the governance of strategic state assets. Di Foggia, who served as CFO from 2019 to 2023 and briefly held the title of director general in 2022, was due to receive performance-linked deferred compensation under a remuneration plan approved by shareholders in 2020. That plan, tied to long-term industrial targets including grid resilience and renewable integration metrics, would have vested in tranches over a five-year period. His waiver, isn’t merely a renunciation of past earnings—it’s a direct intervention in a compensation architecture designed to align executive incentives with national infrastructure goals.
To understand the significance of this moment, one must look beyond the individual act and into the structural context. Italy’s state-owned enterprises have historically operated under a dual mandate: deliver public service efficiency while navigating political pressures that often blur the lines between stewardship and patronage. Terna, though listed on the Milan Stock Exchange with a public float of approximately 30%, remains under significant influence from the Italian government through Cassa Depositi e Prestiti (CDP), which holds a 29.9% stake via its infrastructure arm, CDP Reti. This hybrid ownership model has long complicated accountability, particularly when it comes to executive pay. A 2023 report by the Italian Court of Auditors found that while Terna’s compensation practices were formally compliant with the 2020 Stability Law—which caps variable pay for managers of public entities at 25% of fixed remuneration—the interpretation of what constitutes “variable” versus “deferred” compensation had allowed for arrangements that effectively circumvented the spirit of the regulation.
Di Foggia’s waiver, while voluntary, echoes a broader pattern of recalibration seen across Europe’s utility sector. In Germany, following public backlash over executive bonuses at E.ON during the 2022 energy crisis, the company revised its remuneration policy to tie 60% of long-term incentives to sustainability metrics, including carbon reduction and grid modernization. In France, EDF’s board faced parliamentary scrutiny in 2021 after revealing that its CEO’s total compensation had risen to €2.1 million despite stagnant shareholder returns, prompting a binding shareholder vote on pay policy. These cases suggest that Di Foggia’s gesture, while commendable, may be less about personal sacrifice and more about preemptive reputational management in an environment where social license to operate is increasingly contingent on perceived fairness.
To gain deeper insight into the implications of this decision, I spoke with two experts familiar with Italian corporate governance and energy sector dynamics. First, Lorenzo Bianchi, professor of public finance at Bocconi University and former advisor to Italy’s Ministry of Economy and Finance, offered this perspective:
“What we’re seeing here is not altruism—it’s risk mitigation. When a public utility’s executive voluntarily surrenders compensation that was contractually owed, it’s often because the reputational cost of accepting it now exceeds the financial benefit. Terna operates in a politicized space where every euro paid to executives is scrutinized through the lens of household energy bills. Di Foggia’s waiver may protect the institution’s legitimacy, but it doesn’t fix the underlying asymmetry in how risk and reward are distributed between state-linked firms and the public they serve.”
Second, Elisa Rossi, senior analyst for European utilities at S&P Global Commodity Insights, added:
“From an investor standpoint, this kind of move can actually be reassuring—it signals that the board is sensitive to social and governance concerns, which are increasingly material to credit ratings and ESG evaluations. But the real test will be whether Terna follows through with structural changes to its remuneration framework. One-off gestures don’t build trust; consistent, transparent alignment between pay performance and public service outcomes does.”
The timing of this announcement is too noteworthy. It comes just weeks before Terna’s annual general meeting, scheduled for June 18, 2026, where shareholders will vote on the renewal of the board and the approval of the 2025 remuneration report. Di Foggia’s successor in the CFO role, appointed in early 2024, is currently serving in an acting capacity pending formal confirmation. Meanwhile, the role of administrator—now held by Di Foggia on a reduced basis—has been temporarily assigned to Alberto De Biasio, a veteran Terna executive with over two decades in grid operations, pending the outcome of the upcoming assembly. This transitional phase has fueled speculation about whether the waiver is part of a broader leadership recalibration ahead of potential shifts in government influence following the 2027 general elections.
Beyond governance, the decision intersects with Italy’s pressing energy challenges. As the nation strives to meet its Fit for 55 obligations under the EU Green Deal, Terna’s infrastructure investments are projected to exceed €30 billion by 2030, with major upgrades needed to accommodate offshore wind in the Adriatic and solar expansion in the South. The utility recently announced a new 10-year development plan that includes 1,200 kilometers of new transmission lines and significant investments in grid-scale storage—projects that will require not only technical precision but also sustained public trust. How state-linked firms handle executive compensation isn’t just a matter of ethics; it’s a factor in social acceptance of the energy transition itself.
Historically, Italy has seen few instances of voluntary compensation renunciations at the highest levels of state-linked enterprises. A notable precedent occurred in 2015 when Francesco Starace, then CEO of Enel, declined a performance bonus amid public criticism over rising electricity prices—a move widely praised at the time but later scrutinized when it was revealed that his long-term equity awards remained intact. Di Foggia’s case differs in that it involves deferred compensation already accrued under a formal plan, making the waiver more material in immediate financial terms. Yet, as with Starace’s gesture, the absence of systemic reform leaves open the question of whether such acts change behavior or merely manage perception.
What, then, does this moment truly signify? Is it a harbinger of deeper change in how Italy governs its strategic assets, or a carefully calibrated exit designed to minimize reputational damage while preserving the status quo? The answer likely lies somewhere in between. What is clear, however, is that the era of opaque compensation packages at firms like Terna is facing increasing pressure—not just from regulators and shareholders, but from a public that now views access to affordable, clean energy as a fundamental right. For utilities operating at the intersection of public duty and market logic, the ledger of legitimacy is no longer balanced solely in euros and cents. It is measured in trust.
As Italy navigates the complex terrain of energy security, decarbonization, and fiscal responsibility, the actions of those who manage its critical infrastructure will continue to be weighed not just by what they take, but by what they choose to leave behind. In that ledger, Francesco Di Foggia’s waiver writes a single line—but the story it tells is far from over.
What do you think—can symbolic gestures like this ever lead to real structural change in how state-run enterprises compensate their leaders? Or are we destined to keep seeing these moments as isolated acts of conscience in a system that resists transformation?
