Titans of Italy’s Economy Await Fate as Meloni Reshapes Elite

Alessandra Migliaccio and Chiara Albanese
·4 min read
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(Bloomberg) -- A chance for Italian Prime Minister Giorgia Meloni to leave her mark on the economy is looming as a multitude of top jobs come up for renewal — including the governorship of the central bank.

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Bank of Italy head Ignazio Visco’s term will end later this year. Before then, the leadership of more than 60 state-controlled enterprises, including the country’s biggest energy and oil companies Enel SpA and Eni SpA, will be decided, and the chief Treasury official is among key positions that already need to be confirmed this month.

With interest rates set by the European Central Bank, and the country’s huge debt burden limiting the scope for fiscal largess, reshaping its business and policy elite may be the best hope for the new premier to overcome that relative impotence on economic matters, and make a difference.

“Corporate appointments are the perfect opportunity for Meloni to exercise power and to place trusted and loyal people in key positions,” said Martina Carone, a political analyst at YouTrend, a polling and research company. “She has never been so close to this power game before.”

An initial deadline for personnel decisions including the director general of the Treasury — an influential position once held by former premier Mario Draghi — will arrive on Jan. 24, by when key public administration jobs must be confirmed.

Meloni and Finance Minister Giancarlo Giorgetti will need to decide whether to stick with the incumbent, Alessandro Rivera, or find someone else.

The second round of appointments will be more wide-ranging, offering the coalition an opportunity to revamp Italian capitalism in its image after criticizing the system when out of power.

Finding new chiefs for the state’s myriad companies could impact policy for years in multiple areas. The two energy companies along with three others account for just under a quarter of the weighting in Italy’s benchmark FTSE MIB Index.

Meanwhile, having criticized the ECB for raising rates too fast, Meloni’s choice of a governor to partake in decisions in Frankfurt may be even more consequential. A successor to Visco will be needed for November.

Here’s a closer look at some of the key appointments for Italy’s economic elite.

Big Oil

The biggest state-controlled company is oil producer Eni. It is currently run by Chief Executive Officer Claudio Descalzi, who is on his third term. He is considered relatively close to the government and likely to stay on.

Eni is among Europe’s biggest oil producers. It is active in 69 countries and is the main oil company on the African continent.

Descalzi has extensive experience dealing with geopolitically sensitive parts of the world, and has worked closely with multiple governments overseeing both his company and Italy’s interests in the Middle East and Africa.

Eni is a source of dividends for the state and an important player in its energy policies. That became a huge priority amid the gas-supply crisis following Russia’s invasion of Ukraine.

Power Giant

Electricity giant Enel is also instrumental in determining Italy’s energy policies, and working toward meeting the country’s green transition goals, some of which are targets for receiving European Union Recovery Fund cash.

Current CEO Francesco Starace, also on his third term, is less likely to be kept on, according to people familiar with the matter. Spokespeople for Enel and Italy’s finance ministry declined to comment. No decision has been taken by the government yet.

The company has a presence in 30 countries and plans to sell assets worth as much as €21 billion ($22 billion) exiting Argentina, Peru and Romania to cut its debt pile. The CEO is confident those deals will be concluded “pretty fast” during 2023.

Weapon Maker

Another heavyweight is defense company Leonardo SpA run by former banker Alessandro Profumo, now on his second mandate. He is also likely to be replaced with someone closer to the Meloni government, according to the people.

A spokesman for Leonardo declined to comment.

Leonardo is involved in aerospace, defense and security — all areas of national interest for Italy and the new government, which is pushing for technological sovereignty in these fields.

Other companies

Top jobs are also facing renewal at Poste Italiane SpA, which runs the country’s mail service and postal savings accounts and has diversified into energy, insurance and telecoms; power network operator Terna SpA; and struggling bank Banca Monte dei Paschi di Siena SpA. Smaller entities ranging from air traffic controller Enav to state-owned distressed loans manager AMCO will also change leadership.

Bank of Italy

The coalition will need to find a new face for the central bank to succeed Visco, whose second six—year term isn’t renewable. Whoever gets the job will become a member of the ECB’s rate-setting Governing Council.

With the central bank’s independence guaranteed by treaty, any scope to use the appointment to influence policy might be politically fraught.

Should Meloni appoint ECB Executive Board member Fabio Panetta — whose name featured prominently during coalition talks over who should be finance minister — that would mean the vacancy created there would need to be filled too.

Meanwhile opting for former Finance Minister Daniele Franco, another ex-Bank of Italy official, would involve less upheaval.

--With assistance from Alberto Brambilla.

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