Meloni takes bold step of reshaping Italy’s top economic, business leadership

Prime Minister Giorgia Meloni extended her revamp of Italy’s economic and business elite as her government reappointed or replaced leaders at some of its biggest state-controlled enterprises.

Out of the three most significant company roles announced on Wednesday, only oil giant Eni SpA still has the same chief executive, with Claudio Descalzi keeping his job.

In a concession to League leader Matteo Salvini and other coalition parties that resolves government tensions, energy company Enel SpA will be headed by Flavio Cattaneo, ending Francesco Starace’s three-term stint.

And Roberto Cingolani, a minister in Mario Draghi’s former government, will replace Alessandro Profumo at defense company Leonardo SpA.

The appointments, which each last for three years, mark the biggest step yet to reshape Italy’s business leadership in the image of the Meloni-led coalition at a consequential juncture with so many selections happening at once.

That provides a unique opportunity for the coalition to make its mark in economic matters when European Union fiscal rules limit the room for maneuver on public finances, and interest rates get set in Frankfurt for the euro zone as a whole.

Eni and Enel alone have a combined market value of about $120 billion (€110 billion) and account for almost 20 percent of the Milan benchmark FTSE MIB index’s capitalization.

The question of who helms strategic companies ranging from energy to defense has taken on more significance given the backdrop of rapidly realigning priorities in gas supply and military rearmament as war rages on the European continent.

Yet Meloni’s coalition partners didn’t let such considerations distract them from demanding their share of appointments.

The prime minister had wanted Stefano Donnarumma to become Enel CEO, but pivoted to keep her allies on board and also allowed them to push through Paolo Scaroni as the company’s chairman.

Scaroni currently holds that position at soccer club AC Milan and is considered close to former premier Silvio Berlusconi’s Forza Italia party. He’s a ex-CEO of Eni, where he worked to deepen ties with Russia’s Gazprom.

Enel plays a big role in shaping Italy’s energy policies and green transition targets, all the more important after Russia’s invasion of Ukraine heightened the need for energy independence.

The same is true of Eni, whose chief Descalzi helped steer Italy away from dependence on Russian gas. Now on his fourth term, he leads one of Europe’s biggest oil producers, which is active in 69 countries and is the main such company on the African continent.

The job selections for state enterprises represent the second round of key economic appointments this year after a personnel revamp of officials in January.

London finance industry veteran Riccardo Barbieri was promoted to run the Treasury, a pivotal role in economic policy and managing state-controlled entities. That post of director general was once held by Draghi.

The last step will come in the fall when Ignazio Visco’s non-renewable term as Bank of Italy governor will end. Meloni’s coalition will need to find a new face, keeping in mind that whoever gets the job will become a member of the European Central Bank’s Governing Council.

While the central bank’s independence is guaranteed by treaty, the government is likely to try to chose someone near their views.

Meloni has openly criticized the ECB’s rate hiking, saying it was too fast and risked damaging the economy.