Annual Report 2013

Corporate governance

Objectives regarding Supervisory Board composition

In consideration of the specific situation of the corporation, the Supervisory Board has established the objectives described below with respect to its composition. These objectives will be taken into account by the Supervisory Board when proposing election candidates to the Annual General Meeting for all re-electable and ad-hoc replacement Supervisory Board positions:

     

  • The members of the Supervisory Board should, generally speaking, offer the knowledge, skills and relevant experience necessary in order to properly perform their duties. In particular, experience and expertise are required in one or several of the fields of corporate management, accounting, financial control/risk management, corporate governancecorporate governance
    System of management and control, primarily within listed companies. Describes the powers and authority of corporate management, the extent to which these need to be monitored and the extent to which structures should be put in place through which certain interest/ stakeholder groups may exert influence on the corporate management.
    /compliancecompliance
    Acting in conformity with applicable regulations; adherence to laws, rules, regulations and in-house or corporate codes of conduct.
    , research and development, production/engineering, and marketing/sales/distribution, as is knowledge of the industrial or consumer businesses and of the primary markets in which Henkel is active. Members of the Supervisory Board should also have sufficient time at their disposal in order to carry out their mandate.
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  • The international activities of the corporation should be appropriately reflected in the composition of the Supervisory Board. Thus, it aims to include several members with an international background. The mix of candidates proposed for election should also contain an appropriate number of women. Here, a proportion of 30 percent is essentially regarded as appropriate. Efforts will therefore be made to maintain or, if possible, increase this proportion for upcoming new and ad-hoc replacement elections.
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  • In addition, the Supervisory Board should have an appropriate number of independent members. Specifically, the Supervisory Board should contain no more than two former members of the Management Board, no persons who perform board or committee functions or act as consultants for major competitors, and no persons whose relationship with the corporation or members of the Management Board could give rise to material conflicts of interest which are not of a temporary nature. Assuming that the pure exercise of their Supervisory Board mandate by the employee representatives does not give rise to doubts as to whether the independence criteria as defined by item 5.4.2 of the DCGK are fulfilled, the Supervisory Board should include at least 13 members who are independent as defined by the DCGK. Consistent with the corporation's tradition as an open family business, possession of a controlling interest or attribution of a controlling interest due to membership in the Henkel share-pooling agreement is not viewed as a circumstance that creates a conflict of interest in the meaning above. However, irrespective of this, at least three of the shareholder representatives on the Supervisory Board should, as a rule, be neither members of the Henkel share-pooling agreement nor members of the Shareholders' Committee nor members of the Supervisory Board of Henkel Management AG. Further, no persons shall be proposed for election at the Annual General Meeting who, at the time of the election, have already reached their 70th birthday.
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