a) Composition, Profile of Skills and
Expertise, and Implementation Status
In December 2018, the Supervisory Board
again discussed the concrete company-specific objectives and the profile of
skills and expertise for its composition. These objectives reflect the
company’s international activities, potential conflicts of interest, the number
of independent Supervisory Board members, regular limits on age and length of
membership for Supervisory Board members, and diversity – especially an
appropriate degree of female representation. According to its profile of skills
and expertise the Supervisory Board members must collectively possess the
knowledge, skills, and professional experience required to properly perform the
Board’s duties. The objectives and profile of skills and expertise form part of
the diversity policy for the composition of the Supervisory Board. They
initially apply until the end of 2021 and will be taken into account in future
proposals for election as they have been in the past.
International Focus
All members of the Supervisory Board
must be open to the company’s international orientation. At least three members
should embody this in concrete terms and should therefore have particular international
experience due to their activities abroad or their background, for example. At
least two members with international experience should be shareholder
representatives.
Women
The Supervisory Board’s goal is to
further strengthen the number and position of women on the Supervisory Board
and to achieve a target of at least four female members. At least two women
should be shareholder representatives. As a listed company subject to
codetermination on a basis of parity, the Supervisory Board needs to be
comprised of 30% women and men, respectively, under statutory law.
Regular Limits on Age and Length of Membership
According to the Supervisory Board
bylaws, members should normally retire at the Annual General Meeting following
their 72nd birthday, and at the latest after a term of office of 20 years. The
goal for the Supervisory Board’s composition is that different age groups are
adequately represented. The term of office of each Supervisory Board member is
disclosed on the company’s website at www.rmqv.cn/Boards.
Independent Focus
The Supervisory Board should include
what it considers to be an appropriate number of independent members, taking
into account the ownership structure. A Supervisory Board member is not considered
to be independent in particular if he or she or a close family member has
personal or business relations with the company, its Executive Board, a
controlling shareholder, or an enterprise associated with the latter which may
cause a material and not merely temporary conflict of interests. The
Supervisory Board considers it to be adequate if at least eight of its members
are independent. In this context, it assumes that the employee representatives
are to be considered independent within the meaning of the Code. With respect
to the shareholder representatives, considering the fact that Beiersdorf AG is
a dependent company within the meaning of § 17 (1) AktG, the Supervisory Board
considers it to be adequate if at least two of its members are independent.
Potential Conflicts of Interest
The Supervisory Board’s objective with
respect to independence also takes potential conflicts of interest on the part
of its members into account. All members of the Supervisory Board must inform
the Supervisory Board, by way of communication addressed to the Chairman of the
Supervisory Board, of any conflicts of interest, in particular those relating
to a consulting function or directorship with clients, suppliers, lenders, or
competitors of the company. Members of the Supervisory Board must resign their
office if faced with material and not merely temporary conflicts of interest.
Where involvement of the Supervisory Board is not already required by statutory
law, material transactions between the Group and members of the Supervisory
Board and their related parties require the approval of the Supervisory Board
and must comply with the standards customary in the sector.
Profile of Skills and Expertise
The Supervisory Board ensures that its members collectively
have the knowledge, skills, and professional experience needed to properly
perform their duties. In addition to the concrete objectives for its
composition, the Supervisory Board has prepared a profile of skills and
expertise setting out the particular personal and professional skills and
expertise required. In terms of their expertise, the members must collectively
be familiar with the sector in which the company operates; in addition, at
least one member must have expertise and experience in each of the following
areas: accounting and finance; consumer goods, retail and sales channels;
international markets (including emerging markets); beauty and body care; brand
development and management; personnel development and support; corporate
organization; corporate governance and supervisory law; risk management,
internal control systems, compliance and auditing; innovation management and
research and development; digital, data management, and information technology;
sustainability and corporate social responsibility. The Supervisory Board’s aim
is that all these areas of expertise should be represented among its members in
as balanced a way as possible, thereby complementing one another. In addition
to this, every Supervisory Board member should meet the necessary general and
personal requirements for fulfilling their duties in terms of education,
international professional orientation, international diversity, seniority,
reliability, diligence, and availability to the required and appropriate
extent.
Diversity Officers
Two Supervisory Board members have been appointed as
diversity officers in order to develop the targets further and promote
diversity on the Supervisory Board: Martin Hansson and Prof. Manuela Rousseau.
Their role is to support the Supervisory Board at every intended election of a
shareholder representative to the Supervisory Board, or of a committee member,
and to issue a statement together with the Chairman of the Supervisory Board
regarding the proposals for election made by the Nomination Committee
responsible for this, after consultation with the remaining members of the
Supervisory Board.
Implementation Status of Targets and the Profile
of Skills and Expertise
In addition to a balanced mix of professional skills
within the Supervisory Board as a whole, diversity is an important criterion
for the selection of Supervisory Board and committee members in the company’s
best interests. There are currently five female Supervisory Board members in
total: Prof. Manuela Rousseau, Regina Schillings, and Kirstin Weiland as
employee representatives, and Dr. Dr. Christine Martel and Hong Chow as
shareholder representatives. The statutory gender quota for the Supervisory
Board’s composition has therefore been fulfilled. In addition to their
particular professional skills, all the shareholder representative members
embody the idea of international orientation by virtue of their background or
extensive international experience.
Three-quarters of the members of the Supervisory Board
are independent, and at least one-half of the shareholder representatives. The
Supervisory Board assumes, as a highly precautionary measure, that a
Supervisory Board member with relations to the controlling shareholder should
not be regarded as independent. Notwithstanding this, the Supervisory Board
believes that relations to the controlling shareholder do not in themselves
pose the risk of a material and permanent conflict of interest; rather, it
assumes that the company’s interests will largely coincide with those of its
majority shareholder in those cases in which their business activities do not
overlap. The Supervisory Board therefore assumes that, among the shareholder
representatives, at least the following active members are independent from
both the controlling shareholder and the company and Executive Board: Hong
Chow, Dr. Dr. Christine Martel (the Chair of the Audit Committee), and Frédéric
Pflanz. In addition, the Supervisory Board takes the view that, alongside
Martin Hansson, the Chairman of the Supervisory Board and Presiding Committee
Prof. Reinhard Pöllath should be regarded as independent from the company and
Executive Board, despite his more than 12 years of service on the Supervisory
Board. The Supervisory Board believes that the Chairman of the Supervisory Board’s
long-standing, company-specific experience and expertise is conducive to the
goals of advising and supervising the Executive Board and coordinating the
Supervisory Board’s work in a lasting and objective manner. Moreover, given his
length of service, there are no circumstances in his specific case that might
cause a material and not merely temporary conflict of interests.
Two Supervisory Board members, Michael
Herz and Prof. Reinhard Pöllath, have exceeded the regular age limit set out in
the bylaws of the Supervisory Board. One Supervisory Board member, Prof.
Manuela Rousseau, has exceeded the regular term of office. Given their
knowledge and experience, the Supervisory Board has decided to make a
reasonable exception for these members from the regular limits on age and
length of membership. The regular limits on age and length of membership and
the rules governing potential conflicts of interest were otherwise complied
with. All members of the Supervisory Board also fulfill the necessary personal
competence requirements for their tasks. Moreover, the Supervisory Board
members are collectively familiar with the sector in which the company
operates. In addition, the fields of required expertise are each represented by
at least one member.