Legal regulations on the management and monitoring of listed German companies
The German Corporate Governance Code specifies significant legal regulations on the management and monitoring of listed German companies and contains numerous internationally and nationally recognised standards on good and responsible company management.
The code was drawn up by the Government Commission responsible for the German Corporate Governance Code and was first published on 26 Februrary 2002. Since then, it has been revised by the Government Commission and amended to comply with the applicable legal framework conditions.
The (Group) declaration of corporate management, which is published on an annual basis by the company on its website in accordance with sections 289f (1), 315d German Commercial Code (HGB), is part of the management report of EnBW Energie Baden-Württemberg AG and the combined management report. In line with the (Group) declaration of corporate management, the Board of Management and the Supervisory Board provide information about the company’s corporate governance pursuant to principle 22 German Corporate Governance Code (in the version of 16 December 2019).
The latest version of the declaration of corporate management can be found here.
The Management Board and the Supervisory Board of EnBW Energie Baden-Württemberg AG make the annual Declaration of Compliance with the German Corporate Governance Code, in accordance with Section 161 of the German Public Companies Act (AktG).
Below is the current Declaration of Compliance dated 4 December 2019.
The EnBW Board of Directors has five members. It is jointly responsible for managing the business of the Group. In addition to the duties of the Chairperson of the Board of Directors, the responsibilities of the Board of Directors are divided into the “Finance,” “Human Resources,” “Sustainable Generation Infrastructure,” and “System-Critical Infrastructure” portfolios. The Chairperson of the Board of Directors is Dr. Frank Mastiaux, the other members of the Board of Directors are Dirk Güsewell, Thomas Kusterer, Colette Rückert-Hennen and Dr. Georg Stamatelopoulos.
Dr. Frank Mastiaux
Chief Executive Officer
Chief Financial Officer
Chief Operating Officer Critical Infrastructure
Chief Human Resources Officer
Dr. Georg Stamatelopoulos
Chief Operating Officer Generation
Committees of the Supervisory Board
Depending on the specifics of the enterprise and the number of its members, the Supervisory Board has formed committees with sufficient expertise. They serve to increase the efficiency of the Supervisory Board's work and the handling of complex issues. The respective committee chairmen report regularly to the Supervisory Board on the work of the committees.
The Supervisory Board has set up a Personnel Committee, a Finance and Investment Committee, an Audit Committee, a Nomination Committee and an Arbitration Committee. The duties and members of the committees are specified below.
The Personnel Committee decides on the employment agreements of the Management Board members put forward by the Supervisory Board, on the determination of their annual salaries and on the granting of loans to the Management Board members. The committee meets when necessary.
The Finance and Investment Committee is responsible for preparing investment decisions. If, in urgent cases, it is not possible to convene a Supervisory Board meeting with the required quorum, investment decisions are referred for decision to the committee. The committee also prepares the Supervisory Board meetings on annual planning. In this respect, the committee has no decision-making powers. The committee meets when necessary.
The Audit Committee is responsible for questions relating to reporting, risk management, compliance, and the required independence of the auditor. The committee decides in place of the Supervisory Board on the appointment of the auditor, determines the audit focus, and handles the agreement on the auditor's fee. The committee also prepares the Supervisory Board meeting on the financial statement (balance sheet meeting). In this respect, the committee has no decision-making powers. It meets when necessary. The chairman of the Audit Committee possesses special knowledge and experience of the application of accounting principles and internal auditing procedures. The Audit Committee may not be chaired by the Chairman of the Supervisory Board or a former member of the Management Board of the company.
The Nomination Committee has the task of recommending suitable candidates to the Supervisory Board for its suggestions for the Annual General Meeting regarding elections. Moreover, it passes resolutions on behalf of the shareholder representatives of the Supervisory Board persuant to Section 32 of the German Codetermination Act (MitbestG). The committee meets in the run-up to the Annual General Meeting to determine which candidates to recommend and at other times when necessary.
The Arbitration Committee submits proposals to the Supervisory Board for the appointment of Management Board members if the required two thirds majority for the appointment or termination of Management Board members has not been achieved. The creation of this committee is legally required under the codetermination legislation. The committee meets when necessary.
The digitalisation committee deals with measures and projects in the area of digitalisation at the company and its affiliated entities, insofar as they have fundamental strategic significance for the development of the company and the Group. In particular, this is the case if the projects or measures result in substantial changes to an existing business model, or result in new business models, which have a high significance for the company or could develop such significance, if fundamental questions about the use of technologies arise that have or could have a material impact on the existing business (e.g. an impact assessment of digitalisation technologies) or if there is or could be a significant impact on employees and the organisation. The committee meets as required.
The Board of Management remuneration as well as the Supervisory Board remuneration of EnBW Energie Baden-Württemberg AG as well as the remuneration systems are pursuant to the statutory provisions for listed companies (in particular in accordance with sections 87, 87a, 113 and 120a German Stock Corporations Act (AktG)) and pursuant to the principles of the German Corporate Governance Code as presented in the current Declaration of Compliance in accordance with section 161 AktG.
Remuneration system for members of the Board of Management
Under section 120a (1) AktG, the Annual General Meeting of a listed company must adopt a resolution on the approval of the remuneration system for members of the Board of Management at every material change and in any case at least every four years.
Such a resolution was last adopted by the Company’s Annual General Meeting on 5 May 2021.
The resolution on the approval of the remuneration system for members of the Board of Management as well as the remuneration system itself must be published on the Company’s website in accordance to section 120a (2) AktG. The latest versions can be found here (only available in German).
Remuneration system for members of the Supervisory Board
Under section 113 (3) AktG, the Annual General Meeting of a listed company must adopt a resolution on the remuneration of Supervisory Board members at least every four years, with the resolution permitted to take the form of a resolution confirming remuneration. The Company’s Annual General Meeting last adopted a resolution on the remuneration of Supervisory Board members on 17 July 2020. This resolution was confirmed by the Company’s Annual General Meeting on 5 May 2021.
The resolution on the approval of the remuneration system for members of the Supervisory Board as well as the remuneration system itself must be published on the Company’s website in accordance to section 113 (3) sentence 6 AktG and in accordance to section 120a (2) AktG. The latest versions can be found here (only available in German).
The topic of Compliance - as the abidance by the statutory provisions and the company's guidelines - has significantly gained in importance during the past years. The reputation of a company and its economic success can be detrimentally affected by compliance violations. Therefore a risk-oriented and preventative compliance strategy is more important today than ever before.
One of EnBW's goals is making the adherence to external and internal rules an integral part of the thinking and action of all company bodies, executives and employees. Simultaneously the trust of business associates, stockholders and the capital market should be increased.
The Department of Compliance is responsible especially for the group-wide regulations for corruption prevention, cartel law prevention, data protection and capital markets compliance. The department is available to managers and employees as the central point of contact and advisor for compliance questions.
Compliance at EnBW group comprises the following four elements:
Compliance Department: Corporate function with direct reporting lines to the member of the Board of Management for personnel and law, responsible for the group-wide organisation of EnBW's Compliance Management System and for monitoring its uniform implementation across the group.
Compliance Committee: Internal decision-making board with an advisory capacity, made up of representatives from the relevant corporate compliance functions.
Compliance Forum: Meeting between local Compliance Officers from the most relevant group companies, business units and Compliance, to coordinate the implementation of centrally planned compliance measures into the operating entities.
Compliance Working Group: Exchange of information between Compliance and the Compliance Officers from the non-controlled group companies.
To ensure the success of the Compliance Programme it is of utmost importance that all employees be made aware of compliance topics. With this knowledge they can work responsibly and consistently within the legal regulations and the company's guidelines. EnBW makes this possible by holding face-to-face seminars and by providing e-learning programs for all general compliance topics and especially for the Code of Conduct.
Regular reports on current compliance topics and concerning the further developments of the Compliance Management System are prepared regularly for the Board of Management, the Supervisory Board and the Supervisory Board's Audit Committee.
Integrity - meaning the adherence to laws and legislation, honesty, dependability and fairness - is an indispensable basic requirement for the success of our company. The Board of Management has passed a Code of Conduct for EnBW Group which gives executives and employees an overview of the most important statutory provisions and company guidelines.
The Code of Conduct should serve as an aid to all decisions and actions taken. It acts as a binding framework for internal co-operation as well as for the interaction with customers, competitors, public officials as well as public institutions.
How to deal with business partners, officials and public bodies is set out in the Code of Conduct. The specifics are contained in a group policy on how to deal with gifts, invitations and hospitality, with internal thresholds on value and qualitative criteria. If these thresholds are exceeded, approval must be obtained from the Compliance Department. These regulations make a significant contribution toward protecting the integrity of the EnBW group and its employees in the course of business.
EnBW has clear regulations on checking business partners, which provide for careful selection and review of business partners with regard to the risk of corruption and infringements of social and environmental standards. The objective of the procedure is to avoid financial damage and reputational risks to EnBW, in particular in connection with its international activities.
EnBW has established two channels of communication for all internal and external indications of compliance infringements or suspected violations. The internal regulations define clear responsibilities and processes when investigating compliance infringements, ensure confidentiality and offer the best possible protection for all parties involved.