Corporate Governance Report
In this Declaration on Corporate Governance (also known as the Corporate Governance Report), we report, in accordance with Sections 289a and 315 (5) of the German Commercial Code (HGB) and No. 3.10 of the German Corporate Governance Code (GCGC), on the principles of management and corporate governance. The declaration contains the Declaration on Conformity, information on corporate governance practices, a description of how the Management Board and Supervisory Board work and key corporate governance structures. The corporate governance declaration has been published on the Vonovia website under Investor Relations and does not form part of the management report. Pursuant to Section 317 (2) (4) HGB, the disclosures pursuant to Sections 289 a, 315 (5) HGB are not included in the audit performed by the auditor of the annual financial statements.
Declaration of Conformity to the GCGC Pursuant to Section 161 of the German Stock Corporation Act (AktG)
The Management Board and the Supervisory Board of Vonovia SE declare that the company complies with the recommendations made by the “Government Commission on the German Corporate Governance Code (GCGC)” as published on February 7, 2017, and since the last Declaration of Conformity in September 2017, in the official section of the federal gazette by the German Federal Ministry of Justice subject to the exceptions set out below, and that it will continue to do so in the future:
- Pursuant to Section 5.3.2 (3) (3) GCGC, the Chairman of the Supervisory Board is not supposed to be the Chairman of the Audit Committee. Following the departure of the previous Chairman of the Supervisory Board, the Supervisory Board elected the former Deputy Chairman, Prof. Dr. Edgar Ernst, as Chairman on September 7, 2017 and with effect until the Annual General Meeting to be held in May 2018. Prof. Dr. Edgar Ernst is also the Chairman of the Audit Committee. As Prof. Dr. Edgar Ernst is the member of the current Supervisory Board with the greatest specialist expertise in the field of accounting, he is to remain the Chairman of the Audit Committee. As a result, Vonovia has made the provisional decision not to comply with the recommendation. Following the constitution of the new Supervisory Board after the upcoming elections of all Supervisory Board members scheduled for the Annual General Meeting in May 2018, the plan is to comply with Section 5.3.2 (3) (3) GCGC again.
The company’s Supervisory Board and Management Board would like to point out that the company has made a public takeover offer to the shareholders of BUWOG AG, Vienna/Austria, for the acquisition of all shares in BUWOG AG. If the takeover offer is successful, the company will become a majority shareholder in BUWOG AG before the end of the first quarter of 2018. If the transaction is successful, the two Boards expect that, due to the expected work involved in the first-time consolidation of BUWOG AG in the company’s consolidated financial statements, it will not be possible to make the financial information for the second, and possibly also for the third, quarter of 2018 available to the public within 45 days of the end of the reporting period as necessary in accordance with Section 7.1.2 (3), 2nd half-sentence GCGC. As soon as this prospect appears likely, the Management Board and Supervisory Board will publish a deviation from the recommendation set out in the German Corporate Governance Code (GCGC) in an updated Declaration of Conformity.