Sustainability Report 2020

Tag Manager

Corporate Governance and Responsible Business Practices

Governance and Compliance



Reliable, transparent and trust-based corporate governance is at the heart of our business model. Securing the trust of our customers, employees and all other key stakeholders is our top priority. This requires managers who lead the company responsibly and independently in accordance with the principles of good corporate governance, and whose “tone from the top” attests to their credibility. The same applies to compliance with legislation, directives and regulations, because it is only by consistently following all of the rules – both those defined by law and those we set ourselves – that we will be seen as reliable and trustworthy.

If we fail to meet the expectations of our stakeholders in terms of responsible corporate governance, this may lead to risks that could have an impact on our business. Any abuse of trust jeopardizes the reputation of our company and its commercial success. That’s why we strive to be seen by our stakeholders as a trustworthy and reliable partner in order to strengthen the competitiveness of our company.

With this in mind, we are refining our corporate strategy to include stakeholder expectations and the ESG (environment, social and governance) targets defined by international standard-setters. If we are unsuccessful in our endeavors, this could lead to the capital market and other significant stakeholders taking a negative view of our company. Non-compliance with laws and regulations would in turn imply financial risks, such as liability risks, the risk of administrative penalties or other official sanctions.

Our Approach

We understand good corporate governance – also referred to as business ethics – to mean the responsible management and supervision of the company. As a result, our governance endeavors are geared toward the establishment and implementation of, and systematic compliance with, a transparent and modern system of rules. Group-wide guidelines and business principles provide the framework and form the basis for our sustained corporate success: our business philosophy, the Code of Conduct, the Business Partner Code and the Declaration of Respect for Human Rights all provide guidance for how we should run our business.

Further information on corporate governance at Vonovia can be found in the 2020 Annual Report (see chapter Corporate Governance, – Annual Report 2020).

Good compliance management makes a key contribution to sustainable company performance and value creation and gives our customers and partners even greater security concerning their relationship with us. By adhering to compliance rules, we not only protect the integrity of employees, customers and business partners, but also shield our company from negative influences. This provides Vonovia with the foundation it needs to act and to be perceived as a reliable and trustworthy partner. Tight residential property markets, combined with customers’ fears of losing their homes, are a breeding ground for misconduct by our employees. That’s why we place such an emphasis on compliance with applicable legislation and tenancy law. This is as true for our employees as it is for our suppliers and service providers because they play a key role in Vonovia achieving its objectives, very much in the spirit of the long-term partnerships that we are aiming for.

Important Internal and External Guidelines

  • German Corporate Governance Code (GCGC) as amended on March 20, 2020
  • Code of Conduct
  • Business Partner Code
  • Vonovia’s own compliance guidelines [based on the Principles for the Proper Performance of Reasonable Assurance Engagements Relating to Compliance Management Systems (IDW AsS 980)]
  • Policies on anti-corruption, money laundering prevention and whistleblowing
  • Core labor standards of the International Labor Organization (ILO)
  • UN Global Compact (UNGC)

Whenever legislation in Austria or Sweden conflicts with Group-wide rules, a different rule is adopted for the sub-group in the form of a national guideline. The responsibility lies with the respective managing directors.

Organizational Focus

The Management Board and Supervisory Board office coordinates committee work at Vonovia and organizes information flow and cooperation between the Management Board and the Supervisory Board. The Legal department, Management Board and Supervisory Board office work together closely to decide how to implement resolutions taken by the decision-making bodies.

At Vonovia, compliance management is the responsibility of the Legal department, which monitors adherence to the rules that apply within our central compliance management system (CMS). The Management Board (CEO) is responsible for the implementation of the CMS. The CMS applies to the entire Group. Managing directors of subsidiaries are supported in compliance matters by the Vonovia Legal department (see chapter Compliance Management, Annual Report 2020).

Enhancing the CMS and adapting it to fulfill current requirements is the responsibility of the Compliance Committee. The Compliance Committee is made up of compliance officers, compliance managers and compliance coordinators, an external ombudsperson and representatives of the Internal Audit, Risk Management and HR Management departments, as well as the works council. A central Compliance Officer is necessary for identifying compliance risks, taking suitable measures to avoid and detect these risks, and responding appropriately to identified compliance risks. All employees and business partners are able to contact the external ombudsperson confidentially if they have any questions concerning compliance. Vonovia also has a whistleblowing hotline that is managed by an independent law firm.

Objectives and Measures

Across the Group, our aim is for full compliance with guidelines, applicable laws, values, corporate governance principles and the code of conduct.

Corporate Governance

Corporate governance at Vonovia covers all areas of the company and ensures that the management team leads and supervises the company responsibly and independently. To this end we have implemented uniform standards across the company for corporate governance and employee behavior, including our Code of Conduct and our business philosophy. Whenever we integrate new companies into the structures of the Group, we assess which standards already apply there and which changes will be needed to bring them into line with the Group standard, all while taking national requirements into account and with the aim of securing the highest level of acceptance. The responsible managers review our guidelines every two years to determine if they have to be updated.

We also submit an annual Declaration of Conformity with the principles of the GCGC and are guided by the principles of the Institute for Corporate Governance in the German Real Estate Industry. Our Management Board and Supervisory Board are responsible for their implementation. Effective and secure audit and control processes, e.g., the Executive and Nomination Committee and the Audit Committee, help us to monitor corporate governance. Our corporate governance declaration states that all members of the Supervisory Board of Vonovia SE should be independent.

Our Investor Relations website provides additional information about corporate governance, including the shares in our company held by our board members.

We have established standard procedures for related party transactions (RPT). The Supervisory Board receives regular reports from the Management Board on other related-party transactions pursuant to the German Stock Corporation Act – once a year from board members and twice a year in the form of the compliance report. Transactions with related parties are documented in accordance with ARUG II. The Supervisory Board reserves the right to make a decision itself on any RPT requiring approval or to delegate the decision to one of its committees.

Elements of long-term variable Management Board remuneration

  • Relative Total Shareholder Return (relative TSR)
  • NTA (Net Tangible Assets) per share
  • Group FFO (Funds from Operations) per share
  • Sustainability Performance Index (SPI)

We took a close look at our company’s remuneration policies in 2020 and decided to link the variable remuneration of the Management Board and the first management level to the achievement of sustainability targets. For this purpose we developed the Sustainability Performance Index (SPI), which comprises six material non-financial performance indicators and will be a material management metric for Vonovia from 2021 onwards (see chapter Our Approach to Sustainable Development in Detail).

Board: 25%

Board: 33.3%

Proportion of women on management
and supervisory bodies

We intend to improve the diversity of the Group’s decision-making bodies going forward by taking diversity criteria into account when members are appointed to the Management Board and Supervisory Board. The Supervisory Board set a target of at least 20% of the members of the Management Board being women by December 31, 2021. This has already been achieved, as the Management Board consists of one woman and three men who lead the Group with their experience and expertise.

More information can be found in the Corporate Governance section of the Annual Report.


The compliance management system (CMS) is implemented throughout the Group through the extensive and secure monitoring of compliance and anti-corruption rules.

Main compliance regulations at Vonovia

  • Compliance guidelines
  • Code of Conduct
  • Business Partner Code
  • Inspection guidelines
  • Group guidelines on guideline management
  • Donations and sponsorship guidelines
  • Anti-corruption program
  • Whistleblowing guidelines

Vonovia’s CMS is based on three pillars: the “prevention” and “identification” of and “reaction” to any misconduct. There is a particular emphasis on prevention. These three pillars form the basis for a comprehensive program of compliance measures and processes that are guided by the Compliance Guidelines. These Guidelines in turn are based on the Principles for the Proper Performance of Reasonable Assurance Engagements Relating to Compliance Management Systems (IDW PS 980) and the implementation standards for the UK Bribery Act 2010. The program, which has already been firmly implemented, is evaluated and enhanced on an ongoing basis. Regular training sessions support our preventative work. Procurement in Germany, for which the issue is particularly relevant, receives special training on corruption and criminal law pertaining to corruption.

Vonovia focused on the establishment of a system to prevent and combat corruption in 2020 on the basis of new anti-corruption guidelines and guidelines to protect whistleblowers. In addition to an independent ombudsperson, Vonovia uses a hotline that ensures anonymity for whistleblowers. An anti-money laundering policy also addresses the particular issue of money laundering in the real estate industry in order to combat abuses in this area.


updated to combat corruption

We need supplementary and more in-depth training in order to make the frameworks that have been put in place and the corresponding awareness of corruption issues an even more established part of our corporate culture (see Social and Governance Key Figures). The coronavirus pandemic meant that it was not possible to conduct as many of these sessions as usual in 2020. This should change in 2021. A total of eight courses were held for the Sales, Procurement and Transactions departments in Austria on subjects including data protection and privacy, the Code of Conduct, and money laundering. Training was also provided on a regular basis for new employees.

In the 2020 fiscal year, there were isolated suspected cases of corruption, which we investigated diligently. None of the cases were confirmed. There were also a number of immaterial compliance violations or suspected violations. Cases were reported and investigated and the necessary measures taken.

Compliance with antitrust law is important to us. We inform the German Federal Cartel Office as soon as possible of any potential acquisitions and only begin to integrate companies or portfolios following approval. There were no violations of competition law guidelines in 2020.


confirmed incidents of corruption
or breaches of anti-money laundering
regulations in 2020

More information on compliance on our website.

We are continuing to implement the tax strategy adopted in 2018 to provide transparency about our tax situation. We see ourselves as a taxpayer that lives up to its social responsibility in terms of contributing to society financially,

  • pays taxes in Germany, Austria, Sweden and the Netherlands as a multinational company with operational subsidiaries,
  • does not abuse subsidiaries as vehicles for tax optimization,
  • complies in full with tax compliance regulations and
  • does not use tax havens.

Our understanding of tax is based on clearly defined responsibility and control processes and a functioning risk management system that comprises the following elements:

  • Regular exchange of information between the CFO and the Head of Tax
  • Information provided to the Supervisory Board about key topics and risks
  • Implementation of an internal tax compliance system (internally and externally audited)
  • Complete documentation of tax-related issues
  • Whistleblowing system

The tax compliance management system for the Austrian subsidiaries successfully completed an adequacy audit in 2020 in accordance with the audit regulation for tax control systems and with IDW PS 980. This formed the basis for an effectiveness audit that was then carried out at the end of the year.

More information about taxes can be found in the Annual Report.

Planned for 2021

  • Confirmation of the new compensation system by the Annual General Meeting (including introduction of the SPI) in April
  • Related party transactions: reported to the Annual General Meeting as part of the Supervisory Board report
  • Further training on anti-corruption and money laundering
  • Roll-out of computer-based training (e.g., video-based courses, especially for data protection and privacy in Austria)
  • Compliance risk analysis for the Group
  • Sanctions list audit in SAP R/3


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