Report of the Supervisory Board

FRANZ M. HANIEL
Chairman of the Supervisory Board


Profile: Franz M. Haniel became Chairman of the Supervisory Board of METRO AG in November 2011. He had previously held the same position from November 2007 to May 2010. Mr Haniel, who was born in Oberhausen in 1955, holds a degree in mechanical engineering and an MBA from the international graduate school INSEAD. He initially worked as a consultant for Booz Allen Hamilton. In 1986, he joined the investment companies of the Quandt family. In 2000, he became managing director of Giesecke & Devrient, a manufacturer of bank notes, security and identification documents. Since 2003, he has been the Chairman of the Supervisory Board of Franz Haniel & Cie. GmbH.

For more information about the other members of the Supervisory Board, see the website www.metrogroup.de in the section Company – Supervisory Board of www.metrogroup.de.

METRO GROUP achieved its targets in financial year 2014/15. Like-for-like sales increased by 1.5 per cent compared with the previous year. Despite a persistently challenging geopolitical and economic environment, the group’s core business developed more positively again and the group’s balance sheet was strengthened further. EBIT before special items, adjusted for currency effects, showed an increase of 4.7 per cent compared with the previous year and thus fully corresponds to communicated expectations. The successful disposal of Galeria Kaufhof provided the group with financial resources for complementary and strengthening acquisitions, as well as for continuing debt reduction. The group significantly expanded its business in the strategic growth areas of online retail and delivery and, in doing so, reinforced its market position and customer relevance in many countries.

The group’s achievements are the result of the strategy which the Management Board has consistently implemented and which we – the Supervisory Board of METRO AG – actively support. In particular, we intensively monitored the portfolio changes during the reporting period and approved the Management Board’s proposals on this issue.

We would like to express our thanks to the members of the Management Board and to the employees of the group for their entrepreneurial determination and their outstanding commitment. Their can-do spirit is what drives METRO GROUP.

Consultation and supervision of executives

The Supervisory Board continued to carry out the duties set forth by law and by the company’s Articles of Association during financial year 2014/15. We extensively advised the Management Board on the operations of METRO AG and the group and continuously supervised the company’s executives. In line with its reporting obligations, the Management Board provided us with regular, timely and comprehensive written and oral reports about all developments of material importance for METRO GROUP. The reports covered, in particular, fundamental questions about company planning, the company’s profitability, current business developments and operations of material importance. The Supervisory Board thoroughly discussed and reviewed all reports and documents that were submitted to it. No objections about the legality, advisability and regularity of the Management Board’s activities were raised. We approved individual business matters insofar as this was required by law, on the basis of the Articles of Association or by proprietary determinations. We made no use of the rights of inspection and audit granted under § 111 Section 2 Sentence 1 and 2 of the German Stock Corporation Act (AktG) since no matters requiring clarification arose.

During financial year 2014/15, the Supervisory Board held eleven meetings, five of which were unscheduled. Three decisions were taken outside a Board meeting. In my function as Chairman of the Supervisory Board, I remained in constant contact with the Chairman of the Management Board and discussed important business transactions and upcoming decisions with him during regular face-to-face meetings.

The German Corporate Governance Code recommends that a statement be included in this report in the event that a member of the Supervisory Board only attended half, or fewer than half, of all Supervisory Board meetings or meetings of the committees of which he is a member in any given financial year. Mr Jürgen B. Steinemann only joined the Supervisory Board of METRO AG in September 2015 by court-approved appointment. For this reason, it was impossible for him to attend more than one meeting as a member of the Supervisory Board during the reporting period. In addition, because the date of one of the meetings was set at short notice, Mr Jürgen Fitschen was only able to attend one of two meetings of the Nomination Committee.

In financial year 2014/15, three members of the Supervisory Board notified the Board about possible or existing conflicts of interest. As an employee of METRO AG, Mr Andreas Herwarth can be indirectly affected by individual remuneration decisions taken by the Supervisory Board which the Management Board implements for its employees. For this reason and to avoid a conflict of interest, Mr Herwarth abstained from casting a vote when the Supervisory Board voted on the one-year performance-based management compensation (hereinafter: short-term incentive) for financial year 2013/14. Messrs Theo de Raad and Peter Küpfer notified the Supervisory Board that they have business relationships with a shareholder of the RTS group of companies which was acquired by METRO GROUP in financial year 2014/15. The acquisition required the approval of the Supervisory Board. Mr de Raad and Mr Küpfer decided not to take part in the Board’s discussions about the acquisition.

Furthermore, Mr de Raad abstained from casting a vote when the Supervisory Board voted on the issue; Mr Küpfer did not attend the vote.

Key issues covered by Supervisory Board meetings and resolutions during the year

November 2014 – In the first meeting of financial year 2014/15, we discussed the short-term incentive for financial year 2013/14 and passed resolutions to set the amount. These also included determining the personal performance factors for each member of the Management Board at the discretion of the Supervisory Board. Using the performance factors, the Supervisory Board can reduce or increase the payout amount of the short-term incentive calculated on the basis of financial performance targets for each member of the Management Board individually by up to 30 per cent. Further topics of the Supervisory Board meeting were antitrust law proceedings, the appointment of an independent consultant to examine and further develop the Management Board remuneration system as well as succession planning for the Supervisory Board. In addition, the Supervisory Board received information about the disposal of the METRO Cash & Carry business in Greece, which was planned at that time. It also addressed this transaction in a written procedure as well as in another Board meeting conducted as a telephone conference. The Supervisory Board delegated final decision-making responsibility to the Supervisory Board Presidential Committee.

December 2014 – As usual, our audit meeting held on 10 December 2014 focused on the annual and consolidated financial statements for financial year 2013/14, the combined management reports for METRO AG and for the group for 2013/14, the Management Board’s proposal for the appropriation of the balance sheet profit to the Annual General Meeting 2015 as well as the Management Board’s report on relations with affiliated companies in 2013/14. The auditor attended this meeting and reported on the key findings of his audits. Another focal point of the meeting was a resolution regarding a change to the system of Management Board remuneration. In this context, a new declaration of compliance also had to be issued with regard to the recommendations of the Government Commission on the German Corporate Governance Code pursuant to § 161 of the German Stock Corporation Act (AktG). The adjusted remuneration system was presented to the Annual General Meeting in February 2015. The meeting then approved it by an overwhelming majority (99.60 per cent). Other key issues addressed by the Supervisory Board in December 2014 were the report of the Supervisory Board and the corporate governance report for financial year 2013/14, preparations for the Annual General Meeting 2015, recent business developments, the work of the METRO GROUP Sustainability Board and legal issues. We approved a real estate project and received information about political and economic developments in Russia. Subject to the election of the auditors by the Annual General Meeting 2015, we also adopted the audit assignments for the annual and consolidated financial statements, the combined management report and the dependency report for the financial year ending on 30 September 2015. Also subject to the election of the auditors, we approved the request for the review of the abbreviated consolidated financial statements as of 31 March 2015 and the consolidated management report covering the period from 1 October 2014 to 31 March 2015.

January 2015 – Outside a meeting, the Supervisory Board passed resolutions for the preparation of the election of the Supervisory Board by the Annual General Meeting 2016.

February 2015 – In a meeting held immediately before the Annual General Meeting on 20 February 2015, the Management Board reported about the latest business developments, the status of an international project as well as the audit carried out on OTC derivative contracts pursuant to § 20 of the German Securities Trading Act (WpHG). As a precaution, the Supervisory Board passed a resolution on the hiring of a law firm, especially in preparation for the eventuality of legal challenges or complaints for nullity against resolutions passed during the Annual General Meeting 2015.

May 2015 – The focal point of an initial meeting in May 2015 comprised discussions about a new management model (New Operating Model) for METRO Cash & Carry which is supposed to foster an entrepreneurial spirit within the company. To this end, the national subsidiaries are granted greater operating responsibility and creative freedom. Under this model, measures geared towards specific customer groups (for example, for the group of hotels, restaurants and catering firms or traders) are cross-nationally coordinated. Personnel issues relating to the Management Board were another focal topic. We approved the reappointment of Mr Pieter Haas and the new appointment of Mr Pieter C. Boone to the Management Board of METRO AG as well as the signing of their employment contracts. In addition, we confirmed the delegation of Mr Haas to the Management Board of Media-Saturn-Holding GmbH and temporarily relieved him of all responsibilities extending beyond Media-Saturn on the Management Board of METRO AG. In view of the extension of the Management Board we also modified the assignment of responsibilities on the Management Board. Additionally, the Management Board reported about the latest business developments, changes in the shareholder structure and current projects at this meeting. In addition, we discussed issues concerning antitrust law.

With the participation of executives from the METRO GROUP sales lines, the Management Board and the Supervisory Board discussed group strategy in a second meeting in May 2015. Specifically, we dealt with the strategic objectives, the current status and the other challenges facing METRO Cash & Carry, Media-Saturn, Real and Galeria Kaufhof. Furthermore, we also addressed macroeconomic conditions, our human resource strategy as well as the implications of our group strategy for budget planning in subsequent financial years. Finally, the Supervisory Board passed the resolution regarding a personnel issue on the Management Board.

June 2015 – During the reporting year, two unscheduled meetings were held in June. In the first meeting, the Management Board gave a detailed report about the increasing likelihood of a disposal of Galeria Kaufhof. We addressed at length the offers that had been tabled but not yet finalised at the time and the possible effects of a disposal. We examined the likelihood that the respective transactions could be completed and discussed the potential buyers’ future concepts for the continuation of the department store. Together with the Management Board, we discussed in detail the requirements which METRO AG should stipulate for a sufficiently attractive disposal offer. Subsequently, in a telephone conference in June, we evaluated the extent to which the status of the negotiations had advanced. Finally, the potential buyers’ offers were examined in detail with regard to their risks and opportunities, including whether the potential buyers could prove they had definite financing for their offer. As a result, we decided to approve the recommendation of the Management Board to sell Galeria Kaufhof to Hudson’s Bay Company. The transaction was in line with METRO AG’s strategic and financial priorities and enables METRO GROUP to focus its financial and management resources on its core business operations. The Supervisory Board rated the offer made by Hudson’s Bay Company as sufficiently attractive. In addition, the buyer presented a convincing strategy for the continued development of Galeria Kaufhof.

July 2015 – In a telephone conference, we addressed the disposal of METRO Cash & Carry’s operations in Vietnam, which had already been approved in 2014, and approved the signing of a contract to accelerate the completion of the transaction. Also in July, we approved the disposal of a real estate portfolio outside a meeting.

August 2015 – Two acquisitions were the focal points of our meeting in August. First, we approved the acquisition of the RTS group of companies, which will enable Media-Saturn to expand its range of services. In addition, we approved the takeover of a leading Asian premium food service distributor (Classic Fine Foods group). This second acquisition strengthens METRO GROUP’s wholesale business with specialised competencies and expertise in the strategically important delivery business. Other issues addressed in the Supervisory Board meeting were business developments, the status of current projects as well as information about the company’s directors and officers (D&O) liability insurance. The Supervisory Board approved a revised version of the company car guideline it has imposed for members of the Management Board and discussed various corporate governance issues. These included new and impending regulatory requirements with regard to the work of the Supervisory Board, succession planning for the Supervisory Board and the implementation of new recommendations of the German Corporate Governance Code. In this context, a provision in the Management Board’s rules of procedure was also amended.

September 2015 – In the last meeting of financial year 2014/15, we approved the budget plan submitted by the Management Board. Other resolutions dealt with success performance targets for the short-term incentives for financial year 2015/16 for members of the Management Board, the implementation of recommendations of the German Corporate Governance Code, the declaration of compliance in accordance with § 161 of the German Stock Corporation Act (AktG) as well as the objectives of the Supervisory Board with regard to appointments to the Management Board in accordance with the new legal regulations regarding the equal participation of women and men in management positions. The shareholders’ and employees’ representatives respectively agreed on the aim to each separately fulfil the gender quota of 30 per cent for the Supervisory Board of METRO AG, which will be applicable by law starting in 2016. In addition, the Supervisory Board discussed the governance functions within the group (internal control system, risk management system, internal auditing and compliance) in detail. We elected Mr Jürgen Fitschen, member of the Supervisory Board since 2008, as a member of the Presidential Committee and of the Personnel Committee of the Supervisory Board. The Management Board reported about current business developments, the status of the completion of the sale of Galeria Kaufhof as well as the METRO GROUP initiatives in the area of sustainability. Other issues addressed the preparation of the Annual General Meeting 2016. In my function as Chairman of the Supervisory Board, I instigated a discussion, among other things, about the question of whether the Annual General Meeting 2016 should propose an increase in the remuneration of the Supervisory Board.

Work of the committees

Five committees support the Supervisory Board in its work, greatly contributing to the Board’s overall efficiency: the Presidential Committee, the Personnel Committee, the Accounting and Audit Committee, the Nomination Committee and the Mediation Committee pursuant to § 27 Section 3 of the German Co-determination Act (MitbestG). The committees prepare resolutions and discussions of the Supervisory Board. In addition, decision-making responsibilities have been transferred to individual committees within legally allowed parameters. The work of the committees is described in detail in the annual statement on corporate management pursuant to § 289 a of the German Commercial Code (HGB). It can be found in the section Company – Corporate Governance of the website www.metrogroup.de. I, as Chairman of the Supervisory Board, chair all committees with the exception of the Accounting and Audit Committee. The contents and results of committee meetings are reported to the Supervisory Board in a timely manner. The committees of the Supervisory Board currently take the following forms:

  • Presidential Committee:
    Franz M. Haniel (Chairman), Werner Klockhaus (Vice Chairman), Jürgen Fitschen, Xaver Schiller
  • Personnel Committee:
    Franz M. Haniel (Chairman), Werner Klockhaus (Vice Chairman), Jürgen Fitschen, Xaver Schiller
  • Accounting and Audit Committee:
    Dr jur. Hans-Jürgen Schinzler (Chairman), Werner Klockhaus (Vice Chairman), Dr Florian Funck, Andreas Herwarth, Rainer Kuschewski, Dr Fredy Raas
  • Nomination Committee:
    Franz M. Haniel (Chairman), Jürgen Fitschen, Dr jur. Hans-Jürgen Schinzler
  • Mediation Committee pursuant to § 27 Section 3 of the German Co-determination Act (MitbestG):
    Franz M. Haniel (Chairman), Werner Klockhaus (Vice Chairman), Dr jur. Hans-Jürgen Schinzler (Chairman), Xaver Schiller

Last updated: 9 December 2015

Accounting and Audit Committee – The Accounting and Audit Committee primarily handles accounting and auditing issues as well as the monitoring of governance functions (internal control system, risk management, internal auditing and compliance). Five meetings were held in financial year 2014/15. The Chairman of the Management Board and the Chief Financial Officer attended all meetings. The Chief Human Resources Officer, representatives of the auditor and the managers of the relevant departments of METRO AG attended certain meetings to address particular agenda items.

The Accounting and Audit Committee prepared the Supervisory Board’s balance sheet meeting in December 2014 and reviewed the annual and consolidated financial statements for financial year 2013/14, the combined management report of METRO AG and the group for 2013/14 as well as the report of the Management Board on relations with affiliated companies. The committee discussed the results of the audit in the presence of the auditor. On this basis, the Accounting and Audit Committee made concrete recommendations to the Supervisory Board after holding detailed discussions. These included, in particular, the recommendation to approve the annual and consolidated financial statements for financial year 2013/14 and the Management Board’s proposal to the Annual General Meeting 2015 on the appropriation of the balance sheet profit.

Another focal point of the committee work was the selection of the auditor for financial year 2014/15 by the Annual General Meeting and the preparation of the mandate related to the Supervisory Board’s implementation of this decision.

The members of the Accounting and Audit Committee discussed the quarterly financial reports and the half-year financial report for financial year 2014/15 prior to their respective release. Other issues addressed by the committee were the audit plans of the selected auditor, governance functions within the group (internal control system, risk management, internal auditing and compliance) and the Management Board’s budget plan. On the basis of the budget plan, the Accounting and Audit Committee supported the Personnel Committee of the Supervisory Board in developing a proposal for the stipulation of performance targets based on key indicators for variable Management Board remuneration in 2015/16. In addition, the Accounting and Audit Committee gathered information on developments in international accounting standards, an audit carried out on OTC derivative contracts pursuant to § 20 of the German Securities Trading Act (WpHG) as well as the progress of a sampling audit conducted by the German Financial Reporting Enforcement Panel, which resulted in no errors being determined. Furthermore, the Accounting and Audit Committee addressed how the capital market views METRO AG, group tax planning, the charging of intra-group transactions as well as the distribution of donations, and received reports on key projects and legal issues. Legal topics included, for example, the implementation of the EU audit reform in Germany as well as the management and status of antitrust proceedings within METRO GROUP.

Personnel Committee – The Personnel Committee primarily deals with personnel issues concerning the Management Board. Nine meetings were held in financial year 2014/15. Four of these were unscheduled; three meetings took place together with the Supervisory Board’s Presidential Committee. During the reporting period, the Personnel Committee focused intensely on the preparation of proposals for changes to the Management Board remuneration system. The other personnel-related discussions and decisions of the Supervisory Board which the committee prepared included specifically the resolutions regarding the amount of the short-term incentives for financial year 2013/14, taking individual performance into account, the appointment of Messrs Pieter Haas and Pieter C. Boone as members of the Management Board as well as resolutions about their employment contracts. In addition, the committee issued a recommendation for the performance targets for the short-term incentive for financial year 2015/16 and discussed succession planning for the Management and Supervisory Boards as well as the objectives on which this is based in each case. As required, the committee also conducted its regular review of expenditures on the basis of the travel cost guidelines that apply to members of the Management Board and discussed the ancillary activities of the members of the Management Board. The committee formulated guidelines for the approval of ancillary activities outside the private sphere and also approved authorisations in individual cases.

Presidential Committee – The Presidential Committee deals with the monitoring of compliance with legal regulations and the application of the German Corporate Governance Code. In consideration of § 107 Section 3 Sentence 3 of the German Stock Corporation Act (AktG), the Presidential Committee takes decisions about urgent matters and matters submitted to it by the Supervisory Board. The Presidential Committee met three times during financial year 2014/15, each time with the Personnel Committee. One resolution was prepared outside a meeting. Key issues addressed by the Presidential Committee included corporate governance at METRO GROUP, including the corporate governance report for financial year 2013/14, the implementation of the recommendations of the German Corporate Governance Code, the preparation of the latest declaration of compliance in accordance with § 161 of the German Stock Corporation Act (AktG) and the objectives for the composition of the Supervisory Board and the Management Board. Following delegation of final decision-making responsibility by the Supervisory Board, the Presidential Committee approved the disposal of the METRO Cash & Carry business in Greece, including the associated real estate portfolio, outside a meeting.

Nomination Committee – The Nomination Committee is responsible for proposing suitable candidates for the Supervisory Board’s election proposals to the Annual General Meeting. Two committee meetings were held in financial year 2014/15. In addition, one resolution was made outside a meeting. With these decisions, the committee prepared the way for the election by the Annual General Meeting 2015 of Ms Gwyn Burr as a member of the Supervisory Board. In addition, the committee recommended the nomination of Ms Karin Brigitte Dohm and Mr Jürgen B. Steinemann to the Supervisory Board for the election of the Supervisory Board by the Annual General Meeting on 19 February 2016. Following the recommendations of the committee and in advance of the respective Annual General Meeting, the Management Board of METRO AG applied for the temporary court-approved appointment of Ms Gwyn Burr and Mr Jürgen B. Steinemann as members of the Supervisory Board.

Mediation Committee – The Mediation Committee formulates proposals for the appointment and dismissal of members of the Management Board in cases pursuant to § 31 of the German Co-determination Act (MitbestG). The Mediation Committee did not have to meet during financial year 2014/15.

Corporate governance

The Management Board and the Supervisory Board report on METRO GROUP’s corporate governance in the corporate governance report for financial year 2014/15. Together with the statement on corporate management pursuant to § 289 a of the German Commercial Code (HGB), the report is also published in the section Company – Corporate Governance of the website www.metrogroup.de.

During the reporting period, the Management Board and the Supervisory Board of METRO AG issued two declarations of compliance with regard to the recommendations of the Government Commission on the German Corporate Governance Code pursuant to § 161 of the German Stock Corporation Act (AktG), most recently in September 2015. The declarations were made permanently available to shareholders on the website www.metrogroup.de.

Annual and consolidated financial statements, report on relations with affiliated companies

The annual financial statements of METRO AG for financial year 2014/15, in consideration of accounting, that were submitted by the Management Board pursuant to the regulations laid down in the German Commercial Code (HGB), the consolidated financial statements compiled by METRO AG according to International Financial Reporting Standards (IFRS) – as they are to be applied in the European Union – and the group’s combined management report for financial year 2014/15 were reviewed by KPMG AG Wirtschaftsprüfungsgesellschaft and were given unqualified approval. The auditor provided a written report on the findings.

We, the Supervisory Board, reviewed the annual financial statements of METRO AG and the consolidated financial statements for financial year 2014/15, the combined management report of METRO AG and the group for financial year 2014/15 as well as the Management Board’s proposal to the Annual General Meeting 2016 on the appropriation of the balance sheet profit. For this purpose, these documents and the reports of the auditor were provided to us in a timely manner, and were discussed and reviewed in detail during the Supervisory Board’s annual accounts meeting held on 9 December 2015. The auditor attended this meeting, reported the key findings of the review and was at the Supervisory Board’s disposal to answer questions and provide additional information – even in the absence of the Management Board. The auditor did not report any material weaknesses of the internal control and risk management system with regard to the accounting process. The auditor also provided information on services rendered in addition to auditing services. According to the information provided, no disqualification or bias issues arose. We concurred with the findings of the auditor’s review. In a concluding finding of our own review, we determined that no objections were necessary. We support, in particular, the conclusions reached by the Management Board in the combined management report of METRO AG and the group’s management report and have endorsed the annual financial statements compiled by the Management Board. As a result, the annual financial statements of METRO AG have been adopted. Following careful consideration of the interests involved, we endorsed the Management Board’s proposal for the appropriation of the balance sheet profit.

Pursuant to § 312 of the German Stock Corporation Act (AktG), the Management Board of METRO AG prepared a report on relations with affiliated companies for financial year 2014/15 (in short, “dependency report”). The auditor reviewed this report, provided a written statement about the findings of the review and issued the following opinion:

“After our due audit and assessment, we confirm that

  1. the factual information in the report is correct,
  2. in the legal transactions listed in the report, the company’s expenses were not inappropriately high,
  3. no circumstances related to the measures listed in the report required an assessment deviating materially from that of the Management Board.”

The dependency report was submitted to us together with the audit report in a timely manner and was discussed and reviewed particularly in terms of thoroughness and accuracy during the annual accounts meeting that the Supervisory Board held on 9 December 2015. The auditor attended this meeting, reported the key findings of the review, and was at our disposal to answer questions and to provide information – even in the absence of the Management Board. We concurred with the findings of the auditor’s review. In a concluding finding of our own review, we determined that no objections have to be made with respect to the statement of the Management Board at the conclusion of the dependency report.

The aforementioned reviews by the Supervisory Board accounts were carefully prepared by the Accounting and Audit Committee on 7 December 2015. The auditor also attended this committee meeting, reported on the key findings of his review and was available to answer questions. The Accounting and Audit Committee urged the Supervisory Board to approve the financial statements prepared by the Management Board and to endorse the Management Board’s recommendation for appropriation of the balance sheet profit.

Appointments and resignations

Upon the order of the District Court in Düsseldorf, Ms Gwyn Burr replaced Baroness Lucy Neville-Rolfe on the Supervisory Board on 9 December 2014. As requested, her court-approved appointment ended with the conclusion of the Annual General Meeting of METRO AG on 20 February 2015. On the same day, the Annual General Meeting elected Ms Burr to the Supervisory Board as a shareholder representative.

Dr Wulf H. Bernotat resigned from the Supervisory Board as of 4 September 2015. The Supervisory Board thanks him for his commitment over many years. During his time in office, he supported and shaped significant changes at METRO GROUP. He was always a trusted advisor to the Management Board. The Management Board and the Supervisory Board of METRO AG greatly benefited from his outstanding management expertise.

Upon the order of the District Court in Düsseldorf dated 5 September 2015, he was replaced on the Supervisory Board by Mr Jürgen B. Steinemann. His court-approved appointment will end with the conclusion of the Annual General Meeting of METRO AG on 19 February 2016. The Annual General Meeting will take a decision on Mr Steinemann’s continued service on the Supervisory Board of METRO AG.

Following the disposal of Galeria Kaufhof, the appointments of Ms Gabriele Schendel and Mr Uwe Hoepfel as employee representatives on the Supervisory Board ended on 30 September 2015. In coordination with the Group Works Council, the Management Board has requested the court-approved appointment of two successors.

I myself have resigned from the Supervisory Board, effective as of the conclusion of the next Annual General Meeting. The reason for this is the dissolution of the pooling agreement among the shareholder groups Haniel and Schmidt-Ruthenbeck in October 2014 and the reduction of the shareholding of major shareholder Haniel. Under this agreement, both shareholder groups had originally pooled their voting rights. However, they dissolved this agreement again to simplify and decartelise the shareholder structure. Following the reduction in the shareholding and the dissolution of the pooling agreement, I would like to personally broach the possibility that the chairmanship of the Supervisory Board passes into the hands of an independent, external shareholder representative. Mr Jürgen B. Steinemann has been proposed as the new Chairman of the Supervisory Board; his nomination has been endorsed by all members of the Supervisory Board. The election of the new Chairman by the Supervisory Board is set to take place directly after the Annual General Meeting on 19 February 2016.

Düsseldorf, 9 December 2015

The Supervisory Board

Signature Franz M. Haniel – Chairman Supervisory Board (handwriting)

FRANZ M. HANIEL
Chairman