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  • Declaration of Conformity of
    HORNBACH Holding AG & Co. KGaA

    PDF-Download PDF (104.53 kB)
      

    Declaration of Conformity with the German Corporate Governance Code pursuant to § 161 of the German Stock Corporation Act (AktG)

    The general partner (HORNBACH Management AG, acting via its Board of Management) and the Supervisory Board of HORNBACH Holding AG & Co. KGaA hereby declare pursuant to § 161 of the German Stock Corporation Act (AktG):

    I. Preliminary remarks

    The German Corporate Governance Code (the “Code”) is tailored to companies with the legal form of a stock corporation (“AG”) or a European Company (“SE”) and does not account for the special circumstances of partnerships limited by shares (“KGaA”). Many of the recommendations made in the Code can only be applied in modified form to HORNBACH Holding AG & Co. KGaA. The following factors in particular require consideration:

    1. Management

    Many of the Code recommendations refer to the Board of Management. Unlike an AG, however, the KGaA does not have a Board of Management. At a KGaA, the tasks incumbent on the Board of Management are performed by the general partner, in this case HORNBACH Management AG.

    2. Supervisory Board

    The Code recommendations concerning the Supervisory Board also do not account for the legal form of a KGaA, where the rights and obligations of the Supervisory Board differ from those at an AG. Specifically, the Supervisory Board of a KGaA does not have any personnel competence in respect of any Board of Management at the general partner and also cannot obligate the latter in terms of the company’s management by laying down transactions subject to approval requirements.

    3. Annual General Meeting

    The Annual General Meeting of a KGaA basically has the same rights as that at an AG; it additionally passes resolution on the adoption of the company’s annual financial statements. Unlike at an AG, some of the resolutions adopted by the Annual General Meeting require the approval of the general partner. These include the adoption of the company’s annual financial statements.

    II. Future-related section

    The company will basically comply in future with the recommendations of the Code in the version dated May 5, 2015 and published in the Federal Official Gazette on June 12, 2015 with the exception of the deviations listed below:

    No application will be made of the recommendations in Points 3.4 Sentence 3, 3.8 (3), 4.1.5, 4.2, 4.3, 5.1.2, 5.2 (2), 5.2 (3), 5.4.1 (2) and (3), and 5.4.6 (3) Sentence 1.

    These deviations from the recommendations are due to the following considerations:

    a) Point 3.4 Sentence 3:

    The KGaA does not have a Board of Management. By resolution dated October 9, 2015, the Supervisory Board laid down the general partner’s disclosure obligations in a Code of Procedure.

    b) Point 3.8 (3):

    In Point 3.8 (3), the Code recommends agreeing a specified deductible in any D&O insurance policy taken out for the Supervisory Board. No such deductible has been agreed at the expense of Supervisory Board members. This would reduce the attractiveness of Supervisory Board activities, and thus also the company’s chances in the competition to attract qualified candidates. The recommendation made in Point 3.8 (3) is therefore not followed.

    c) Point 4.2:

    In Point 4.2, the Code makes several recommendations concerning the composition and compensation of the Board of Management. The KGaA does not have a Board of Management. The Supervisory Board of HORNBACH Holding AG & Co. KGaA has no responsibility for appointing and dismissing the members of the Board of Management at HORNBACH Management AG or for specifying their contractual terms and conditions.

    d) Point 4.3:

    In Point 4.3, the Code makes several recommendations concerning the treatment of conflicts of interest on the part of members of the Board of Management. The KGaA does not have a Board of Management. Conflicts of interest on the part of members of the Board of Management of the general partner, transactions with persons and enterprises closely related to such and any sideline activities are dealt with by the general partner. Pursuant to § 8 (1) Sentence 2 of the Articles of Association, however, the Supervisory Board represents the company in its dealings with the general partner in respect of all transactions.

    e) Point 5.1.2:

    The KGaA does not have a Board of Management. The Supervisory Board of a KGaA does not have any personnel competence in respect of the Board of Management of the general partner.

    f) Point 5.2 (2):

    In Point 5.2 (2), the Code recommends that the supervisory board chairman should not simultaneously chair the audit committee. Given the expertise and industry experience of the Chairman and the fact that he also holds the same position in the Audit Committee of HORNBACH Baumarkt AG, the largest subgroup, we deviate from this recommendation.

    g) Point 5.2 (3):

    The KGaA does not have a Board of Management. Within the framework of the amended responsibilities of the Supervisory Board, the Supervisory Board will nevertheless maintain contact with the general partner, inform the Supervisory Board and also convene extraordinary meetings for this purpose where appropriate.

    h) Point 5.4.1 (2) and (3) and Point 4.1.5:

    According to Point 5.4.1 (2) and (3) of the Code, the supervisory board should specify concrete objectives regarding its composition that should be taken into account in the recommendations made by the supervisory board to the competent election bodies and published in the corporate governance report. Furthermore, according to the new version of the Code dated May 5, 2015, the supervisory board should specify a regular limit for the length of membership of the supervisory board. Overall, the company deviates from the recommendations made in Point 5.4.1 (2) and (3). In terms of the composition of its Supervisory Board, HORNBACH Holding AG & Co. KGaA accords priority above all to the knowledge, ability and expert experience of the individual in question. The same criteria apply when the general partner selects candidates for management positions at the company (consistent with Point 4.1.5 of the Code).

    i) Point 5.4.6 (3) Sentence 1:

    In Point 5.4.6 (3) Sentence 1, the Code recommends that the compensation of supervisory board members be reported in the notes to the financial statements or the management report on an individual basis and broken down into its constituent components. Given that the amount of compensation paid to the Supervisory Board is governed by the Articles of Association, we see no need to disclose individual compensation packages. In response to suggestions received from shareholders, however, account will be taken of this recommendation starting with the reporting on the 2016/2017 financial year. The 2016/2017 Annual Report is scheduled for publication on May 30, 2017.

    III. Past-related section

    The recommendations of the Code in the version dated May 5, 2015 and published in the Federal Official Gazette on June 12, 2015 were basically complied with the exception of the deviations already listed and substantiated for the future in Section II.

    Neustadt an der Weinstrasse, December 2016

    HORNBACH Holding AG & Co. KGaA

    The Supervisory Board of HORNBACH Holding AG & Co. KGaA

    The Board of Management of HORNBACH Management AG

    --

    Archive Statements of Compliance

    2015 PDF (174.02 kB)
    2014 PDF (33.02 kB)
    2013 PDF (26.26 kB)
    2012 (2) PDF (24.31 kB)
    2012 (1) PDF (101.17 kB)
    2011 PDF (24.63 kB)
    2010 PDF (25.60 kB)
    2009 (2) PDF (23.78 kB)
    2009 (1) PDF (21.92 kB)
    2008 PDF (107.50 kB)
    2007 PDF (25.56 kB)
    2006 PDF (22.90 kB)
    2005 PDF (46.27 kB)
    2004 PDF (22.52 kB)
    2003 PDF (23.67 kB)
    2002 PDF (11.38 kB)
  • Declaration of Conformity of
    HORNBACH Baumarkt AG

    PDF-Download PDF (103.55 kB)
      

    Declaration of Conformity with the German Corporate Governance Code pursuant to § 161 of the German Stock Corporation Act (AktG)

    The Board of Management and Supervisory Board of HORNBACH Baumarkt AG hereby declare pursuant to § 161 of the German Stock Corporation Act (AktG):

    I. Future-related section

    The recommendations of the “German Corporate Governance Code” in the version dated May 5, 2015 and published in the Federal Official Gazette on June 12, 2015 will basically be complied with in future. No application will be made of the recommendations in Points 3.8 (3), 4.1.5, 4.2.3 (4) and (5), 4.2.5 (3), 4.3.3 Sentence 4, 5.3.3, 5.4.1 (2) and (3), 5.4.2 Sentence 3, and 5.4.6 (3) Sentence 1.

    These deviations from the recommendations are due to the following considerations:

    a) Point 3.8 (3):

    In Point 3.8 (3), the Code recommends agreeing a specified deductible in any D&O insurance policy taken out for supervisory board members. No such deductible has been agreed at the expense of Supervisory Board members. This would reduce the attractiveness of Supervisory Board activities, and thus also the company’s chances in the competition to attract qualified candidates. Furthermore, it would also improperly apply to employee representatives. The recommendation made in Point 3.8 (3) is therefore not followed.

    b) Point 4.2.3 (4) and (5):

    Furthermore, no application is made of the recommendations in Point 4.2.3 (4) (“severance payment cap”) and (5) (“change of control compensation cap”) of the Code. The deviation to Point 4.2.3 (4) and (5) is due to competition-related factors. Apart from that, it still has not been definitively clarified whether and how the recommendations in Point 4.2.3 (4) are legally enforceable.

    c) Point 4.2.5 (3):

    The compensation paid to the Board of Management is not presented separately for each member. The Annual General Meeting held on July 7, 2016 resolved to uphold the more guarded approach towards reporting management board compensation. For the same reason, no use is made of the “model tables” included in the “German Corporate Governance Code”.

    d) Point 4.3.3 Sentence 4:

    According to Point 4.3.3 Sentence 4, important transactions with persons or enterprises closely associated with a member of the management board may only be carried out with the consent of the supervisory board. For this recommendation, which requires interpretation, the company can refer neither to established practice at German stock corporations nor to initial case law. As a matter of precaution, it has therefore declared a deviation. Due to application of the accounting standard IAS 24, however, the company has already ensured transparency concerning such transactions for many years now.

    e) Point 5.3.3:

    In Point 5.3.3, the Code recommends that the supervisory board should form a nomination committee composed exclusively of shareholder representatives which proposes suitable candidates to the supervisory board for its election proposals to the Annual General Meeting. The company’s Supervisory Board has not formed such a committee. Based on our experience to date, the establishment of such a committee would not appear to be necessary.

    f) Point 5.4.1 (2) and (3) and Point 4.1.5:

    According to Point 5.4.1 (2) and (3) of the Code, the supervisory board should specify concrete objectives regarding its composition that should be taken into account in the recommendations made by the supervisory board to the competent election bodies and published in the corporate governance report. Furthermore, the supervisory board should specify a regular limit for the length of membership of the supervisory board. Overall, the company deviates from the recommendations made in Point 5.4.1 (2) and (3). In the interests of the company, in terms of the composition of its Board of Management and Supervisory Board, as well as of other management positions, HORNBACH Baumarkt AG accords priority above all to the knowledge, ability and expert experience of the individual in question. The same criteria apply when the Board of Management selects candidates for management positions at the company (Point 4.1.5 of the Code).

    g) Point 5.4.2 Sentence 3:

    In Point 5.4.2 Sentence 3, the Code recommends that the supervisory board should not include more than two former management board members. This is intended to ensure the autonomy of the supervisory board in its advising and monitoring of the management board. However, the Code does not stipulate any number of years for which a former member of the management board is impaired in this respect following his departure from the management board. As a matter of precaution, the company therefore declares that it deviates from the recommendation made in Point 5.4.2 Sentence 3, even though Dr. Wolfgang Rupf, Albrecht Hornbach and Martin Hornbach retired from their positions on the Board of Management of HORNBACH Baumarkt AG on October 31, 1996, October 31, 2001 and December 31, 2001 respectively.

    h) Point 5.4.6 (3) Sentence 1:

    In Point 5.4.6 (3) Sentence 1, the Code recommends that the compensation of supervisory board members be reported in the notes to the financial statements or the management report on an individual basis and broken down into its constituent components. Given that the amount of compensation paid to the Supervisory Board is governed by the Articles of Association, we see no need to disclose individual compensation packages.

    II. Past-related section

    The recommendations of the “German Corporate Governance Code” in the version dated May 5, 2015 and published in the Federal Official Gazette on June 12, 2015 were complied with apart from the deviations already listed and substantiated for the future in Section I.

    Bornheim bei Landau, December 2016

    HORNBACH Baumarkt AG

    Supervisory Board

    Board of Management

    --

    Archive Statements of Compliance

    2015 PDF (107.19 kB)
    2014 PDF (42.78 kB)
    2013 PDF (33.06 kB)
    2012 (2) PDF (30.44 kB)
    2012 (1) PDF (112.83 kB)
    2011 PDF (32.25 kB)
    2010 PDF (33.79 kB)
    2009 (2) PDF (31.24 kB)
    2009 (1) PDF (28.38 kB)
    2008 PDF (187.04 kB)
    2007 PDF (31.73 kB)
    2006 PDF (95.41 kB)
    2005 PDF (97.32 kB)
    2004 PDF (26.02 kB)
    2003 PDF (31.28 kB)
    2002 PDF (12.55 kB)

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