At the latest since the Wirecard scandal is well-known that Germany is internationally not a Paragon in matters of Corporate Governance, so clean corporate governance. Members of the Supervisory Board to stick to long to your well-endowed Items, and are often too lenient with controversial managers – these are only some of the points of criticism apply not only to the insolvent scandal group from Aschheim close to Munich, but without a doubt, also, Volkswagen, Bayer and Deutsche Bank.
Although almost 20 years have passed since the so-called Deutschland AG, so the close connection of some of the dissolved less control of your with the companies, dominate on the boards of many corporations are still a few prominent figures.
A recent study by the German Schutzgemeinschaft für wertpapierbesitz DSW now shows that in the 30 companies in the benchmark index, the Dax out of every five Supervisory Board or member of the Supervisory Board (a total of 95, of which 53 shareholders and 42 employee representatives) for three or even more terms of office on the Board is no longer sitting, what they are “meet for the most part, the criterion of Independence,” as the DSW writes. Special attention should be give to the Chairman of the Supervisory Board: This Position should not be also necessarily the “second career” after the exit from the profession, even here, a reasonable age limit and a limited term of office for the necessary “rejuvenation” should ensure that the shareholder protectors, which will examine the last 18 years, the composition of the bodies.
Outstanding long Dieter Schenk (24 years of sitting, according to the study in the health care group Fresenius Medical Care), and Stefan Quandt and Susanne Klatten (both 23 years at BMW) as a representative of the major shareholders in the respective panel. Or Paul Achleitner, the longtime chief inspector of the German Bank, has been a member since the age of 18 years also on the Supervisory Board of the chemicals group Bayer.
Particularly negative, the Supervisory Board of the payment service provider Wirecard was last, of course, noticed, its Board of Directors has forged under the eyes of the control panel is probably several times the balance sheets. The panel, handpicked by the company’s founder, Markus brown, resembled for a long time, rather a circle of friends, critical questions were unwelcome there. At the end of April 2020, a few weeks before the collapse of the group, had strengthened the Chairman of the Supervisory Board the Board of public the back.
Anglo-Saxon Fund management companies are calling for the professionalization of German Supervisory boards
It’s no wonder that international investors are reporting increasingly to word and from your point of view cemented structures in Germany, more and more direct. Several Anglo-Saxon Fund companies had recently demanded in an open letter to the professionalization of German Supervisory boards. At the top of their wish list: The German companies should shorten the term of office of the shareholders elected members of the Supervisory Board on a voluntary basis for three years. Anyone who wants to stay in office, must be put to the annual General meeting for re-election. By law, a tenure in Germany is five years limited, take advantage of local boards of Directors in the majority, while their colleagues in the UK and Ireland after a year choose to leave. But to change something? In Germany, leadership of the initiative was rejected promptly. Elections every three years would preclude an effective work, it said.
But the Federal government also wants to have learned from the Wirecard debacle, which is why the draft of the financial market integrity strengthening law (FISG), which supervision and control of the German company aims to improve, also to make proposals for the Supervisory Board contains. So to sit in the control panel, at least one expert in accounting, in addition to know a member particularly well with the theme of “auditing”. So far, only in about twenty percent of the thirty Dax companies two or more members are to be found according to studies, with such a “financial expertise” to. With Wirecard for example, there was a long time, not even the necessary specialized committees, in which the balance sheet or Compliance issues discussed should be.
According to Daniela Mattheus, member of the Supervisory Board and President of the professional Association of Financial Experts of Association, the meaning of the financial experts last even further into the Background. Companies laid more emphasis on whether candidates are experienced in digitalization or sustainability. “This is without a doubt important, but we should not forget what belongs to the core business of a Supervisory Board or a member of the Supervisory Board,” says the expert. “It is also to control the Numbers and to monitor, as well as whether or not a company is in breach of the rules, i.e. Compliance.” The draft is at this point sketchy, don’t call explicitly to competence in control systems, risk management or internal audit for the financial experts.
After all, The pay for the Jobs is still often handsomely: Deutsche Bank Chairman of the Supervisory Board Achleitner about the highest paid Dax chief inspector was in 2019 again. The Manager received 900 000 euros, nearly five percent more than in 2018, the study shows. Also, the highest total compensation paid again, Deutsche Bank: Good 6.1 million Euro were invested in the twenty councils, six percent more than in the previous year. The Bank had established two additional committees.