Supervisory Board procedures

The Supervisory Board of Fresenius SE consisted of twelve members who were elected at the AGM. The nominations for election to the Supervisory Board took account of the knowledge, ability, and expertise required to perform the tasks and the diversity of the Supervisory Board’s composition. Specifying fixed quotas and age limits for the composition of the Supervisory Board of Fresenius SE and taking them into account in the election proposals − as proposed by the Corporate Governance Code − would, on the other hand, have generally limited the selection of qualified candidates. A Nomination Committee had been created for proposals regarding the shareholder representatives. Its activities were aligned with the provisions of law and the Code. Of the twelve members of the Supervisory Board, six were proposed directly by the employees; the AGM was bound by these nominations. The term of office of the incumbent Supervisory Board members in the reporting period ended with the entry of the change of legal form in the Commercial Register. The Supervisory Board of Fresenius SE included what it deemed a sufficient number of independent members who had no business or personal relations with the Company or its Management Board that could have caused a conflict of interest. The statutes of Fresenius SE regulated the details with regard to the Supervisory Board’s election, constitution, and term of office, its meetings and resolutions, and its rights and duties. These statutes are published on our website at www.fresenius.com (to download, see Who we are − Corporate Governance).

The Supervisory Board of Fresenius SE had established its rules of procedure in accordance with clause 5.1.3 of the Code. The Chairman of the Supervisory Board was responsible for coordinating the activities of the Supervisory Board, chairing its meetings, and representing its interests externally. The Supervisory Board of Fresenius SE was supposed to convene once each calendar quarter, and had to convene twice each calendar half-year. The meetings were convened and chaired by the Chairman, or, if he was incapacitated, by a chairperson named by the Chairman. The person chairing the meeting decided the order for dealing with the items on the agenda and the form in which the voting was conducted. Unless other majorities were mandatory by law, the Supervisory Board passed its resolutions by a simple majority of the votes submitted in the voting. If a vote was tied, the Chairman cast the deciding vote or, if he did not take part in the voting, the matter was resolved by the vote of the Deputy Chairman, who was a shareholder representative.

The Supervisory Board conducted its business in accordance with the provisions of law, the Company’s statutes, and its rules of procedure. Regular dialogue with the Management Board ensured that the Supervisory Board was well informed at all times about the Company’s operating performance, corporate development, and planning and strategy. It approved all corporate planning and, taking into account the auditor’s reports, approved the Group’s annual financial statements. Another important part of the Supervisory Board’s activities was the work conducted within the committees formed in accordance with the requirements of the German Stock Corporation Act (AktG) and the recommendations of the Code.

The members of the Supervisory Board kept themselves regularly informed, through internal and external sources, about the latest requirements with regard to their supervisory activities. With the support of the Company, the Supervisory Board of Fresenius SE ensured at all times that its members were suitably qualified, kept their professional knowledge up to date, and further developed their judgment and expertise to the extent necessary for the proper performance of their duties, including those of its committees. Information was sourced from various external experts, and representatives from the Company’s specialist divisions kept the members informed about important developments, for instance about relevant new laws or changes in the U.S. GAAP and IFRS accounting and auditing standards.

The report of the Supervisory Board of the Annual Report informs about the main focuses of its activities and those of its committees in 2010.

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