Excerpts from Deutsche Post AG's 2013 Group Annual Report.
Wulf von Schimmelmann
In the 2013 financial year, Deutsche Post DHL performed well in what continued to be a challenging economic environment in its capacity as provider, investment and employer of choice in its market.
Advising and overseeing the Board of Management
In 2013, the Supervisory Board scrutinised Group and divisional strategy and results in light of the global economic situation at five Supervisory Board meetings and one closed meeting. To this end, the Board of Management provided the Supervisory Board with detailed up-to-date information on the situation and performance of the Group, strategic initiatives and key business transactions, the development of acquisitions, compliance management, as well as risk exposure and risk management, and issues related to planning and implementation. Between meetings, the Chairman of the Supervisory Board was also kept abreast of ongoing developments.
Measures requiring the consent of the Supervisory Board were discussed in even greater depth, and in advance by the relevant committees. The results of the deliberations were presented by the respective committee chairs in the plenary meetings.
Five meetings during the reporting year
Three Supervisory Board meetings took place during the first half of the year and two in the second. All members participated in at least 50% of the meetings. The overall participation rate exceeded 90%.
At the financial statements meeting on 4 March 2013, with the auditors in attendance, the annual and consolidated financial statements and the management reports for 2012 were discussed in detail and approved. After a thorough review, we endorsed the Board of Management’s proposal for the appropriation of the unappropriated surplus for the 2012 financial year. At this meeting, the Board of Management’s achievement of its targets for the 2012 financial year was also assessed and the Supervisory Board’s proposed resolutions for the Annual General Meeting (AGM) were adopted. In addition, we discussed the outcome of the review on the efficiency of the Supervisory Board’s work. The Supervisory Board also looked in detail at EXPRESS aviation strategy at this meeting.
As a number of members of the Supervisory Board had previously been re-elected, an extraordinary meeting of the Supervisory Board was held immediately after the Deutsche Post AG AGM on 29 May 2013, where the members of the Supervisory Board re-elected Andrea Kocsis as deputy chair and me as chairman of the Supervisory Board. The meeting also confirmed the positions of all committee members. Details of the current members of the Supervisory Board committees are shown below.
At the meeting of the Supervisory Board on 27 June 2013, we discussed measures aimed at optimising Deutsche Post AG’s investment portfolio. Matters relating to the Board of Management were also dealt with at this meeting, in particular the remuneration of its members and the extension of Roger Crook’s appointment to the Board and of his contract for a further five years. We also considered the New Forwarding Environment (NFE) strategic project within the Global Forwarding business unit in great detail. Under the new IT-based operating model, Global Forwarding will become a single, internationally homogeneous organisation, with a clear customer focus, efficient processes and high standards of quality.
On 24 September 2013, Directors’ Day, selected speakers were invited to provide basic and further training to the members of the Supervisory Board. At the meeting of the Supervisory Board that followed, changes in the regulatory environment were the main focus of discussions. The Supervisory Board also discussed the Group’s external image in the market, with the help of external guest speakers, specialising in the fields of customers, investors, media and the labour market. On 25 September 2013, the current status of Strategy 2015 implementation within the Group and the divisions was the main point on the agenda.
The Supervisory Board’s final meeting of 2013 was held on 13 December. Following extensive discussions, we adopted the 2014 business plan and also considered various aspects of the Board of Management’s remuneration. Furthermore, the Board of Management’s targets for 2014 were set and the formation of a Strategy Committee agreed upon. Following in-depth discussions, we again submitted an unqualified Declaration of Conformity with the German Corporate Governance Code.
Hard work by the committees
The Executive Committee met four times during the year under review. Meeting agendas focused primarily on matters relating to the Board of Management and preparations for the respective Supervisory Board meetings.
The Personnel Committee also met four times and considered the reorganisation of the Human Resources board department, diversity management and activities in the areas of training, health and employee commitment. The committee received ongoing updates regarding the progress of the One HR programme, which is reorganising the content and structure of the Group’s personnel activities. It also considered the remuneration structure for executives. The annual employee opinion survey was also discussed.
The Finance and Audit Committee met seven times. Its chairman, Hero Brahms, and Stefan Schulte are financial experts as defined by sections 100 (5) and 107 (4) of the Aktiengesetz (AktG – German Stock Corporation Act). At its meeting in February, the committee examined the annual and consolidated financial statements for 2012 and recommended that these be approved by a plenary meeting of the Supervisory Board. The auditors took part in this meeting and gave a detailed presentation on their findings regarding the key audit priorities set by the committee for 2012, along with recommendations arising from their findings. Following the AGM, the Finance and Audit Committee engaged the auditors to perform an audit of the 2013 annual and consolidated financial statements and the interim financial report for the first half of the year. The committee also defined the key audit priorities. In advance of their publication, the reviewed quarterly financial reports and the interim financial report for the first half of the year were discussed by the committee together with the Board of Management and the auditors. The main risk factors for the Group were also discussed at the February meeting as planned.
At its meeting on 20 June 2013, the Finance and Audit Committee considered the planned acquisition of companies and holdings aimed at optimising Deutsche Post AG’s investment portfolio. The committee received ongoing updates about other acquisitions and disposals throughout the year. The committee’s deliberations included the acquisition of optivo GmbH, a leading German provider of e-mail marketing services. The results of internal audits were also discussed by the committee.
At its meeting on 13 September 2013, the Finance and Audit Committee received a detailed progress report on compliance organisation and compliance management from the Chief Compliance Officer. The main risk factors for the Group were also discussed further.
On 4 December 2013, the Finance and Audit Committee considered the Group’s investment strategy for pension assets as well as equity transactions. It also examined the business plan for 2014 and approved both the 2014 internal audit plan and the sale of property in Hamburg. The committee regularly discussed the Group’s business development and the internal control and risk management system. The appropriateness of the Group’s accounting system was discussed with the auditors by the committee.
The Strategy Committee that was set up in December 2013 will meet for the first time in 2014.
The Nomination Committee met on one occasion in 2013 to consider nominations for the 2014 AGM.
The chairs of the committees reported on the committees’ deliberations in the subsequent plenary meetings.
In 2013 there were no meetings of the Mediation Committee, formed pursuant to section 27 (3) of the Mitbestimmungsgesetz (MitbestG – German Co-determination Act).
No changes to the composition of the Supervisory Board and Board of Management
There were no changes to the members of the Board of Management or the Supervisory Board during 2013. At the Deutsche Post AG AGM on 29 May 2013, I was re-elected as a shareholder representative on the Supervisory Board. The end of the AGM also marked the start of a new term of office for the Supervisory Board’s employee representatives who were re-elected in April 2013 by the Delegate Assembly, in accordance with the MitbestG. At its extraordinary meeting immediately after the AGM, the Supervisory Board re-elected Andrea Kocsis as deputy chair and I was re-elected as chairman of the Supervisory Board. The meeting also confirmed the positions of all committee members. Details of the current members of the Supervisory Board committees are shown below.
Managing conflicts of interest
No conflicts of interest arose during the reporting year.
Company in compliance with all recommendations of the German Corporate Governance Code
In December 2013, the Board of Management and the Supervisory Board submitted an unqualified Declaration of Conformity pursuant to section 161 of the AktG and published it on the company’s website. The declarations from previous years can also be viewed on this website. In the 2013 financial year, Deutsche Post AG complied with all the recommendations of the Government Commission on the German Corporate Governance Code, as amended on 15 May 2012, and also intends to comply with the recommendations of the code as amended on 13 May 2013. The Corporate Governance Report contains further information on corporate governance within the company and the remuneration report.
Annual and Consolidated Financial Statements audited
The auditors appointed by the AGM, PricewaterhouseCoopers Aktiengesellschaft Wirtschaftsprüfungsgesellschaft (PwC), Düsseldorf, audited the annual and consolidated financial statements for the 2013 financial year, including the respective management reports, and issued unqualified audit opinions. PwC also conducted the review of the quarterly financial reports and the interim report for the first half of the year.
Following a detailed preliminary assessment by the Finance and Audit Committee, the Supervisory Board reviewed the annual and consolidated financial statements and the management reports for the 2013 financial year at the financial statements meeting held on 11 March 2014. The review included the Board of Management’s proposal for the appropriation of the unappropriated surplus. The auditors’ reports were made available to all Supervisory Board members and were discussed in detail with the Board of Management and the auditors in attendance. The Supervisory Board concurred with the results of the audit and approved the annual and consolidated financial statements for the 2013 financial year. Based on the final outcome of the examination of the annual and consolidated financial statements, of the management reports and of the proposal for the appropriation of the unappropriated surplus by the Supervisory Board and the Finance and Audit Committee, there are no objections to be raised. The Supervisory Board endorses the Board of Management’s proposal for the appropriation of the unappropriated surplus and the payment of a dividend of €0.80 per share.
We would like to thank the Board of Management and all employees for their great commitment and ongoing effort to safeguarding the company’s continued success. The Supervisory Board is confident that the Group is well on the way to ensuring that it remains profitable in the long term, building on its strong position in the market.
Bonn, 11 March 2014
The Supervisory Board
Wulf von Schimmelmann
|Shareholder representatives||Employee representatives|
|Finance and Audit Committee|
(pursuant to section 27 (3) of the German Co-determination Act)
(since 13 December 2013)