Campus

Unclear wording for Code adjustments criticized

Advisors to companies complained at a seminar of the German Stock Institute (DAI) that following the most recent changes to the German Corporate Governance Code some formulations were unclear. The Government Commission on 15 May decided some changes and tracked various legislative changes to the Code. It has now confined itself mainly to clarifications, after the recommendations on good corporate governance remained entirely unchanged last year. The Commission also emphasized in its presentation comments by the public from the consultation process first adopted and successfully carried out in 2011. Those interested could express themselves beforehand in a written procedure on concrete proposed formulations. The code changes presented partly differ significantly from the proposals published in January. While at first an objectively reasonable number of independent supervisory board members was to be set out in the regulations, the Supervisory Board must now itself evaluate what it regards as an adequate number of independent members. The Commission has also dropped its original recommendation to introduce variable in addition to fixed remuneration on the Supervisory Board. The DAI seminar went on to debate whether the Supervisory Board could in future consider zero as an appropriate number of independent directors. Also unclear is whether it is consistent with the Code for the Supervisory Board to set a goal of independence, but depart from it in the actual situation.

More changes in executive suites

Every sixth CEO left his post in 2011, Booz & Company has announced.  The fluctuation was present particularly strongly in the German-speaking countries. Thus, the turnover in the biggest companies in Germany, Austria and Switzerland had amounted to 16.7 percent. That was almost twice as many as last year (8.7 percent). On an international comparison, this represents the largest increase, writes the management consultancy. Worldwide, the rate had risen from 11.6 percent to 14.2 percent.  While in good times companies were readier for change, in times of crisis supervisory boards seek continuity at the helm. Because of the good economic situation in Germany, the turnover was almost four percentage points higher than in the rest of Western Europe or the United States. In this country, the health sector at 33 percent and industry at 26 percent were most affected. In the context of the CEO succession study, the 2,500 largest public companies were examined.

Best online annual report comes from Deutsche Bank

Deutsche Bank, BASF and DEUTZ have the best online business reports. The report by Deutsche Bank particularly impressed with its “concept”. BASF was awarded the best possible rating in the category “service”. DEUTZ‘s report was particularly impressive in the field of “technology”. At the bottom of the ranking came the annual reports of HOCHTIEF and GILDEMEISTER (joint 33rd), Brenntag (No. 35) and Douglas (No. 36). This year, 19 of the 30 DAX companies offer a fully-fledged HTML annual report; last year there were 20. In contrast, among the MDAX companies there is a positive trend for HTML annual reports. A total of 17 of the MDAX companies now provide their Annual Report as a full HTML version. Last year there were only 16. A total of 26 companies now tie their own website more strongly into communication on the date of publication of the report; last year there were just 14. This year’s study by Kirchhoff Consult of the 2011 online annual reports of the DAX and MDAX companies also shows that not all the possibilities of an online annual report are yet being used. Thus, for example, links to tables were not available in all reports, say to the explanatory notes, which would make it easier for users to navigate. In this way, information belonging together could be brought together more quickly, says Kirchhoff. 16 of the 78 companies present only a PDF available for download.