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CENIT AG
ISIN DE0005407100, WKN 540710
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Stock exchange: XETRA

Corporate governance

General remarks on the German Corporate Governance Code

The principles of values-based and transparent company management and control have become much more significant in the evaluation and appraisal of listed companies. In September 2001, the German Federal Ministry of Justice took up this issue with the establishment of the German Corporate Governance Code regulatory committee, chaired by Dr Gerhard Cromme. The committee approved the Code on 26 February 2002 and has since modified it. The Code has a legal basis in the statement of compliance pursuant to Section 161 of the Stock Corporation Act (incorporated as a result of the Transparency and Disclosure Act, which came into effect on 26 July 2002). As a result of Section 161 of the Stock Corporation Act, all listed companies are required to disclose their compliance with the requirements of the Code and explain any potential non-conformities (comply or explain). In particular, this should meet the expectations of international investors.

You can download and read or print out the current version of the German Corporate Governance Code on the home page here.

Article of association of CENIT AG

Fiscal calendar

April 1, 2019
Release of Annual Report 2018

May 9, 2019

Release of 3-Months Report 2019

May 13-15, 2019

German Spring Conference, Frankfurt

May 24, 2019

Annual Shareholder's Meeting

August 01, 2019

Release of 6-Months Report 2019

November 05, 2019

Release of 9-Months Report 2019

 

 

Declaration on corporate governance (Section 289a of the German Commercial Code)

The declaration on corporate governance (Section 289a of the German Commercial Code) contains the compliance statement, details of corporate governance practices and a description of the way the Executive and Supervisory Boards work.

Details of Corporate Governance practices

The structure of the company management and control of CENIT AG is organized as follows:

Shareholders and Annual General Meeting

The shareholders of CENIT AG exercise their rights at the company's Annual General Meeting. This annual assembly takes places in the first six months of the fiscal year and is presided over by the chairman of the Supervisory Board. At the meeting, shareholders undertake all the tasks allocated to it under law (e.g. the election of Supervisory Board members, amendments to the articles of association, appropriation of profit, measures relating to capital).

Supervisory Board

The Supervisory Board advises and supervises the Management Board. The Supervisory Board of CENIT AG comprises three members. Two of the members are elected at the Annual General Meeting, and the third is elected by the company's employees. The chairman of the Supervisory Board is chosen by the board itself.
The Supervisory Board also appoints the members of the Management Board. It supervises and advises the Management Board on the management of the company. Major decisions made by the Management Board also require the approval of the Supervisory Board.

Management Board

The Management Board is the company's management body. It manages the company's business activities under its own responsibility, in line with the provisions of the German Stock Corporation Act. It is bound by the interests of the company and by general business principles. It reports to the Supervisory Board regularly and in a timely and comprehensive manner on all matters that are of importance to business development, the company strategy and on potential risks.
The Management Board remuneration is made up of performance-related and fixed compensation.

Accounting and reporting

The consolidated financial statements of CENIT AG, Stuttgart, are compiled by the Management Board in accordance with International Financial Reporting Standards (IFRS), as they are to be applied within the EU, and the supplementary applicable reporting standards pursuant to Section 315a Para 1 of the German Commercial Code. The consolidated financial statements are audited by an external auditor and approved by the Supervisory Board, then made available to the public within 90 days.
The external auditor is BDO AG Wirtschaftsprüfungsgesellschaft.
It was agreed with the auditor that the chairman of the Supervisory Board is to be informed immediately of any grounds for exclusion or exemption or of any inaccuracies in the Compliance Statement that come up during the audit. The auditor reports all issues and events that are relevant to the role and tasks of the Supervisory Board and that arise during the audit to the chairman of the Supervisory Board, without undue delay.

Transparency

Reporting on the business situation and performance of CENIT AG takes place comprehensively and promptly in the Annual Financial Report, the discussion of accounts in the quarterly financial statements and in the six-month financial statement. Furthermore, information is published on an ad-hoc basis. All statements and reports are available online here.
CENIT AG has compiled the required register of individuals with insider information. These individuals were informed of all of their legal duties and penalties.

Mode of operation of the Management and Supervisory Boards

The Supervisory and Management Boards work closely together for the good of the company.
The Management Board informs the Supervisory Board regularly, promptly and in full about the course of business, the economic and financial development of CENIT and of the risk situation, risk management, compliance issues and fundamental issues related to the company's strategy. Significant decisions require the approval of the Supervisory Board.

The main role of the Supervisory Board is to advise and supervise the Management Board. Employee interests are represented appropriately by the employee representative. The Supervisory Board convenes in regular meetings and in additional teleconferences if required. Due to the small size of the Supervisory Board, no committees were formed.

DOWNLOAD

You can download the current declaration of compliance to the German Corporate Governance Code pursuant to Section 161 of the Stock Corporation Act  here.

The following gentlemen make up the company's Management Board:

  • Kurt Bengel
    Management Board spokesman
    Responsible for international operations, as well as the Marketing and Investor Relations departments
  • Matthias Schmidt
    Member of the Management Board since 1 February 2013
    Responsible for Finance, Organization and Human Resources

Remuneration system

The remuneration system for the Management Board at CENIT AG comprises performance-related and fixed compensation. In the reporting year, the remuneration of Management Board members was as follows:

Remuneration of the Management Board in EUR k

20182017
Kurt Bengel
Fixed242242
Fringe benefits2825
Performance-based134191
Long-term incentive137194
Total remuneration for Kurt Bengel541652
Matthias Schmidt
Fixed215215
Fringe benefits2221
Performance-based134191
Long-term incentive137194
Total remuneration for Matthias Schmidt508621
Total1,0491,273

In the reporting year, the following compensation was paid to members of the Management Board:

Remuneration of the Management Board in EUR k

20182017
Kurt Bengel
Fixed242242
Fringe benefits2825
Performance based191176
Long-term incentive from 2015/2014160126
Total remuneration for Kurt Bengel621569
Matthias Schmidt
Fixed215215
Finge benefits2221
Performance-based191176
Long-term incentive from 2015/2014160130
Total remuneration for Matthias Schmidt588542
Total1,2091,111

The variable remuneration component breaks down into a short-term and long-term component, which is based on the Group EBIT, with the short-term portion being paid out in the subsequent year. The long-term portion is paid out after three years provided that other criteria have been met. Total annual remuneration is capped in each case to EUR 750,000.00. No minimum remuneration has been agreed for performance-based pay and remuneration with a long-term incentive effect.

The fringe benefits relate to the provision of company cars and subsidies for pension insurance.

The employment contracts of Mr. Bengel and Mr. Schmidt provide for compensation payments pursuant to Sec. 74 HGB for the term of a one-year ban on competition and full remuneration paid to the surviving dependents of deceased Management Board members for a six-month period.

No further pension obligations or benefits were promised in the event of termination of service. In the event that the Company terminates the agreement before its expiry without good reason, the Management Board member receives a severance payment of no more than twice the annual fixed remuneration set out in the agreement for the remainder of the employment agreement. In any case, no more than the remaining term of the employment agreement will be remunerated.

The employment contract of Mr. Bengel was extended prematurely for a further three years with effect as of 1 January 2019. The employment contract of Mr. Schmidt was likewise extended prematurely for a further two years with effect as of 1 February 2019. The cap on total remuneration was raised to EUR 900,000.00 in Mr. Bengel’s contract and to EUR 800,000.00 in Mr. Schmidt’s contract.

The short-term variable remuneration of the Management Board depends on the Group EBIT and is capped at EUR 230,000 from the 2019 financial year. From 2020, the maximum amount will increase by 5% in each case. The long-term variable remuneration also depends on the Group EBIT and is capped at EUR 350,000. The maximum amount will increase by 5% from 2020 onwards. The long-term variable remuneration will be paid out after three years only if the average Group EBIT of the last three years amounts to at least EUR 9,000,000. This limit is also increased by 5% annually.

The Company’s Supervisory Board is composed of the following persons in 2018:

  • Dipl.-Ing. Andreas Schmidt
    (independent management consultant), Ahrensburg, chairman, from 30 May 2008 to 18 May 2018
  • Dipl.-Kfm. Hubert Leypoldt
    (independent German public auditor, tax advisor, legal counsel), Dettingen/Erms, deputy chairman, from 6 May 1998 to 18 May 2018
  • Dipl.-Ing. Andreas Karrer (Head of Department at CENIT Aktiengesellschaft, Stuttgart), Leinfelden-Echterdingen, employee representative, from 30 May 2008 to 18 May 2018
  • Prof. Dr. Oliver Riedel
    (university professor), Pfaffenhofen a.d. Ilm, chairman since 18 May 2018
  • Dipl.-Kfm. Stephan Gier
    (independent German public auditor, tax advisor), Stuttgart, deputy chairman since 18 May 2018
  • Dipl.-Ing. Ricardo Malta (Service Manager CENIT Aktiengesellschaft, Stuttgart), Munich, employee representative since 18 May 2018

Remuneration System

Pursuant to the Articles of Association, the Members of the Supervisory Board receive a fixed remuneration. Each Supervisory Board Member receives a fixed remuneration of 15,000.00 EUR, payable at the end of the business year. The Chairman of the Supervisory Board receives double this sum, his Deputy 1.5 times this sum.

During the reporting year, the Members of the Supervisory Board received the following incomes:

Remuneration of the Supervisory Board in EUR k

Fixed remuneration
2018
Performance-based
remuneration 2018
Fixed remuneration
2017
Performance-based
remuneration 2017
Andreas Schmidt11.5030.00
Hubert Leypoldt8.5022.50
Andreas Karrer5.5015.00
Oliver Riedel18.500.00
Stephan Gier14.000.00
Ricardo Malta9.500.00
Total amount67.5067.50


The D&O insurance was continued in 2018 for Management Board members, Supervisory Board members as well as other executives. The premiums of EUR 40 k (prior year: EUR 51 k) were borne by the Company.

The Management Board held 7,670 shares as of the balance sheet date (0.09%). The Supervisory Board members held 80 shares.

Sustainability at CENIT AG

At CENIT, we understand Corporate Social Responsibility (CSR) to mean responsible and sustainable management of the company. We require that our employees, business partners and suppliers comply with all applicable laws and guidelines.

We observe and respect human rights within our sphere of influence and base our conduct on the ten principles of the UN Global Compact. We fully support the abolition of any form of forced or child labour and expect the same of our business partners and suppliers.

CENIT does not tolerate corruption, bribery or the acceptance/granting of personal advantage in all their forms and works against unfair trading practices. In their dealings with business partners, customers, suppliers and government officials, our employees maintain clear boundaries between the normal parameters of a business relationship and private interests.

This is the basis of the way we do business and we firmly believe that a company can only be successful if business or financial concerns are held in equal consideration as its responsibilities towards society and the planet. For us, this also means involving our stakeholders and maintaining ongoing, open dialogue with them.

YOUR CONTACT PERSON

Tanja Marinovic

Tanja Marinovic

CENIT AG
Industriestraße 52 - 54
70565 Stuttgart | Germany

+49 (0)711 7825 3320
aktie@CENIT.de