Company Management

The Management and Supervisory Board of PNE AG declare that the recommendations of the Government Commission on the German Corporate Governance Code published by the Federal Ministry of Justice and Consumer Protection in the official section of the Federal Gazette as amended have been and are being complied with, with the exception of the recommendations listed below.

According to Recommendation A.3 of the 2022 Code, the internal control system and risk management system should also cover sustainability-related objectives, insofar as this is not already required by law. This is to include the processes and systems for recording and processing sustainability-related data.

PNE AG is working on a further expansion of its internal control system and risk management system,

so that currently the requirements of recommendation A.3 of the 2022 Code have not yet been fully implemented.

Therefore, a deviation from recommendation A.3 of the 2022 Code is declared as a precautionary measure.

Pursuant to Recommendation B.2 of the 2022 Code, the supervisory board together with the management board is to ensure long-term succession planning; the procedure is supposed to be described in the corporate governance statement. 

Due to the current composition of the Management Board and the current terms of office, there is currently no reason for concrete succession planning. The Supervisory Board, together with the Management Board, has therefore not yet drawn up a concept for long-term succession planning.

Pursuant to Recommendation C.1 of the 2022 Code, the supervisory board is to specify concrete objectives for its composition and draw up a competence profile for the entire body. When doing so, the supervisory board is to pay attention to diversity. The competence profile of the supervisory board shall also include expertise on sustainability issues of importance to the company. Proposals of the supervisory board to the shareholders in general meeting are supposed to take these objectives into account and at the same time aim to fill out the competence profile for the entire board. The status of implementation is supposed to be published in the form of a qualification matrix in the corporate governance statement. This statement is also to provide information on the number of independent shareholder representatives deemed appropriate by the shareholder representatives on the supervisory board and the names of these members.

Deviations from these recommendations have been made to date. Section 8 (2) of the Articles of Association merely stipulates that Supervisory Board members may not be elected for a longer period than until the end of the annual general meeting in the year in which the Supervisory Board member reaches the age of 75. Furthermore, the Supervisory Board's Rules of Procedure stipulate that the Supervisory Board shall have what it considers to be a sufficient number of independent members and that the members shall not include more than two former members of the Board of Management.

Pursuant to Recommendation D.11 of the 2022 Code, a company is to provide appropriate support to supervisory board members during their inauguration and training and further training measures and to report on the implemented measures in the supervisory board’s report.

The Supervisory Board refrains from reporting in the Supervisory Board's report about training and further training measures for individual members as well as measures to support them during their inauguration.

Pursuant to Recommendation G.7 of the 2022 Code, the supervisory board is to determine the performance criteria for all variable remuneration components for each member of the management board for the coming financial year, which in addition to operational objectives, are to be based above all on strategic objectives. The supervisory board is to determine the extent to which individual goals for the individual management board members or goals for all management board members together are to be decisive.

In addition to the development of the share price and personal goals, the performance criterion for variable remuneration is based on the development of operating results.

Pursuant to Recommendation G.10 of the 2022 Code, the variable remuneration amounts granted to a management board member are to be invested predominantly in shares of the company or granted on a share basis, taking into account the respective tax liability. A management board member is first to be able to dispose over the granted long-term variable amounts after four years.

The current employment agreements do not provide for the variable remuneration amounts granted to the Management Board members to be invested predominantly in shares of the Company or granted on a share basis, taking into account the respective tax liability.

Pursuant to Recommendation G.11 of the 2022 Code, the supervisory board is to have the possibility to take account of extraordinary developments to an appropriate extent. In justified cases, it is to be possible to withhold or reclaim variable remuneration.

The employment agreements with the Management Board members do not currently contain any provision according to which variable remuneration can be withheld or reclaimed

Pursuant to Recommendation G.12 of the 2022 Code, in the event of the cessation of an employment agreement with a management board member, the payment of outstanding variable remuneration components attributable to the period up to the cessation of the contract is to be made in accordance with the originally agreed targets and benchmark parameters and in accordance with the due dates or holding periods specified in the contract.

The employment agreements of the Management Board members do not provide for the payment of outstanding variable remuneration components attributable to the period up to the cessation of the contract to be made in accordance with the originally agreed targets and benchmark parameters and in accordance with the due dates or holding periods specified in the contract.

The employment agreements of the Management Board members stipulate that in the event of cessation of the contract, the variable remuneration is to be determined ahead of time on a lump-sum basis. The Supervisory Board considers the complete cessation with immediate compensation of all outstanding remuneration benefits to be a proper and appropriate procedure in order to ensure the clear and speedy settlement of contracts.

A deviation from Recommendation G.12 of the 2022 Code is hereby declared.