Adidas 2002 Annual Report Download - page 97

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SUPERVISORY BOARD COMMITTEES /// In order to increase
the efficiency of its work and better handle complex issues,
the Supervisory Board of adidas-Salomon AG has established
three committees:
>The General Committee deals with Executive Board per-
sonnel matters.
>The Mediation Committee submits proposals to the Super-
visory Board regarding the appointment and the dismissal
of Executive Board members in cases where the majority
of two-thirds of the Supervisory Board necessary for an
appointment or a dismissal is not achieved.
>The Audit and Accounts Committee, set up in 2003, handles
issues of accounting and risk management, the necessary
independence required of the auditors, the issuing of the
audit mandate to the auditors, the determination of audit-
ing focal points and the fee agreement. The auditors shall
disclose to the Audit and Accounts Committee without
delay any issues that could potentially affect their impar-
tiality or require their eventual disqualification.
For specific information on the activities of these committees
in 2002, please see the Supervisory Board report.
EXECUTIVE BOARD /// The adidas-Salomon Executive Board
is comprised of seven members who reflect the diversity and
the international nature of the Group. The Executive Board
develops the adidas-Salomon strategy and ensures its imple-
mentation. It guarantees appropriate risk management and
risk control within the Group (see Risk Management). The
Executive Board also explains deviations in the actual busi-
ness development versus original plans and targets. The
remuneration of the members of the Executive Board is made
up of a fixed salary and a variable component. The variable
component is linked to individual and Group performance.
In addition, members of the Executive Board receive stock
options not to exceed 10% altogether of the total issued under
the Group’s Management Stock Option Plan (MSOP) (see note
30). This plan provides additional compensation when
absolute and/or relative performance targets for the develop-
ment of the adidas-Salomon share price occur. We report the
cumulative remuneration of the Executive Board in the notes
to the consolidated financial statements and on the corporate
website, subdivided according to fixed, performance-related
and long-term incentive components (see note 31).
COOPERATION BETWEEN THE BOARDS /// An important
component of good corporate governance is open dialog and
constant cooperation between the Executive and Supervisory
Boards. By tradition, our Executive and Supervisory Boards
have had a constructive and efficient working relationship in
the best interests of the Group. Rules of Procedure for both
Boards underpin, among other things, this collaboration.
AVOIDING CONFLICT OF INTEREST /// The Executive and
Supervisory Board members are required to act in the best
interests of the Group and shall not pursue personal interests
in their decisions. Each member of the Executive Board is
required to disclose any potential conflicts of interest to the
Supervisory Board without delay and to inform the other
members of the Executive Board accordingly. Should the
occasion arise, the Supervisory Board will report these con-
flicts and how they have been dealt with to the Annual General
Meeting. Any consultancy or service agreements concluded
between a member of the Supervisory Board and adidas-
Salomon AG requires the approval of the Supervisory Board.
The amounts paid under such agreements will be disclosed
cumulatively in the annual report. All transactions between
the Group companies and Executive Board members as well
as between Executive Board members and persons or com-
panies with whom they have a close association must comply
with customary standards for arm’s length business practice
and require the approval of the Supervisory Board.
adidas ORIGINALS “TENNIS
COLLECTION” /// TENNIS COACH
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