Audi 2013 Annual Report Download - page 208

CORPORATE GOVERNANCE REPORT
CORPORATE GOVERNANCE // CORPORATE MANAGEMENT DECLARATION
MANAGEMENT REPORT
205
A
Porsche Automobil Holding SE, Stuttgart, could result in this
independence not being guaranteed. It is the view of the Board
of Management and Supervisory Board that these activities do
not represent a conflict of interest and do not impair the work
of the Chairman of the Audit Committee. Due to the lack of any
clear definition of the concept of independence within the Code,
this deviation is explained here for purely precautionary reasons.
The Supervisory Board has not formed a nominating committee
(Section 5.3.3 of the Code). It is the Supervisory Board’s view
that such a committee would merely increase the number of
committees without having any tangible benefit with regard to
the Supervisory Board’s work.
In terms of the recommendations on the disclosure of certain
circumstances in relation to the nominations proposed by
the Supervisory Board to the Annual General Meeting (Sec-
tion 5.4.1, Paras. 4 to 6 of the Code), the requirements set
out in the Code are vague and not clearly defined. Any deviation
is therefore declared here purely as a precautionary measure,
although the Supervisory Board will strive to adhere to the
Code’s recommendation.
With regard to the Code’s recommendation that no more than two
former members of the Board of Management should sit on the
Supervisory Board (Section 5.4.2, Sentence 3 of the Code), the
Board of Management and Supervisory Board are of the opinion
that having a higher number of former Board of Management
members will not result, given the existing majority situation,
in the Board of Management not being properly advised and
monitored by the Supervisory Board. In addition, limiting the
number of former Board of Management members on a purely
numerical basis would result in the loss of valuable expertise.
For these reasons, a deviation from the Code is declared. Never-
theless, the Supervisory Board will always ensure with regard to
its election nominations that the number of former Board of
Management members sitting on the Supervisory Board shall
not impede the independent provision of advice to and moni-
toring of the Board of Management.
Given the lack of clarity surrounding the recommendation in
Section 5.4.6, Para. 2, Sentence 2 of the Code and the as yet
undefined scope of a performance-related remuneration com-
ponent for the Supervisory Board with regard to long-term
Company development, the Board of Management and Super-
visory Board are declaring this deviation from the Code as a
purely precautionary measure. The Board of Management and
Supervisory Board believe that the current remuneration rules
set out in Section 16 of the Articles of Incorporation and Bylaws
of AUDI AG with regard to the Supervisory Board contain a per-
formance-related component that is geared towards the long-
term development of the Company.
Based on legal decisions adopted over recent years, there is
uncertainty with regard to the required scope of the Supervisory
Board’s reporting, as recommended in Section 5.5.3, Sentence
1 of the Code, to the Annual General Meeting on any conflicts
of interest that have arisen and how these have been handled.
For this reason, the Board of Management and the Supervisory
Board are declaring this deviation from the recommendation as
a purely precautionary measure. Nevertheless, the Supervisory
Board will provide information on any conflicts of interest that
have arisen in its report to the Annual General Meeting.
The response to the suggestions made in the Code is as follows:
AUDI AG fulfills all of the suggestions made in the Code.
/ PARTICULARS PURSUANT TO
SECTION 6.3 OF THE CODE
No reportable acquisition or sales transactions were conducted
during the past fiscal year.
/ STOCK OPTION PLANS AND SIMILAR SECURITIES-
BASED INCENTIVE ARRANGEMENTS
AUDI AG does not offer any such plans or incentive
arrangements.
/ DECLARATION RELATING TO
THE CODE ON THE INTERNET
The current joint declaration of the Board of Management and
the Supervisory Board of AUDI AG on the recommendations of
the German Corporate Governance Code has been available on
the Audi website www.audi.com/cgk-declaration since Novem-
ber 28, 2013.
CORPORATE MANAGEMENT
DECLARATION
The corporate management declaration pursuant to Section
289a of the German Commercial Code (HGB) is permanently
available on the Internet at www.audi.com/corporate-
management.