BMW 2006 Annual Report Download - page 7

06 Report of the Supervisory Board
The Supervisory Board used the business status reports prepared by the Board
of Management for each Supervisory meeting to keep abreast of business per-
formance, including that of the Financial Services and Motorcycles segments.
These business status reports also provided information about the situation of
competitors in the major markets, the fluctuation of the euro against the US dol-
lar and other important currencies, the BMW Group’s currency management
strategy and, in particular, its sales volume performance.
The Board of Management also informed the Supervisory Board of the progress
of the share buy-back programme and the decision to withdraw these shares
from circulation with a view to reducing the company’s outstanding share capital.
The Supervisory Board subsequently amended the wording of the Articles of
Incorporation to take account of the reduced share capital.
As a special topic, the Supervisory Board deliberated intensively in 2006 on the
Motorcycles segment, including a review of the renewal of production structures
at the Berlin plant and the Board of Management’s continued model range ex-
pansion, intended to attract new target groups.
The Supervisory Board discussed in detail with the Board of Management both
the annual budget for the financial year 2007 and the long-term business plan for
the BMW Group presented to it for authorisation. The long-term business plan
was approved as necessary.
During the financial year 2006, the Supervisory Board and the Board of Manage-
ment again discussed the subject of corporate governance in great detail and
issued a joint Declaration of Compliance with the German Corporate Governance
Code pursuant to §161 AktG. Having been satisfied that the Code’s recom-
mendations had been fulfilled in accordance with the previous Declaration of
Compliance (subject to a small number of exceptions stated therein), the Board
of Management and the Supervisory Board took the decision to fulfil all of the
recommendations contained in the revised version of the Code on 24 July
2006, with a single exception, namely that the discussion and regular review of
the structure of the compensation system of the Board of Management is per-
formed by the Personnel Committee. The Chairman of that committee informs
the members of the Supervisory Board at its next meeting.
In conjunction with the Disclosure of Management Board Compensation Act
(VorstOG), listed companies in Germany are now required to disclose details of
the remuneration of Board of Management members, analysed individually. In
advance of the Annual General Meeting in 2006, the two boards had decided
not to apply the option of proposing an exception to the Annual General Meeting
2006, but rather to comply with the legal requirements. BMW AG is thus required