BMW 2009 Annual Report Download - page 9

07 Report of the Supervisory Board
Ladies and Gentlemen,
The financial year 2009 presented many challenges for the BMW Group. Throughout this difficult period, the Super-
visory
Board and Board of Management worked together closely, constructively and in an atmosphere of trust.
We supported the Board of Management in an advisory capacity in key management issues, including strategic
decisions concerning the expansion of the product portfolio within the Automobiles segment. We also continu-
ously monitored the management of the business with the aid of regular written and oral reports provided by the
Board of Management and on the basis of joint discussions. In a total of five meetings, one of them held over a
two-day period, we deliberated at length on the Group’s business plan and forecasts – the preparation of which
has clearly been rendered more difficult by the financial and economic crisis. Our discussions also covered risk
management issues, risk provisions, the current performance and financial position of the BMW Group and the
compensation of the Board of Management. In addition to the scheduled meetings, the Board of Management
also kept us informed of current business and economic developments, in particular sales volume performance,
personnel figures and other significant matters. The Chairman of the Board of Management informed me per-
sonally and on a
regular basis about major business transactions and projects.
Primary objectives of the Supervisory Board’s monitoring and advisory activities Against the background of the
current financial and economic crisis, legislative measures in key markets to reduce CO2 emissions and changing
customer requirements, we paid particular attention to the Board of Management’s detailing and implementation
of the Strategy
Number ONE. The main focus of our monitoring and advisory work was on management’s en-
deavours to engage
in new growth areas and with new customer target groups, on securing access to customers
and innovative
technologies, on improving profitability and hence safeguarding the long-term competitiveness of
the BMW Group.
The Board of Management reported to the Supervisory Board at regular intervals and in depth
on risk management and risk provision issues. These two topics constituted a further area of emphasis for our de-
liberations in the Supervisory Board.
The Board of Management kept us informed of changes in the general economic environment caused by the
finan cial and economic crisis and provided a detailed analysis of the risk profile, particularly that of the Financial
Services segment. In this context we also held discussions with the Board of Management regarding its plans
to restructure activities in this segment to take account of the changing economic environment and regulatory
framework. The Supervisory Board fully supports the initiatives taken by the Board of Management to optimise
liquidity management, risk management, sales support facilities within the Automobiles segment as well as cor-
porate and management organisational structures.
In September we joined the Board of Management over a two-day period in a board meeting with a new format.
During one session of that meeting – dedicated to reviewing technical information, exploring the concept of
motoring as an experience and exchanging ideas – members of the Board of Management gave presentations on
new products and innovative drive concepts developed in conjunction with the Strategy Number ONE. It is hoped
that these developments will provide some answers to the changing requirements of customers, legislation and
the environment. In a further session, the Board of Management presented the results of its strategy review which
were discussed at great length. The Supervisory Board considers that the Board of Management is on the right
track with new projects designed to tap new growth markets, address new customer groups and move into other
vehicle segments. In the course of this meeting we also gave intensive consideration to the long-term business
plan which the Board of Management presented for approval and which, due to the financial and economic crisis,
predicts a delayed increase in sales volume but a quality of earnings from 2012 onwards in line with pre vious
forecasts. The Board of Management explained variances from earlier forecasts and reported fully
on the main
external risk factors affecting business. The Supervisory Board remains convinced that the Board of Manage-
ment’s Strategy Number ONE is robust and accordingly granted its formal approval to the long-term business
plan.
We also carefully considered the annual budget for the financial year 2010 and the targets incorporated therein
and discussed these with the Board of Management.