BMW 2010 Annual Report Download - page 153

151 STATEMENT ON CORPORATE GOVERNANCE
The Supervisory Board, the Presiding Board and the com-
mittees also meet without the Board of Management if
necessary.
BMW AG ensures that the Supervisory Board and its com-
mittees are sufficiently equipped to carry out their duties.
This includes the services provided by a centralised sec-
retariat to support the chairmen in coordinating the work
of the Supervisory Board.
In accordance with the relevant terms of reference, the
Presiding Board comprises the Chairman of the Super-
visory
Board and board deputies. The Presiding Board
prepares Supervisory Board meetings to the extent that
the subject matter to be discussed does not fall within
the remit of a committee. This includes, for example, pre-
paring the annual Declaration of Compliance with the
German Corporate Governance Code and the Supervisory
Board’s efficiency examination.
The Personnel Committee prepares the decisions of the
Supervisory Board with regard to the appointment and
revocation of appointment of members of the Board of
Management and, together with the full Supervisory
Board and the Board of Management, ensures that long-
term successor planning is in place. For information
regarding the criteria applied, see pages 08 et seq. The
Personnel Committee also prepares the decisions of the
Supervisory Board with regard to the Board of Manage-
ment’s
compensation and the Supervisory Board’s regu-
lar
review of the Board of Management’s compensation
system. In conjunction with the resolutions taken by
theSupervisory Board regarding the compensation of
the Board of Management, the Personnel Committee is
responsible for drawing up, amending and revoking
service /employment contracts or, when necessary, other
relevant contracts with members of the Board of Manage-
ment. In specified cases, the Personnel Committee also
has the authority to give the necessary approval for a
particular transaction (instead of the Supervisory Board).
This includes loans to members of the Board of Manage-
ment or Supervisory Board, specified contracts with
members of the Supervisory Board (in each case taking
account of theconsequences of related party transac-
tions), as well as other activities of members of the Board
of Management, including the acceptance of non-BMW
Group supervisory mandates.
The Audit Committee deals in particular with issues re-
lating to the supervision of the financial reporting process,
the effectiveness of the internal control system, the risk
management system, internal audit arrangements and
compliance. It also monitors the external audit, auditor
independence and any additional work performed by
the external auditor. It prepares the proposal for the elec-
tion of the external auditor at the Annual General Meet-
ing, issues the audit engagement letter and agrees on
points of emphasis as well as the auditor’s fee. The Audit
Committee prepares the Supervisory Board’s resolution
relating to the Company and Group Financial Statements
and discusses interim reports with the Board of Manage-
ment before publication. The Audit Committee also de-
cides on the Supervisory Board’s agreement to use the
Authorised Capital 2009 (Article 4 point 5 of the Articles
of Incorporation) and on amendments to the Articles of
Incorporation which only affect their wording.
In line with the recommendations of the German Corpo-
rate Governance Code, the Chairman of the Audit Com-
mittee is independent and not a former Chairman of
theBoard of Management. He or she is required to have
specific know-how and experience in applying financial
reporting standards and internal control procedures.
Alongside
other members of the Supervisory Board, he
also fulfils the requirements of being an independent
financial expert as defined by § 100 (5) and § 107 (4) AktG.
The Nomination Committee is charged with the task of
finding suitable candidates for election to the Supervisory
Board (as shareholder representatives) and for inclusion
in the Supervisory Board’s proposals for election at the
Annual General Meeting. In line with the recommenda-
tions of the German Corporate Governance Code, the
Nomination Committee comprises only shareholder rep-
resentatives.
The establishment and composition of a Mediation Com-
mittee are required by the German Co-determination
Act. The Mediation Committee has the task of making
proposals to the Supervisory Board if a resolution for the
appointment of a member of the Board of Management
has not been carried by the necessary two-thirds majority
of members’ votes. In accordance with statutory require-
ments, the Mediation Committee comprises the Chair-
man and Deputy Chairman of the Supervisory Board and
one member each selected by shareholder representatives
and employee representatives.