BMW 2010 Annual Report Download - page 9

07 REPORT OF THE SUPERVISORY BOARD
Dear Ladies and Gentlemen,
The fi nancial year 2010 marked an upswing for the BMW Group after the global fi nancial crisis. Together with the Board
of Management and the entire workforce, we are delighted with the way business has developed, enabling us to report
the best result to date in the BMW Group’s corporate history.
During the year under report, we continuously and carefully monitored the running of the business and its perform-
ance with the aid of regular written and oral reports provided by the Board of Management. Joint discussions were also
held in which we advised the Board of Management on important aspects of projects and planning. These discussions
with the Board of Management were always conducted constructively and in an atmosphere of trust.
Main emphases of the Supervisory Board’s monitoring and advisory activities In a total of fi ve meetings, one of
them held over a two-day period, we deliberated in particular on the BMW Group’s current performance and fi nancial
position, the corporate plan and strategy, risk management and risk provision, personnel decisions, the further develop-
ment of the Board of Management’s compensation system and corporate governance. In addition to the scheduled
meetings, the Board of Management also kept us informed of current business and economic developments, particularly
sales volume performance, personnel fi gures and other signifi cant matters. The Chairman of the Board of Manage-
ment informed me personally and on a regular basis about major business transactions and projects.
Again in 2010 the Supervisory Board examined the management and organisation of the Financial Services segment.
In preparation for the full Supervisory Board meeting, we discussed with the Presiding Board the current organisation
of the Financial Services segment, which falls under the remit of the “Finances” management portfolio. We received
adetailed status report on various projects aimed at improving liquidity and risk management, maximising the benefi ts
from sales support given to the Automobiles segment and optimising legal entity and management structures. The
framework conditions and organisational implications of the planned changes in the segment were also discussed at
length. The Supervisory Board is in favour of enhancing the segment‘s legal and organisational structure in a way that
ensures that suitable control and balancing mechanisms are in place in the relationship between the core industrial
segments and the Financial Services segment.
One meeting of the Supervisory Board took place at the Regensburg plant, where vehicles such as the BMW1 Series,
the BMW 3 Series and the BMW Z4 are manufactured. During our visit, we took the opportunity to look for ourselves
at the preparations being made for the scheduled model start-ups in 2011. Using examples from the pressing plant, body
construction and assembly areas, the members of the Supervisory Board were given a demonstration of how the prin-
ciples of a value-added production system (VPS) can be applied to achieve further process improvements.
In September, another two-day meeting was held, providing us with the opportunity for an in-depth discussion with
the Board of Management regarding technical innovations and new vehicle concepts. The Supervisory Board members
were able to test several of the vehicles that are now already capable of fulfi lling customer requirements for forward-
looking mobility in various vehicle categories. These included a next-generation BMW 5 Series ActiveHybrid prototype,
but also production models such as the BMW 320d E cientDynamics Edition. We were also able to test vehicles such
asthe BMW X3 xDrive 20d that will soon be going into series production. A further part of the meeting was dedicated to
the strategy review. The Board of Management provided us with an insight into the progress made over the last twelve
months in implementing Strategy Number ONE, based on the four pillars “Growth”, “Shaping the Future”, “Profi tability”
and “Access to Technologies and Customers”. Market and volume forecasts for the Automobiles segment were discussed
at great length, with certain markets also successfully being subjected to a stress test. The Supervisory Board supports
the Board of Management in its endeavours to achieve a balanced relationship in its sales activities between the major
markets of Europe, Asia and America. Furthermore, we discussed a number of selected issues relating to product and
brand strategy, such as plans to establish a new BMW sub-brand in the fi eld of electromobility. In the opinion of the
Supervisory Board, Strategy Number ONE has proved to be robust in times of crisis: we believe that the Board of Manage-
ment remains on the right track in strategic terms.
Before giving our go-ahead, we carefully reviewed the long-term business plan presented to us for approval by the
Board of Management, which forecasts highly positive and rising economic added value for the years from 2011 to 2016.
The Board of Management explained changes from previous forecasts and targets. The most important external risk
factors, such as regulatory requirements and potential challenges caused by a repeat of the fi nancial crisis, were also dealt
with in both written reports and joint discussions. We stressed the importance to the Board of Management of planning
fi xed costs and personnel requirements prudently, despite the current economic recovery. The Supervisory Board gave
appreciative recognition to the fact that, despite the fi nancial crisis, the e orts expended in recent years have brought