BMW 2011 Annual Report Download - page 183

183 OTHER INFORMATION
Operating cash flow
Cash inflow from the operating activities of the Auto-
motive
segment.
Preferred stock
Stock which receives a higher dividend than common
stock, but without voting rights.
Production network
The BMW Group production network consists world-
wide of 17 plants, seven assembly plants and one con-
tract production plant. Within this network, the plants
supply one another with systems and components
and are all characterised by a high level of productivity,
agility and flexibility.
Rating
Standardised evaluation of a company’s credit standing
which is widely accepted on the global capital markets.
Ratings are published by independent rating agencies,
e. g. Standard & Poor’s or Moody’s, based on their analysis
of a company.
Return on sales
Pre-tax: Profit before tax as a percentage of revenues.
Post-tax: Profit as a percentage of revenues.
Risk management
An integral component of all business processes. Following
enactment of the German Law on Control and
Trans-
parency within Businesses (KonTraG), all companies
listed
on a stock exchange in Germany are required to
set up a risk management system. The purpose of this
system is to
identify risks at an early stage which could
have a significant
adverse effect on the assets, liabilities,
financial position and results of operations, and which
could endanger the continued existence of the Company.
This applies in particular to transactions involving risk,
errors in accounting or financial reporting and violations
of legal requirements. The Board of Management is
required to set up an appropriate system, to document
that system and monitor it regularly with the aid of the
internal audit department.
Sales locations
Sales locations include separate legal entities, non-sepa-
rate
entities and regional offices. In addition, 105 markets
are serviced by 97 importers.
Subsidiaries
Subsidiaries are those enterprises which, either directly
or indirectly, are under the uniform control of the
management
of BMW AG or in which BMW AG, either
directly or indirectly
– holds the majority of the voting rights
– has the right to appoint or remove the majority of the
members of the Board of Management or equivalent
governing body, and in which BMW AG is at the same
time (directly or indirectly) a shareholder
– has control (directly or indirectly) over another
enter-
prise on the basis of a control agreement or a provision
in the statutes of that enterprise.
Supplier relationship management
Supplier relationship management (SRM) uses focused
procurement strategies to organise networked supplier
relationships, optimise processes for supplier qualifica-
tion and selection, ensure the application of uniform
standards throughout the Group and create efficient
sourcing and procurement processes along the whole value
added chain.
Sustainability
Sustainability, or sustainable development, gives equal
consideration to ecological, social and economic develop-
ment.
In 1987 the United Nations “World Commission
on Environment and Development” defined sustainable
development as development that meets the needs of
the present without compromising the ability of future
generations to meet their own needs. The economic
relevance of corporate sustainability to the BMW Group
is evident in three areas: resources, reputation and risk.