Mercedes 2004 Annual Report Download - page 91

Issues of company management and supervision are the subject
of discussion by a wide spectrum of society under the heading
of corporate governance. DaimlerChrysler welcomes the various
initiatives aimed at raising general standards of corporate gov-
ernance. Many of the resulting principles and recommendations
have already been practiced for a long time at our company.
As DaimlerChrysler is a company with its roots in both Germany
and the United States, the Board of Management and the Super-
visory Board aim to make DaimlerChrysler’s corporate gover-
nance system more international and transparent. This purpose
is also served by the details given on the following pages. Further
information on corporate governance at DaimlerChrysler is avai-
lable on the Internet at www.daimlerchrysler.com/corpgov_e.
General conditions. DaimlerChrysler is a stock corporation with
its domicile in Germany. The legal framework for corporate
gov-ernance therefore derives from German Law, particularly the
Stock Corporation Law, the Codetermination Law and legislation
concerning capital markets, as well as from the Memorandum
and Articles of Incorporation of DaimlerChrysler AG.
As our shares are listed on stock exchanges outside Germany,
and in particular on the New York Stock Exchange (NYSE), we
also have to adhere to those countries’ capital-market legislation
and the listing regulations applicable at those stock exchanges.
The Sarbanes-Oxley Act of the United States of America is of
particular significance in this respect. We are therefore in favor
of the convergence of international stock-exchange regulations.
A general description of the differences between DaimlerChrysler’s
corporate governance practices and those applicable to US
companies under NYSE corporate governance listing standards is
available on our website at www.daimlerchrysler.com/corpgov_e.
DaimlerChrysler’s corporate bodies
Shareholders and the Annual Meeting. The company’s share-
holders exercise their rights and cast their votes at the Annual
Meeting. Each share in DaimlerChrysler AG entitles its owner to
one vote. There are no shares with multiple voting rights,
no preferred or privileged stock, and no maximum voting rights.
Various important decisions can only be taken by the Annual
Meeting. These include the decision on the appropriation of
distributable profits, the ratification of the actions of the members
of the Board of Management and of the Supervisory Board,
the election of the independent auditors and the election of
members of the Supervisory Board. The Annual Meeting also
takes decisions on amendments to the Memorandum and Arti-
cles of Incorporation, capital measures, and consent to certain
intercompany agreements. The influence of the Annual Meeting
on the management of the company is limited by law, however.
The Annual Meeting can only take management decisions if it is
requested to do so by the Board of Management.
Separation of corporate management and supervision.
DaimlerChrysler AG is obliged by the German Stock Corporation
Law to apply a dual management system featuring the strict
separation of the two boards responsible for managing and for
supervising the company (two-tier board). With this system, the
company’s Board of Management is responsible for the executive
functions, while the Supervisory Board appoints, monitors and
advises the Board of Management. No person may be a member
of these two boards at the same time.
The members of the Board of Management bear shared respon-
sibility for managing the company, and the work of the Board
of Management is coordinated by the Chairman of the Board of
Management.
The Supervisory Board is involved in decisions of fundamental
importance, and the work of the Supervisory Board is coordinated
by the Chairman of the Supervisory Board. Half of the members
of the Supervisory Board are elected by the shareholders at
the Annual Meeting. The other half comprises members who are
elected by the company’s German employees. The members
Corporate Governance at DaimlerChrysler
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