Mercedes 2009 Annual Report Download - page 168

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Our understanding
The importance we place on our corporate governance goes
beyond the mere fulfillment of statutory provisions. In the interests
of all stakeholders, the Board of Management and the Super-
visory Board have the goal of aligning the Group’s management
and controls with national and international benchmarks, pro-
tecting the long-term continuation of the Group with its strong
traditions, and creating sustained value.
General conditions
Daimler AG is a stock corporation with its domicile in Germany.
The legal framework for corporate governance therefore derives
from German law, in particular the Stock Corporation Act, the
Codetermination Act and legislation concerning capital markets,
as well as from the Articles of Incorporation of Daimler AG.
As our shares are also listed on the New York Stock Exchange,
we are obliged to adhere to the capital market legislation and list-
ing requirements applicable in the United States. A description
of Daimler’s corporate governance principles for the US capital
market can seen be in Item 16G of our Annual Report according
to Form 20-F filed by Daimler with the US Securities and
Exchange Commission (SEC), which is posted on our website
at www.daimler.com/ir/reports.
Daimler’s corporate bodies
Shareholders and Annual Meeting. The company’s sharehold-
ers exercise their rights and cast their votes in the Annual Meet-
ing. Each share in Daimler AG entitles its owner to one vote.
There are no Daimler shares with multiple voting rights, no pre-
ferred stock, and no maximum voting rights. All documents
and information relating to the Annual Meeting can be found on
our website at www.daimler.com/ir/am (see also page 57).
Various important decisions can only be made by the Annual
Meeting. These include decisions on the appropriation of distrib-
utable profits, the ratification of the actions of the members
of the Board of Management and the Supervisory Board, the elec-
tion of the external auditors and the election of members of
the Supervisory Board representing the shareholders. The Annual
Meeting also makes other decisions, especially on amendments
to the Articles of Incorporation, capital measures, and the
approval of 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 make management decisions if it is requested to do so by
the Board of Management.
Separation of corporate management and supervision.
Daimler AG is obliged by the German Stock Corporation Act to
apply a dual management system featuring the strict separation
of the two boards responsible for managing and 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 monitors the Board of Management. No
person may be a member of the two boards at the same time.
Supervisory Board. In accordance with the German Codetermi-
nation Act, the Supervisory Board of Daimler AG comprises 20
members. Half of them are elected by the shareholders at the
Annual Meeting. The other half comprises members who are
elected by the company’s employees who work in Germany.
The members representing the shareholders and the members
representing the employees are equally obliged by law to act in
the company’s best interests. The Supervisory Board has also
decided that more than half of the members of the Supervisory
Board representing the shareholders are to be independent in order
to ensure that the Board of Management is advised and moni-
tored independently. The Supervisory Board of Daimler AG ful-
fills this criterion in its present composition. Only one member of
the Supervisory Board is a former member of the Board of
Management.
The Supervisory Board monitors and advises the Board of Man-
agement in its management of the company. It has given itself a
set of rules of procedure, which regulate not only its duties and
responsibilities and the personal requirements placed upon its
members, but above all the convening, preparation and chairing
of its meetings and the procedure of passing resolutions. The
rules of procedure of the Supervisory Board can be seen on our
website at www.daimler.com/dai/rop.
The Supervisory Board has retained the right of approval for
transactions of fundamental importance. Furthermore, it has
explicitly formulated the Board of Management’s duties of
information and reporting.
The Supervisory Board’s duties include appointing and recalling
the members of the Board of Management and deciding on their
remuneration. The Supervisory Board takes the issue of diversity
into consideration in connection with the composition of the
Corporate Governance Report