Guidelines

A working group of well-known supervisory board chairs of listed companies in Germany together with representatives of key institutional investors, academics and corporate governance experts has developed best practice guidelines for simpler and sustainability focussed best-practice management board remuneration. The guidelines cover key design elements of sustainable management board remuneration in Germany, offer companies direction for the alignment of their remuneration plans with institutional investor expectations and support a constructive dialogue between companies and their shareholders.

Design

Design

What should simplified, company-specific remuneration systems look like? How can the remuneration system provide sufficient and reasonable motivation and adequately reflect the company’s strategic orientation as well as sustainability goals? …

Reporting

Reporting

What are investor expectations regarding reporting and transparency on remuneration systems? What expectations do companies have? How should a transparent and comprehensible remuneration system be presented?  

Engagement

Engagement

How should a constructive dialogue between investors and companies on remuneration systems be set up? What expectations do companies have from investors regarding the engagement process and their voting behaviour? …

Working Group

The working group involves supervisory board managers, international investors and corporate governance experts. It consists of the following members:

Supervisory board chairs

  • Dr. Kurt Bock - BASF (Chair), BMW (Deputy Chairman)
  • Dr. Werner Brandt - RWE (Chair), Siemens (Deputy Chairman)
  • Dr. John Feldmann - Hornbach Holding (Chair)
  • Jürgen Fitschen - Vonovia (Chair)
  • Martin Jetter - Deutsche Börse (Chair)
  • Prof. Dr. Ulrich Lehner - Porsche Automobil Holding (Member)
  • Prof. Dr. Norbert Winkeljohann - Bayer (Chair), Sievert (Chair), Deutsche Bank (Member)

Representatives of institutional investors

  • Dr. Vanda Rothacker (Union Investment)
  • Nicolas Huber, Hendrik Schmidt (DWS)
  • Ingo Speich (Deka Investment)
  • Dr. Antje Stobbe (Allianz Global Investors)

Academic representatives

  • Prof. Dr. Christina Bannier (Professor for Banking & Finance Justus Liebig University Gießen & Lecturer Institute for Law & Finance, Goethe University Frankfurt/Main)
  • Prof. Christian Strenger (Deputy Head of DVFA Commission Corporate Governance; Academic Director of the Center for Corporate Governance HHL Leipzig)
  • Prof. Dr. Michael Wolff (Professor for Business Administration, with a focus on Management and Controlling, Georg August University of Göttingen)

Corporate governance experts

  • Dr. Jan Dörrwächter (hkp/// group)
  • Dr. Georg Franzmann (BASF)
  • Lisa Lange (EOS at Federated Hermes)
  • Dr. Stephan Semrau (Bayer)
  • Regine Siepmann (hkp/// group)

Initiators

  • Dr. Hans-Christoph Hirt (CEO, EOS at Federated Hermes)
  • Michael H. Kramarsch (Managing Partner, hkp/// group)
Michael H. Kramarsch, Managing Partner hkp/// group
Michael Kramarsch, Managing Partner, hkp/// group
"Through the implementation of the European Shareholders Rights Directive, remuneration of management board members will become a regular voting item at the annual general meetings of listed German companies. In some cases, companies are insufficiently prepared for the expectations of investors regarding remuneration systems, which is also driven by the different and sometimes not congruent expectations of institutional investors."
Guidelines for sustainable management board remuneration systems
Guidelines for sustainable management board remuneration systems
Download Guidelines
Dr. Hans-Christoph Hirt, CEO Hermes EOS
Dr. Hans-Christoph Hirt, CEO, EOS at Federated Hermes
"Importantly, the devised guidelines will help companies to simplify management board remuneration and to take into account the pay-for-performance relationship more explicitly. In doing so, they will make remuneration systems more comprehensible for the various market players and society. In addition, they will support companies in their preparations to meet the expectations of institutional investors."

Contact

Thomas Müller, Partner, Head of Marketing & Communication hkp/// group,
+49 176 100 88 237, thomas.mueller@hkp.com

Press Office, International Business of Federated Hermes,
+44 (0) 20 7680 8064, press@hermes-investment.com

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