Declaration on Corporate Governance 2010
Statement of Compliance pursuant to Section 161 AktG
The German Corporate Governance Code is now available in its version dated 18 June 2009 which contains new material relating particularly to the area of remuneration which the previous version did not. During financial year 2009, the Management Board and Supervisory Board several times dealt with the issue of corporate governance and in December 2009 delivered the following joint Statement of Compliance 2009 in accordance with Section 161 of the German Stock Corporation Act (AktG):
Pursuant to Section 161 of the German Stock Corporation Act (AktG), the Management Board and Supervisory Board of YOC AG hereby declare that the recommendations made by the Government Commission on the German Corporate Governance Code» and published by the Federal Ministry of Justice on 5 August 2009 in the official section of the electronic German Federal Gazette (Bundesanzeiger) in the version dated 18 June 2009, and until 5 August 2009 in the version dated 6 June 2008, have been complied with apart from the following list of exceptions and will also be complied with in future:
- Point 2.3.2 of the Code: The Company regards the announcement of the invitation to attend the General Meeting in the electronic Bundesanzeiger as sufficient.
- Point 3.8 Par. 2 of the Code: The D&O liability insurance for the Management Board and Supervisory Board has been concluded without a deductible. The Company believes that the motivation and responsibility with which the members of the Management Board and Supervisory Board carry out their duties will not be improved by a deductible. The D&O liability insurance serves to safeguard against the Company’s material own risks and at most serves as a second-line defence of the assets of the members of those Boards. With regard to the D&O liability insurance for the Management Board, Section 23 of the introductory act to the Stock Corporation Act (EGAktG) (transitional provision of the Reasonableness of Management Remuneration Act (Gesetz zur Angemessenheit der Vorstandsvergütung)) is observed.
- Point 4.2.3 Par. 5 of the Code: In deviation from the Corporate Governance Code, payments in the event of a change of control are not limited to 150% of the severance cap. A limit could jeopardise the ability to attract highly qualified employees. According to the Board remuneration structure, a change of control, particularly when Board members participate in the share option programme, will also have the effect of increasing the YOC share price. In addition to the beneficiaries of the share option programme, however, it is also the shareholders who will profit from the rise in the share price, so that in this respect the interests of the Management Board and shareholders are guaranteed to coincide.
- Point 5.1.2 Par. 2 sentence 3 of the Code: The Supervisory Board has not set an age limit for members of the Management Board. The members of the Supervisory Board are convinced that the suitability for company management depends to a large extent on the individual ability to perform.
- Points 5.3.2 and 5.3.3 of the Code: With the Supervisory Board of YOC AG having only three members, it is not practical to establish an Audit Committee and a Nomination Committee. The increased efficiency of auditing the accounts intended by the Code through the establishment of an Audit Committee would not be achieved because the Audit Committee would have to be filled with almost all plenum members. Similarly, the Nomination Committee would have to be filled with almost all plenum members, which would not result in any improved preparation of the decision proposals of the Supervisory Board concerning the election proposals of the shareholders.
- Point 5.4.1 Par. 2 of the Code: No age limit has been set for members of the Supervisory Board. Suitability to monitor the Management Board as a member of the Supervisory Board and to be an equal-ranking contact for the Management Board depends to a large extent on individual effectiveness.
- Point 5.4.4 of the Code: In the opinion of the Management Board and Supervisory Board, in certain cases it may be worthwhile for former members of the Management Board to move to the Supervisory Board and there also to take over the chairmanship of the Supervisory Board or to chair certain committees. The internal knowledge of the former members of the Management Board concerning the enterprise serves to enhance the efficiency of the control exercised by the Supervisory Board.
- Point 5.4.6 Par. 2 of the Code: The remuneration of the Supervisory Board consists of a fixed emolument. Any variable remuneration to be granted beyond this is unnecessary for a performance-related motivation of the Supervisory Board and would not effect any additional incentive or motivational step.
- Point 7.1.2 Par. 4 of the Code: The Company will endeavour to obey the recommendation such that the consolidated financial statements are to be available to the public within 90 days of the end of the financial year and the interim reports within 45 days of the end of the reporting period, but cannot guarantee this due to the large scope of consolidation.
Berlin, 30 December 2009
The Management Board
The Supervisory Board
The Statement has been made permanently available to the public on the website of YOC AG (www.yoc.com) under «Investor Relations».
Information concerning company management practices Basic principles
Sustainable economic, ecological and social actions form a characteristic element of the corporate culture at YOC AG. This also includes integrity in the treatment of employees, investors, customers, suppliers, institutions, interest groups and other stakeholders as well as the public. YOC AG is a stock corporation with its registered office in Germany. The scope for corporate governance thus results on the basis of German law, particularly the Stock Corporation Law and the law on capital markets as well as the memorandum and articles of association of YOC AG. As a service company, YOC AG is compelled to win and maintain the trust of its customers and business partners through exemplary behaviour. The aim is to act in a credible, trustworthy and reliable manner and to convey this image.
A uniform, comprehensive and prompt information policy in the relationship to employees, investors, customers, suppliers, institutions, interest groups and other stakeholders is of high importance to YOC AG. All those mentioned above are provided with information by YOC AG on a uniform, comprehensive, prompt and simultaneous basis. Reporting on the business situation and results of YOC AG and the YOC group of companies takes place through the annual report, the semi-annual report and interim reports. As well as this, information is passed on through ad-hoc communication where legally necessary and through the Company’s website. All messages, presentations and notices as well as the current financial calendar can be viewed on the Company’s website (www.yoc.com) under «Investor Relations». Changes that have to be reported in the make-up of the shareholder structure according to Section 26 of the Securities Trading Act (WpHG) and the purchase and sale of shares of individuals who hold management positions with YOC AG (directors’ dealing according to Section 15 a of the Securities Trading Act (WpHG)) are also published by the Management Board. YOC AG also keeps the stipulated insider registers in accordance with Section 15 b of the Securities Trading Act (WpHG). The individuals this relates to have been informed of the legal duties and sanctions.
The YOC Group is one of the world’s leading providers of mobile marketing, mobile advertising and mobile Internet and as such is exposed to many of the opportunities and risks specific to the sector and enterprise. In agreement with the Act on Control and Transparency in Enterprises (KonTraG), YOC AG has an established, comprehensive and effective system which allows the company to detect, assess, report on and deal with opportunities and risks at an early stage in respect of all functions and business processes. The underlying principles and guidelines have been compiled as risk management guidelines which apply throughout the Group. The aim of these guidelines and all the systems concerned is to systematically detect risks at the earliest possible time, assess the likelihood of their occurring and the potential qualitative and quantitative impact and instigate effective countermeasures. The management of risk is regularly discussed at Management Board and Supervisory Board level, then developed further and discussed with the Company’s auditors. Further information on the Company’s risk management, the particular risks to which it is exposed and the accounts-related internal control and risk management system can be found in the Risk Report which forms part of the Company’s Group Management Report.
Organs of the Company – composition and methods of working
As a German stock corporation, YOC AG is governed by the German Stock Corporation Act (AktG). Its executive organs are thus the General Meeting, the Management Board and the Supervisory Board. The Management Board and Supervisory Board have autonomous powers and collaborate closely and in confidence in steering and supervising the Company.
The YOC AG shareholders exercise their rights through the General Meeting. The Annual General Meeting of YOC AG takes place within the first eight months after each financial year comes to an end. The General Meeting decides on such matters pursuant to Section 119 of the Stock Corporation Act (AktG) as the memorandum and articles of association of the Company, the composition of the Supervisory Board, capital measures and the appointment of the auditors. Each share in the Company grants one vote. All shareholders who register punctually are entitled to participate in the General Meeting. The right to attend or vote may also be exercised through a proxy. In good time prior to each General Meeting YOC AG publishes the relevant invitation, the text of the envisaged resolutions and the necessary reports and information pursuant to the valid provisions of the laws governing stock corporations as published on the website as well as in stipulated media.
In accordance with Section 111 of the Stock Corporation Act (AktG) the Supervisory Board must advise and supervise the activities of the Management Board. It is involved in strategy and planning and in all issues which are of fundamental important for the Company and its approval has to be obtained for all major decisions taken by the Management Board. This includes the corporate planning for the year ahead prepared by the Company once a year (the budget); this is submitted to the Supervisory Board by the Management Board, discussed with it and adapted where necessary. The Supervisory Board also assigns the audit mandate to the auditor appointed by the General Meeting. The YOC AG Supervisory Board consists of three members none of whom were previously on the Company’s Management Board. The Supervisory Board is also responsible for appointing the members of the Management Board. The members of the Supervisory Board are Mr Gerd Schmitz-Morkramer (chairman of the Supervisory Board), Mr Peter Zühlsdorff (deputy chairman of the Supervisory Board) and Dr Arnold Bahlmann. The way the Supervisory Board works is set out formally in rules it has devised. These dictate that it must meet at least once each quarter. The meetings normally demand the physical presence of the Board members. In addition to this, extraordinary meetings may be convened which can, if necessary, be conducted by telephone. The Company’s Management Board attends the meetings regularly and in certain cases other members of the extended management are also invited to attend. At the first meeting each year demanding physical presence after the preparation and auditing of the annual financial statements, the Company’s auditors are in attendance to present their report of the recent audit to the Supervisory Board. The agenda and applications for resolution by the Supervisory Board are communicated to all the participants in writing, allowing sufficient notice. When decisions are needed at short notice, they may be dealt with through a written circulation procedure. All the meetings of the Supervisory Board are minuted in writing. The completed minutes of the meeting have to be approved by all members. The chairman of the Supervisory Board explains the activities of the Supervisory Board each year at the Annual General Meeting and in his report to the shareholders, which is printed in the company’s Annual Report.
The Management Board is appointed by the Supervisory Board. It manages the Company in accordance with Section 76 of the Stock Corporation Act (AktG) and in line with rules established by the Supervisory Board. The periods in office of the members of the Management Board may last up to a maximum of five years, but a member may serve for several periods. The Supervisory Board can nominate a member of the Management Board to be its chairman. Mr Dirk Kraus has been made chairman of the YOC AG Management Board. At present YOC AG has three Management Board posts. The tasks of the Board members are described in the Management Board regulations and do not overlap. Mr Dirk Kraus, the chairman of the Management Board, is responsible for the areas of product development, strategy, marketing and finance. Mr Alex Sutter is responsible for sales and marketing and business development. Mr Jan Webering heads professional services and internationalisation. The Management Board reports to the Supervisory Board regularly, promptly and completely on material facts and circumstances relating to the development of business, strategy and planning, the risk situation of the Group and compliance and also consults the Supervisory Board prior to all important strategic decisions. Meetings of the Management Board are normally held every two weeks for joint consultation. In addition to this, the Management Board regularly obtains information from the members of the Company’s second level of management.
Berlin, March 2010
The Management Board