Declaration on Corporate Governance 2014
The Declaration on Corporate Governance pursuant to Sect. 289a HGB includes the Declaration of Conformity in accordance with Sect. 161 of the German Stock Corporation Act (AktG), relevant information concerning company management practices and a description of the working methods of the Management Board and the Supervisory Board.
This declaration forms part of the Management Report of YOC AG and Group Management Report of YOC Group for the financial year 2014. According to Sect. 317 Para. 2 Sent. 3 HGB, the information pursuant to Sect. 289a HGB is not among the information that is subject to an auditor’s scrutiny.
Declaration by the Management Board and Supervisory Board of YOC AG in accordance with Sect. 161 Stock Corporation Act (AktG) on the German Corporate Governance Code in the version of 24 June 2014 (Declaration of Conformity 2014).
According to Sect.161 AktG, the Management Board and the Supervisory Board of a listed company must annually declare that the recommendations of the “Government Commission on the German Corporate Governance Code” in the official part of the electronic Federal Gazette published by the German Federal Ministry of Justice were or are compiled with, or which recommendations for valid reasons were or are not applied. The declaration must be made publicly available on the company’s website.
The German Corporate Governance Code (DCGK) contains provisions, not all of which are equally binding. Aside from descriptions of current company law, it contains recommendations which companies may deviate from, in which case, however, they are obliged to disclose this annually. According to Sect. 161 AktG, deviations from the recommendations of the DCGK must be justified. Furthermore, the DCGK contains suggestions which companies may disregard without disclosing that they have done so. The following declaration concerns the period since the last Declaration of Conformity of March 2014, and refers to the requirements of the DCGK in its current version of 24 June 2014.
The Management Board and the Supervisory Board of YOC AG declare that the recommendations made by the “Government Commission on the German Corporate Governance Code” are and were fundamentally complied with in the past. The Management Board and the Supervisory Board also intend to comply with it in the future. Only the following recommendations of the German Corporate Governance Code were and are not applied:
- Item 3.8 Para. 3 DCGK: The company is of the opinion that the motivation and responsibility with which the members of the Supervisory Board carry out their duties will not be improved by an insurance excess. 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 bodies. The D&O insurance for the Supervisory Board was therefore taken out without an excess.
- Item 4.2.1 DCGK: According to item 4.2.1 of the DCGK, the Management Board is to consist of several persons and have a chairman or spokesman. During the financial year 2014, YOC AG’s Management Board consisted of one person. Since 1 January 2015, it has been fully restored and two members with equal rights have been appointed. In agreement with the Supervisory Board and Management Board, the Group renounces a spokesman or chairman, as a hierarchy within the Management Board is not deemed necessary with respect to the company’s size.
- Item 4.2.2 Para. 2 Sent. 3 DCGK: The Supervisory Board is to consider the relationship between the remuneration of the Management Board and that of senior management and of the staff overall, particularly in terms of its development over time. For this comparison the Supervisory Board must determine how senior management and the relevant staff are to be differentiated. No explicit differentiation has taken place in order to uphold the economic scope of the different bodies for salary negotiations.
- Item 5.1.2 Para. 2 Sent. 3 DCGK: No age limit for members of the Management Board has been set by the Supervisory Board. The members of the Supervisory Board are convinced that the suitability for company management depends largely on individual capabilities.
- Items 5.3.1, 5.3.2 and 5.3.3 DCGK: As the Supervisory Board of YOC AG has only three members, it would be neither practical nor in accordance with best practice standards to set up committees, particularly an audit committee or nomination committee. The purpose of setting up an audit committee as proposed by the DCGK is to increase the efficiency of auditing. This aim would not be achieved at YOC AG as nearly all members of the plenum would have to sit on the audit committee. Similarly, nearly all plenum members would have to sit on the nomination committee, which would not bring any improvement in the preparation of Supervisory Board recommendations regarding candidates proposed by the shareholders.
- Item 5.4.1 Para. 2 DCGK: No age limit has been set for Supervisory Board members. A candidate’s ability to monitor and act as a coequal contact for the Management Board depends mainly on individual capabilities.
- Item 5.4.3 Sent. 2 DCGK: According to Item 5.4.3 Sent. 2 DCGK, the next General Meeting is to be set as the deadline for an application for judicial appointment of a Supervisory Board member. To ensure continuity and efficient and productive work in the Supervisory Board, no deadline was set for the application for judicial appointment of the present Supervisory Board members.
- Item 7.1.2 Sent. 4 DCGK: The company will endeavour to comply with the recommendation that the consolidated financial statements be made available to the public within 90 days after the end of the financial year and the interim reports within 45 days after the end of the reporting period, but cannot guarantee that it will do so owing to the large scope of consolidation.
Berlin, March 2015
The Management Board
The Supervisory Board