Siemens 2008 Annual Report Download - page 105

At the Annual Shareholders’ Meeting on January 24, 2008, the ve-year term of the Supervisory Board
members elected at the Annual Shareholders’ Meeting in 2003 expired. Seven shareholder representa-
tives and four employee representatives left the Supervisory Board. I would like to thank the departing
members for their dedication and their constructive work on the Supervisory Board and its committees
during their term of ofce. A new Supervisory Board was elected for the period 2008 to 2013. At the
constituent meeting of the Supervisory Board on January 24, 2008 – immediately following the Annual
Shareholders’ Meeting – the Chairman, First Deputy Chairman and Second Deputy Chairman of the
Supervisory Board were conrmed in their ofces and the necessary committee appointments made.
At our meeting on April 29, 2008, the Managing Board reported on the Company’s business and nancial
position at the end of the second quarter and informed the Board of the status of negotiations regarding
the sale of Siemens Enterprise Communications (SEN). In addition, the Supervisory Board discussed the
status of compliance-related investigations. The Board was also informed about the contractual modali-
ties of the Company’s directors and ofcers (D&O) liability insurance. Also at this meeting, the Supervi-
sory Board – adopting a proposal by the Chairman’s Committee – appointed Jim Reid-Anderson a mem-
ber of the Managing Board of Siemens AG, effective May 1, 2008. The previous CEO of the Siemens
Healthcare Sector, Professor Dr. Erich R. Reinhardt, resigned from the Managing Board on April 30, 2008.
At our meeting on July 29, 2008, we dealt with the Company’s business and nancial position as well as
the status of compliance-related measures and a report on the work of the Compliance Committee. On
the basis of an expert opinion provided by the law rm Hengeler Mueller, the Supervisory Board decided
to seek damages from former members of the Corporate Executive Committee on the grounds that – in
connection with allegations of illegal business practices and extensive bribery in international transac-
tions in the years 2003 to 2006 and the resulting nancial burdens on the Company – they had breached
their organizational and supervisory duties. It was decided to claim damages from two former members
of the Corporate Executive Committee arising from payments made to Wilhelm Schelsky or his compa-
nies. It was also decided that the former Corporate Executive Committee members in question be given
an opportunity to state their positions regarding the allegations before a decision was made to enforce
the damage claims. In addition, the Supervisory Board received a detailed report from the Managing
Board on the status of the project to reduce sales, general and administrative (SG&A) costs. At the meet-
ing, the Supervisory Board also discussed the Managing Board’s new compensation system and the stock-
oriented remuneration plan and approved the adjustments made to the Bylaws for the Managing Board,
Supervisory Board and the Chairman’s, Audit and Compliance Committees. At the meeting, the Super-
visory Board extended the stock buyback program that had been approved in November 2007.
At our meeting on September 24, 2008, the Managing Board provided an overview of the state of the
Company against the backdrop of the nancial and real estate crisis in the U.S. and the anticipated eco-
nomic downturn in and outside Germany. This topic was also the focus of a report on the business strat-
egy of Siemens Financial Services. In addition, the Healthcare Sector reported on the current status of its
business. We also discussed the status of the bidding procedure for appointing the independent auditors.
We also met once in executive session. At this meeting, in which only members of the Supervisory Board
participated, we discussed the efciency review of Supervisory Board operations.
Report of the Supervisory Board 9