Siemens 2008 Annual Report Download - page 122

26 Corporate Governance Report
Committees
In contrast to the NYSE Standards, which require the creation of several specied board committees, composed
of independent directors and operating pursuant to written charters that set forth their tasks and responsibili-
ties, the Supervisory Board of Siemens AG has combined the functions of a nominating, compensation and
corporate governance committee substantially in the Chairman’s Committee and has delegated the remaining
functions to the Nominating Committee. Both the Audit Committee and the Chairman’s Committee have written
bylaws – adopted by the Supervisory Board based on the NYSE Standards – addressing their respective purposes
and responsibilities.
The Audit Committee of Siemens AG is subject to the standards of the SOA and the Securities Exchange Act of
1934, as applicable to a foreign private issuer, and performs – in cooperation with the Compliance Committee
established in April 2007 – functions similar to those of an audit committee subject to the full NYSE Standards.
Nevertheless, German law precludes certain responsibilities from being delegated to a committee, such as
the selection of the independent auditors, who are required by German law to be elected at the shareholders’
meeting.
In addition, the Supervisory Board of Siemens AG has a Finance and Investment Committee and a Mediation
Committee, the latter of which is required by German law. Neither of these two committees is required under
the NYSE Standards.
Shareholder approval of equity compensation plans; stock repurchases
The NYSE Standards generally require U.S. domestic companies listed on the NYSE to obtain shareholder
approval of all equity compensation plans (including stock option plans) and any material revisions to such
plans. Similarly, our adoption of stock option plans and any material revisions thereto require the approval by
our shareholders insofar as any issuance of shares and/or stock options under authorized or contingent capital
authorizations requires shareholder approval (which approval requires consideration of the key elements of
the applicable option plan or relevant modications). The 2001 Siemens Stock Option Plan, for example, under
which no further options can be issued after December 2006, was approved in 2001 by our shareholders.
Similarly, under German law, share buybacks generally require the prior authorization by shareholders. Such
approval was provided at our January 24, 2008 Annual Shareholders’ Meeting, and this matter will generally
be voted upon annually.