Siemens 2011 Annual Report Download - page 126

6 A. To our shareholders 23 B. Corporate Governance
25 B. Corporate Governance report
31 B. Corporate Governance statement pursuant to
Section a of the German Commercial Code
(HGB) (part of the combined management’s
discussion and analysis)
33 B. Compliance report
36 B. Compensation report
(part of Notes to
Consolidated Financial Statements)

> In its election proposals, the Supervisory Board shall also
pay particular attention to the appropriate participation of
women. Qualified women shall already be included in the
initial process of selecting potential candidates for new
elections or for the filling of Supervisory Board positions
that have become vacant and shall be considered, as appro-
priate, in nominations. There are currently four women on
our Supervisory Board. Our goal is, at the minimum, to
maintain or, if possible, to increase this number at the next
Supervisory Board election in 2013. It is also intended that a
woman join the Nominating Committee following this Su-
pervisory Board election.
> A sufficient number of independent members shall belong
to the Supervisory Board. Material and not only temporary
conflicts of interest, such as organizational functions or ad-
visory capacities with major competitors of the Company,
shall be avoided. In addition, the Supervisory Board mem-
bers shall have sufficient time to be able to devote the nec-
essary regularity and diligence to their mandate.
> The age limitation established in the Bylaws for the Super-
visory Board will be taken into consideration. In addition,
no more than two former members of the Managing Board
of Siemens AG shall belong to the Supervisory Board.
In fiscal 2011, the composition of the Supervisory Board did
not change.
According to the Bylaws for the Supervisory Board, the share-
holder representatives on the Supervisory Board must be in-
dependent. Some Supervisory Board members hold, or held in
the past year, high-ranking positions at other companies with
which Siemens does business; nevertheless, transactions be-
tween Siemens and such companies are carried out on an
arm’s length basis. We believe that these dealings do not
compromise the independence of the relevant Supervisory
Board members.
The Supervisory Board oversees and advises the Managing
Board in its management of the Company ’s business. At regu-
lar intervals, it discusses business development, planning,
strategy and implementation. It reviews the Annual Financial
Statements of Siemens AG, the Consolidated Financial State-
ments of Siemens worldwide, management’s discussion and
analysis of these financial statements and the proposal for the
appropriation of net income. It also discusses Siemens’ quar-
terly and half-yearly reports and approves the Annual Finan-
cial Statements of Siemens AG as well as the Consolidated Fi-
nancial Statements of Siemens worldwide, taking into ac-
count both the audit reports issued by the independent audi-
tors thereon and the results of the review conducted by the
Audit Committee. In addition, the Supervisory Board concerns
itself with the Company ’s adherence to statutory provisions,
official regulations and internal Company policies (compli-
ance). Furthermore, the Supervisory Board appoints the mem-
bers of the Managing Board and determines each member’s
duties. Important Managing Board decisions – such as major
acquisitions, divestments and financial measures – require
Supervisory Board approval, unless the Bylaws for the Super-
visory Board specify that such authority is delegated to the Fi-
nance and Investment Committee of the Supervisory Board.
In the Bylaws for the Managing Board, the Supervisory Board
has established rules that govern the work of the Managing
Board, in particular the allocation of duties among individual
Managing Board members, matters reserved for the Manag-
ing Board as a whole, and the required majority for Managing
Board decisions.
The Supervisory Board currently has six committees whose
duties, responsibilities and procedures fulfill the require-
ments of the German Stock Corporation Act and the Code, re-
flect applicable SOA requirements and incorporate applicable
NYSE rules, as well as certain NYSE rules with which Siemens
AG complies voluntarily. Each committee’s chairperson pro-
vides the Supervisory Board with regular reports regarding
the activities of the relevant committee.
The Chairman’s Committee comprises the Chairman and
Deputy Chairmen of the Supervisory Board as well as one fur-
ther employee representative to be elected by the Supervisory
Board and performs the collective tasks of a ”nominating,
compensation and corporate governance committee” to the
extent that such tasks are not performed by the Nominating
Committee or German law requires such tasks to be per-
formed by the Supervisory Board in full session. In particular,
the Chairman‘s Committee makes proposals regarding the ap-
pointment and dismissal of Managing Board members, han-
dles contracts with members of the Managing Board, prepares
the determination of the Managing Board compensation and
the review of the Managing Board compensation system at
the Supervisory Board’s plenary board meetings. In preparing
recommendations on the appointment of Managing Board
members, the Chairman’s Committee takes into account a
candidate’s professional qualifications, international experi-
ence and leadership qualities, the long-range plans for suc-
cession as well as diversity, and the composition of the Man-
aging Board regarding an appropriate consideration of wom-