Siemens 2014 Annual Report Download - page 135

171 C. Combined Management Report 247 D. Consolidated Financial Statements 337 E. Additional Information
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> An adequate number of independent members shall belong
to the Supervisory Board. Material and not only temporary
conflicts of interest, such as organizational functions or advi-
sory capacities with major competitors of the company, shall
be avoided. Under the presumption that the mere exercise of
Supervisory Board duties as an employee representative
gives no cause to doubt the compliance with the indepen-
dence criteria pursuant to Section .. of the Code, the
Supervisory Board shall have a minimum of  members who
are independent in the meaning of the Code. In any case, the
Supervisory Board shall be composed in such a way that a
number of at least six independent shareholder representa-
tives in the meaning of Section .. of the Code is achieved.
In addition, the Supervisory Board members shall have suffi-
cient time to be able to devote the necessary 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.
These objectives for the Supervisory Board’s composition have
been fully achieved: a considerable number of Supervisory
Board members are currently engaged in international activi-
ties and / or have many years of international experience. Since
the Supervisory Board election in , the Supervisory Board
has had five female members. Dr. Nicola Leibinger- Kammüller
is a member of the Nominating Committee. The Supervisory
Board has an adequate number of independent members. In
the opinion of the Supervisory Board, a minimum of  Super-
visory Board members are independent in the meaning of Sec-
tion .. of the Code. Some Supervisory Board members
hold – or have held in the past fiscal year – high-ranking posi-
tions at other companies with which Siemens does business.
Transactions between Siemens and such companies are carried
out on an arm’s length basis. We believe that these trans-
actions do not compromise the independence of the Super-
visory Board members in question.
The Supervisory Board oversees and advises the Managing
Board in its management of the Company’s business. At regular
intervals, the Supervisory Board discusses business develop-
ment, planning, strategy and the strategy’s implementation.
It reviews the Annual Financial Statements of Siemens AG and
the Consolidated Financial Statements of the Siemens Group,
the Combined Management Report of Siemens AG and the
Siemens Group, and the proposal for the appropriation of net
income. It approves the Annual Financial Statements of
Siemens AG as well as the Consolidated Financial Statements
of the Siemens Group, based on the results of the preliminary
review conducted by the Audit Committee and taking into
account the reports of the independent auditors. The
Supervisory Board decides on the Managing Board’s proposal
for the appropriation of net income and the Report of the
Supervisory Board to the Annual Shareholders’ Meeting. In
addition, the Supervisory Board or the Compliance Committee,
which is described in more detail below, concern themselves
with the Company’s adherence to statutory provisions, official
regulations and internal Company policies (compliance). The
Supervisory Board also appoints the members of the Managing
Board and determines each member’s portfolios. Important
Managing Board decisions – such as those regarding major
acquisitions, divestments, fixed asset investments and finan-
cial meas ures – require Supervisory Board approval, unless the
Bylaws for the Supervisory Board specify that such authority be
delegated to the Innovation and Finance Committee of the
Super visory Board. In the Bylaws for the Managing Board, the
Supervisory Board has established the rules that govern the
Managing Board’s work.
The Supervisory Board has seven committees, whose duties,
responsibilities and procedures fulfill the requirements of the
German Stock Corporation Act and the Code. The chairmen of
these committees provide the Supervisory Board with regular
reports on their committees’ activities.
The Chairman’s Committee, which comprises the Chairman
and Deputy Chairmen of the Supervisory Board as well as one
further employee representative elected by the Supervisory
Board, makes proposals, in particular, regarding the appoint-
ment and dismissal of Managing Board members and handles
contracts with members of the Managing Board. In preparing
recommendations on the appointment of Managing Board
members, the Chairman’s Committee takes into account the
candidates’ professional qualifications, international experience
and leadership qualities, the age limit specified for Managing
Board members, the Managing Board’s long-range plans for suc-
cession as well as its diversity and, in particular, the appropriate
consideration of women. The Chairman’s Committee concerns
itself with questions regarding the Company’s corporate gover-
nance and prepares the resolutions to be approved by the Super-
visory Board regarding the Declaration of Conformity with the
Code ‒ including the explanation of deviations from the Code ‒
and regarding the approval of the Corporate Governance Report
as well as the Report of the Supervisory Board to the Annual
Shareholders’ Meeting. Furthermore, the Chairman’s Committee
submits recommendations to the Supervisory Board regarding
the composition of the Supervisory Board committees and de-
cides whether to approve contracts and business transactions
with Managing Board members and parties related to them.
The Compensation Committee, which comprises the mem-
bers of the Chairman’s Committee of the Supervisory Board as
well as one of the Supervisory Board’s shareholder representa-
tives and one of the Supervisory Board’s employee representa-
tives, prepares, in particular, the proposals for decisions by the