E_mg_GB_03_vorne-29_3_04

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12 CORPORATE GOVERNANCE AT mg mg technologies ag regards the German Corporate Governance Code as an important benchmark that helps management in its efforts to run the company in a responsible and transparent fashion so as to add value. The company complies with all of the Code's material recommendations in its version of May 21, 2003. It has implemented many of its suggestions. Code helps to win and retain investors’ confidence The past two years have seen the establishment of the German Corporate Governance Code, a standard that aligns German financial legislation more closely with practical requirements. The Code stipulates clearly defined disclosure requirements and codes of conduct for the executive boards and supervisory boards of publicly traded German companies in particular. mg technologies ag views this Code as a major contribution to ensuring a functioning capital market. It is the first code to provide companies with a binding benchmark against which to measure their efforts to ensure transparency and guide their management mechanisms. The company is confident that the Code will help strengthen domestic and international investors’ confidence in the German economy. Management and control at mg technologies As a German stock corporation, mg technologies ag has an executive board and a supervisory board, which is the usual structure of corporate management and control in Germany. The Executive Board is responsible for running the company on a day-to-day basis. The Supervisory Board appoints and monitors the Executive Board and advises it on all important corporate issues. The interaction between management and control in the Group is governed by an established system of structures, processes and responsibilities. The functioning of the system’s material inhouse rules and procedures is regularly reviewed and, where necessary, aligned with the latest requirements. This is particularly true of the issues addressed by the Code, such as the executive board, the supervisory board, the annual shareholders’ meeting, transparency, accounting, and auditing. The Executive Board and its terms of reference The Executive Board is responsible for running the company on a day-to-day basis. It devises corporate strategy, coordinates it with the Supervisory Board, and ensures that it is implemented. It is responsible for ensuring compliance with the relevant legislation and for putting in place an appropriate risk management and control system. The rules of internal procedure stipulate in sufficient detail the allocation of mandates and cooperation among the members of the Executive Board.
MANAGEMENT SHARE STRATEGY SPECIAL SECTION MANAGEMENT REPORT FINANCIAL STATEMENTS FURTHER INFORMATION Executive Board • Letter to the Shareholders • Supervisory Board • Report of the Supervisory Board • Corporate Governance at mg In performing its mandates, the Executive Board undertakes to avoid conflicts, and – if they should occur – to inform the Supervisory Board accordingly. The Supervisory Board ensures that the company’s interests are safeguarded at all times. The Supervisory Board and its terms of reference The Supervisory Board consists of 20 members. It comprises equal numbers of shareholder representatives and employee representatives, as required by the German Codetermination Act (MitbestG). The shareholder representatives are appointed by the Annual Shareholders’ Meeting, whereas the employee representatives are elected in accordance with the provisions of the Codetermination Act. The Supervisory Board is appointed for a five-year term. The current Supervisory Board’s term expires at the end of the 2008 Annual Shareholders’ Meeting. The Supervisory Board’s main function is to advise and monitor the Executive Board. It appoints and removes the members of the Executive Board. Certain Supervisory Board and Executive Board functions stipulated in the articles of incorporation and in the rules of internal procedure are subject to its approval. Supervisory Board committees The Supervisory Board is currently assisted in its work by two committees: the Chairman’s Committee, which was set up in 2003, and the Audit Committee. There is also the Mediation Committee, which was set up under the Codetermination Act. Each committee’s responsibilities and procedures are laid down in their own rules of internal procedure. Cooperation between Supervisory Board and Executive Board The Executive Board and the Supervisory Board collaborate closely in the company’s interest and in pursuit of the agreed performance targets. The Executive Board coordinates the Group’s strategy with the Supervisory Board and regularly discusses with it the issues relevant to the implementation of this strategy. It provides the Supervisory Board with regular, timely and comprehensive information on the development of business, the company’s performance, and the risks inherent in its operations. Communication between the Executive Board and the Supervisory Board is characterized by a spirit of openness and trust. They ensure that confidentiality is maintained at all times on issues affecting the company, even amongst colleagues. 13
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mg's mission is to ensure sustainab
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Key Figures for the mg Group RESULT
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