Annual Report 2009/10 Excellence in Retailing - Douglas Holding

8 DOUGLAS HOLDING AG
Mission Statement
Letter to the Shareholders
Executive Board
Corporate Governance
Report of the Supervisory Board
DOUGLAS Share
Impressions
Human Resources
REPORT OF THE
SUPERVISORY
BOARD
Dear Shareholders,
The Supervisory Board of DOUGLAS HOLDING AG
dealt extensively with the business and strategic performance
of our Group during the fiscal year under
review. In the 2009/10 fiscal year, the Supervisory
Board fulfilled its duties in accordance with the legal
requirements and the company’s statutes, rules of
order and Principles of Corporate Governance of
DOUGLAS and further monitored and provided advice
to the Executive Board. The Executive Board
reported to the Supervisory Board regularly, comprehensively
and in a timely manner. Beyond these
meetings, the Chairmen of the Supervisory and
Executive Boards remained in close contact to regularly
review strategy options and current policy issues.
Focus of deliberations
The Supervisory and Executive Boards held four
ordinary meetings to discuss in-depth the business
trends in the European retail sector and the financial
performance of the DOUGLAS Group’s individual
corporate divisions. The Executive Board submitted
detailed reports to all Supervisory Board members
before the Supervisory Board meetings. Discussions
were held and decisions made on numerous issues including,
among others:
a) risks and opportunities for the DOUGLAS Group’s
corporate divisions arising from E-Commerce and
the implementation of own multi-channel concepts
for all corporate divisions;
b) intensification of the vertical integration strategy
by means of expanding private and exclusive labels;
c) impact of digitalization on the bookselling business;
d) strategically necessary measures in certain countries;
e) further development of the remuneration system
for the Executive Board;
f) diverse measures to secure earnings in a tough economic
environment;
g) strategic considerations to promote growth of the
Douglas Perfumeries outside of Germany.
Given the impact of the global economic crisis,
weaknesses in the organization and store network
were analyzed and adjusted, processes optimized and
services improved in all markets in which the DOUG-
LAS Group operates. In this respect, pleasing and impressive
progress was made in all areas, so that the
market position was upheld and expanded.
Corporate Governance
Under www.douglas-holding.com the declaration
of compliance according to the Corporate Governance
Code and pursuant to Section 161 of the German Stock
Corporation Law (AktG) was updated and publicized
on the Internet, together with the DOUGLAS HOLD-
ING AG Principles of Corporate Governance.
For purposes of self-evaluation, the Supervisory
Board performs an efficiency audit at regular intervals,
which confirms the open communication and
constructive work among the Board and Committees.
Committees
In addition to holding numerous teleconferences
and individual discussions, the Executive Committee
convened for one meeting during the period under review.
Among other topics, its discussions covered the
strategic further development of the DOUGLAS Group
in Germany and abroad, significant leases, a range of
acquisitions and divestiture projects as well as Executive
Board remuneration and issues relating to human resources.
Additionally, the form and content of the Supervisory
Board’s activities were discussed and reviewed,
with both being found efficient and appropriate by the
Supervisory Board and its Executive Committee.
The Audit Committee met on three occasions during
the 2009/10 financial year. The main focal points
of its deliberations were the DOUGLAS HOLDING AG’s
separate and consolidated annual financial statements,
the current financial structure, the hedging of interest
and foreign currency risks and the operational planning
for the Group. Moreover, the Executive Board and
Audit Committee held three in-depth teleconferences
concerning the quarterly financial reports of the fiscal
year under review. The Supervisory Board as a whole
was kept fully informed of the outcome of the discussions
held at all the committee meetings. There was no
need to convene the Arbitration Committee (pursuant
to Section 27 (3) of the German Codetermination Act).