Corporate Governance by nikeborome


									     chapter 2 / corporate governance

01   Corporate Governance-Code

02   Boards and committees of the Company

03   Functions of the Personally Liable Partners

                                                   Corporate Governance

01   the german corporate governance code ensures that the principles governing the responsible
     management and control of listed companies are transparent for domestic and international investors. The
     aim of the code is to strengthen confidence in the management of German companies. The Code addresses key
     points of criticism in German corporate governance, such as a lack of focus on shareholders’ interests, the dual
     corporate structure of management board and supervisory board, and the limited independence of supervisory
     boards and auditors.

     The Corporate Governance Code does not apply directly to Sal. Oppenheim jr. & Cie. as a partnership
     limited by shares (Kommanditgesellschaft auf Aktien – KGaA), as the Bank is not a listed company. Never-
     theless, Sal. Oppenheim observes these principles insofar as the legal form of a KGaA and its bodies do not
     prescribe otherwise.

02   The Company’s boards and committees are as follows:

     –>    the Personally Liable Partners
     –>    the Shareholders’ Committee
     –>    the Supervisory Board (comprising an equal number of employees and shareholders), and
     –>    the Annual General Meeting.

03   The Personally Liable Partners jointly manage the Company’s business. Each Personally Liable Partner
     is, however, authorised to represent the Company solely and independently for external purposes. The

     98                                                                   sal. oppenheim jr. & cie. | annual report 2005
                                                                          corporate governance / chapter 2

                                                                                        Shareholders’ Committee   04
                                                                                         Annual General Meeting   05
                                                                                              Supervisory board   06

Personally Liable Partners are both managers and owners in that they are liable to the extent of all their
assets for the liabilities of the Company.
     The Shareholders’ Committee performs the tasks assigned to it by the Articles of Association                 04
and the Annual General Meeting and represents the limited liability shareholders and the Company
vis-à-vis the Personally Liable Partners, unless the Annual General Meeting or the Supervisory Board
is required to take responsibility. The Shareholders’ Committee and the Personally Liable Partners
have jointly stipulated that the approval of the Shareholders’ Committee is required for transactions
exceeding normal parameters.

The Annual General Meeting decides on the approval of the annual financial statements, the appropriation          05
of net profit, the discharge of the other boards and committees and the appointment of the auditor. The
resolution on the approval of the annual financial statements and resolutions regarding amendments to
the Articles of Association require the consent of the Personally Liable Partners.

Following the acquisition of BHF-BANK AG at the turn of the year 2004/ 2005, the law now states                   06
that Sal. Oppenheim jr. & Cie. KGaA, as the Group parent company, must maintain a supervisory
board with an equal number of shareholder and employee representatives, given the increased number
of employees. The Supervisory Board of Sal. Oppenheim has twelve members. Six of these were elected
by the shareholders in April 2005. The six employee representatives were determined in a joint election
with BHF-BANK on 15 September 2005. Three employees each from Sal. Oppenheim and BHF-BANK
will represent the employees of the Sal. Oppenheim Group on the Supervisory Board in the future.

annual report 2005 | sal. oppenheim jr. & cie.                                                             99

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