Corporate Governance Declaration
Corporate Governance Declaration
Corporate Governance Declaration in Accordance with section 289a of the Handelsgesetzbuch (HGB – German Commercial Code)
DECLARATION OF COMPLIANCE IN ACCORDANCE WITH § 161 OF THE AKTIENGESETZ
(AKTG – GERMAN STOCK CORPORATION ACT)
THE MANAGEMENT BOARD AND THE SUPERVISORY BOARD OF TOM TAILOR HOLDING SE SUBMITTED A DECLARATION OF COMPLIANCE IN ACCORDANCE WITH SECTION 161 AKTG IN DECEMBER 2018.
TEXT OF THE DECLARATION BY THE MANAGEMENT BOARD AND THE SUPERVISORY BOARD OF TOM TAILOR HOLDING SE ON THE GERMAN CORPORATE GOVERNANCE CODE IN ACCORDANCE WITH SECTION 161 AKTG (DECLARATION OF COMPLIANCE)
TOM TAILOR HOLDING SE, HAMBURG
Since the last Declaration of Compliance was issued in December 2017, TOM TAILOR Holding SE has complied with the recommendations of the Government Commission on the German Corporate Governance Code published by the German Federal Ministry of Justice in the Federal Gazette recently in the latest version dated 07 February 2017 with the exception of clause 4.1.3 sentence 2 (Compliance Management System), clause 5.3.3 (Establishment of a Nomination Committee), clause 5.4.1 paragraph 2 sentence 1, paragraph 4 sentence 1 (Overall Profile of Skills and Expertise for the Supervisory Board) and clause 5.4.6 paragraph 1 sentence 2 (Compensation for Members of the Supervisory Board):
- Since April 2017 Management Board has started with the preparation and implementation of a specific Compliance Management System across the group within the meaning of clause 4.1.3 sentence 2 German Corporate Governance Code (GCGC). This system provides appropriate measures reflecting the company’s risks situation in order to ensure that all provisions of law and the company’s internal policies are complied with. This Compliance Management System has been extended in the year 2018. Due to the fact that the General Data Protection Regulation came into force on May 25th 2018, Data Protection Compliance received special attention. Beyond that, personal resources were increased for the further development of the Compliance Management System.
- The Supervisory Board has no plans at present to establish a nomination committee within the meaning of clause 5.3.3 of the GCGC. The Supervisory Board comprises five members (shareholder representatives) and therefore sees itself as being in a position to nominate new members based on a proposal by the plenum if this should prove necessary.
- According to appraisal of Supervisory Board its members fulfil all fields of competence which are required for an efficient activity of Supervisory Board. Currently, Supervisory Board has considered the determination of an overall profile of skills and expertise within the meaning of section 5.4.1 paragraph 2 sentence 1 GKGC as not required. Therefore, proposals by the Supervisory Board to the General Meeting for appointment of new Supervisory Board members will not aim at fulfilling the overall profile of required skills and expertise of Supervisory Board within the meaning of clause 5.4.1 paragraph 4 sentence 1 GCGC. In consequence, Corporate Governance Report does not publish information about the implementation status according to clause 5.4.1 paragraph 4 sentence 2 GCGC.
- In deviation from the recommendation in clause 5.4.6 paragraph 1 sentence 2 GCGC, the position of Vice Chairman of the Supervisory Board of the Supervisory Board is not considered when setting compensation for Supervisory Board members. The Vice Chairman of the Supervisory Board does not currently undertake any additional duties which would represent a greater burden compared to those of a regular Supervisory Board member.
Hamburg, December 2018.
THIS DECLARATION OF COMPLIANCE AND ALL PREVIOUS DECLARATIONS OF COMPLIANCE ARE PUBLISHED ON TOM TAILOR HOLDING SE’S WEBSITE AT http://ir.tom-tailor-group.com.
DISCLOSURES ON CORPORATE GOVERNANCE PRACTICES
RESPONSIBLE CORPORATE GOVERNANCE
TOM TAILOR Holding SE is the management holding company and parent of the TOM TAILOR GROUP. The various TOM TAILOR Holding SE subsidiaries conduct the operating business (the subsidiaries and TOM TAILOR Holding SE are also referred to jointly as “TOM TAILOR” or the “TOM TAILOR GROUP”). TOM TAILOR Holding SE and its governing bodies are committed to good, responsible corporate governance. This philosophy is shared by the entire TOM TAILOR GROUP.
In addition to compliance with these principles of good corporate governance, company specific guidelines and standards also contribute to good, sustainable business performance at TOM TAILOR.
WORKING PRACTICES OF THE MANAGEMENT BOARD AND THE SUPERVISORY BOARD
TOM TAILOR Holding SE is a stock corporation established in accordance with European law. The legal framework for corporate governance is therefore provided by the provisions of Council Regulation (EC) No. 2157/2001 of 8 October 2001 on the Statute for a European company (SE) and by German stock corporation law, particularly the provisions governing the Management Board and the Supervisory Board.
The Management Board conducts TOM TAILOR Holding SE’s business and represents the Company in dealings with third parties. It manages the Company on its own responsibility and in the Company’s best interests with the aim of ensuring sustained value creation. The Management Board develops the corporate strategy, and manages and supervises its implementation. In addition, it ensures that all statutory provisions and applicable internal corporate guidelines are observed (compliance). The Management Board has also implemented an internal control and risk management system. This is an integral part of its business processes and a key element in corporate decisions. The planning system, internal reporting and risk reporting are key components of this.
The Supervisory Board has adopted by-laws for the Management Board, which set out the transactions and measures for which a resolution by the full Management Board is required, as well as the principles for decision-making within the Management Board as a whole. In addition, the Supervisory Board has listed a catalogue of transactions in the by-laws that may only be performed with the approval of the Supervisory Board. These include transactions and measures that have a material effect on the net assets, financial position and results of operations of the TOM TAILOR GROUP. As part of the implementation of the provisions of the by-laws, the full Management Board has adopted a schedule of responsibilities that assigns responsibility for specific areas of activity to individual members of the Management Board, without this affecting the overall responsibility of the Management Board.
The Management Board currently has three members. The members cooperate in a collegial manner and inform one another on an ongoing basis about important measures and events within their areas of responsibility. Generally speaking, the Management Board passes resolutions in regular meetings. Resolutions require a simple majority.
The members of the Management Board are Dr Heiko Schäfer (Chief Executive Officer, CEO), Thomas Dressendörfer and Liam Devoy.
The former member of the Management Board Uwe Schröder left the Company effective 29 May 2017 by mutual agreement. Mr Schröder was appointed by the Supervisory Board with effect from 22 September 2016 for the duration of one year in accordance with section 105 (2) of the Aktiengesetz (AktG – German Stock Corporation Act) to deputise for the CEO, Dieter Holzer, who had stepped down. Uwe Schröder assumed responsibility on an interim basis for the Sales and Marketing Board department that Mr Holzer had managed, especially for issues related to products, sales and the collections, but did not take over as CEO.
With effect from 1 August 2017 Liam Devoy was named Management Board member responsible for operations (COO) with a focus on purchasing, logistics and IT.
The members of the Management Board were appointed at different times.
Appointment of Management Board Members
|Dr. Heiko Schäfer
Born in 1972
Chief Executive Officer (CEO)
|Since 22 September 2016
From 2015 to 2016
|Chief Executive Officer of TOM TAILOR Holding SE
Member of the Management Board of TOM TAILOR Holding SE
|Until 15 March 2020
Born in 1958
Chief Financial Officer (CFO)
|Since 15 June 2016
||Member of the Management Board of TOM TAILOR Holding SE
||Until 30 June 2019
Born in 1962
Chief Operating Officer (COO)
|Since 1 August 2017
||Member of the Management Board of TOM TAILOR Holding SE
||Until 31 Juli 2020
CEO Dr Heiko Schäfer (born 1972) joined the Management Board of TOM TAILOR GROUP as at 1 December 2015. In his function as Chief Operating Officer (COO) at that time, he was responsible for purchasing, logistics and IT, as well as project and process management. The Supervisory Board additionally appointed him the new Chief Executive Officer (CEO) on an interim basis with effect from 22 September 2016. In this position Dr Heiko Schäfer is responsible for strategy, sales, e-commerce and public relations. He was permanently appointed to this position by the Supervisory Board with effect from 15 March 2017. Dr Heiko Schäfer’s term on the Management Board runs until 15 March 2020.
Dr Schäfer started his career at the Boston Consulting Group, where he advised clients for more than six years, mainly from the consumer goods and retail sectors, in sales/marketing and operations topics. Prior to that, he built up extensive experience parallel to his academic studies as a consultant in prestigious consulting companies.
Dr Schäfer joined the TOM TAILOR GROUP from the private equity firm Kohlberg Kravis Roberts (KKR) in London. Previously, Dr Heiko Schäfer worked for over six years as a senior executive for the adidas Group, where his last position was Senior Vice President with responsibility for product development, sourcing and logistics for the four lifestyle/fashion labels of the adidas umbrella brand.
Dr Heiko Schäfer studied business administration at the University of Saarbrücken and subsequently earned a doctorate degree at the University of Mannheim with a dissertation on cross-selling.
Thomas Dressendörfer (born in 1958) assumed the position of Chief Financial Officer (CFO) within the TOM TAILOR GROUP with effect from 15 June 2016. In this capacity he is responsible for finance and accounting, controlling, investor relations, human resources and legal affairs. His Management Board’s appointment runs until 30 June 2019.
Thomas Dressendörfer has built up extensive experience as the CFO of exchange-traded companies and major corporate divisions and regions. He previously held CFO positions at Swiss implant manufacturer Institut Straumann AG, which is listed on the Swiss SIX stock exchange, and technology firm Uster Technologies AG, also based in Switzerland. During the course of his career he has also held senior finance positions at Randstad, The Nielsen Company and Procter&Gamble. As an independent consultant he recently advised companies on complex business projects and turnarounds.
Since January 2016, Thomas Dressendörfer has also served as an operating partner of WP Management in Bad Homburg. From April 2016 to April 2017, he was also a member of the Supervisory Board of Pax Anlage AG in Basle/Switzerland.
Thomas Dressendörfer has a master’s degree in business administration from the University Erlangen-Nuremberg.
Liam Devoy has been a member of the Management Board of TOM TAILOR Holding SE since 1 August 2017. As Chief Operating Officer (COO), he is the Management Board member responsible for operations with a focus on purchasing, logistics and IT.
Liam Devoy has logged more than 20 years of experience in the fashion and sportswear industry. He worked in operations roles for companies including Quicksilver, Marc Jacobs, The Childrens Place and Reebok.
Most recently, Liam Devoy was responsible for the strategic focus of the worldwide supply chain of the adidas Group as Vice President Global Supply Chain Strategy. His responsibilities in earlier roles with adidas and Reebok also included setting up the global warehouse network.
Liam Devoy studied English and Politics at Bridgewater State University.
With the exception of the aforementioned duties, the Management Board members of the Company neither hold currently nor held during the past five years any board of directors, management or supervisory board seats or partnerships on comparable boards in Germany or abroad outside of the TOM TAILOR GROUP.
The Supervisory Board of TOM TAILOR Holding SE advises and supervises the Management Board in the management of the Company. The Supervisory Board is also responsible for appointing the members of the Management Board, for approving the annual financial statements and the consolidated financial statements, and for engaging the Company’s auditors.
The Management Board and the Supervisory Board of TOM TAILOR Holding SE work together closely and in an atmosphere of mutual trust for the benefit of the Company. The Management Board agrees the Company’s strategic orientation with the Supervisory Board and regularly discusses the status of the strategy’s implementation with it. The Management Board informs the Supervisory Board regularly, promptly and extensively on all issues related to strategy, planning, business development, the risk and opportunity position, the internal control and risk management system and compliance that are relevant for the Company. The Chief Executive Officer also regularly exchanges information with the Chairman of the Supervisory Board between the Supervisory Board meetings.
The Supervisory Board has adopted by-laws for itself. These contain, among other things, detailed procedural rules for its meetings and how they are to be chaired by the Chairman of the Supervisory Board, as well as rules on committee work.
According to section 9 (2) sentences 1 and 2 of the Memorandum of Association, the Supervisory Board consists of twelve members appointed by the Annual General Meeting. Of these twelve members, six members must be appointed based on employee nominations. The Annual General Meeting is bound by the proposals for the appointment of employee representatives. In accordance with section 9 (3) of the Memorandum of Association, Uwe Schröder, Thomas Schlytter-Hennrichsen, Andreas Karpenstein, Patrick Lei Zhong, Liqun (Carrie) Liu and Jerome Griffith were appointed members of the first Supervisory Board as shareholder representatives.
At the Company’s Annual General Meeting on 31 May 2017, an amendment of section 9 (2) sentences 1 and 2 of the Memorandum of Association of TOM TAILOR Holding SE was agreed in accordance with section 9 (2) of the agreement dated 6 July 2016, on the involvement of employees in the Company in accordance with section 21 of the SE-Beteiligungsgesetz, or Act on Employee Involvement in an SE, ("Employee Participation Agreement”) and supplement dated 19 May 2017, that stipulates that the Supervisory Board of TOM TAILOR Holding SE consists of ten members appointed by the Annual General Meeting. Of the ten members, five members are appointed upon recommendation of the employees, with the Annual General Meeting bound by these proposals.
The shareholder representatives appointed as per the Memorandum of Association – Uwe Schröder, Patrick Lei Zhong and Liqun (Carrie) Liu – indicated to the Company prior to entry of the Company in the commercial register in the legal form of an SE on 18 April 2017 – that they would not accept their appointment as Supervisory Board members.
Prior to the Company’s reorganisation as an SE, Uwe Schröder had already taken an interim position on the Company’s Management Board beginning on 22 September 2016 and ending when he stepped down with effect from 29 May 2017. Liqun (Carrie) Liu and Patrick Lei Zhong had stepped down from their previous positions as Supervisory Board members as at 23 August 2016, and 31 August 2016, respectively. With effect from 21 September, 2016, Hamburg Local Court appointed Yun (Joann) Cheng and Wei Han as members of the Supervisory Board in accordance with section 104 AktG. On 22 November 2016, Wei Han stepped down. Hamburg Local Court then appointed Dr Junyang (Jenny) Shao as a member of the Supervisory Board with effect from 13 February 2017, in accordance with section 104 AktG. The term of office of the two court-appointed Supervisory Board members Ms Yun (Joann) Cheng and Dr Junyang (Jenny) Shao ran until the end of the Annual General Meeting on 31 May 2017.
Furthermore, Thomas Schlytter-Henrichsen and Jerome Griffith stepped down as shareholder representatives to the Supervisory Board effective at the end of the Annual General Meeting on 31 May 2017.
Against this backdrop and in view of the fact that Andreas Karpenstein was the only remaining shareholder representative appointed as per the Memorandum of Association, it was necessary for the Annual General Meeting of the Company on 31 May 2017 to elect four new Supervisory Board members to act as shareholder representatives and an additional five Supervisory Board members to serve as employee representatives.
In this context, Dr Thomas Tochtermann (Chairman of the Supervisory Board), Otmar Debald, Yun (Joann) Cheng and Dr Junyang (Jenny) Shao were elected to the Supervisory Board of the Company as shareholder representatives.
The employee representatives newly appointed to the Supervisory Board were Barbara Pfeiffer (Deputy Chairman of the Supervisory Board), Stefanie Branahl, Kitty Cleijne-Wouters, Sven Terpe and Oliver Kerinnes.
As a general rule, their term of office is for a period of five years. In a departure from this principle, the term of office of Andreas Karpenstein, who had been appointed to the Supervisory Board as a shareholder representative in the Company’s Memorandum of Association, runs to the end of the Annual General Meeting responsible for approving the activities for the first fiscal year of the Company, i.e. until the end of the 2018 Annual General Meeting, as per the Memorandum of Association.
- Dr Thomas Tochtermann
(Chairman of the Supervisory Board)
Independent management consultant for Hvidehus GmbH, Hamburg
Born in 1960, Dr Thomas Tochtermann has many years of experience in the fashion and lifestyle sector. He looks back on thirty years as a consultant at McKinsey&Company with a focus on branding and the fashion and consumer goods industry. In addition, he has extensive experience in strategy, marketing, organisation and sales. Since June 2014, Dr Tochtermann has worked as an independent consultant and supervisory board member at international consumer goods and fashion companies as well as international institutions.
From 1980 to 1985, he studied business administration at Ludwig Maximilian University in Munich and completed his degree there (Dr. rer. Pol.) in the period from 1988 to 1989.
- Barbara Pfeiffer
(Deputy Chairman of the Supervisory Board)
Employee and Chairman of the Works Council at Tom Tailor GmbH, Hamburg, Chairman of the SE Works Council and member of the Executive Committee of the SE Works Council
Barbara Pfeiffer, born 1966, has been employed at TOM TAILOR GmbH in Hamburg, since 2006. She was employed in various purchasing positions at the TOM TAILOR GROUP, most recently as Director Strategic Buying. Since 2014, she has been Chairman of the Works Council of Tom Tailor GmbH in Hamburg and as such has been released from these duties.
Ms Pfeiffer began her career at Levi Strauss Germany in 1993, where her last position was Product Manager. From 1997 to 2006, she worked at Esprit Germany in various sourcing positions.
In the period from 1987 to 1992, Barbara Pfeiffer attended Albstadt-Sigmaringen University and completed her studies with a Dipl. Ing. (University of Applied Sciences) qualification in apparel technology.
- Otmar Debald
Independent management consultant, working under his own name and for his own company)
Born in 1954, Otmar Debald was employed for 30 years in various positions at consumer goods company Procter&Gamble, most recently as Director of Finance in Germany with additional responsibility for logistics and customer service in Germany, Austria and Switzerland. Since 2013, he has been a Senior Advisor at Corfina AG, additionally acting as that company’s shareholder since January 2018.
Otmar Debald studied at the University of Freiburg, where he completed his degree in economics (Diplom-Volkswirt) in 1979.
- Andreas Karpenstein
Partner and Managing Director of Deloitte Legal Rechtsanwaltsgesellschaft mbH, Düsseldorf
Andreas Karpenstein (born in 1963) has been Partner and Managing Director at Deloitte Legal Rechtsanwaltsgesellschaft mbH, since 2002. His career as a lawyer began in 1995 at Andersen Luther Rechtsanwaltsgesellschaft mbH.
Andreas Karpenstein studied law at the Universities of Würzburg and Göttingen and was subsequently a lecturer in business and labour law at various universities.
- Yun (Joann) Cheng
Executive President and Chief Financial Officer of the China Momentum Fund, Shanghai/China
Yun (Joann) Cheng (born in 1976) has acted as Chief Financial Officer of the China Momentum Fund since 2016 and, since 2017, also as its Executive President. Yun (Joann) Cheng has many years of experience in the financial sector. Between 2011 and 2015 she worked as Chief Financial Officer at various companies, namely DJI Innovation and the Allyes Group, prior to which she was a senior manager in the Auditing department at KPMG, among other things.
Yun (Joann) Cheng studied economics at Shanghai University of Finance&Economics from 1994 to 1998 before going on to do an Executive Master of Business Administration (EMBA) at the China Europe International Business School between 2011 and 2013.
- Dr Junyang (Jenny) Shao
Executive Director of the German unit of the Fosun Group, Frankfurt am Main
Born in 1981, Dr Junyang (Jenny) Shao has held the position of Executive Director at the German unit of the Fosun Group in Frankfurt/Main since 2016. She has many years of experience working at various management consulting firms. From 2012 to 2016, she was a Director at Acxit Capital Partners in Frankfurt/Main and prior to that a Senior Consultant at PwC in Düsseldorf from 2011 to 2012.
Dr Junyang (Jenny) Shao studied business administration at Georg August University in Göttingen from 2001 to 2005. From 2006 to 2009, she subsequently completed post-graduate studies at the Supply Management Institute of EBS University of Business and Law in Wiesbaden, ultimately receiving the academic title of Ph.D. (Doctor of Philosophy).
- Sven Terpe
Employee of Tom Tailor GmbH, Hamburg, in the Import department, Deputy Chairman of the SE Works Council and member of the Executive Committee of the SE Works Council
Born in 1980, Sven Terpe has worked in the Import department at Tom Tailor GmbH as an Import Specialist since 2005.
He began his career at Kube&Kubenz in 1999, where he completed vocational training as a forwarding agent in 2001. In the period from 2002 to 2004, he was employed at Nord-Süd-Transporte (NST).
- Oliver Kerinnes
Employee of BONITA GmbH, Hamminkeln, in the position of Senior Specialist Buying, member of the Bonita GmbH Works Council and of the Executive Committee of the SE Works Council
Born in 1969, Oliver Kerinnes has been a Senior Specialist Buying at the TOM TAILOR GROUP since 2013. He has many years of experience in the procurement sector. Among other positions, he was previously a buyer at BONITA GmbH&Co KG, HOLTEX Edith Pohl e.K., EDUSCHO Versand GmbH&Co. KG, Annabell’s GmbH and Lloyd Textil Handelsgesellschaft mbH.
From 1987 to 1989, Oliver Kerinnes completed an apprenticeship as a wholesale and export merchant at Ospig Textil-Gesellschaft W. Ahlers GmbH&Co.
- Stefanie Branahl
Employee of BONITA GmbH, Hamminkeln, in the position of Buyer, member of the Bonita GmbH Works Council and of the SE Works Council
Stefanie Branahl, born 1968, joined BONITA GmbH as a Buyer in January 2009.
From 1988 to 1991, she completed an apprenticeship as an industrial clerk at Klaus Steilmann GmbH&Co. KG.
- Kitty Cleijne-Wouters
Employee of BONITA GmbH, Hamminkeln, in the position of Assistant Senior Manager Retail
Born in 1961, Kitty Cleijne-Wouters has been an employee of BONITA GmbH in the position of Assistant Senior Manager Retail since 2016. Her primary responsibility in this position is supporting the Human Resources department with regard to the BONITA GmbH stores in the Netherlands. Previously, she worked at BONITA GmbH for ten years as Area Manager and in the period prior to that as a store manager at various Netherlands-based companies, including fashion retailer Ter Horst van Geel and electronics wholesaler E.T.G. Zeddam B.V.
In the period from 1985 to 1999, she completed training in various fields such as computer science, bookkeeping and business and tax law.
Other Appointments of the Members of the Supervisory Board (as at 31/12/2017):
Dr Thomas Tochtermann
- Chairman of the Supervisory Board of Vapiano SE, Bonn
- Member of the Supervisory Board of Dansk Supermarked Group, Braband, Denmark
- Member of the Advisory Board of Jahr Holding GmbH&Co. KG, Hamburg
- Member of the Advisory Board of POS Pulse/24 Insights GmbH, Berlin
- Managing Director of PP Picture Partners GmbH, Frankfurt am Main/Germany
- Member of the Supervisory Board (Deputy Chairman) of Trusted Advice AG, Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft, Düsseldorf/Germany
Yun (Joann) Cheng
- Deputy Chief Financial Officer of the Fosun Group, Shanghai/China
- Executive President of the Fosun Fashion Group, Shanghai/China
Dr Junyang (Jenny) Shao
- Managing Director Koller Beteiligungs-GmbH, Dietfurt
None of the employee representatives on the Supervisory Board are members of any other statutory supervisory boards and do not hold positions in comparable domestic or foreign corporate governing bodies.
Composition of the Supervisory Board
In December 2017 the Supervisory Board updated the objectives for its composition in accordance with section 5.4.1 (2) of the German Corporate Governance Code. Taking into account the following objectives, the Supervisory Board is to be composed in such a way that, taken as a whole, its members have the knowledge, skills and specialist expertise to duly carry out their tasks.
TOM TAILOR Holding SE is an international fashion company primarily active in the European market. The Supervisory Board takes this international orientation into account with respect to its composition.
For this reason, at least one member of the Supervisory Board should, if possible, be particularly qualified with respect to the Company’s international activities. This means, for example, that he or she should have long-term experience, preferably gained outside Germany, of international business – in particular in TOM TAILOR’s core markets (Austria, Switzerland, the Benelux countries).
Diversity, in Particular an Appropriate Degree of Female Representation
The composition of the Supervisory Board reflects the interests of the Company and must ensure effective supervision of and advice to the Management Board. Consequently, when determining its composition, the Supervisory Board focuses particularly on the knowledge, skills and specialist expertise required to duly carry out these tasks. Additionally, the Supervisory Board believes that as a whole, its composition should comply with the principles of diversity. In this connection, the Supervisory Board is aiming in particular for an appropriate degree of female representation in compliance with the provisions of the German Act on the Equal Participation of Women and Men in Executive Positions in the Private and the Public Sector. A diversity plan with more extensive provisions regarding the composition of the governing and supervisory bodies of the Company is not currently being pursued. The goals aligned with the recommendations of the German Corporate Government Code for the composition of the Supervisory Board stipulate sufficiently specific requirements to ensure diverse Board membership overall. Individuals selected to fill a specific Management Board positions are chosen by the Supervisory Board in line with the Company’s interests and taking into account all of the circumstances of the particular situation.
According to section 17 para. 2 of the SE Implementation Act, the Supervisory Board of a stock exchange-listed company with a Supervisory Board with an equal number of shareholder and employee representatives must comprise at least 30% women and at least 30% men.
When examining potential candidates, the Supervisory Board should include qualified women in the selection process and take them into account appropriately when proposing candidates. Where multiple candidates are considered to be equally qualified, the Supervisory Board shall examine whether a female candidate should be preferred in order to facilitate an appropriate degree of female representation. The Supervisory Board considers this level of female representation to be appropriate with regard to the composition of the Company’s other managers and in view of other companies in the industry.
As at 31 December 2017 the Management Board of TOM TAILOR Holding SE did not have any female members. The Supervisory Board did not specify a minimum quota for the representation of women on the Management Board of TOM TAILOR Holding SE. The share of female executives on the two management levels below the Management Board of the TOM TAILOR GROUP as at 31 December 2017 was 48%. This share should not fall below 30%.
Potential Conflicts of Interest
In selecting Supervisory Board members, the focus is on their knowledge, ability and specialist expertise; these qualities shall be given priority during the evaluation process. In addition, the Supervisory Board shall take potential conflicts of interest among its members into account when determining its composition. Therefore, no persons should be on the Supervisory Board who could probably have a material and more than temporary conflict of interest. In order to avoid from the start any potential conflicts of interest that could arise during their term of office, members of the governing bodies of the Company’s major competitors should not be proposed.
Number of Independent Members of the Supervisory Board
A Supervisory Board member is not considered to be independent within the meaning of the Code as amended on 7 February 2017 in particular if he or she has personal or business relations with the Company, its governing bodies, a controlling shareholder, or an enterprise associated with a controlling shareholder, that could give rise to a material and more than temporary conflict of interest. In view of this and given the size of this governing body, the Supervisory Board should have at least two independent members.
In accordance with section 5.4.2 of the German Corporate Governance Code, the Supervisory Board discloses that Ms Yun (Joann) Cheng and Ms. Junyang (Jenny) Shao hold executive positions at companies of the FOSUN Group. FOSUN International Holdings Ltd., a company of the FOSUN Group, is a shareholder holding a material indirect interest in the Company. The Supervisory Board is of the opinion that the persons proposed for election otherwise have no personal or professional relationships with the Company or Group member companies, the bodies of the Company or a shareholder holding a material interest in the Company which would have to be disclosed pursuant to section 5.4.2 of the German Corporate Governance Code.
In the Supervisory Board’s opinion, there are no personal or business relationships between the employee representatives and the Company, the Company’s governing bodies or a shareholder holding a material interest in the Company, the disclosure of which is recommended by section 5.4.2 of the German Corporate Governance Code.
The Supervisory Board currently considers eight of its members to be independent within the meaning of the German Corporate Governance Code, including three shareholder representatives (Dr Thomas Tochtermann, Otmar Debald and Andreas Karpenstein) und five employee representatives (Barbara Pfeiffer, Stefanie Branahl, Kitty Cleijne-Wouters, Sven Terpe and Oliver Kerinnes).
Implementation of the Objectives
The Company’s interests must always be given preference when implementing all of the objectives mentioned. The Supervisory Board considers all of the above-mentioned objectives to be met at this time.
The Supervisory Board has five female members – Barbara Pfeiffer, Stefanie Branahl, Kitty Cleijne-Wouters, Yun (Joann) Cheng and Dr Junyang (Jenny) Shao – and five male members – Dr Thomas Tochtermann, Otmar Debald, Andreas Karpenstein, Oliver Kerinnes and Sven Terpe. This means that the statutory quota of 30% each has been met.
The members of the Supervisory Board also include finance experts (Otmar Debald and Yun (Joann) Cheng), a representative of the legal profession (Andreas Karpenstein) and a representative with professional expertise in relation to the fashion industry (Dr Thomas Tochtermann).
The major shareholder Fosun International Ltd. is committed to the long-term strategy of the Company, and its interests are represented by Supervisory Board members Yun (Joann) Cheng, Executive Vice President and Chief Financial Officer of China Momentum Fund, Deputy Chief Financial Officer of the Fosun Group and Executive President of the Fosun Fashion Group, and Dr Junyang (Jenny) Shao, Executive Director of the German unit of the Fosun Group in Frankfurt/Main.
MANAGEMENT BOARD AND SUPERVISORY BOARD COMMITTEES
The Management Board has not currently established any committees.
The Supervisory Board has established an Executive Committee, an Audit and Finance Committee and a Personnel Committee to efficiently perform its tasks.
The Executive Committee is responsible for preparing the Supervisory Board meetings and coordinating the work of the Supervisory Board, as well as consulting on the strategy, direction and further development of the Company and issues of strategic importance for the Company. In particular, it handles fundamental issues of Group strategy, including the business policies and focus of the Group. The Executive Committee lays the groundwork for corporate governance-related decisions by the Supervisory Board and, in the place of the Supervisory Board, resolves amendments to the annual Declaration of Compliance to address changes in circumstances. It also checks compliance with the Declaration of Compliance.
Members: Dr Thomas Tochtermann (Chairman of the Executive Committee), Andreas Karpenstein and Barbara Pfeiffer.
The Audit and Finance Committee is tasked with monitoring the Company’s accounting and financial reporting and the accounting process, the effectiveness of the internal control system, internal risk management system and internal audit system, as well as compliance and the financial statements audit. To this end, it may exercise the inspection and audit duties to which the Supervisory Board is entitled in accordance with section 111 (2) AktG. The Audit and Finance Committee also issues a recommendation to the Supervisory Board for its proposal to the Annual General Meeting on the election of the auditors. In the place of the Supervisory Board, it adopts a resolution on the agreement with the auditors (especially the audit engagement, determination of the areas of emphasis for the audit and the fee agreement). It takes suitable measures to determine and monitor the independence of the auditors. Prior to publication, the Audit and Finance Committee and the Management Board discuss the quarterly and half-yearly reports and other interim reports, if these are prepared for specific reasons. The Audit and Finance Committee additionally prepares the meetings and decisions of the Supervisory Board relating to the annual budget and three-year planning of the TOM TAILOR GROUP.
Members: Otmar Debald (Chairman of the Audit and Finance Committee), Yun (Joann) Cheng and Kitty Cleijne-Wouters.
At least one independent member of the Supervisory Board has expertise in accounting or auditing, in the person of the Chairman of the Audit and Finance Committee.
The Personnel Committee prepares the decisions of the Supervisory Board on appointment of Management Board members, the election of the Management Board chairman and determination of the remuneration structure of the Management Board as well as the remuneration, including target agreements, of the individual Management Board members. The Supervisory Board by-laws confer on this Committee the authority to pass resolutions on the following issues:
- signing, amending and terminating employment contracts with the members of the Management Board with the exception of the decisions which are the domain of the Supervisory Board pursuant to section 87 (1) and (2) sentence 1 and sentence 2 AktG (prepared by the Personnel Committee);
- other legal transactions with respect to Management Board members or their affiliated companies (sections 15 et seq. AktG) or their related parties as defined in section 15 of the Abgabenordnung (AO – German Fiscal Code);
- extending loans to the persons named in sections 89, 115 AktG;
- approving other activities of Management Board members as per section 88 AktG;
- approving contracts with Supervisory Board members in accordance with section 114 AktG.
- Members: Dr Thomas Tochtermann (Chairman of the Personnel Committee), Dr Junyang (Jenny) Shao and Sven Terpe.
REMUNERATION OF THE MANAGEMENT BOARD AND THE SUPERVISORY BOARD
Designing remuneration systems for the Management Board and the Supervisory Board members that provide incentives and reward performance in an appropriate manner is a key component of responsible corporate governance.
We refer to the detailed presentation in the management report on pages 49ff.
SHAREHOLDINGS OF THE MEMBERS OF THE MANAGEMENT BOARD
Dr Heiko Schäfer (CEO) directly held 53,000 shares of the Company as at 31 December 2017, corresponding to 0.138% of the Company’s shares. Thomas Dressendörfer (CFO) directly held 25,000 shares of the Company as at 31 December 2017, corresponding to 0.065% of the Company’s shares.
SHAREHOLDINGS OF THE MEMBERS OF THE SUPERVISORY BOARD
One member of the Supervisory Board, Barbara Pfeiffer (Deputy Chairman) directly held one share of the Company as at 31 December 2017, corresponding to 0.00% of the Company’s shares.
In accordance with section 19 of the Market Abuse Regulation (MAR), the members of the Management Board and the Supervisory Board of TOM TAILOR Holding SE as well as certain employees with managerial responsibilities and any persons closely associated with these employees must disclose the acquisition and sale of TOM TAILOR shares and any related financial instruments. This duty of disclosure exists if the value of the transactions by a person belonging to the above-mentioned group of persons amounts to or exceeds EUR 5,000 until the end of a calendar year. Further details as well as the individual transactions disclosed can be found at http://ir.tom-tailor-group.com
TOM TAILOR Holding SE received voting right notifications in accordance with section 33 (1) of the WpHG from institutional investors in Germany, Portugal, France, Luxembourg and Switzerland, among other countries.
ACCOUNTING AND TRANSPARENCY
Information is regularly provided to the shareholders and the public, in particular via the annual report containing the consolidated financial statements, and the interim reports. Our Group financial reporting is prepared in accordance with International Financial Reporting Standards (IFRSs), as adopted by the EU, ensuring a high degree of transparency and international comparability.
Hamburg, March 2018