German Corporate Governance Code and Declaration of Compliance
The German Corporate Governance Code (the “Code”) applies as amended on June 12, 2006. Besides setting out important legal provisions, the Code also contains recommendations and suggestions for good corporate governance. There is no legal obligation to follow these standards. Under section 161 of the German Stock Corporation Act, listed companies are, however, obliged to make a declaration of compliance following the terms of the Code’s recommendations on the basis “comply or explain”.
In Germany the Code is ever-increasingly taken as the benchmark of good corporate governance and control. Analyses show that acceptance of the German Corporate Governance Code is rising continuously. At 2006 year end, the DAX-30 companies met an average of 97 percent of all recommendations whereas in the M-DAX around 92 percent and in the S-DAX about 89 percent of the recommendations had been followed by the companies.
The declaration of compliance with the German Corporate Governance Code pursuant to section 161 of the German Stock Corporation Act, issued by Allianz SE on December 18, 2006, is as follows:
“1. Allianz SE will comply with all the recommendations made by the Government Commission of the German Corporate Governance Code (Code version as of June 12, 2006).
2. Since the last Declaration of Compliance as of December 15, 2005, which referred to the German Corporate Governance Code in its June 2, 2005 version, Allianz SE has complied with all recommendations made by the Government Commission on the German Corporate Governance Code then in force.”
Furthermore, we comply with the non-binding suggestions of the German Corporate Governance Code with the exception that the shareholder representatives on the Supervisory Board are, in principle, not elected to staggered terms, as suggested by the Code. It is preferable, in our view, for a Supervisory Board with employee co-determination to retain a uniform term of office.
Our two listed group companies Allianz Lebensversicherungs-AG and Oldenburgische Landesbank AG issued own declarations of compliance in December 2006. Allianz Lebensversicherungs-AG discloses therein a deviation from the recommendation concerning performance-based remuneration for its Supervisory Board. Oldenburgische Landesbank AG will in future comply with all recommendations except the recommendation of a self-retention on its Directors&Officers insurance.
