Under Section 161 of the German Stock Corporation Act, the management and supervisory boards of listed companies must make a declaration each year stating that the recommendations of the “Code of the Government Commission on German Corporate Governance” published by the German Federal Ministry of Justice in the official section of the Federal Gazette (electronic version) have been met. It must also specify which recommendations are not being applied.
Four Exceptions to the Corporate Governance Code.
As required by Section 161 of the German Stock Corporation Act, the Board of Directors and the Supervisory Board issued a new declaration of compliance on November 30, 2006.
Since its last declaration of compliance on November 30, 2005, Wincor Nixdorf AG has complied with the recommendations of the German Corporate Governance Code (version dated June 2, 2005) and with the recommendations of the revised version of the Code, which took effect on June 12, 2006, apart from the following exceptional instances listed below:
– The D&O insurance policy agreed by Wincor Nixdorf AG for its Board of Directors and Supervisory Board does not feature a policy excess (GCGC, Section 3.8 Paragraph 2).
The D&O insurance policy agreed by Wincor Nixdorf AG for its Board of Directors and Supervisory Board does not feature a policy excess. The D&O insurance is in place for a significant number of management staff across the entire Wincor Nixdorf Group at home and abroad, including members of the Company boards. For this reason, it does not appear proper to differentiate between Board members on the one hand and other management staff on the other. A policy excess is not customary outside Germany.– Limited disclosure of the remuneration of the Board of Directors (GCGC, Sections 4.2.4 and 4.2.5).
Wincor Nixdorf AG has not disclosed the total remuneration of each individual member of the Board of Directors citing the name of each member and has not included breakdown of remuneration into the categories “fixed compensation”, “performance-related compensation” and “long-term incentive components” (GCGC, Section 4.2.4 version dated June 2, 2005). Wincor Nixdorf AG will comply with the legal obligation of individual disclosure, as introduced by the Management Board Remuneration Disclosure Act ("Vorstandsvergütungsoffenlegungs-Gesetz") of August 3, 2005, in future reports (i.e. from the fiscal year October 1, 2006, to September 30, 2007, when the new Act first applies to Wincor Nixdorf).
The remuneration of the Board of Directors is not disclosed in a specific compensation report that gives details of the remuneration system in a generally understandable form as part of the overall Corporate Governance report (GCGC, Section 4.2.5 Paragraph 1 in the version dated June 12, 2006).
The presentation of the specific structure of a share option plan or comparable schemes for components with a long-term incentive effect and risk exposure does not include details of their value. In the case of agreed pension commitments, the allocations made to pension accruals or pension funds are not shown each year (GCGC, Section 4.2.5 Paragraph 2 in the version dated June 12, 2006).
The nature of fringe benefits provided by the Company has not been specified in a compensation report (GCGC, Section 4.2.5 Paragraph 3 in the version dated June 12, 2006).
For reasons of privacy, the remuneration paid to members of the Board of Directors is not stated for each individual director. It is for this same reason that such data is not disclosed in a compensation report. Instead, we explain the structure of the remuneration system by offering the relevant information in this annual report. In addition to the stated total remuneration paid to the Board of Directors, pension accruals for members of the Board of Directors are shown separately.
– In setting the level of remuneration paid to members of the Supervisory Board, no account is taken of chairmanship of any committee other than the Audit Committee and of membership of any of the Supervisory Board committees (GCGC, Section 5.4.7 Paragraph 1 Sentence 3).
Remuneration for mere membership of a committee is deemed unnecessary. As regards the activities of the Supervisory Board, practice has shown that the vast majority of committee meetings are scheduled to coincide closely with meetings of the Supervisory Board itself. Chairmanship of the Audit Committee is remunerated separately due to the additional time and effort required by the role.– Members of the Supervisory Board are not paid any performance-related remuneration in addition to their fixed emoluments (GCGC, Section 5.4.7 Paragraph 2 Sentence 1).
The Company has decided to monitor the development of relevant case law in order to establish a firm foundation for appropriate arrangements within this area. It would appear that legal debate concerning this issue has yet to be concluded, as evidenced by court rulings in recent years regarding the prohibition of share options for Supervisory Board members.Wincor Nixdorf AG will comply in future with the recommendations of the “Code of the Government Commission on German Corporate Governance” in the version dated June 12, 2006, apart from the following exceptions (see explanations above):