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Compliance statement
Updated Declaration by the Management Board and Supervisory Board of Demag Cranes AG on the recommendations of the "Government Commission for the German Corporate Governance Code" (Regierungskommission Deutscher Corporate Governance Kodex) according to paragraph 161 of the German Stock Corporations Act
Under Section 161 of the German Stock Corporations Act (AktG), the Management Board and Supervisory Board of listed German stock corporations are required to declare at least once a year that the recommendations of the “Government Commission on the German Corporate Governance Code” published by the Federal Ministry of Justice in the official section of the electronic Bundesanzeiger (Federal Gazette) have been and will be complied with or, if not, which recommendations have not been or will not be applied and why not.
The Management Board and Supervisory Board of Demag Cranes AG issued the annual declaration of conformity in accordance with Section 161 of the German Stock Corporations Act on 8 December 2009. By issuing the present declaration, the Management Board and Supervisory Board are updating the declaration of conformity issued by them on 8 December 2009.
Demag Cranes AG can confirm that the recommendations published by the Federal Ministry of Justice in the official section of the electronic Federal Gazette with regard to the “Government Commission on the German Corporate Governance Code” have been complied with in full with the following exceptions since issuing the declaration of conformity on 15 December 2008 and up to 4 August 2009, in accordance with the Code in force on 6 June 2008 and since 5 August 2009, in accordance with the Code in force on 18 June 2009.
| a) | Clause 3.8 provides for the agreement of a deductible if the Company takes out a D&O policy on behalf of the Management and Supervisory Boards. Until 30 September 2009, Demag Cranes AG’s D&O insurance policy did not include a deductible for either the Management Board or the Supervisory Board, since the Management Board and Supervisory Board do not deem this to be either necessary or suitable for controlling the behaviour of the board members. For the same reason, the D&O insurance policy for Demag Cranes AG’s Supervisory Board has also not stipulated a deductible since 1 October 2009. |
| b) | In accordance with Clause 5.4.6, the members of the Supervisory Board should be paid performance-related remuneration in addition to their fixed basic remuneration. The Articles of Association of Demag Cranes AG do not include a performance-related component for members of the Supervisory Board, so that it can preserve the independence it must have to be able to carry out its monitoring function. The performance of this function should not be tied to any monetary incentives. |
| c) | In accordance with Clause 5.4.5, Supervisory Board members who are members of the management board of a listed company may not accept more than a total of three supervisory board mandates in non-group listed companies. The Supervisory Board member Robert J. Koehler is chairman of the management board of SGL CARBON SE, Wiesbaden, and has a total of four supervisory board mandates in non-group listed companies, including his position as member of the Supervisory Board of Demag Cranes AG. This does not affect his monitoring duties as a member of the Supervisory Board of Demag Cranes AG. Mr. Koehler has sufficient time to perform his mandate at Demag Cranes AG. |
| d) | In accordance with Clause 5.4.3, an application for the judicial appointment of a Supervisory Board member should be limited in time up to the next general meeting. On some occasions, an opinion has been expressed that the recommendation also applies to the judicial appointment of employee representatives to the Supervisory Board. As a matter of precaution, the Management Board and Supervisory Board are declaring that this recommendation was not implemented in having employee representatives appointed by court to the Supervisory Board of Demag Cranes AG. As employee representatives on the Supervisory Board are not elected by the general meeting, the Management Board and Supervisory Board believe it is inappropriate to limit their judicial appointment in time up to the next general meeting. |
Apart from the above exceptions, the recommendations of the “Government Commission on the German Corporate Governance Code” in force on 18 June 2009 were fully met.
Düsseldorf, 2 March 2010
The Management BoardThe Supervisory Board
