DAX 30 supervisory board study 2018 Selected results July 2018 Jens-Thomas Pietralla & Dr. Thomas Tomkos Board & CEO Practice Private and Confidential
The following assessment and evaluation is based on publicly available biographical data *) on supervisory board members of DAX 30 and MDAX companies. Obviously, the effectiveness of supervisory boards also depends on the board culture, the personalities of their members and their constructive dialogue. *) Data sources: biographies made available by companies, invitations to annual meetings, annual reports, voting results from annual meetings; additional externally available biographical data where necessary Private and Confidential 2
Preview... § As expected, the ”super election year 2018” has resulted in significant changes: 89 seats were up for election, of which 42 were filled by new candidates § Eight new digital directors add critical expertise to the DAX 30 boards. As of 2018 more than half of the companies can rely on this experience § For the first time the share of women among shareholder representatives in DAX 30 exceeds 30% § Equivalent representation of women in chairperson and committee positions is still lagging behind § While the number of foreign board members in DAX 30 declined slightly, the companies are able to attract experienced female board members, especially from the anglophone world § The cross-linkage of “Germany Inc.” is shifting: there are less supervisory board members with more than one DAX 30 mandate; however, several current DAX 30 executive board members take on DAX 30 supervisory board sets for the first time § The average grade of all DAX 30 supervisory boards according to the German school grading system improves again: from 2.3 to 2.2 § Lufthansa, Daimler, Bayer and MunichRe lead the ranking in 2018. Especially Lufthansa is able to leap from position 16 all the way to the top Private and Confidential 3
Content – Results from the “super-election-year 2018“... Digitalization! Quota fulfilled? Competency profiles and breadth of experience. Return to “Germany Inc.?” The current ranking Looking ahead – “super election year #2”! Private and Confidential 4
Core messages § Digital expertise in DAX 30 supervisory boards is developing positively § Eight new digital directors entered the boards this year; more than half of the companies now have members with digital experience § Their background ranges from technology and online-focused industries to classical CIOs and leading experts in IT, industry 4.0 and digital content Private and Confidential 5
Digital directors in the top 300 global companies by region vs. DAX 30 and MDAX With the 2018 changes, DAX 30 and MDAX are moving up in comparison to their international peers. However, concerning “highly digital boards”, the USA is still ahead of the Germans Russell Reynolds study: „Digital Directors 2016: Supervisory board study 2018: Diverse Perspectives in the Boardroom“ 13% 20% 10% 40% 70% 47% DAX 30 MDAX „Highly Digital”: two or more digital directors on the supervisory board Private and Confidential 6
Number of digital directors in DAX 30 and MDAX by gender - cumulated Until 2014 hardly any female digital directors were elected into office. Starting 2015 more women (+22) than men (+12) took office *) Number of digital directors in DAX 30 and MDAX over time Total: 23 + 150% 57 35 As of 2018: 30 + 12 25 20 15 25 Women 32 Men + 22 (44%) (56%) 10 5 0 2011 2012 2013 2014 2015 2016 2017 2018 M W Year M F *) Data base: supervisory board members still in office, counted from the year when they were first elected Private and Confidential 7
“New digital directors“ 2018 in DAX 30 Eight additional digital directs with very diverse profiles entered the DAX 30 – some of the supervisory boards already had digital expertise Picture sources: company websites; LinkedIn; Wallstreetandtech.com; cio.de, Handelsblatt IT service provider Blockchain exec Digital service builder IT foundation builder Victoria Ossadnik, Marie Wieck Michele Trogni Martin Jetter Commerzbank (& Linde) Daimler Deutsche Bank Deutsche Börse Digital transformer Digital strategist CEO in the Cloud Process designer Aicha Evans Diane Greene Michael Nilles Dr. Mario Daberkow SAP SAP Lufthansa Deutsche Post Private and Confidential 8
Core messages § Germany needs qualified women for top-leadership levels § The mandated 30% female quota on DAX 30 supervisory boards was achieved – but on CxO, first and second leadership level more than 1,100 female leaders are missing § Despite the fulfillment of the quota: only one chairperson, only 8% female committee chairpersons and only 18% of committee positions are occupied by women Private and Confidential 9
Development of the share of women With currently 31.6%, for the first time in history the share of women among DAX 30 shareholder representatives has surpassed 30%. Changes in index membership, board sizes, as well as a high share of re-elections among women helped achieve this milestone, despite a relatively low share of female candidates among newly elected members 40% Share of women among successors 50% 37% 34% 34% 39% 46% 41% 33% 35% +2.5 PP +5 PP +0.4 PP 31.6% 30% +2.5 PP +3.6 PP 25% +3.8 PP 20% +3.8 PP +3.0 PP 15% 10% Total share of women among shareholder representatives 5% After the respective annual meetings 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 Women/Total SH Reps 76/261 19/258 27/259 36/256 44/250 53/251 59/249 75/261 81/256 Private and Confidential 10
DAX 30 supervisory boards – share of women among shareholder, employee representatives and in total For the first time the average share of women among both, shareholder and employee representatives exceeds 30%. Thus the total share of women improves by 2 percentage points to 33.8% After 2018 elections SH Reps Empl. Reps Total After 2018 elections SH Reps Empl. Reps Total Adidas 25% 25% 25% HeidelbergCement 33% 33% 33% Allianz 33% 33% 33% Henkel 25% 50% 38% BASF 33% 33% 33% Infineon Technologies 25% 50% 38% Bayer 30% 30% 30% Linde 33% 33% 33% Beiersdorf 33% 17% 25% Merck 25% 50% 38% BMW 30% 30% 30% Munich Re 40% 50% 45% Commerzbank 40% 40% 40% RWE 30% 30% 30% Continental 20% 40% 30% SAP 56% 22% 39% Siemens 30% 40% 35% Covestro 33% 33% 33% ThyssenKrupp 30% 30% 30% Daimler 30% 30% 30% Volkswagen 30% 30% 30% Deutsche Bank 30% 30% 30% Vonovia 33% 33% Deutsche Boerse 38% 50% 43% Total 2018 31.6% 36.2% 33.8% Deutsche Lufthansa 30% 40% 35% Deutsche Post 30% 40% 35% Total 2017 29% 34% 31% Deutsche Telekom 30% 50% 40% Total 2016 29% 32% 30% E.ON 29% 33% 31% Total 2015 24% 29% 26% Fresenius Medical Care 33% 33% Total 2014 21% 28% 24% Fresenius SE 33% 33% 33% Total 2013 18% 26% 22% Adidas and Beiersdorf have objected to “joint fulfilment”. Adidas uses the legal provision to round down, thus fulfilling the minimal requirement. Beiersdorf‘s next opportunities to improve the employee representative number will be in 2019 Private and Confidential 11
Newly elected women in DAX 30 – top executives Ten women with top executive experience were newly elected to a total of 11 supervisory board positions. Seven are sitting executives, four are digital directors Sources: Russell Reynolds Associates; company websites; Rotsch – buj.net Daimler Deutsche Börse Commerzbank Deutsche Bank Deutsche Bank Marie Wieck Michele Trogni Mayree Carroll Clark Barbara Lambert Dr. Victoria Ossadnik GER & CH, 1962) (GER, 1968) (USA, 1960) (UK, 1965) (USA, 1957) General Manager Former Group C Risk O CEO Former SVP & CIO Founder & MP IBM Blockchain IHS Markit Eachwin Capital Banque Pictet & Cie E.ON Energie GER Telekom & SAP SAP SAP Volkswagen HeidelbergCement Aicha Evans Diane Greene Dr. Friederike Rotsch Marianne Heiß Margret Suckale (USA, 1969) (GER, 1972) (AUT, 1972) (USA, 1955) (GER, 1956) SVP & C Strat. O CEO General Counsel CFO, BBDO Group Former ED, BASF Intel Google Cloud Merck Private and Confidential 12
Newly elected women in DAX 30 – consultants and experts Three women without top executive experience were chosen for the expert knowledge they contribute to their respective supervisory boards Sources: Russell Reynolds Associates; company websites; Sapiro & Shafik - Wikipedia Lufthansa Siemens ThyssenKrupp (& MunichRe) Miriam E. Sapiro Dame N. T. Shafik Ursula Gather (USA, 1960) (UK, 1962) (GER, 1953) Managing Director Director, London Dean, TU Dortmund and head of the Sard Verbinnen School of Economics board of trustees at Alfried Krupp von Bohlen und Halbach-Stiftung Former member of the US Formerly with IMF and Mathematical statistics and industrial foreign ministry and World Bank; applications; national security council; International development, Extensive international experience and economic policy international trade and well connected security Private and Confidential 13
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