Combined Corporate Management Declaration and Corporate Governance Report
The following section contains the combined Corporate Management Declaration for HHLA and the Group in accordance with Section 289f HGB and Section 315d in conjunction with Section 289f HGB, as well as the Corporate Governance Report by the Executive Board and Supervisory Board in accordance with Section 3.10 of the German Corporate Governance Code (hereafter “the Code” or “GCGC”).
Implementation of the Code
Responsible and transparent corporate management geared towards creating sustainable value has always been a main foundation of HHLA’s commercial success. HHLA therefore expressly supports the Code and the objectives and purposes that it pursues. The Executive Board and Supervisory Board once again took great care to ensure the recommendations and suggestions of the Code were met in the 2017 financial year and submitted their annual declaration of compliance in accordance with Section 161 AktG in December 2017. This confirms that the management and corporate culture of HHLA and the Group comply with the recommendations and most of the suggestions contained in the Code, with only a few exceptions. The current declaration of compliance is printed below. It can also be viewed by shareholders and the public on HHLA’s website at www.hhla.de/corporategovernance together with the declarations of compliance relating to previous years.
Declaration of Compliance in Accordance with Section 161 of the German Stock Corporation Act (AktG)
The Executive and Supervisory Boards of HHLA submitted the following joint declaration of compliance in accordance with Section 161 AktG on 18 December 2017:
“The Executive Board and Supervisory Board of Hamburger Hafen und Logistik AG hereby state after due examination that in the period starting 9 December 2016 (the date on which the previous declaration of compliance was issued), HHLA complied with the recommendations of the German Corporate Governance Code (“the Code” or “GCGC”) in the version dated 5 May 2015 and – subsequent to its taking effect – the version dated 7 February 2017 with the following exceptions. Furthermore, HHLA shall comply with the Code in the future with the following exceptions.
- In February 2017, sentence 2 was added to Section 4.2.3 (2) GCGC, which recommends that the long-term assessment basis used for variable executive remuneration should fundamentally be forward-looking. However, the variable remuneration policy which applies to HHLA’s Executive Board is fundamentally based on the achievement of certain key figures and/or targets for a three-year average comprising the current financial year and the two previous financial years. It did not appear practicable to amend the Executive Board contracts to reflect the new recommendation as they were concluded for a fixed term and cannot be changed unilaterally. Irrespective of this, the variable remuneration of the HHLA Executive Board is already geared towards sustainable development in its current form.
- Section 5.4.1 (2) sentence 1 GCGC was also amended and now recommends that the Supervisory Board draw up a skills matrix for the board as a whole, as well as identifying concrete targets for its overall composition. Proposals made to the Annual General Meeting regarding the Supervisory Board should take into account the targets agreed for its overall composition but should also strive to fulfil the board’s skills matrix (Section 5.4.1  sentence 1 GCGC). Furthermore, as per section 5.4.1 (5) sentence 2 clause 2 GCGC, curricula vitae for all Supervisory Board members should be published on the company’s website and updated every year. These should be supplemented by an overview of each member’s main activities in addition to their Supervisory Board mandate. Once these recommendations had taken effect, the re-elections had been held and the Supervisory Board had been reconstituted, the Supervisory Board drafted a comprehensive skills matrix or requirement profile which it approved at its meeting on 18 December 2017. The Supervisory Board members’ curricula vitae were also updated and published on the company’s website, www.hhla.de. This means that the company now complies with these recommendations.
- According to Section 7.1.2 of the Code, interim financial information is to be discussed by the Executive Board with the Supervisory Board or its Audit Committee prior to publication. HHLA has not complied with this recommendation to date because compiling the half-yearly financial report and the interim statements on the basis of individual segment reporting for the A and S divisions takes more time than for companies with just one type of share. Furthermore, the additional financial information contained in these reports is reviewed by the auditors in order to increase the level of detail and frequency with which the company’s reports are examined. However, the company intends to amend its processes in the near future to enable this information to be discussed with the Audit Committee before publication. The recommendation will therefore be met in the future.
Hamburg, 18 December 2017
Hamburger Hafen und Logistik Aktiengesellschaft
The Executive Board
The Supervisory Board"
Information about Corporate Governance Practices
Structure and Management of the Group
HHLA acts as the strategic management holding company for the Group. Its operating business is conducted by domestic and foreign subsidiaries and associated firms. see also Group Structure Operating activities are managed and monitored by the Executive Board of HHLA and its central departments, such as Purchasing, Finance, Legal and HR. Compliance with the management’s corporate governance requirements is ensured by internal company guidelines, provisions in the articles of association and rules of procedure for the subsidiaries and associated firms. Most subsidiaries also have their own supervisory or advisory boards that monitor and advise the executive boards of the respective companies.
Compliance with corporate guidelines and the statutory provisions relevant to the company’s activities (hereinafter also referred to as “compliance”) is regarded as an essential part of corporate governance at HHLA. The management team in each corporate unit is therefore responsible for working to achieve compliance with the regulations that are relevant for their field of activity and area of responsibility. Workflows and processes must be structured in line with these regulations. The cornerstone of HHLA’s compliance management system (CMS) is a code of conduct, which formulates overriding principles on topics with special relevance for compliance, such as conduct in the competitive environment, the prevention of corruption, discrimination and conflicts of interest, and how to deal with sensitive corporate information, especially insider information. see also www.hhla.de/compliance The code of conduct also sets out the whistleblowing channels available to employees and third parties for reporting evidence of misconduct in the company. The code of conduct is supplemented by further Group guidelines on such matters as the prevention of corruption and conduct in the competitive environment. A further element of the CMS is the systematic, ongoing analysis of compliance risks and the introduction of corresponding measures – such as staff training and process adjustments to minimise the respective risks. The overall coordination of the CMS is performed by the HHLA Group’s Compliance Officer, who reports directly to the Executive Board and synchronises their activities with those of Internal Audit and Risk Management departments, among others. There are also compliance managers or officers at the various corporate units in Germany and abroad. The responsibilities of compliance officers include advising employees on all compliance-related issues and investigating any indications of breaches. The Audit Committee monitored the effectiveness of the CMS in the reporting period by means of regular reports from the Executive Board and the Compliance Officer. The system will continue to be optimised on an ongoing basis.
Sustainability has been an integral part of HHLA’s business model since the company was established. see also Sustainability and www.hhla.de/en/sustainability
The HHLA Group’s risk management system is described in detail in the Risk and Opportunity Report, which forms part of the Group Management Report. see Risk and Opportunity Report
Function and Composition of the Executive Board and the Supervisory Board
In accordance with the stipulations of German stock corporation law, HHLA has a dual system of management with an Executive Board and a Supervisory Board as management bodies, both of which have their own defined areas of competence. This system is characterised by having separate personnel to carry out the management and supervision functions: the Executive Board manages the company on its own responsibility, while the Supervisory Board monitors the Executive Board and discusses relevant matters with it. HHLA’s Executive Board and Supervisory Board work closely together for the company’s benefit in an atmosphere of mutual trust.
Function of the Executive Board
The Executive Board manages the company’s business. It determines the company’s goals, its fundamental strategic orientation and Group policy and organisation. These tasks include, in particular, steering the Group and managing its financing, developing a personnel strategy, appointing and developing managers and representing the company before the capital markets and the general public. It is also responsible for appropriate risk management and controlling within the company.
The Executive Board assumes management responsibility as a collegial body. Regardless of the overall responsibility to manage the company, the individual members of the Executive Board also bear responsibility for the departments assigned to them by Executive Board resolutions. The schedule of responsibilities states which Executive Board members are responsible for which departments. see also Group Structure
The Executive Board provides the Supervisory Board with regular, timely and comprehensive information on all matters that are relevant for the company or the Group. These include, in particular, the intended business policy, profitability, the current position and course of business, planning, the current risk position, risk management and compliance for both the Group and the company in each case. The Executive Board must notify the Chairman of the Supervisory Board without undue delay of any important events of fundamental significance for the assessment of the position and development or the management of the company or the Group, including between meetings. These include, for example, operational malfunctions and illegal actions that disadvantage the company or a Group affiliate.
Conflicts of interests concerning members of the Executive Board must be immediately disclosed to the Supervisory Board. Other members of the Executive Board must also be informed. Executive Board members may only take on other duties, especially supervisory board posts at companies outside the Group, with the approval of the Supervisory Board. Transactions of material importance between Group companies and members of the Executive Board and parties and companies related to them also require the approval of the Supervisory Board. All such transactions must be performed on an arm’s length basis. There were no transactions of this nature in the reporting period. There were also no conflicts of interest in the year under review.
The Executive Board’s work is outlined in more detail in the Executive Board’s rules of procedure. The rules state, inter alia, that decisions on fundamental organisational questions, business policy and corporate planning are to be made by the Executive Board as a whole. The rules also state that decisions and transactions of considerable importance for the company must be discussed and decided upon together and that certain decisions and transactions of fundamental importance require the prior approval of the Supervisory Board.
The company has taken out D&O insurance for the members of the Executive Board that meets the requirements of Section 93 (2) sentence 3 of the German Stock Corporation Act (AktG).
Composition of the Executive Board and Diversity
In accordance with Article 8 of the articles of association, HHLA’s Executive Board must consist of at least two members. At present, there are four member of the Executive Board. see also Notes to the Consolidated Financial Statements, Note 49, Board Members and Mandates The Executive Board’s members are appointed by the Supervisory Board which, together with the Executive Board, ensures there is a long-term succession plan in place and that diversity considerations are taken into account in the Executive Board’s composition. In the interests of outlining diversity aspects more precisely, the Supervisory Board approved a Diversity Concept for the Executive Board in December 2017.
Objective of the Diversity Concept
Along with the professional skills and experience of the Executive Board members, the Supervisory Board believes that diversity aspects play an important role in the sustainable development of the company. Different personalities, experiences and expertise prevent group thinking and facilitate a more holistic approach, thereby enriching the work of the Executive Board. The objectives below serve as guidelines for long-term succession planning and the selection of suitable candidates.
The Supervisory Board strives to ensure that the Executive Board is composed of members whose personal and professional backgrounds, experience and expertise complement one another so that the Executive Board as a whole can draw on the widest possible range of experience, knowledge and skills.
Proportion of Women on the Executive Board
When appointing Executive Board members, the Supervisory Board is guided by the model of equal participation by women and men and actively pursues this objective, e.g. by specifically looking for female candidates to join the Executive Board. However, given that the Executive Board is small and there is usually a limited number of suitable candidates, it is not always possible to ensure that women and men are represented equally. With this in mind, the Supervisory Board has set a target quota of 25 % for women on the HHLA Executive Board. It has specified 30 June 2022 as the deadline for achieving this target.
Qualifications and Professional Background
Diversity in the Executive Board is also reflected by members with different qualifications and career paths who can draw on a wide range of different experiences (such as industry background). Members with different qualifications, professional backgrounds and experiences are therefore actively welcomed. However, each Executive Board member must have the personal and professional skills and experience necessary to fulfil the responsibilities of an Executive Board member at an international, listed company and protect the HHLA Group’s public image. The members of the Executive Board should also have an in-depth understanding of HHLA’s business activities and are usually required to have several years of managerial experience.
Furthermore, with a view to HHLA’s business model, at least one member should have specialist expertise in each of the following areas:
- strategy and strategic management;
- the logistics business, including the relevant markets and client needs;
- operations and technology, including IT and digitisation;
- the real estate business;
- legal affairs, corporate governance and compliance;
- human resources, especially HR management and staff development, as well as experience of co-determined structures;
- finance, including financing, accounting, controlling, risk management and internal control processes.
As the Group’s activities are international by their very nature, at least some of the members should have considerable international experience.
The age limit for Executive Board members is 67. There is no minimum age. However, Executive Board members are generally expected to have several years of managerial experience when they are appointed, which presupposes a certain amount of professional experience. Within this framework, a varied age structure within the Executive Board is targeted – in the interests of diversity and long-term succession planning – although age is deemed less important than the other criteria.
Progress to Date and Future Applicability
The Executive Board’s current composition fulfils the targets set out above. The Executive Board is composed of people with different career paths, a wide range of experience and varying expertise, including members with considerable international experience. The target quota of 25 % for female executives has also been met. The age limit is not exceeded by any member. The Supervisory Board and its Personnel Committee will continue to take the above objectives into account during their long-term succession planning and when searching for suitable candidates for HHLA’s Executive Board.
Function of the Supervisory Board
The Supervisory Board decides on the composition of the Executive Board, oversees the Executive Board’s management of the company, advises it on company management and is involved in fundamental and important decisions. Decisions and transactions of fundamental importance require the approval of the Supervisory Board in accordance with the Executive Board’s rules of procedure. Its other main tasks include the examination and adoption of the Annual Financial Statements and the approval of the Consolidated Financial Statements. The tasks and internal organisation of the Supervisory Board and its committees are based on the law, the articles of association, which are available on HHLA’s website at www.hhla.de/corporategovernance, and the Supervisory Board’s rules of procedure. The Code also contains recommendations on the Supervisory Board’s work.
The Supervisory Board carries out its work both in full council and in committees. The individual committees and their responsibilities are laid down in the Supervisory Board’s rules of procedure. The chairpersons of the committees regularly report on the work of their respective committees at the following Supervisory Board meeting. There are currently a total of six committees: the Finance Committee, the Audit Committee, the Personnel Committee, the Nomination Committee, the Arbitration Committee and the Real Estate Committee.
- The Finance Committee prepares Supervisory Board meetings and resolutions of major financial importance, such as resolutions to be adopted concerning significant borrowing and lending, the assumption of guarantees for third-party liabilities, financial investments and other financial transactions. It also deals with planning and investment issues, such as the budget and medium-term planning.
- The Audit Committee monitors accounting, the accounting process and the effectiveness of the audit of the financial statements. It also prepares the Supervisory Board’s resolution proposal to the Annual General Meeting on the election of the auditor. The Audit Committee is responsible for the selection procedure if there are plans to rotate the auditor. After the auditor has been elected by the Annual General Meeting, it awards the audit assignment for the Consolidated Financial Statements and the Annual Financial Statements. It also deals with the fee agreements and determines which areas the audits should focus on. It continually monitors the independence of the auditor and discusses the risks to the auditor’s independence as well as the prevention measures taken to mitigate these risks. In this connection, the Audit Committee is also responsible for monitoring and approving the additional services provided by the auditor in addition to the audit of the financial statements (non-audit services). Other focus areas of its work include monitoring the effectiveness of the internal control system, the risk management system, the internal audit system and the compliance management system.
- The Personnel Committee prepares the personnel decisions to be taken by the Supervisory Board, ensures together with the Executive Board that a long-term succession plan is in place and takes account of diversity considerations in the Executive Board’s composition. It prepares the Supervisory Board resolution specifying the remuneration of the Executive Board and the examination of the remuneration system for the Executive Board and handles the Executive Board contracts, provided the German Stock Corporation Act (AktG) does not require the full council of the Supervisory Board to handle these responsibilities.
- The Personnel Committee also fulfils the role of Nomination Committee, which consists solely of shareholders’ representatives when performing this role. In line with the statutory requirements, the recommendations of the Code, the skills matrix agreed by the Supervisory Board for the Executive Board, and the targets adopted regarding its composition, the Personnel Committee proposes suitable candidates to the Supervisory Board to stand for election at the Annual General Meeting as shareholder representatives on the Supervisory Board. In each case, it also ensures that the candidate is able to devote the necessary amount of time to the role.
- The Arbitration Committee performs the duties defined in Section 31 (3) of the German Co-Determination Act (MitbestG). This entails making proposals for appointing members of the Executive Board if the statutory majority of two thirds of the Supervisory Board members’ votes is not reached after the first round of voting.
- As HHLA is divided into the two subgroups Port Logistics (A division) and Real Estate (S division), a Real Estate Committee was constituted for the latter. This committee receives all Executive Board reports on behalf of the Supervisory Board and is involved in discussing all affairs that relate to the Real Estate subgroup. It also decides on whether to grant Supervisory Board approval for all legal transactions that require such approval and all other matters that affect the Real Estate subgroup, either primarily or in their entirety. In addition, the Real Estate Committee is responsible for examining and preparing the Supervisory Board’s decision on the adoption of the Annual Financial Statements and the approval of the Consolidated Financial Statements, insofar as these relate to the affairs of the Real Estate subgroup. It is also responsible for preparing the Supervisory Board’s decision on appropriating the distributable profit of the Real Estate division based on the Executive Board’s proposal.
The company has arranged for D&O insurance for the members of the Supervisory Board which complies with Section 3.8 of the Code.
Composition of the Supervisory Board and Diversity
The composition of the Supervisory Board is based on the company’s articles of association as well as Sections 95 and 96 of the German Stock Corporation Act (AktG) and Section 7 of the German Co-Determination Act (MitbestG). The Supervisory Board consists of six shareholder representatives elected by the Annual General Meeting and six employee representatives elected in accordance with the German Co-Determination Act (MitbestG).
In view of the various requirements and recommendations relating to the composition of the Supervisory Board, the Supervisory Board approved a requirement profile for HHLA’s Supervisory Board in December 2017. In addition to key legal requirements and the recommendations of the Code concerning the Supervisory Board’s composition, this includes the Supervisory Board’s own objectives for its composition, the skills matrix for the board as a whole as per Section 5.4.1 (2) GCGC, and the diversity concept for the Supervisory Board, including the disclosures pursuant to Section 289 et seq. (1) (6) of the German Commercial Code (HGB).
Objective of the Requirement Profile
The Supervisory Board strives for a composition which ensures it is capable of monitoring and advising the Executive Board professionally at all times. As well as ensuring its members fulfil professional and personal requirements, the Supervisory Board believes that diversity aspects play an important role for the effective work of the Supervisory Board and thus for the sustainable development of the company. Different personalities, experiences and expertise prevent group thinking and facilitate a more holistic approach, thereby enriching the Supervisory Board’s work. The objectives below therefore serve as guidelines for long-term succession planning and the selection of suitable candidates. They also provide transparency with regard to the key appointment criteria.
Requirements for Individual Members
Each Supervisory Board member should have the personal and professional skills and experience necessary to fulfil the responsibilities of a Supervisory Board member at an international, listed company and protect the HHLA Group’s public image. In view of this, each Supervisory Board member should fulfil the following requirements:
- sufficient professional knowledge, i.e. the ability to perform the duties which are normally handled by the Supervisory Board;
- commitment, integrity and personality;
- a general understanding of HHLA’s business activities, including the market environment and clients’ needs;
- corporate or operational experience – for shareholder representatives, this should ideally take the form of experience from working in company management teams, occupying a managerial position or sitting on supervisory bodies;
- compliance with the limits on mandates set out in Section 100 of the German Stock Corporation Act (AktG) and Section 5.4.5 sentence 2 GCGC.
Each Supervisory Board member ensures that they have the time needed to properly fulfil a Supervisory Board mandate. In particular, it must be taken into account that there are usually four to six Supervisory Board meetings per annum, which each need adequate preparation – especially in the case of reviewing the documents relating to the Annual and Consolidated Financial Statements. Membership of one or more of the committees requires additional time for preparation and attendance of committee meetings. Lastly, additional extraordinary meetings of the Supervisory Board or the committees may become necessary to deal with special topics.
Duration of Membership and Age Limit
Candidates proposed for election to the Supervisory Board should be under the age of 70 at the time of the election. As a rule, members should not serve more than three full terms on the Supervisory Board.
Requirements and Objectives for the Supervisory Board as a Whole
With regard to the composition of the Supervisory Board as a whole, the Supervisory Board strives to ensure that it is composed of members whose personal and professional backgrounds, experience and expertise complement one another so that the Supervisory Board as a whole can draw on the widest possible range of experience and specialist knowledge. This also serves to promote diversity.
The Supervisory Board of HHLA must always be composed in such a way that its members have the necessary knowledge, skills and industry expertise to fulfil the Supervisory Board’s responsibilities properly. Furthermore, the members of the Supervisory Board as a whole must be familiar with the logistics industry – especially the port logistics and intermodal sectors – and the real estate industry, and at least one member of the Supervisory Board must have expertise in the fields of accounting or the auditing of financial statements.
Specific Knowledge and Experience
The Supervisory Board of HHLA as a whole should cover all the areas of expertise necessary to perform its duties effectively. In line with the company’s business model, this specifically includes in-depth knowledge and experience in:
- managing a large or medium-sized listed company which operates internationally;
- the logistics business, ideally in the port logistics and intermodal sectors, including the relevant markets and clients’ needs;
- operations and technology, including IT systems and digitisation;
- the real estate business, specifically letting office space in the Hamburg area;
- legal affairs, corporate governance and compliance;
- controlling and risk management;
- applying accounting principles and internal control processes.
The Supervisory Board strives for a composition whereby at least one member is qualified to provide advice on each of the aspects listed above.
Independence and Conflicts of Interest
Given HHLA’s specific commercial situation and ownership structure, the Supervisory Board should have at least two independent members from amongst the shareholders, as defined in Section 5.4.2 GCGC. Furthermore, the Supervisory Board assumes that the fact employee representatives speak for the staff and are employed by the company does not as such jeopardise their independence and that employee representatives should not therefore be viewed as dependent per se. Instead, they are expected to consider the material circumstances in each case.
To prevent potential conflicts of interest, no more than two former Executive Board members should sit on the Supervisory Board. In addition, the Supervisory Board should not include anyone who holds a seat on an executive body or performs an advisory role at any organisation in direct competition with the company.
Should any conflicts of interest arise – especially as a result of an advisory role or seat on an executive body involving customers, suppliers, creditors or other third parties – the Supervisory Board member in question is obliged to disclose these to the Supervisory Board. The Supervisory Board provides information on conflicts of interest and their treatment in its yearly report to the Annual General Meeting. If a member of the Supervisory Board has significant conflicts of interest that are not merely temporary, this should result in the termination of their period of office.
HHLA’s Supervisory Board consists of at least 30 % women and 30 % men. Furthermore, the Supervisory Board has set itself the medium-term goal of ensuring at least 40 % of its shareholder representatives are women.
In addition to this, diversity in the Supervisory Board is reflected by shareholder representatives with different career paths and fields of activity who can draw on a wide range of different experiences (such as industry background). In the interests of diversity, the Supervisory Board strives for a composition whereby its members complement one another with their backgrounds, experience and expertise. It also strives to ensure that some members have international experience.
Progress to Date and Future Applicability
The Supervisory Board’s current composition fulfils the targets set out above. The Supervisory Board is composed of people with different career paths, a wide range of experience and varying expertise, including members with considerable international experience. The target quota of 30 % for female Supervisory Board members has been met. The age limit was not exceeded by any member at the time of their election. No member has served more than three terms of office on the Supervisory Board. The Supervisory Board has three independent members from amongst the shareholders: the Supervisory Board Chairman Prof. Dr. Grube, Mr. Westhagemann and Dr. Kloppenburg. Dr. Kloppenburg also has expert knowledge and experience in the fields of accounting, auditing and internal control processes and therefore fulfils the requirements in Sections 100 (5) and 107 (4) AktG and Section 5.3.2 (3) GCGC.
The Nomination Committee and the Supervisory Board will take the above requirements and objectives into account during their succession planning and when searching for suitable candidates and proposing them to the Annual General Meeting for election to the Supervisory Board. At the same time, they will strive to fulfil the skills matrix for the Supervisory Board as a whole. However, the Annual General Meeting is under no obligation to observe this requirement profile or the Supervisory Board’s election proposals when electing shareholder representatives. Furthermore, in the case of employee representatives, the Supervisory Board has no right to nominate candidates for election and the employees entitled to vote are also not obliged to observe this requirement profile.
Further information on the Supervisory Board and Supervisory Board committees, as well as the Supervisory Board’s cooperation with the Executive Board in the reporting period, can be found in the Report of the Supervisory Board. see also Report of the Supervisory Board Further information on the composition of the Supervisory Board and its committees can be found in the Notes to the Consolidated Financial Statements. see also Notes to the Consolidated Financial Statements, Note 49, Board Members and Mandates Lastly, curricula vitae for the current members of the Supervisory Board are published on the company’s website, www.hhla.de. These are updated each year.
Gender Representation on the Supervisory Board, Proportion of Women on the Executive Board and in the Two Management Levels Below the Executive Board
In accordance with Section 96 (2) of the German Stock Corporation Act (AktG), the Supervisory Board of HHLA consists of at least 30 % women and 30 % men. The gender quota applies to all members appointed since 1 January 2016. Until the Supervisory Board re-elections in June 2017, the Supervisory Board had two female shareholder representatives. Women therefore accounted for 33.3 % of the shareholder representatives and 16.7 % of the Supervisory Board as a whole. It was not possible to increase the proportion of women prior to the Supervisory Board re-elections as no positions were vacated. Before the Supervisory Board re-elections, Section 96 (2) sentence 3 AktG was not complied with in full, meaning that the respective minimum quotas for the shareholder and employee representatives on the Supervisory Board were to be met separately. In other words, at least two of the shareholder seats and two of the employee seats had to be filled by each gender. Since the Supervisory Board re-elections, there have been four female members of the Supervisory Board, two of whom are shareholder representatives and two of whom are employee representatives. Since then, women have therefore accounted for 33.3 % of both the shareholder representatives and the employee representatives on the Supervisory Board. The gender quota has therefore been fulfilled since the Supervisory Board re-elections.
In September 2015, the Supervisory Board set a target quota of 25 % for women on the Executive Board, which was to be met by 30 June 2017. This target has been met since 1 January 2017. Following the expiry of the initial deadline for target achievement, the Supervisory Board reaffirmed the 25 % target for a further five years, i.e. until 30 June 2022.
Regarding the two management levels below the Executive Board, the Executive Board originally set a target quota of 25 % for women in the first management level below the Executive Board and 30 % for the second management level. The deadline for fulfilling each of these targets was 30 June 2017. Following the expiry of the initial deadline for target achievement, the Executive Board set a target of 30 % for both management levels, to be met in both cases by 30 June 2022. As of 30 June 2017 and 31 December 2017, women accounted for 11 % of the first management level and 21 % of the second management level. In both cases, the main reason for the targets not being achieved by 30 June 2017 was that only a few positions were vacated during the comparatively short period prior to the deadline. Furthermore, in the first management level below the Executive Board, there are a number of vacancies which will not be occupied until after the beginning of 2018. Taking these new appointments into account would put the proportion of women in the first management level at 27 %.
Shareholders and Annual General Meeting
Shareholders exercise their rights, in particular their voting rights, at the Annual General Meeting. The Annual General Meeting is held in Hamburg, another major German city or the seat of a German stock exchange to which the company’s shares have been admitted for trading, within the first eight months of each financial year. Each share entitles its holder to one vote at the Annual General Meeting. There are no shares with multiple voting rights, no preference shares and no caps on voting rights.
Shareholders may exercise their voting rights at the Annual General Meeting in person, by appointing a representative of their choice or by giving voting instructions to proxies designated by the company. The articles of association also authorise the Executive Board to allow shareholders to cast their vote in writing or by means of electronic communication (postal vote). The invitation to the Annual General Meeting includes explanations of the participation conditions, the voting procedure (including proxy voting) and the rights of shareholders. In addition, the company has a hotline for shareholders’ questions. The reports and documents required by law for the Annual General Meeting, including the Annual Report, are published on the company’s website at www.hhla.de/agm together with the agenda. Information on attendance at the Annual General Meeting and the voting results can likewise be found on the company’s website after the Annual General Meeting.
HHLA informs capital market participants and interested members of the general public about the position of the company and the Group and important company developments, particularly by means of its financial reporting (annual report, half-yearly financial report and interim statements), press conferences for analysts and financial press conferences, dialogue with analysts and the press, press releases and ad hoc announcements as required, and its Annual General Meetings. As a permanently available and up-to-date communication medium, the website www.hhla.de provides all the relevant information in both German and English. In addition to comprehensive information about the HHLA Group and the HHLA share, it contains a financial calendar, which provides an overview of the main events. Any enquiries over and above this from shareholders, investors and analysts should be addressed to the Investor Relations department.
Accounting and Auditing
The Separate Financial Statements of HHLA (parent company) are prepared in line with the accounting regulations of the German Commercial Code (HGB). The Consolidated Financial Statements and the Interim Reports comply with the International Financial Reporting Standards (IFRS) that apply in the European Union and the additional requirements of German commercial law pursuant to Section 315e (1) HGB. This Annual Report provides further information on IFRS in the Notes to the Consolidated Financial Statements. see also Notes to the Consolidated Financial Statements, General Notes The appropriation of profits is based solely on the Separate Financial Statements of HHLA.
The choice and appointment of the auditing firm, and the monitoring of its independence and the additional services it provides, are conducted in accordance with statutory provisions. In addition, arrangements have been made with the auditor of the Separate Financial Statements and Consolidated Financial Statements for the 2017 financial year – PricewaterhouseCoopers GmbH Wirtschaftsprüfungsgesellschaft, Hamburg – for the Chairman of the Audit Committee to be informed immediately of any possible grounds for exclusion or bias arising during the audit, insofar as these are not rectified without delay. The auditor should also report immediately on any findings or incidents that are of significance for the Supervisory Board’s remit which come to its attention during the audit of the financial statements. Furthermore, the auditor is to inform the Supervisory Board and/or record in its report if – when conducting the audit – it identifies facts that indicate that the declaration of compliance issued by the Executive Board and Supervisory Board as per Section 161 AktG is incorrect. The audit conducted includes an extended audit as stipulated under Section 53 of the German Budgetary Procedures Act (HGrG). This requires an audit and assessment of the propriety of the company’s management and its financial situation as part of the audit of the Annual Financial Statements.
In the 2017 financial year, the company did not receive any notifications regarding directors’ dealings with HHLA shares or related financial instruments as defined in the Market Abuse Regulation (Regulation [EU] No. 596/2014 of the European Parliament and of the Council).
Payments for investments in property, plant and equipment, investment property and intangible assets.
Transportation via several modes of transport (water, rail, road) combining the specific advantages of the respective carriers.
International Financial Reporting Standards.