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Management structure
As an European Company (Societas Europaea – SE) based in Hannover, the formal structure of our corporate governance is determined by national law. The fundamental hallmarks are the two-tier system with its transparent and effective split into the management of the company (Executive Board) and its oversight (Supervisory Board). Overall responsibility for enterprise management and Group-wide risk management as well as for the definition of the risk strategy rests with the Executive Board of our company. The Supervisory Board takes responsibility for advising and monitoring the Executive Board in its management of the company and also with respect to risk management. In accordance with the principle of co-determination, the Supervisory Board is made up of representatives of the shareholders and the employees. The shareholders exercise their rights of co-administration and supervision in the context of the General Meeting.
Composition of the Executive Board
Our Executive Board is composed of seven members, who are appointed by the Supervisory Board. Along with their qualifications, the Supervisory Board also pays attention to diversity in the selection of members of the Executive Board. We have set ourselves a target of zero for the quota of women on the Executive Board by 30 June 2017. This is because the Executive Board is currently comprised exclusively of men and all existing Board contracts are valid beyond 30 June 2017. When appointing a new member of the Executive Board, the Supervisory Board shall give preference to a potential female candidate in case of equal personal aptitude and professional qualifications.
Composition of the Supervisory Board
Our Supervisory Board consists of nine members. They are appointed for a term of office until the end of the General Meeting that ratifies the acts of management for the 2018 financial year.
Pursuant to statutory requirements and the Participation Agreement, the employees are represented by three members. Given that members of the Supervisory Board cannot at the same time belong to the Executive Board, a high degree of independence in the oversight of the Executive Board is assured. In addition, in its current composition the Supervisory Board also fulfils the requirements of the German Corporate Governance Code with regard to independence.
In order to deal with complex matters and depending on the specific circumstances of the company, the Supervisory Board forms committees under its Rules of Procedure. These are currently the Standing Committee, the Finance and Audit Committee and the Nomination Committee. Appointments to the committees are crucially guided by the respective specialist aptitude required by the committee members.
When it comes to selecting the shareholder candidates who are proposed to the General Meeting for election to the Supervisory Board, the Supervisory Board takes care to ensure that the individuals in question have the necessary knowledge, abilities and specialist experience. The anticipated time that can be invested in a sustainable increase in the value of the company is similarly a central criterion in the selection of candidates. The principle of diversity is also taken into account when making a selection. Allowing for the term of appointment of the Supervisory Board, the Supervisory Board has therefore determined that it will achieve a target quota of 30% for women on the Supervisory Board by 30 June 2017. This target had already been fulfilled by the end of 2016 with a proportion of 33%.
Training activities are held as necessary in order to further enhance the expertise of the Supervisory Board, including for example in 2016 in connection with the implementation of the new solvency regime Solvency II.
Avoidance of conflicts of interest
The avoidance of conflicts of interest is already extensively safeguarded by the control mechanisms stipulated in law and in the Articles of Association that exist between the three governance bodies. In order to assure the provision of independent advice to and oversight of the Executive Board by the Supervisory Board, no more than two former members of the Executive Board shall belong to the Supervisory Board. Members of the Supervisory Board may not undertake any executive role or consulting functions at significant competitors of the company.
Avenues for dialogue on critical issues
Our stakeholders have the opportunity to report critical issues to the company's highest governance body. Within the framework of our established governance structures, critical concerns – including in relation to sustainability matters – are communicated on an ongoing basis to both the Executive Board and the Supervisory Board.
Our shareholders exercise their co-determination right at the Annual General Meeting of the company, in particular through the appointment of members of the Supervisory Board, the ratification of the acts of management of the Executive Board and the Supervisory Board, the resolution on profit appropriation and through their right to ask questions and obtain information.
The participation of our employees in decision-making processes within the company is ensured by their right to have a say through the SE-Employee Councils, the joint German Employee Council of Hannover Rück SE, E+S Rückversicherung AG and International Insurance Company of Hannover SE as well as through the three employee representatives on the Supervisory Board elected by this joint Employee Council.