ALTANA

Corporate Governance

ALTANA considers good corporate governance as a basis for its business success. Therefore, even as a company not listed on the stock exchange, ALTANA orients itself to the rules of the German Corporate Governance Code.

In the 2015 fiscal year, the Supervisory and Management Boards again dealt in depth with the recommendations and suggestions of the German Corporate Governance Code and examined which recommendations and suggestions ALTANA can follow even as a company not listed on the stock exchange and sensibly apply within the company given its shareholder structure.

ALTANA follows the vast majority of the applicable recommendations of the German Corporate Governance Code in the current version of May 5, 2015. This especially applies to the cooperation between the Management Board and the Supervisory Board, the responsibilities of the Chairman of the Supervisory Board and the Supervisory Board plenum, dealing with conflicts of interest and the independence of the Supervisory Board members, the setting up and composition of the committees, as well as matters relating to the audit.

Management and Control

The Management Board of ALTANA AG basically consists of three members, who are appointed by the Supervisory Board for a period of three or five years. During a transition period from August 1 to December 31, 2015, from the time Stefan Genten was appointed to the Management Board until Dr. Matthias L. Wolfgruber’s resignation as Chairman of the Management Board, the Management Board had four members. The Management Board members manage the Group independently and are solely committed to the interests of the company. Together with the presidents of the divisions and some heads of central functional areas, the Management Board forms the Executive Management Team. In regular meetings, this team discusses and analyzes the development of business and important business incidents.

The company’s Supervisory Board has twelve members. Half of them are employee representatives, elected by Group employees in Germany in accordance with the German Codetermination Act. The remaining six members of the Supervisory Board are elected by the Annual General Meeting. The Supervisory Board members are elected for a period of five years. The Management Board reports to the Supervisory Board regularly, without delay, and comprehensively on all issues relevant for the company regarding business development, risks, and planning, and discusses ALTANA’s strategy with the Supervisory Board. The Supervisory Board monitors and advises the Management Board in its management activities. The Supervisory Board’s tasks also include appointing Management Board members and approving the annual financial statements. Specially defined business decisions of the company, such as major acquisitions and divestments, require the approval of the Supervisory Board, in accordance with a list of transactions that are subject to authorization.

The Supervisory Board formed an Audit Committee, a Human Resources Committee, and a Mediation Committee, legally required in accordance with section 27 (3) of the German Codetermination Act. Each committee consists of two shareholder representatives and two employee representatives. The Chairman of the Human Resources Committee and the Mediation Committee is the Chairman of the Supervisory Board, Dr. Klaus Jürgen Schmieder. The Chairman of the Audit Committee is Dr. Lothar Steinebach. He has the necessary knowledge and expertise in the fields of accounting and auditing in accordance with the German Stock Corporation Act.

There is a D & O liability insurance scheme for members of the Management and Supervisory Boards. The insurance covers personal liability risks in the event that a claim is made against members of the Management and Supervisory Boards while they are performing their activities. The insurance contract stipulates a deductible of 10 % of the damages, but a maximum of one-and-a-half times the amount of the fixed annual compensation of the respective member of the Management or Supervisory Board per insurance year. Details on the compensation of the Management and Supervisory Boards can be found on pages 137 ff.

Compliance

The trust of our business partners and customers, as well as the public, in the lawful and responsible behavior of the ALTANA Group and its employees is decisive for the success and reputation of the company. Compliance therefore is very important for ALTANA.

ALTANA’s Code of Conduct, which holds for the entire Group, contains binding rules regarding responsible, ethical and lawful behavior for all staff members. This applies in particular to issues such as antitrust law, environmental protection, safety, corruption, and discrimination. Together with the company’s Guiding Principles, the Code of Conduct determines responsible corporate action. The Code of Conduct and the Guiding Principles are published on our website (www.altana.com). Since 2010, ALTANA’s employees have been trained with the help of an e-learning program regarding the content of the Code of Conduct and further issues relevant to compliance. In 2015, 749 staff members worldwide took part in a Code of Conduct training program.

In addition, ALTANA set up a Compliance Management System designed to help ensure compliance in the ALTANA Group.

ALTANA joined the U.N. Global Compact initiative, whose members are voluntarily committed in their corporate policy to adhering to social and environmental standards as well as the protection of human rights. By joining Global Compact, ALTANA not only acknowledged its principles but also showed a general commitment to support and promote overall U.N. aims.