The Supervisory Board is involved in important decisions

Providing oversight and advice

The Supervisory Board of Covestro oversees and advises the Board of Management. It is directly involved in decisions of fundamental importance to the company, regularly conferring with the Board of Management on the company’s strategic alignment and the implementation status of the business strategy.

Through regular discussions with the Board of Management, the Supervisory Board is kept constantly informed of business policy, corporate planning and strategy. Its tasks include approving the company’s annual budget and financial framework, the financial statements of Covestro AG, the consolidated financial statements of the Covestro Group and the combined management report, taking into account the reports by the auditor.
 
The Supervisory Board comprises 12 members. Under the German Codetermination Act, half the members of the Supervisory Board represent the stockholders and half the company’s employees. The Chairman of the Supervisory Board coordinates its work and presides over the meetings. Since fall 2015, this office has been held by Dr. Richard Pott.

In accordance with legal requirements in Germany, at least 30 percent of the Supervisory Board members are women and at least 30 percent men. Moreover, the Supervisory Board has the objective of ensuring that three-quarters of its members and more than half of the stockholder representatives are sufficiently independent. This requirement has also been met.

The Supervisory Board assesses the independence of its members according to the recommendations contained in Section 5.4.2 of the German Corporate Governance Code. It also considers the criteria given in the European Commission recommendation of February 15, 2005 (2005/162/EC, Annex 2).

Until 2013, Supervisory Board Chairman Dr. Richard Pott was a member of the Board of Management of Bayer AG, which was the majority stockholder of Covestro in the reporting year. He has no personal or business relationship with Covestro that in the opinion of the Supervisory Board gives rise to a material conflict of interest of more than a temporary nature.

Supervisory Board member Johannes Dietsch is Chief Financial Officer of Bayer. He has no personal or business relationship with Covestro that in the opinion of the Supervisory Board gives rise to a material conflict of interest of more than a temporary nature.

The Supervisory Board has four committees: the Presidial Committee, the Audit Committee, the Human Resources Committee and the Nominations Committee. In fiscal 2015, considerably more than 90 percent of members attended the meetings of the Supervisory Board. Committee meetings were attended by all members.

The Supervisory Board evaluates the efficiency of its work yearly on the basis of a questionnaire. The first evaluation, for fiscal 2016, will take place at the start of 2017.  The questionnaire covers the preparation and implementation of meetings, the work of the committees and the presentation of information.

Further information about the Supervisory Board can be found in the Corporate Governance chapter in the Annual Report 2015. This also contains details about compensation of the Supervisory Board, which is appropriate in light of its composition and in comparison with other companies.