Deutsche Bank

Annual Report 2017

Supervisory Board

The Supervisory Board of Deutsche Bank AG appoints, supervises and advises the Management Board and is directly involved in decisions of fundamental importance to the bank. It works together closely with the Management Board in a cooperative relationship of trust and for the benefit of the company. The Supervisory Board decides on the appointment and dismissal of members of the Management Board including long-term succession planning for the Management Board based on the recommendations of the Chairman’s Committee and the Nomination Committee. Based on the recommendation of the Compensation Control Committee, the Supervisory Board determines the total compensation of the individual members of the Management Board resolves on the compensation system for the Management Board and reviews it regularly.

The Supervisory Board receives reports from the Management Board at least within the scope prescribed by law or administrative guidelines, in particular on all issues of relevance for the Group concerning strategy, intended business policy, planning, business development, risk situation, risk management, staff development, reputation and compliance. Furthermore, the Audit Committee is also informed regularly, and in the case of severe deficiencies without undue delay, of any serious deficiencies identified by Group Audit and of any substantial deficiencies which have not yet been rectified. The Chairman of the Supervisory Board is informed accordingly of any serious findings against the members of the Management Board. In addition to the already existing reporting principles, the Supervisory Board and Management Board, adopted an Information Regime with detailed specifications regarding the Management Board's reporting to the Supervisory Board as well as rules relating to enquiries addressed by the Supervisory Board to the Management Board. Furthermore, the Information Regime covers, among other things, the Supervisory Board’s requests for information and reports from employees of the company, and the exchange of information in connection with the meetings of the Supervisory Board and its committees.

The Chairman of the Supervisory Board plays a crucial role in the proper functioning of the Supervisory Board and has a leadership role in this. He can issue internal guidelines and principles concerning the Supervisory Board’s internal organization and communications, the coordination of the work within the Supervisory Board and the Supervisory Board’s interaction with the Management Board. Between meetings, the Chairman of the Supervisory Board, and, if expedient, the chairpersons of the Supervisory Board committees, maintain regular contact with the Management Board, especially with the Chairman of the Management Board, and deliberate with him on issues of Deutsche Bank Group's strategy, planning, the development of business, risk situation, its risk management, governance, compliance and material litigation cases. The Chairman of the Supervisory Board and – within their respective functional responsibility – the chairpersons of the Supervisory Board committees are informed without delay by the Chairman of the Management Board or by the respectively responsible Management Board member about important events of material significance for the assessment of the situation, development and management of Deutsche Bank Group. The Chairman of the Supervisory Board engages in discussions with investors on Supervisory Board-related topics when necessary and regularly informs the Supervisory Board of the substance of such discussions.

The types of business that require the approval of the Supervisory Board to be transacted are specified in Section 13 of our Articles of Association. The Supervisory Board meets, if required, without the Management Board. After due consideration and insofar as materially appropriate, the Supervisory Board, or any of its committees, may, in order to perform their tasks, consult auditors, legal advisors and other internal or external advisors. In performing their tasks, the Chairman of the Supervisory Board, the chairpersons of the standing committees and the Supervisory Board members are supported by the Office of the Supervisory Board, which is independent of the Management Board.

In 2017, a total of 59 meetings of the Supervisory Board and its committees took place. As in previous years, joint meetings were held on topics of relevance for several committees.

The duties, procedures and committees of the Supervisory Board are specified in its Terms of Reference. The current version is available on the Deutsche Bank website (www.db.com/ir/en/documents.htm).

Members of the Supervisory Board

The Supervisory Board of Deutsche Bank AG has 20 members. In accordance with the German Co-Determination Act (Mitbestimmungsgesetz), it comprises an equal number of shareholder representatives and employee representatives.

The members representing our shareholders were elected at the Annual General Meeting on May 23, 2013. In departure from this, Dr. Paul Achleitner was first elected at the Annual General Meeting on May 31, 2012, and Gerhard Eschelbeck, Professor Dr. Stefan Simon and Gerd Alexander Schütz were elected at the Annual General Meeting on May 18, 2017. The election of employee representatives took place on April 16, 2013, Alfred Herling stepped down as an employee representative from the Supervisory Board on December 31, 2016. Until then, he was Deputy Chairman of the Supervisory Board. For the remainder of his term of office on the Supervisory Board, he is being replaced by the substitute member elected to take his place, Stefan Rudschäfski, whom the Supervisory Board elected Deputy Chairman of the Supervisory Board with effect from January 1, 2017.

The following table shows information on the current members of our Supervisory Board. The information includes the years in which the members were born, the years in which they were first elected or appointed, the years when their terms expire, their principal occupation and their membership on other companies’ supervisory boards, other nonexecutive directorships and other positions. Representatives of the employees are indicated with an asterisk (*).

Member

Principal occupation

Supervisory board memberships and other directorships

*

Employees representatives.

Dr. Paul Achleitner
Year of birth: 1956
First elected: 2012
Term expires: 2022

Chairman of the Supervisory Board of Deutsche Bank AG, Frankfurt

Bayer Aktiengesellschaft; Daimler AG; Henkel AG & Co. KGaA (member of the Shareholders’ Committee)

Wolfgang Böhr*
Year of birth: 1963
Promoted to the post as Alternate Member: 2015
Term expires: 2018

Chairman of the Staff Council of Deutsche Bank, Düsseldorf; Member of the Group Staff Council of Deutsche Bank; Member of the General Staff Council of Deutsche Bank

Betriebskrankenkasse Deutsche Bank AG (member of the Advisory Board)

Frank Bsirske*
Year of birth: 1952
First elected: 2013
Term expires: 2018

Chairman of the trade union ver.di (Vereinte Dienstleistungsgewerkschaft), Berlin

RWE AG (Deputy Chairman); Deutsche Postbank AG (Deputy Chairman); IBM Central Holding GmbH (until June 2017); Kreditanstalt für Wiederaufbau (KfW) (member of the Board of Supervisory Directors); innogy SE (Deputy Chairman)

Dina Dublon
Year of birth: 1953
First elected: 2013
Term expires: 2018

 

Accenture PLC (until February 2017); PepsiCo Inc.

Jan Duscheck*
Year of birth: 1984
Appointment by court: 2016
Term expires: 2018

Head of national working group Banking, trade union ver.di (Vereinte Dienstleistungsgewerkschaft), Berlin

No memberships or directorships subject to disclosure

Gerhard Eschelbeck
Year of birth: 1965
First elected: 2017
Term expires: 2022

Vice President Security & Privacy Engineering, Google Inc., Mountain View

No memberships or directorships subject to disclosure

Katherine Garrett-Cox
Year of birth: 1967
First elected: 2011
Term expires: 2021

Managing Director and Chief Executive Officer, Gulf International Bank (UK) Ltd., London

No memberships or directorships subject to disclosure

Timo Heider*
Year of birth: 1975
First elected: 2013
Term expires: 2018

Deputy Chairman of the Group Staff Council of Deutsche Bank AG; Chairman of the Group Staff Council of Deutsche Postbank AG; Chairman of the General Staff Council of BHW Kreditservice GmbH; Chairman of the Staff Council of BHW Bausparkasse AG/Postbank Finanzberatung AG

Deutsche Postbank AG; BHW Bausparkasse AG (Deputy Chairman); Pensionskasse der BHW Bausparkasse AG VVaG (Deputy Chairman)

Sabine Irrgang*
Year of birth: 1962
First elected: 2013
Term expires: 2018

Head of Human Resources Baden-Württemberg, Deutsche Bank AG

No memberships or directorships subject to disclosure

Professor Dr. Henning Kagermann
Year of birth: 1947
First elected: 2000
Term expires: 2018

President of acatech – German Academy of Science and Engineering, Munich

Münchener Rückversicherungs-Gesellschaft AG; Deutsche Post AG; BMW Bayerische Motoren Werke AG (until May 2017); KUKA AG (since May 2017)

Martina Klee*
Year of birth: 1962
First elected: 2008
Term expires: 2018

Chairperson of the Staff Council Group COO Eschborn/Frankfurt of Deutschen Bank

Sterbekasse für die Angestellten der Deutsche Bank-Gruppe VVaG

Henriette Mark*
Year of birth: 1957
First elected: 2003
Term expires: 2018

Chairperson of the Combined Staff Council Munich and Southern Bavaria of Deutsche Bank; Member of the Group Staff Council of Deutsche Bank; Member of the General Staff Council of Deutsche Bank

No memberships or directorships subject to disclosure

Richard Meddings
Year of birth: 1958
Appointment by court: 2015
Term expires: 2021

 

HM Treasury; Legal & General Group PLC (until May 2017); TSB Bank PLC (Non-Executive Director since September 2017 and Chairman since February 2018); Jardine Lloyd Thompson Group PLC (Non-Executive Director) (since October 2017)

Louise M. Parent
Year of birth: 1950
Appointment by court: 2014
Term expires: 2018

Of Counsel, Cleary Gottlieb Steen & Hamilton LLP, New York

Zoetis Inc.; Fidelity National Information Service Inc. (since October 2017)

Gabriele Platscher*
Year of birth: 1957
First elected: 2003
Term expires: 2018

Chairperson of the Combined Staff Council Braunschweig/Hildesheim of Deutsche Bank

BVV Versicherungsverein des Bankgewerbes a.G. (Deputy Chairperson);
BVV Versorgungskasse des Bankgewerbes e.V. (Deputy Chairperson);
BVV Pensionsfonds des Bankgewerbes AG (Deputy Chairperson)

Bernd Rose*
Year of birth: 1967
First elected: 2013
Term expires: 2018

Chairman of the General Staff Council of Postbank Filialvertrieb AG; Member of the General Staff Council of Deutsche Postbank; Member of the General Staff Council of Deutsche Bank; Member of the European Staff Council of Deutsche Bank

Deutsche Postbank AG; Postbank Filialvertrieb AG; ver.di Vermögensverwaltungsgesellschaft (Deputy Chairman)

Stefan Rudschäfski*
Year of birth: 1965
Promoted to the post as Alternate Member: 2017
Term expires: 2018

Deputy Chairman of the Supervisory Board of Deutsche Bank AG, Frankfurt; Deputy Chairman of the General Staff Council of Deutsche Bank; Member of the Group Staff Council of Deutsche Bank; Exempted Staff Council member, Deutsche Bank Privat- und Geschäftskunden AG, Hamburg; Chairman of the Staff Council of Deutsche Bank, Hamburg

Betriebskrankenkasse Deutsche Bank AG (Member of the Advisory Board)

Gerd Alexander Schütz
Year of birth: 1967
First elected: 2017
Term expires: 2018

Founder and Member of the Management Board of C-QUADRAT Investment Aktiengesellschaft, Vienna

MyBucks S.A. RCS (Non-Executive Chairman of the Board of Directors) (until February 2018)

Prof. Dr. Stefan Simon
Year of birth: 1969
Appointment by court: 2016
Term expires: 2022

Self-employed attorney at law with his own law firm, SIMON GmbH, Schwyz

Leop. Krawinkel GmbH & Co. KG (Member of the Advisory Council; Chairman of the Advisory Council since January 2018)

Dr. Johannes Teyssen
Year of birth: 1959
First elected: 2008
Term expires: 2018

Chairman of the Management Board of E.ON SE, Essen

Uniper SE (Deputy Chairman) (until June 2017); Nord Stream AG (Member of the Shareholders’ Committee) (since June 2017)

Objectives for the composition of the Supervisory Board, profile of requirements and status of implementation

In accordance with the German Banking Act, members of the Supervisory Board must be reliable, must have the expertise required to perform their control function and to assess and monitor the businesses the company operates, and must commit sufficient time to the performance of their tasks. According to Section 5.4.1 (2) sentence 1 of the German Corporate Governance Code (the “Code”) of February 7, 2017, the Supervisory Board has to prepare and adopt a profile of requirements for the Supervisory Board as a whole, in addition to determining concrete objectives for its composition. The Supervisory Board established the following objectives for its composition in October 2010 and last amended them in February 2018. While taking into account the requirements of Section 5.4.1 (2) sentence 1 of the Code, the Supervisory Board adopted the profile of requirements at its meeting on October 26, 2017.

The Supervisory Board shall be composed in such a way that its members as a whole possess the knowledge, abilities and expert experience to properly complete its tasks and the members in their entirety of the Supervisory Board and the Audit Committee must be familiar with the banking sector. In particular, the Supervisory Board members should have sufficient time to perform their mandates. The composition of the Supervisory Board should ensure the Supervisory Board’s qualified control of and advice for the Management Board of an internationally operating, broadly positioned bank and should preserve the reputation of Deutsche Bank Group among the public. In this regard, in particular, attention should be placed on the integrity, personality, willingness to perform, professionalism and independence of the individuals proposed for election. The objective is for the Supervisory Board as a whole to have all of the knowledge and experience considered to be essential while taking into account the activities of Deutsche Bank Group.

The Supervisory Board, as a whole, must possess the expertise required to effectively monitor and advise the Management Board in its management of Deutsche Bank AG and Deutsche Bank Group – also with regard to the observance of the relevant bank supervisory regulations.

The profile of requirements includes, in particular, the knowledge, skills and professional expertise that are collectively required to perform the tasks of the Supervisory Board of Deutsche Bank AG (collective qualifications). Each Supervisory Board member must have an understanding of the fields of expertise specified below that is appropriate for the size and complexity of Deutsche Bank AG. Experts shall have profound expertise in the individual fields.

The fields of expertise include, in particular, the fields listed below:

  • Knowledge in the areas of banking, financial services, financial markets and the financial industry, including the home market and the bank’s key markets outside Europe
  • Knowledge of the relevant clients for the bank, the market expectations and the operational environment
  • Risk management (investigation, assessment, mitigation, management and control of financial and non-financial risks, capital and liquidity management, shareholdings)
  • Accounting (according to International Financial Reporting Standards (IFRS) and the German Commercial Code (HGB)) and audits of annual financial statements (financial experts: these members of the Supervisory Board must fulfill the requirements as “financial experts” as such term is defined by the implementation rules of the U.S. Securities and Exchange Commission (SEC) issued pursuant to section 407 of the Sarbanes-Oxley Act of 2002 and by Section 100 of the German Stock Corporation Act)
  • Corporate and social responsibility, including reporting
  • Taxation
  • Internal audit
  • Compliance and internal controls
  • Strategic planning, business and risk strategies as well as their implementation
  • Digitalization
  • Information technology (IT), IT systems and IT security
  • Regulatory framework and legal requirements, in particular, knowledge of the legal systems relevant for the bank
  • Knowledge of the social, political and regulatory expectations in the home market
  • Selection procedure for management body members and assessment of their suitability
  • Governance and corporate culture
  • Human resources and staff management
  • Compensation and compensation systems (compensation expert)
  • Management of a large, international regulated company
  • Internal organization of the bank

Furthermore, consideration is to be given to the amendments to the current version of the Business Allocation Plan for the Management Board of Deutsche Bank AG as well as to the requirements and expectations of the regulatory authorities.

Furthermore, the Supervisory Board shall have an adequate number of independent members and shall not have more than two former members of the Management Board of Deutsche Bank AG. Under the premise that the performance of the Supervisory Board mandate in itself by the representatives of the employees cannot be reason to doubt fulfillment of the independence criteria according to Section 5.4.2 of the Code, the Supervisory Board shall have a total of at least sixteen members that are independent within the meaning of the Code. In any event, the Supervisory Board shall be composed such that the number of independent members, within the meaning of Section 5.4.2, among the shareholder representatives will be at least six. The members of the Supervisory Board may not exercise functions on a management body of, or perform advisory duties, at major competitors. Important and not just temporary conflicts of interest with respect to a member of the Supervisory Board should lead to a termination of the mandate. Members of the Supervisory Board may not hold more than the allowed number of supervisory board mandates according to Section 25d of the German Banking Act (KWG) or mandates in supervisory bodies of companies which have similar requirements.

There is a regular maximum age limit of 70. In well-founded, individual cases, a Supervisory Board member may be elected or appointed for a period that extends at the latest until the end of the fourth Annual General Meeting that takes place after he or she has reached the age of 70. This age limit was taken into account in the election proposals to the recent General Meetings and shall also be taken into account for the next Supervisory Board elections or subsequent appointments for Supervisory Board positions that become vacant. In October 2015, the Supervisory Board resolved that for members of the Supervisory Board to be elected or appointed in future, the length of each individual Supervisory Board membership shall not, as a rule, exceed 15 years.

The Supervisory Board respects diversity when proposing members for appointment to the Supervisory Board. In light of the international operations of Deutsche Bank, care should be taken that the Supervisory Board has an appropriate number of members with long-term international experience. Currently, the professional careers or private lives of seven members of the Supervisory Board are centered outside Germany. Furthermore, all of the shareholder representatives on the Supervisory Board have several years of international experience from their current or former activities as management board members or CEOs or a comparable executive function of corporations or organizations with international operations. In these two ways, the Supervisory Board believes the international activities of the company are sufficiently taken into account. The objective is to retain the currently existing international profile.

For the election proposals to the General Meeting, the Supervisory Board takes into account the recommendations of the Nomination Committee and the legal requirements according to which the Supervisory Board shall be composed of at least 30 % women and at least 30 % men. Special importance was already attached to an appropriate consideration of women in the selection process for the Supervisory Board elections in 2008. In reviewing potential candidates for a new election or subsequent appointments to Supervisory Board positions that have become vacant, qualified women shall be included in the selection process and shall be appropriately considered in the election proposals. For many years now, more than 30 % of the Supervisory Board members have been women and, since 2013, 30 % of the shareholder representatives have been women. Currently, seven Supervisory Board members are women, i.e. 35 % of all members. The Supervisory Board strives to maintain this number. It should be taken into account that the Supervisory Board can only influence the composition of the Supervisory Board through its election proposals to the General Meeting.

The Supervisory Board believes that it complies with the specified concrete objectives regarding its composition and the profile of requirements. The members of the Supervisory Board as a whole possess the knowledge, ability and expert experience to properly complete their tasks. Diversity is appropriately taken into account. Further details in this context are given in the “Diversity Concept”, which is also part of this Corporate Governance Statement / Corporate Governance Report.

In accordance with Section 5.4.2 of the Code, the Supervisory Board determined that it has what it considers to be an adequate number of independent members among the shareholder representatives these are namely: Dr. Paul Achleitner, Dina Dublon, Gerhard Eschelbeck, Katherine Garrett-Cox, Richard Meddings, Louise M. Parent, Professor Dr. Stefan Simon and Dr. Johannes Teyssen. Currently, the Supervisory Board does not consider Professor Dr. Henning Kagermann independent due to his length of service on the Supervisory Board of more than 15 years, nor Gerd Alexander Schütz as a representative of the large shareholder HNA.

Some members of the Supervisory Board are, or were last year, in high-ranking positions at other companies that Deutsche Bank has business relations with. Business transactions with these companies are conducted under the same conditions as those between unrelated third parties. These transactions, in our opinion, do not affect the independence of the Supervisory Board members involved.