A long tradition of good corporate governance

Responsible corporate governance has always been part of Bertelsmann’s identity and an important element in its corporate culture. Responsible corporate governance is characterized by a transparent structure and clear decision-making processes in the cooperation between the Executive Board, the Supervisory Board and the Annual General Meeting.

Good cooperation between Boards is of great importance

The Bertelsmann AG Executive Board is responsible for independently managing the company. It informs the Supervisory Board regularly, promptly and comprehensively about all issues significant to the company regarding planning, business development, the financial and earnings situation, risk situations and risk management. The Supervisory Board supervises the Executive Board and advises it in strategic matters and significant business transactions. The Executive and Supervisory Boards cooperate closely and are therefore able to reconcile the demands of effective corporate governance with the necessity of rapid decision-making. Fundamental matters of corporate strategy and its implementation are discussed candidly and are coordinated in joint sessions. Any significant measures to be taken by the management are subject to the agreement of the Supervisory Board. The shareholders exercise their rights, including voting rights, at the Annual General Meeting. Among other responsibilities, the Annual General Meeting decides on amendments to the articles of association and the appropriation of net income, and elects members to the Supervisory Board. The members of the Executive Board are appointed by the Supervisory Board.

Effective Supervisory Board work

The appropriate size of Bertelsmann’s Supervisory Board and the professional expertise of its members are key factors in its effectiveness and independence. In this regard, the delegation of tasks to committees of experts has long been an integral component of the Supervisory Board’s work at Bertelsmann, to increase the Board’s monitoring efficiency and advisory expertise. The breadth and range of responsibilities and tasks delegated to these committees is continuously reviewed through various evaluation processes. In addition to the Personnel Committee, the Bertelsmann AG Supervisory Board has formed a Strategy and Investment Committee, an Audit and Finance Committee, as well as a Working Group of Employee and Management Representatives on the Supervisory Board. Bertelsmann voluntarily introduced employee representation on the Supervisory Board as early as 1974.

At present four employee representatives sit on the Supervisory Board, which has 15 seats, as set out in the corporate constitution. Since 2001, the Executive and Supervisory Boards have been supported in their work by a corporate governance workgroup.

Shareholder Structure

Bertelsmann AG is a privately held stock corporation.
80.9 percent of the capital shares in Bertelsmann are held by foundations (Bertelsmann Stiftung, Reinhard Mohn Stiftung, BVG-Stiftung) and 19.1 percent are held directly by the Mohn family.
The Bertelsmann Verwaltungsgesellschaft (BVG) controls all voting rights in the Bertelsmann AG Annual General Meeting.

Shareholder structure of Bertelsmann AG:

Guideline: The German Corporate Governance Codex

Although Bertelsmann is an unlisted company, the Group largely complies with the recommendations of the German Corporate Governance Codex, which is primarily aimed at listed companies. Exceptions primarily relate to those guidelines which, in the opinion of Bertelsmann AG, apply to publicly held enterprises with large numbers of shareholders or anonymous shareholders. The individual compensation and incentives paid to the members of the Bertelsmann AG Executive Board and Supervisory Board are disclosed to the shareholders of Bertelsmann AG.