Corporate Governance –
Efficient and structured
Good corporate governance creates lasting value. We therefore subscribe to the highest standards and are committed to an effective division of responsibilities within Munich Re’s management.
We define » corporate governance as responsible corporate management and control geared to long-term value creation. To ensure that these activities are performed effectively, we apply nationally and internationally recognised standards. Another success factor is the efficient, enduring work of our Board of Management and Supervisory Board, and the superb collaboration between these bodies.
Meeting the most demanding requirements
Given its international orientation, Munich Re has to consider the corporate governance rules of all the markets in which we operate. In Germany, where Münchener Rückversicherungs-Gesellschaft Aktiengesellschaft in München is registered, these standards are established primarily in the German Stock Companies Act and the » German Corporate Governance Code (DCGK). Since 2002, this Code has contained the main legal rules to be observed by listed German companies. Also applicable in our case is the German Act on the Co-Determination of Employees in Cross-Border Mergers (MgVG) and a co-determination agreement concluded in December 2008 on the basis of the MgVG.
Separate responsibilities and a common objective
The Board of Management and 20-member Supervisory Board both contribute to effective, long-term corporate governance. They cooperate closely to the benefit of Munich Re, as provided for in the dual management system prescribed by law for German joint-stock companies.
The Board of Management is responsible for managing Munich Re and must ensure compliance with statutory requirements and internal corporate directives. The company is a parent group with clearly delineated areas of responsibility, the Group Committee being responsible for all holding functions, while the Reinsurance Committee oversees the reinsurance business. Both of these spheres of activity are stipulated in the Board of Management’s rules of procedure. The Supervisory Board appoints the members of the Board of Management and is involved in fundamental decisions regarding strategic planning and business development. The Board of Management, whose remuneration is geared in particular to long-term corporate performance, has the duty to report regularly to the Supervisory Board on all matters having significant bearing on the corporation. For certain types of transactions, for instance investments, the large-scale disposal of assets or individual capital measures, the Board of Management is required to obtain the consent of the Supervisory Board.
Tried and tested efficiency
In compliance with the applicable co-determination regulations, half of the Supervisory Board comprises employee representatives and the other half shareholder representatives. There are no overlaps, i.e. no one is a member of both the Supervisory Board and the Board of Management. Suitable candidates for the Supervisory Board are selected on the basis of “fit and proper” criteria, in particular their professional abilities, personal qualities and degree of independence, as well as the company's interest in maintaining an adequate degree of diversity on the Board. The Supervisory Board regularly monitors the effectiveness of its work. In the 2010 financial year, the result of this efficiency audit was extremely positive, with consistently favourable evaluations. These were also attributable to the role of the five Supervisory Board Committees. In addition to the Standing Committee, these comprise the Personnel Committee, the Audit Committee, the Conference Committee and the Nomination Committee. The committees investigate issues in their respective areas and prepare resolutions for the Board as a whole, thus increasing the effectiveness of the Board's work.
