Corporate governance declaration of TAG Immobilien AG and the Group for 2024 pursuant to Section 289f and Section 315d of the German Commercial Code

TAG Immobilien AG (hereinafter also referred to as “TAG” or, together with its subsidiaries, the “Group” or “TAG Group”) has issued the following declaration in accordance with Section 289f and Section 315d of the German Commercial Code, taking into account the recommendations of the German Corporate Governance Code in the version dated 27 March 2022 (“Code”). 

 

A. Declaration of conformity in accordance with Section 161 of the German Stock Corporation Act (Section 289f (2) No. 1 of the German Commercial Code)

The Management Board and the Supervisory Board of TAG Immobilien AG issue the following declaration on the recommendations of the Codein the version published on 27 June 2022 in Federal Gazette:

The recommendations of the 2022 Code have been followed since the last declaration of conformity was issued in November 2023 and will continue to be followed in the future.

Hamburg, November 2024
Management Board and Supervisory Board of TAG Immobilien AG

 

B. Remuneration of the Management Board and the Supervisory Board, auditor's opinion in accordance with Section 162 of the German Stock Corporation Act, remuneration system, shareholder resolution on remuneration (Section 289f (2) No. 1a of the German Commercial Code)

The remuneration report and the auditor’s opinion in accordance with Section 162 of the German Stock Corporation Act can be found under Annual reports, details of the remuneration system under Remuneration system and the last resolution passed in 2021 at the annual general meeting on remuneration in accordance with Section 113 (3) of the German Stock Corporation Act under Voting results of the annual general meeting 2021.

TAG’s financial reports and further information on corporate governance are published on its website under Investor Relations (Investor Relations).
 

C. Relevant disclosures on corporate governance (Section 289f (2) No. 2 of the German Commercial Code)

The management of TAG as a listed German stock corporation and of the Group is governed by legal requirements (including the German Stock Corporation Act), the rules of the Frankfurt Stock Exchange, the Code(the “Code”) and its own rules and policies. 

I. Compliance management system

The principles underlying the aforementioned rules are of crucial importance for successful business activity and the sustainable creation of value by the TAG Group. The Management Board and the Supervisory Board of TAG are particularly committed to ensuring that they are complied with.

The compliance management system (“CMS”) is a key component of the TAG Group’s corporate governance. It ensures compliance with all legal requirements and internal Group regulations in order to systematically and permanently prevent any breaches of the law and regulations and promotes corporate culture.

In its policy statement, TAG sets out its commitment to respecting and upholding human rights and to protecting human rights and the environment. Within the Group and in its interaction with customers and business partners, it is actively committed to excluding all violations of human rights and environmental harm and to preventing, minimising and ending any such violations.

The guidelines for action are based on the business principles under which TAG undertakes to engage in honest and ethical behaviour and responsible conduct towards customers, business partners, employees and other stakeholders. TAG also expects its business partners to observe all legal and regulatory requirements as well as ethical principles. The standards of behaviour are anchored in the Business Partner Code of Conduct, which is published on the TAG Immobilien AG website (Business Partner Code).

Employees receive regular training in the aspects of our corporate governance. Through annual compliance training, we ensure that our employees have in-depth knowledge of the relevant legal requirements and compliance-relevant matters.

Employees and stakeholders of the TAG Group can use the digital whistleblower system at any time and anonymously to report actual or suspected violations of the law and internal guidelines as well as human rights and environmental risks and breaches. TAG’s Rules of Procedure describe the reporting channels, procedure, responsibilities and confidentiality requirements.

The members of the Supervisory Board and the Management Board as well as parties closely related to them are required to notify the Company without delay of any transactions in shares or securities issued by TAG Immobilien AG or financial instruments based on them. They are disclosed on the Company’s website under Manager Transactions. As was the case at the end of the previous year, the total number of shares in TAG Immobilien AG held by members of the Management Board and Supervisory Board accounted for less than 1% of the total shares issued by the Company as of 31 December 2024.

II.Institut für Corporate Governance in der deutschen Immobilienwirtschaft e.V. [Institute of Corporate Governance in the German Real Estate Industry] 

TAG is a member of the Institut für Corporate Governance in der deutschen Immobilienwirtschaft e.V. [Institute of Corporate Governance in the German Real Estate Industry] (“ICG”) The Corporate Governance Code of the German Real Estate Industry (last amended in September 2023), which is based on the German Corporate Governance Code, is binding on the members of the ICG. It supplements the latter by incorporating key aspects pertaining to the real estate industry (e.g. with regard to transparency, expertise on the Management Board and Supervisory Board).

III. Sustainability

TAG is committed to sustainable value creation. For this reason, economic, ecological and social aspects as well as good corporate governance are taken into account in decision-making processes in a balanced manner. In addition to generating long-term shareholder value, TAG also creates value for other stakeholders.

All aspects of our sustainability strategy can be found on the Company’s website under Annual Report 2024 (p. 64ff.). 
 

D. Working practices of the Management Board and Supervisory Board, composition (Section 289f (2) No. 3 of the German Commercial Code)

I. Management Board

1. Duties

The Management Board manages the Company at its own initiative. In accordance with the requirements of company law, the individual members of the Management Board are jointly responsible for the overall management and strategy of the Company. The Company’s strategy is determined in consultation with the Supervisory Board. The principles and details of the joint activities between the Management Board and the Supervisory Board are documented in the Management Board’s Rules of Procedure (Rules of Procedure of the Management Board). The responsibilities of the individual members of Management Board and the matters for which the Management Board as a whole is responsible are set out in the Rules of Procedure and the Schedule of Responsibilities. Legal transactions and decisions requiring the approval of the Supervisory Board are specified in the Rules of Procedure of the Management Board.

The Management Board’s duties include reporting to the Supervisory Board regularly, comprehensively and with minimum delay on all main aspects of the Company’s business performance, significant transactions and the current earnings situation including the risk position and risk management. This information is submitted at least four times a year at the meetings of the Supervisory Board and in written reports. Moreover, each member of the Supervisory Board receives a monthly report on current business developments.

Where necessary, the Management Board also reports on an adhoc basis to the Chairman of the Supervisory Board or the Chair of the Audit or Personnel Committee directly.

2. Composition and succession planning

The Management Board consists of two members: Claudia Hoyer (Chief Operating Officer and Co-CEO) and Martin Thiel (Chief Financial Officer and Co-CEO).

The composition of the Management Board is aligned to the interests of the Company and is intended to ensure the effective and sustainable management of the TAG Group. An initial appointment has a maximum term of three years. The age limit for members of the Management Board is capped at 67 years.

The Supervisory Board and the Management Board engage in long-term succession planning for the Management Board. These plans are particularly prepared by the Supervisory Board’s Personnel Committee. The requirements of the German Stock Corporation Act, the Codeand the gender representation targets for the Management Board, further requirements with respect to personal qualities and diversity criteria, their expertise and experience are taken into account. Accordingly, the Personnel Committee draws up a profile of requirements for the position to be filled as a basis for entering into structured negotiations with possible candidates. The Personnel Committee subsequently submits a recommendation to the Supervisory Board on the further selection process or as a basis for a resolution. If necessary, the Personnel Committee and the Supervisory Board can seek assistance from external consultants in the preparation of job profiles and the selection of candidates.

II. Supervisory Board

1. Duties and committees

The Supervisory Board regularly advises the Management Board on the discharge of its duties and monitors its activities. Based on a proposal submitted by the Personnel Committee, it decides on the remuneration system for the Management Board and determines the total annual remuneration, including the variable remuneration components based on the Company’s performance and the remuneration attributable to the individual member of the Management Board. The Supervisory Board works on the basis of the applicable legal system and its rules of procedure, which define the way in which its members work together. The current version is available on the Company’s website under Rules of Procedure of the Supervisory Board.

The Supervisory Board is informed promptly, regularly and comprehensively of current business activities. This includes, in particular, matters relating to strategy, planning, the risk situation and compliance. The Chairman of the Supervisory Board and the Management Board liaise on the above-mentioned matters on an ongoing basis outside the meetings.

The Supervisory Board has also established an Audit Committee and a Personnel Committee. The Audit Committee oversees the preparation and audit of the annual financial statements and the consolidated financial statements, including the sustainability disclosures. It also particularly deals with the risk management system, the internal control system and the compliance management system. The Personnel Committee also acts as the Nomination Committee. It prepares the decisions on appointments to the Management Board as well as the proposals of the Supervisory Board to be submitted to the shareholders at the annual general meeting concerning the election of Supervisory Board members. 

2. Composition

Under its articles of incorporation, the Supervisory Board has six members. The law on the one-third participation of employees on supervisory boards applies to TAG. The shareholder representatives therefore have four members, while the employees are represented by two members. The changes in the composition of the Supervisory Board in 2024 are presented in the Report of the Supervisory Board.

The composition of the Supervisory Board and its committees is as follows:

¹ Resigned at the end of the annual general meeting on 28 May 2024; ^2/3 until/from the end of the annual general meeting on 28 May 2024; ⁴ Employee representative. 

The CVs of the members of the Supervisory Board are available on the Company’s website at Supervisory Board.

The Supervisory Board is satisfied that all the shareholder representatives are independent within the meaning of recommendation C. 7 of the German Corporate Governance Code. 

3. Profile of skills, diversity, succession planning

The Supervisory Board has defined the following profile of skills and specific objectives for the entire Board. Expertise in real estate, capital markets, corporate finance, accounting, auditing, sustainability and diversity principles are taken into account. The profile of skills is also the basis for succession planning on the Supervisory Board. Members of the Supervisory Board should not hold office for any longer than until the end of the annual general meeting that follows their 75th birthday. In a resolution dated 11 March 2024, the term of office is capped at a maximum of 12 years.

Qualification matrix of the Supervisory Board:

^1/2 Mandate until/as of the end of the annual general meeting on 28 May 2024.

In view of her current position as Chair of Planning and Construction Economics/Real Estate Management at the Technical University of Berlin and her professional background, Prof. Wellner is considered to be particularly well qualified to address the sustainability questions relevant to the TAG Group.

4. Self-assessment

The Supervisory Board regularly performs a self-assessment of the effectiveness and efficiency of its work in accordance with recommendation D.12 of the German Corporate Governance Code. This can also be done on an adhoc basis. The self-assessment is carried out by the Chairman of the Supervisory Board, who questions the individual members in advance of a meeting or sends them self-evaluation forms, which the members of the Supervisory Board then complete before the meetings. In particular, the members of the Supervisory Board comment on its organisation, the provision of information, the activities, the selection of members, composition and the provision of information to shareholders and third parties. The results of the survey are subsequently analysed and evaluated at a subsequent meeting. External consultants have not yet been involved in this process. In October 2024, the Supervisory Board completed a self-assessment process using the procedure described. At its meeting on 12 November 2024, it discussed the results in detail and adopted specific measures.

 

E. Gender representation and diversity (Section 289f (2) Nos. 4 and 6 of the German Commercial Code)

Throughout the TAG Group, attention has always been paid to balanced gender representation. The Supervisory Board has set a female representation target of at least 30% to be fulfilled by 31 January 2028 for both the Management Board and the Supervisory Board. Female representation currently stands at 50% for the Management Board and 50% for the Supervisory Board. Female representation on the first and second management levels below the Management Board has been set at a minimum of 30%. This target must be reached by 31 January 2028. As of 31 December 2024, the proportion of women stood at 38.2% at the first management level and 48.7% at the second management level.

TAG has not adopted a separate formal diversity policy within the meaning of Section 289f (2) No. 6 of the German Commercial Code for the Company’s Supervisory Board and Management Board. It considers the internal rules on gender representation in management positions, on the Management Board and on the Supervisory Board on the basis of the diversity criteria (e.g. age, sex, educational and professional background) to be sufficient.

 

Hamburg, March 2025
The Management Board