The management structure of HUGO BOSS is derived from the requirements of German corporate law. As a German stock corporation, HUGO BOSS AG has a dual management and control structure. The Managing Board is responsible for the Group strategy and Group management. The Supervisory Board advises the Managing Board and monitors its management activities.
The Managing Board and Supervisory Board cooperate closely for the benefit of the Group. The common objective is to sustainably increase the enterprise value. The Managing Board regularly informs the Supervisory Board in a timely manner and in detail of issues of relevance for the Group concerning strategy, planning, business development, risk position, changes in the risk situation and compliance. Deviations from targets and budgets are explained to the Supervisory Board and its committees in detail. The strategic alignment and further development of the Group are also discussed and coordinated with the Supervisory Board.
When making decisions and in performing their duties for HUGO BOSS, members of the Managing Board and Supervisory Board are not permitted to pursue their personal interests or grant other persons unjustified advantages. No conflicts of interest of members of the Managing Board or Supervisory Board were reported in fiscal year 2021. The mandates held by the Managing Board and Supervisory Board members in statutory supervisory boards or comparable domestic and foreign oversight committees of business enterprises are listed in the notes to the consolidated financial statements. Notes to the Consolidated Financial Statements, Note 27
The Managing Board
The Managing Board of HUGO BOSS AG consists of the Chairman of the Managing Board and the members of the Managing Board with equal rights and their respective areas of responsibility. At the end of fiscal year 2021, the Managing Board comprised five members.
The HUGO BOSS Group is managed by the Managing Board of the parent company HUGO BOSS AG, in which all of the Group management functions are bundled. The Managing Board’s core duties include developing and successfully executing the Group strategy, corporate finance, risk management (including the implementation and monitoring of the risk management system), decisions on the collections, product sourcing, and management of the distribution network. In addition, the Managing Board is responsible for preparing the annual, consolidated, and interim financial statements, and for representing the Company to the media and the capital market.
The bylaws of the Managing Board govern the internal organization of the Managing Board, in particular the allocation of duties among its members as well as the procedure for adopting resolutions. The bylaws also define the disclosure and reporting duties as well as the matters requiring the approval of the Supervisory Board. The bylaws of the Managing Board are available on the Company’s website. group.hugoboss.com
The Supervisory Board pays attention to diversity in the composition of the Managing Board (diversity concept for the Managing Board). Diversity among the Managing Board’s members serves to ensure the Company’s success over the long term. The Supervisory Board takes account of a number of aspects in the composition of the Managing Board, including the following:
- Members of the Managing Board should have long-standing management experience.
- Members of the Managing Board should have an international background (i.e., individuals who possess experience gained outside Germany due to current or past activities and/or who hold non-German citizenship).
- As many different educational and professional backgrounds as possible should be represented in the Managing Board as a whole.
- In addition to the legally required qualifications, the Managing Board as a whole should have members with knowledge of branding, supply chain matters, and distribution.
- To ensure long-term succession planning, the Managing Board as a whole should have a well balance of ages among its members.
- The Supervisory Board is pursuing the target of having at least one woman on the Managing Board by December 31, 2023 at the latest.
- Members of the Managing Board may not, as a rule, be older than 60 years of age when they are appointed.
Decisions on the specific composition of the Managing Board are made by the Supervisory Board in the interest of the Company and taking into account all the circumstances of the individual case. With the exception of the target for the proportion of women on the Managing Board, the aforementioned composition targets were achieved throughout the reporting period.
Pursuant to Sec. 111 (5) AktG [“Aktiengesetz”: German Stock Corporation Act], the Supervisory Board had set the target of having at least one woman on the Managing Board of the Company for the period up to December 31, 2021, but did not meet this target. The Supervisory Board strives to ensure an appropriate representation of women on the Managing Board. However, personnel decisions are always made with a view to the qualifications of all candidates. In the personnel decisions made by the Supervisory Board during the reference period, the most suitable person for the respective position was selected on this basis from a diverse group of candidates in a multi-stage process, irrespective of gender. Pursuant to Sec. 111 (5) AktG, the Supervisory Board has again set the target of one woman on the Managing Board for the reference period up to December 31, 2023.
The GCGC stipulates that the Managing Board shall pay attention to diversity when filling management positions in the Company, and shall in particular strive for an appropriate consideration of women. The Managing Board is committed to this objective. It has already paid attention to the diversity of the workforce and will continue to do so in future. Pursuant to Sec. 76 (4) AktG, the Managing Board had set the target of achieving a proportion of women of at least 30% at the first management level, and at least 35% at the second management level below the Managing Board for the reference period up to December 31, 2021.
As of December 31, 2021, the proportion of women at the first management level below the Managing Board was 29%. While the proportion of women was hence above the prior-year level (December 31, 2020: 25%), it was slightly below the target figure. HUGO BOSS strives to ensure that all genders are adequately represented within the workforce. However, positions are filled solely on the basis of the qualifications of the applicants, even if – as in the case of the first management level below the Managing Board – this leads to a proportion of women that is lower than the target. With a share of women of 45%, the target for women at the second management level below the Managing Board was again clearly exceeded as at December 31, 2021 (December 31, 2020: 43%). Pursuant to Sec. 76 (4) AktG, the Managing Board has set a target gender quota of at least 40% women in the first management level, and 50% in the second management level below the Managing Board to be achieved for the reference period up to December 31, 2025. Employees and Teams
Jointly with the Managing Board, the Supervisory Board is responsible for long-term succession planning for the Managing Board. In this context, the Supervisory Board considers the target for the proportion of women on the Managing Board and the criteria set out in the diversity concept for the Managing Board’s composition as well as the requirements of the German Stock Corporation Act (Aktiengesetz) and the GCGC. Respecting the specific qualification requirements and the aforementioned criteria, the Personnel Committee draws up an ideal profile, on the basis of which it compiles a shortlist of available candidates. Interviews are then conducted with these candidates before a recommendation is submitted to the Supervisory Board for approval. When developing the requirement profiles and selecting the candidates, the Supervisory Board is supported, if necessary, by external consultants.
The Supervisory Board
HUGO BOSS attaches great importance both to the competencies and independence of the Supervisory Board members as well as to diversity in the composition of the Supervisory Board. The members of the Supervisory Board of HUGO BOSS have the necessary knowledge, skills, and professional experience to duly perform their duties.
In accordance with the recommendation in Sec. C.1 of the GCGC, the Supervisory Board at its meeting on December 7, 2017 adopted a Supervisory Board competency profile and set specific targets for its composition. Accordingly, the Supervisory Board should include at least two members with an international background. In fiscal year 2021, the Supervisory Board had four members who were nationals of countries other than Germany until the departure of Antonio Simina, and three members after his departure. In addition, other Supervisory Board members who have German nationality have international professional experience. Furthermore, none of the members may have any potential conflicts of interest. No conflicts of interest of members of the Supervisory Board were reported in fiscal year 2021. None of the current members of the Supervisory Board previously held a Managing Board position within the Company. There were also no advisory or other service agreements in place between members of the Supervisory Board and the Company in the reporting year. In addition, no member of the Supervisory Board should be older than 69 years at the time of election. , However, the Supervisory Board has not set a standard limit for the length of membership of the Supervisory Board. HUGO BOSS has the opinion that a predefined length of membership is not appropriate, as the Company benefits from the expertise of long-standing Supervisory Board members.
The Supervisory Board has also defined a specific target with regard to the number of independent members of the Supervisory Board within the meaning of the GCGC. Accordingly, of the twelve members of the Supervisory Board, including the six employee representatives, a total of at least nine members shall be independent. In addition to the six employee representatives, the four shareholder representatives Iris Epple-Righi, Christina Rosenberg, Robin J. Stalker, and Hermann Waldemer are to be regarded as independent within the meaning of the recommendation in Sec. C.6 of the GCGC.
The Supervisory Board also adopted the following additional composition targets, with the help of which diversity on the Supervisory Board as a whole is aimed for (diversity concept for the Supervisory Board):
- The Supervisory Board should have at least two members with an international background (i.e., persons who possess experience gained outside Germany due to current or past activities and/or hold non-German citizenship).
- The Supervisory Board should have at least one member holding expertise in branding, supply chain and/or national or international distribution matters.
- The Supervisory Board should have at least two members who are currently or formerly managers of another company.
- The Supervisory Board should have at least four members possessing extensive knowledge and experience of the Company itself.
- Aside from the employee representatives, the Supervisory Board should have at least three members who are independent and two who have expertise in the areas of accounting or auditing.
The targets for filling positions were either reached or exceeded throughout the reporting period.
The Supervisory Board currently comprises five women, with the gender quota pursuant to Sec. 96 (2) AktG being met separately for the shareholder side and the employee side at HUGO BOSS. With three female employee representatives and two female shareholder representatives, the gender quota is met on both sides.
The Supervisory Board regularly reviews the efficiency of its activities. In fiscal year 2021, as in previous years, the assessment of the members of the Supervisory Board was obtained by means of comprehensive questionnaire. The external evaluation of the completed questionnaires and the suggestions for improvement contained therein were analyzed and discussed in detail at the Supervisory Board meeting on December 1, 2021. The Supervisory Board drew an overall favorable conclusion.
The Supervisory Board has adopted bylaws which, among other things, govern its duties and responsibilities as well as the procedures for convening, preparing, and chairing meetings and for passing resolutions. The bylaws of the Supervisory Board are available on the Company’s website. group.hugoboss.com
The Supervisory Board has formed five committees on behalf of and representing the Supervisory Board as a whole, which fulfill duties assigned to them to the extent permitted by law, the Articles of Incorporation and/or bylaws. For the Audit Committee, the Personnel Committee and the Working Committee, the bylaws provide for equal representation of stockholder representatives and employee representatives.
1. Audit Committee
The Audit Committee, which has equal representation of shareholders and employees, consists of six members elected by the Supervisory Board from among its members. In accordance with the GCGC, the Chairman of the Committee shall be independent. The Audit Committee is responsible for monitoring the financial reporting process, the effectiveness of the systems of internal control, risk management and internal auditing, as well as the audit of the annual financial statements. In particular, it has the following duties:
- To perform a preliminary audit of the annual financial statements and the consolidated financial statements, the combined management report of HUGO BOSS AG and the Group and the profit appropriation proposal, to discuss the audit report with the external auditor and to prepare the Supervisory Board’s decision on the approval of the annual financial statements and the consolidated financial statements;
- To examine the quarterly reports (interim reports and quarterly statements) and discuss them with the Managing Board;
- To prepare the Supervisory Board’s proposal to the Annual Shareholders’ Meeting for the appointment of an auditor, and, in particular, review of the auditor’s independence and the additional services provided by the auditor;
- Following consultation with the Managing Board, to engage the external auditor and to sign the corresponding fee agreement for the audit of the annual financial statements and the consolidated financial statements on the basis of the resolution passed at the Annual Shareholders’ Meeting, including the determination of the key audit matters and the auditor’s reporting duties towards the Supervisory Board;
- To verify compliance to legal requirements and internal company guidelines.
The Supervisory Board aussured itself of the independence of the members of the Audit Committee representing the shareholders and of the Chairman of the Audit Committee, Robin J. Stalker.
As of December 31, 2021, the Audit Committee comprises the following members: Robin J. Stalker (Chairman), Gaetano Marzotto, Sinan Piskin, Martin Sambeth, Bernd Simbeck, and Hermann Waldemer.
2. Personnel Committee
The Personnel Committee, which has equal representation of shareholders and employees, consists of the Chairman of the Supervisory Board and five other members elected by the Supervisory Board from among its members. It decides on matters relating to the service agreements of the Managing Board members and other contractual matters (including those relating to former Managing Board members and their surviving dependents), prepares the decisions of the Supervisory Board on the appointment and, if necessary, dismissal of members of the Managing Board, and, together with the full Supervisory Board and the Managing Board, ensures long-term succession planning. Decisions concerning the compensation of Managing Board members (including former Managing Board members and their surviving dependents) as well as regular deliberation on and the review of the compensation system are the responsibility of the full Supervisory Board. However, the Personnel Committee submits proposals in preparation for decisions on these matters. In addition, the Personnel Committee makes decisions in accordance with Sec. 114 AktG (Contracts with Supervisory Board Members) and Sec. 115 AktG (Loans to Supervisory Board Members) as well as matters requiring the Supervisory Board’s consent in connection with senior management (including the granting of loans to senior management within the meaning of Sec. 89 (2) AktG). To the extent permitted by law, it represents the Company in transactions with Managing Board members (including former Managing Board members and their surviving dependents).
As of December 31, 2021, the Personnel Committee comprises the following members: Hermann Waldemer (Chairman), Anita Kessel, Luca Marzotto, Sinan Piskin, Christina Rosenberg, and Bernd Simbeck.
3. Working Committee
The Working Committee, which has equal representation of shareholders and employees, consists of the Chairman of the Supervisory Board and five other members elected by the Supervisory Board from among its members, assisting and advising the Chairman of the Supervisory Board. In accordance with the statutory provisions, the Working Committee works closely with the Managing Board to prepare the meetings of the Supervisory Board. In particular, the Working Committee performs the monitoring duties between the meetings of the Supervisory Board. This does not prejudice the monitoring duties of the individual members of the Supervisory Board. The Working Committee makes decisions on transactions requiring consent in cases where the Supervisory Board has delegated its powers accordingly. To the extent permitted by law, the Working Committee is authorized to make decisions on urgent matters instead of the full Supervisory Board. In such cases, the Working Committee shall inform the Supervisory Board immediately in writing and in detail verbally at the next Supervisory Board meeting about the decision, the reasons and the necessity of the Committee’s resolution.
As of December 31, 2021, the Working Committee comprises the following members: Hermann Waldemer (Chairman), Iris Epple-Righi, Katharina Herzog, Luca Marzotto, Tanja Silvana Nitschke, and Sinan Piskin.
4. Nomination Committee
The Nomination Committee consists of two members elected by the shareholder representatives of the Supervisory Board from among its members, and is thus composed exclusively of shareholder representatives in accordance with the recommendation in Sec. D.5 of the GCGC. Its task is to identify suitable candidates for the election of shareholder representatives to the Supervisory Board, and to propose them to the Supervisory Board for its election proposals at the Annual Shareholders’ Meeting.
As of December 31, 2021, the Nomination Committee comprises the following members: Hermann Waldemer (Chairman) and Gaetano Marzotto.
5. Mediation Committee
The Mediation Committee consists of the Chairman of the Supervisory Board, its Deputy, and one member each elected by the employee and shareholder representatives on the Supervisory Board by a majority of the votes cast. Its sole purpose is to perform the duties referred to in Sec. 27 (3) and Sec. 31 (3) Sentence 1 MitbestG [“Mitbestimmungsgesetz”: German Co-Determination Act]. Accordingly, the Mediation Committee makes proposals for the appointment of members of the Managing Board in the event that a previous proposal has not received the legally required majority.
As of December 31, 2021, the Mediation Committee comprises the following members: Hermann Waldemer (Chairman), Anita Kessel, Gaetano Marzotto, and Sinan Piskin.