Corporate Governance Statement

The Management Board and the Supervisory Board work closely together in the interests of the Company and the Group. This ensures that optimal use is made of the professional expertise of the Board members and speeds up decision-making processes. The Management Board keeps the Supervisory Board regularly, promptly and comprehensively informed of strategy, planning, risk position and risk management, the internal control system, compliance, as well as current business developments. The Chairman of the Supervisory Board is also notified of material developments and decisions by the Management Board between meetings.

The Management Board performs its management role as a collegial body. It determines corporate objectives, strategic orientation, corporate policy and Group organisation and coordinates these with the Supervisory Board and ensures that they are implemented. In this process, the Management Board is bound to the Company’s Group-wide interests and committed to the sustained increase of enterprise value, and to the needs of shareholders, customers, employees and other groups associated with the Company. The members of the Management Board are jointly responsible for managing the entire business. Notwithstanding their overall responsibility, the individual Management Board members manage the departments assigned to them independently and within the parameters of the Management Board resolutions. The allocation of duties between the members of the Management Board is derived from the Schedule of Responsibilities. The Management Board has a quorum if at least the majority of its members participate in the resolution and adopts its resolutions by a simple majority. In the event that the Management Board consists of more than two members, the Chairwoman will have the casting vote in the event of a tie.

The Supervisory Board appoints and dismisses members of the Management Board. The Supervisory Board monitors the Management Board in its leadership and management of the Company. In the case of specifically defined actions of material significance – such as major capital expenditures – the Rules of Procedure for the Management Board issued by the Supervisory Board require the approval of the Supervisory Board. The Supervisory Board has also adopted Rules of Procedure. The Rules of Procedure for the Supervisory Board are available on our website under Company/Corporate Governance. Supervisory Board resolutions are generally passed at meetings by a simple majority of the votes cast. At the instruction of the Chairman of the Supervisory Board, resolutions can also be passed outside meetings if no member objects to this process. The Chairman of the Supervisory Board coordinates work within the Supervisory Board, chairs its meetings and attends to the affairs of the Supervisory Board externally. He holds discussions with investors on Supervisory Board-specific topics as required.

As of 31 December 2022, the Management Board of Branicks consisted and continues to consist of four members. The Management
Board currently consists of Sonja Wärntges as Chairwoman (Chief Executive Officer, CEO), also responsible for Asset, Property and Portfolio Management, Finance, Controlling, Marketing, IR, Sustainability and Administration; Johannes von Mutius, responsible for Transaction
Business (Chief Investment Officer, CIO); and since 1 January 2023 Torsten Doyen, Chief Institutional Business Officer (CIBO) and Christian Fritzsche, Chief Operating Officer (COO).

The Supervisory Board of the Branicks Group AG consists of six members, who are all elected by the General Shareholders’ Meeting. The Supervisory Board has elected a Chairman and two Vice Chairmen. Members of the Supervisory Board are elected for a term of office ending at the conclusion of the General Shareholders’ Meeting that formally approves their actions during the fourth financial year following the start of their term of office. The financial year in which the term of office begins is not included in this calculation. The current terms in office end at different times due to different appointment dates. The specific composition of the Supervisory Board and the disclosures pursuant to section 285 no. 10 HGB are listed in the notes to the consolidated financial statements under “Other disclosures”.

The Supervisory Board works with the Management Board on long-term succession planning. In addition to meeting the requirements of the German Stock Corporation Act (AktG), the German Corporate Governance Code (GCGC) and the Rules of Procedure, the target for the share of women on the Management Board as well as the diversity policy for the Management Board and a requirements profile must also be taken into account when carrying out long-term succession planning. The specific qualification requirements and stated specification are taken into consideration to create an ideal profile that is used by the Supervisory Board to select a shortlist of available candidates with whom to conduct structured discussions. External consultants help the Supervisory Board to develop the requirements profiles and/or select candidates as required. When making decisions on filling Management Board positions, the key suitability criteria are professional qualifications for the division being run, leadership qualities, past performance and acquired skills as well as knowledge of the Branicks Group AG.

With regard to the composition of the Management Board, the Supervisory Board follows a diversity policy that primarily includes the following aspects:

• Members of the Management Board should have the knowledge, skills and experience required to properly complete their tasks.
• Members of the Management Board must be familiar with the commercial real estate sector. At least some members of the Management Board should also have knowledge or experience of funds/asset and property management as well as capital markets and financing. As a minimum, the member of the Management Board responsible for Finance must have accounting or auditing expertise and some members of the Management Board should contribute experience of leading a medium-sized company.
• Diversity should also be taken into account when searching for qualified individuals for the Management Board. There should also be an appreciation of how different complementary professional profiles, work and life experiences and balanced gender representation can benefit the work of the Management Board.
• As a rule, members of the Management Board should be under 65 years old. Age should therefore also be taken into account when appointing Management Board members.
• The Supervisory Board stipulated targets for the share of women on the Management Board and a deadline for their achievement in accordance with section 111 (5) AktG as outlined below.

The diversity policy should benefit the work of the Management Board overall. When deciding which individual should fill a specific Management Board position, the Supervisory Board acts in the best interests of the Company while taking into account all circumstances in each individual case.

The Management Board of the Branicks Group AG currently consists of four members professionally and personally qualified in different areas, including a female member, Sonja Wärntges, as CEO. The Supervisory Board believes that the diversity policy has been satisfied during the reporting period.

The Supervisory Board defined targets for its composition, which take the recommendations of the German Corporate Governance Code into account in accordance with the Declaration of Compliance. These targets include the skills profile for the Supervisory Board as a whole as well as the diversity policy it pursues for its composition.

• As a group, the Supervisory Board should have the knowledge, skills and professional experience required to properly complete its tasks. Members of the Supervisory Board must generally be familiar with the sector in which the Company operates.
• It should be ensured that at least some individual members of the Supervisory Board have the following knowledge or experience: (i) familiarity with the commercial real estate sector, (ii) knowledge of funds/asset and property management, (iii) knowledge of capital markets and financing, (iv) accounting expertise for at least one Supervisory Board member and auditing expertise for at least one further Supervisory Board member, (v) experience of leading a medium-sized or larger company. The individual qualifications of individual members may complement each other in achieving this objective.
• Independence and avoiding conflicts of interest are also important objectives: The Supervisory Board members representing the shareholders should include an adequate number of independent members as defined in clause C.6 of the German Corporate Governance Code. More than half of the shareholder representatives shall be independent from the Company and the Management Board as defined in clause C.7 of the German Corporate Governance Code. At least half of the shareholder representatives shall be independent from a controlling shareholder as defined in clause C.9 of the German Corporate Governance Code. The Supervisory Board also follows the recommendations of the German Corporate Governance Code with regard to conflicts of interest. The Supervisory Board should not include any members who perform an executive or advisory role with significant third-party competitors of the Company or Group. The Supervisory Board should not include more than two former Management Board members.
• Requirements for individual Supervisory Board members include: Only persons under 70 should be proposed for election to the Supervisory Board. Supervisory Board members should have business or operational experience. They should be able to assess the profitability, expediency and legality of the business decisions being evaluated as part of the Supervisory Board’s work as well as key accounting documents, with the support of the auditor where appropriate. They should be willing to get involved in the substance of the business to a reasonable extent. Each Supervisory Board member ensures that they can dedicate the expected time to properly exercising their Supervisory Board mandate.
• The Supervisory Board may also include members who are particularly qualified for international requirements. However, in view of the Branicks Group AG’s primary focus on the German property market, the decision was made not to stipulate the aspect of internationality as an objective.
• Diversity should also be taken into account when searching for qualified individuals for the Supervisory Board. There should also be an appreciation of how different complementary professional profiles, work and life experiences and balanced gender representation can benefit the work of the Supervisory Board. The Supervisory Board stipulated targets for the share of women on the Supervisory Board and a deadline for their achievement in accordance with section 111 (5) AktG as outlined below.

The aforementioned targets should benefit the work of the Supervisory Board overall. The targets for the composition of the Supervisory Board are taken into account in the Supervisory Board’s proposals for the election of Supervisory Board members submitted to the General Shareholders’ Meeting. When preparing and approving candidate proposals to the General Shareholders’ Meeting for the appointment of Supervisory Board members, the Supervisory Board should be guided by the best interests of the Company in each case, observe legal requirements and focus on the professional and personal qualifications of the candidate.

The Branicks Supervisory Board provided an overview of the qualifications of its members (“Qualification matrix”) based on the targets for its composition and the skills profile on p. 125 of its Annual Report 2022.

As a listed company not subject to co-determination, the Branicks Group AG is required by law to stipulated targets for the share of women on the Supervisory Board, on the Management Board and at the two executive levels below the Management Board, to the extent that these exist.

With effect from 1 July 2017, the Supervisory Board adopted targets of 1/6 (corresponding to around 16.66 %) for the share of women on the Supervisory Board and 25 % (1/4) for the share of women on the Management Board. A deadline of 30 June 2022 has been set for achieving these targets. With a ratio of 1/4 (25 %), the target for the Management Board is currently met. The target for the share of women on the Supervisory Board is currently not achieved with a ratio of 0 %. When proposing to the General Shareholders’ Meeting to elect member of the Supervisory Board, the Supervisory Board takes into account the objectives set by the Supervisory Board for its composition and the skills profile for the Supervisory Board as a whole, while focusing on the professional and personal qualification of the candidate. At the end of the 2022 General Shareholders’ Meeting on 24 March 2022, the term of office of a total of three Supervisory Board members expires. Among the Supervisory Board’s proposals for the election of Supervisory Board members is one female candidate. If this individual is elected, the planned target for the share of women on the Supervisory Board will be achieved on time.

With effect from 1 July 2017, the Management Board adopted a target of 15.38 % (2/13) for the share of women at the executive level below the Management Board and a deadline for achieving this target of 30 June 2022. As of the reporting date, this target has been exceeded with a ratio of 15.79 % (3/19).

Each member of the Management Board and Supervisory Board discloses potential conflicts of interest in compliance with the German Corporate Governance Code. No conflicts of interest arose on the Management Board in financial year 2022. Any conflicts of interest on the Supervisory Board disclosed to the Supervisory Board in the 2022 financial year and their treatment are described in the Supervisory Board report.

The Supervisory Board established an Audit Committee, which supports the Board in the performance of its duties and regularly reports to it. The Audit Committee is concerned with the tasks set out in section 107 (3) sentence 2 AktG, which means it primarily monitors the accounting, the financial reporting process, the effectiveness of the internal control system, the risk management system and internal audit system, Group-wide compliance and, finally, the audit of financial statements. It evaluates and monitors the independence of the auditors (also taking into account the additional services provided by the auditors), regularly assesses the quality of the audit, and determines the areas of emphasis of the audit in consultation with the auditors. The Audit Committee mainly meets as needed.

The Audit Committee has the following three members:

• Prof. Dr. Ulrich Reuter (Chairman of the Audit Committee)
• Prof. Dr. Gerhard Schmidt
• René Zahnd

The members of the Audit Committee have particular knowledge and experience in financial reporting and the auditing of financial statements. The Chairman of the Audit Committee is independent and has particular knowledge and experience in financial reporting and the auditing of financial statements. Prof. Dr. Gerhard Schmidt also has financial reporting expertise. All of the members of the Audit Committee are familiar with the property sector.

The Supervisory Board annually assesses how effectively the Supervisory Board as a whole and the Audit Committee fulfil their tasks. Externally created, structured questionnaires are used in which Supervisory Board and committee members are asked to answer a series of questions. These questionnaires include issues concerning the organisational, human resources-related and substantive performance of the Supervisory Board and its committee as well as the collaborative structure and procedures within the Supervisory Board and the provision of information, particularly by the Management Board. The results are then jointly discussed by the Supervisory Board. The Supervisory Board most recently carried out a self-assessment in December 2021.

A Directors & Officers (D&O) insurance policy is in place for members of the Management Board and the Supervisory Board. It provides insurance for claims for damages by the Company, shareholders or third parties, which may be asserted due to Board members’ failure to exercise due care. The Branicks Group AG bears the costs of the insurance policy. The members of the Management Board have to pay a deductible in the event of a claim.