EmailMinusMobilPlusNavpfeilrunterNavpfeilrunterNavpfeilhochNavpfeillinksNavpfeilrechtsarrow_rightarrow_rightBurgermenuDownloadflogo-HexRBG-Wht-58_2FaxTelefonDokumentStandortLoginEmail_invertSucheicon_searchElement 1Schliessen

Dear shareholders,

2020 was a very particular year for Deutsche Wohnen SE because of the coronavirus pandemic and its impact on everyone’s everyday life. We are proud that our company was able to cope with the challenges and bring the financial year to a successful close. Our business model proved to be robust under challenging conditions, including the regulatory intervention in Berlin, and our performance figures were in line with our forecasts. We also assumed our social responsibilities. Portfolio optimisation continued and the project development business was expanded.

Cooperation between Supervisory Board and Managment Board

In 2020 the Supervisory Board carried out with great diligence the tasks assigned to it by law, the articles of association, the German Corporate Governance Code and the Rules of Procedure. It regularly advised the Management Board on the management of the company and monitored its work. It was directly involved and at an early stage in all decisions of fundamental importance for the company.

The Management Board informed the Supervisory Board regularly, promptly and fully in writing and orally about all matters relevant to the company concerning company policy, corporate planning and strategy, the company’s position, including opportunities and risks, the course of business, risk management and compliance. Any differences between forecasts and actual performance were explained in detail. The Management Board agreed important transactions with the Supervisory Board.

The Chair of the Supervisory Board and other members of the Supervisory Board were in regular contact with the Management Board to discuss important topics, also outside meetings of the Supervisory Board and its committees. These concerned the company’s strategy, performance, risk management, and other matters. The Supervisory Board met regularly without the presence of Management Board members, to discuss staffing and remuneration matters, for example

Supervisory Board meetings and resolutions

In financial year 2020 the Supervisory Board discussed the current course of business, important individual matters and transactions requiring approval in twelve meetings. All the meetings were held in the form of phone or video conferences in 2020 due to contact restrictions and anti-corona measures. Where necessary, the Supervisory Board gave its approval in the individual meetings as requested, after a thorough review and detailed discussions. A resolution amending the articles of association was adopted by circulation of documents on 21 January 2020 in response to the issue of company shares to external shareholders of GSW Immobilien AG and members of the Management Board in 2019. The average attendance rate at Supervisory Board meetings was 98.8%. The Supervisory Board and Management Board coordinated their activities in a joint workshop at the start of the financial year.

Individualized participation of meetings in financial year 2019

Member of Supervisory Board Supervisory Board Executive and Nomination Committee Audit Committee Capital Market and Acquisition Committee
Matthias Hünlein
(Chair)
12/12
100%
3/3
100%
3/3
100%
4/4
100%
Jürgen Fenk
(Deputy Chair since 05/06/2020)
11/12
92%
3/3
100%
5/5
100%
 
Arwed Fischer

12/12
100%
 0/0
-----
   4/4
100%
Kerstin Günther
(Member since 05/06/2020)
6/6
100%
  2/2
100%
 
Tina Kleingarn 12/12
100%
    4/4
100%
Dr. Florian Stetter 12/12
100%
  5/5
100%
 
Dr. Andreas Kretschmer 6/6
100%
3/3
100%
  0/0
-----


Focus areas

In the reporting year the Supervisory Board focused on business planning and the performance of Deutsche Wohnen SE, Management Board matters, company strategy, regulatory changes, acquisition and disposal projects and the integration of acquisitions, particularly in the Project Development business. Measures to combat the coronavirus pandemic and its effects were on the agenda throughout the year.

The Supervisory Board discussed regularly and in detail the performance of the segments Residential Property Management, Disposal, Nursing Operations, and Nursing Assets, as well as the financial and liquidity position of the Group. Another focus of the Supervisory Board’s work was to review and advise the internal control system and risk management system of the Deutsche Wohnen Group.

Individual meetings

At the meeting on 2 March 2020 the Supervisory Board approved an acquisition project for some 1,400 units.

On 13 March 2020 the Supervisory Board discussed Management Board matters, especially the STI 2019 and 2020 and the current state of the coronavirus pandemic.

At the meeting on 19 March 2020 the Supervisory Board dealt particularly with reports of committee meetings, the separate and consolidated financial statements for 2019 and Management Board matters, particularly remuneration. Representatives of the auditors were present for the discussion of the financial statements for 2019; they explained items and carrying amounts in the financial statements of the company and the Group and discussed their audit of the non-financial group statement. Other core topics were the proposal for the election of auditors, approval of the Supervisory Board report and the corporate governance declaration, the implications of the coronavirus pandemic and other current topics and projects

The use of profits was discussed again in view of the ongoing coronavirus pandemic at the Supervisory Board meeting on 24 March 2020 and a decision was taken to reduce the original dividend in order to create a relief fund. A resolution was passed changing the proposal to the Annual General Meeting on the use of profits accordingly.

The Supervisory Board meeting on 27 April 2020 focused on the Annual General Meeting, particularly the agenda and proposals for resolution, the proposed candidate for election to the Supervisory Board and the organisation of a virtual general meeting in accordance with the new coronavirus legislation. Management Board matters, specifically various remuneration issues, were also discussed and resolutions passed. The Management Board reported on the successful issue of corporate bonds.

The focus of the Supervisory Board meeting on 6 May 2020 was on committee reports, Management Board matters, particularly remuneration, current performance, approval of an investment project and various other projects.

The meeting on 5 June 2020 took place after the Annual General Meeting and so after the departure of Dr Andreas Kretschmer and the election of Kerstin Günther. New elections were held for the Supervisory Board committees and the virtual Annual General Meeting was discussed.

At the meeting held on 19 June 2020 the Supervisory Board examined and approved a disposal project.

The main elements of the meeting on 18 September 2020 were committee reports and the discussion of current performance in the first half of 2020, project development business, Management Board matters and the definition of a new target for the proportion of female Management Board members.
The DPR audit of Deutsche Wohnen SE, its carbon footprint and other ESG topics were also discussed.

The meeting on 9 November 2020 concentrated primarily on committee reports, company performance, particularly on the basis of the third quarter 2020 report, approval to acquire development projects and data protection matters.

At its meeting on 15 December 2020 the Supervisory Board dealt particularly with approval of the business plan for 2021 and the joint declaration, with the Management Board, of compliance with the German Corporate Governance Code. Aspects of Management Board remuneration were also on the agenda.

The Supervisory Board meeting on 21 December 2020 continued the discussion of the declaration of compliance, which was adopted in agreement with the Management Board. The Supervisory Board also dealt with Management Board matters and a change to the Rules of Procedure for the Supervisory Board.

Supervisory Board committees

The Supervisory Board has formed committees in order to perform its responsibilities efficiently. They each have three members and their work, as well as the need for them, is reviewed continuously by the Supervisory Board.

There were three committees in the reporting year:

  • Executive and Nomination Committee,
  • Audit Committee, and
  • Capital Markets and Acquisition Committee.

The members and tasks of the committees are described in detail in the Corporate Governance Declaration.

Generally speaking, the committees prepare the Supervisory Board resolutions and subjects for discussion by the full Supervisory Board. Decisionmaking authority has been delegated to individual committees by the Rules of Procedure or Supervisory Board resolutions, to the extent permitte by law. The committee chairs reported in the Supervisory Board meetings regularly and fully on the contents and results of committee meetings.

The Executive and Nomination Committee met three times in the reporting year. The contents of the meetings, which were held as conference calls, were succession planning and candidates for election to the Supervisory Board, as well as Management Board remuneration, particularly the AOP 2014. At the meetings in April 2020 the committee particularly dealt with its recommendation for the election of a Supervisory Board member.

The Audit Committee met five times in the reporting year to discuss relevant aspects of the Supervisory Board’s work. They included the preliminary review of the separate and consolidated financial statements and the interim reports by Deutsche Wohnen SE, as well as discussions of the risk management system, compliance and internal auditing. It gave the Supervisory Board a recommendation on the election of auditors for 2020, obtained a statement of independence from them, monitored their work and discussed the focal points of the audit. Two resolutions on engaging the firm of auditors to perform non-audit services were also adopted in writing. The members of the Audit Committee have expertise and experience in the application of accounting principles and internal control procedures. The committee Chair fulfils all the requirements of section 100 para. 5 German Stock Corporation Act [Aktiengesetz – AktG].

The Capital Markets and Acquisition Committee met four times in the reporting year, always by phone or video conference. Tina Kleingarn was elected as committee Chair in June 2020 when the committee reconvened with new members. Discussions in September 2020 focused on terminating the share buyback programme. A debate on acquisitions and the Annual General Meeting 2021 was held in October 2020. At the meeting in December 2020 the committee dealt mainly with acquisition matters.

Corporate Governance

The Supervisory Board monitored and discussed the ongoing development of the company’s own corporate governance standards, paying particular attention to the 2020 revision of the German Corporate Governance Code (GCGC). Detailed information about the company’s corporate governance is provided in the Corporate Governance Declaration, and about the structure and amount of Supervisory Board and Management Board remuneration in the remuneration report. Both reports form part of the Annual Report and are published on the company website.

The Management Board and Supervisory Board discussed the requirements of the applicable German Corporate Governance Code for the reporting year and the implementation of these requirements. They updated their joint declaration of compliance in accordance with section 161 German Stock Corporation Act [Aktiengesetz – AktG] in December 2020 and made it permanently available on the company website www.deutsche-wohnen.com/declaration-of-conformity

It is vital for the Supervisory Board that a reasonable number of its members is independent. After careful review it has ascertained that the all Supervisory Board members are to be considered independent. Further information on these considerations can be found in the Corporate Governance Declaration.

Any potential conflicts of interest are disclosed without delay by members and discussed by the Supervisory Board. There were no conflicts between the interests of individual board members and those of the company in 2020.

The Supervisory Board reviews the efficiency of its work on a regular basis, most recently in December 2019. Opinions were obtained by means of a questionnaire on meetings of the full Supervisory Board and its committees, the exchange of information with the Management Board, staffing competence, risk management and accounting. The Supervisory Board analysed the responses at the meeting on 13 December 2019 noted that the gremium was working effectively, and discussed the suggestions made.

New Supervisory Board members are supported by the company and the other Supervisory Board members when they begin their term of office and provided with the necessary information. Professional training and refresher courses are not organised collectively but are the responsibility of each individual board member, who receive appropriate support from the company on request. Members of the Supervisory Board attended professional training courses on an individual basis in 2020.

In line with the wishes of investors and the corresponding recommendation of the GCGC, the Chairman of the Supervisory Board held meetings with investors in 2020 on corporate governance topics affecting the Supervisory Board.

Audit of the separate and consolidated financial statements

The financial statements of Deutsche Wohnen SE as of 31 December 2020 and the consolidated financial statements together with the combined management report as prepared by the Management Board were audited by KPMG AG, Wirtschaftsprüfungsgesellschaft, Berlin; the auditors elected at the Annual General Meeting on 5 June 2020 and appointed by the Supervisory Board. The auditors raised no objections in their report. The auditors responsible were Haiko Schmidt and René Drotleff, responsible for the audit of the financial statements of the company and the group since 31 December 2016.

The financial statements of Deutsche Wohnen SE and the consolidated financial statements, the combined management report for Deutsche Wohnen SE and the Group, and the auditors’ report were provided to all Supervisory Board members without delay. The auditors attended the meetings of the Audit Committee on 26 February 2021 and 22 March 2021 to prepare for the Supervisory Board meeting to discuss the financial statements. They reported on the main findings of their audit, particularly the key audit matters defined for this year, and provided additional information. The Supervisory Board also reviewed the non-financial group statement. It was supported by KPMG AG, Wirtschaftsprüfungsgsellschaft, which was appointed to perform a management review. After in-depth discussions the Audit Committee approved the result of the audit of the financial statements, the consolidated financial statements and the combined management report.

At the Supervisory Board meeting on 22 March 2021 the Chair of the Audit Committee reported in full on the financial statements and the audit. The auditors also presented the main results of their audit and were available to the Supervisory Board members to answer questions and provide further information. The Supervisory Board carried out a careful review of the financial statements, the consolidated financial statements, the combined management report, the non-financial group statement, the proposal for the use of net profit and the auditors’ report. No objections were raised. In accordance with the recommendation of the Audit Committee the Supervisory Board then approved the separate and consolidated financial statements as of 31 December 2020 as prepared by the Management Board. The separate financial statements are thereby adopted.

The separate financial statements as adopted show a net profit. The Supervisory Board concurs with the Management Board’s proposal for the use of net profit. A proposal to pass a resolution approving the distribution of a dividend of EUR 1.03 per share with dividend rights will therefore be made to the Annual General Meeting 2021.

Changes in the Management Board and Supervisory Board

The Annual General Meeting on 5 June 2020 elected Kerstin Günther to the Supervisory Board to succeed Dr Andreas Kretschmer, whose period of office ended at the close of the Annual General Meeting on 5 June 2020. The Supervisory Board elected Arwed Fischer to succeed Dr Andreas Kretschmer on the Executive and Nomination Committee and the Capital Markets and Acquisition Committee. The Supervisory Board elected Kerstin Günther to the Audit Committee to succeed Matthias Hünlein, who left the committee.

There were no changes in the members of the Management Board of Deutsche Wohnen SE in 2020.

Acknowledgements

On behalf of the Supervisory Board I thank the members of the Management Board and all employees of Deutsche Wohnen SE and all Group companies for their great dedication and all their hard work in a year defined by the challenges of the coronavirus pandemic.

Berlin, 19 March 2020

On behalf of the Supervisory Board

Matthias Hünlein