The Austrian Corporate Governance Code (the “Code”) provides Austrian stock corporations with a framework for managing and monitoring their companies. It is based on the provisions of Austrian stock corporation, stock exchange, and capital market law as well as, generally, on the OECD Principles of Corporate Governance.
The Code was most recently revised in January 2023. It achieves validity when companies voluntarily undertake to comply with it and serves to establish a system for managing and controlling companies and groups in ways that are accountable and geared to creating sustainable, long-term value. By voluntarily undertaking to abide by the Code, voestalpine supports these objectives and commits to providing a high degree of transparency to all of the company’s stakeholders.
The Management Board and the Supervisory Board of voestalpine AG resolved as early as in 2003 to recognize the Code, and they have also implemented all of the amendments thereto that were introduced in the meantime. In the business year 2022/23, voestalpine AG complied with the Code’s mandatory “L Rules” as well as with the “C Rules” (excepting C Rule 39 from which it deviated) and all “R Rules.”
The Code specifies that non-compliance with its C Rules (“Comply or Explain”) must be explained and justified. By explaining the following deviation, therefore, voestalpine AG is complying with the Code.
C Rule 39:
Pursuant to C Rule 39, the majority of committee members shall satisfy the independence criteria stipulated by the Supervisory Board in accordance with C Rule 53. In addition to one employee representative, the General and the Compensation Committee comprise two members elected by the Annual General Meeting. Following his election as the Chairman of the Supervisory Board of voestalpine AG effective April 1, 2022, and pursuant to the Supervisory Board’s internal rules of procedure, Dr. Wolfgang Eder also assumed the chairmanship of both the General Committee (which simultaneously serves as the Nomination Committee) and the Compensation Committee.
Owing to his prior position as the Chairman of voestalpine AG’s Management Board until July 3, 2019, Dr. Eder does not fulfill one of the Supervisory Board’s criteria of independence pursuant to C Rule 53. Given this appointment, therefore, the two Committees are deviating from C Rule 39 of the Code, because the majority of the Committee members elected by the Annual General Meeting is not independent as required under the independence criteria stipulated by the Supervisory Board.
By electing Dr. Eder to the position of Chairman of the Supervisory Board and thus also to the chairmanship of both the General and the Compensation Committees, in the company’s interest the Supervisory Board is relying on his ability to fulfill these core responsibilities thanks to his many years of experience in the industry and management as well as his insight into the Group. As of August 2024, Dr. Eder will satisfy absolutely all of the independence criteria established by the Supervisory Board, with the result that full compliance with C Rule 39 will once again be assured from that date onward.
Business transactions with associated companies and parties are reported in the semi-annual and annual financial statements of voestalpine AG.