Relevant disclosures regarding corporate management practices that are adopted in addition to statutory requirements and a description of the working method of the Managing Board and Supervisory Board of PATRIZIA Immobilien AG

As a Company we have principles for our business activities and related objectives as well as principles for our general values and ideals that endure beyond day-to-day events.

Each of us, irrespective of the tasks we perform at PATRIZIA Immobilien AG, must continually hold our ground in an ever changing environment. Each of us must do so in order that we can all be successful together. We believe that the courage to innovate is the driving force behind the healthy growth of our Company. However, no matter how much things change, in addition to statutory regulations we require enduring principles that express our values and ideals and that we regard as mandatory with respect to our actions. The Managing Board, Supervisory Board, Company management and all employees are called upon to live these values and to put them into practice as they form the basis for effective cooperation and ensuring the success of our business.

PATRIZIA has rules of conduct that apply throughout the Group. Foresighted thinking, but also a strong emotional bond with tradition and deep-rooted values are reflected in all we do. When joining the Company every employee receives an employee handbook documenting our basic guiding principles. This set of rules creates certainty with respect to our conduct both for internal cooperation and external relationships with tenants, customers, suppliers and shareholders. To define our corporate culture and thus our rules of conduct we have defined principles that apply to all employees regardless of hierarchy and role: Performance in return for performance

• Trust based on trust
• Saying what one is thinking
• Doing what one says

We also make progress through mistakes. So that we can all learn from our mistakes, it is necessary to openly communicate them and learn from them together. This is the only way to ensure our Company’s success and create sustainable added value for our Company.

In line with statutory requirements, PATRIZIA Immobilien AG maintains a dual management system that is characterized by the separation of personnel in the Managing Board, as management, and the Supervisory Board, as supervisory bodies. As a listed German stock corporation, PATRIZIA's corporate governance is primarily determined by the German Stock Corporation Act (Aktiengesetz – AktG). Moreover, the trustful cooperation between the Managing Board and Supervisory Board for the good of the Company is closely aligned with the principles of the German Corporate Governance Code. You can view the current declaration in accordance with Article 161 of the Aktiengesetz (AktG – German Stock Corporation Act) here.

Working Method of the Managing Board

The Managing Board manages PATRIZIA Immobilien AG and the PATRIZIA Group along with all its subsidiaries independently and has the duty to protect and promote the interests of the Company. It manages the business in accordance with the law, the Articles of Association, the bylaws for the Managing Board and individual employment contracts. The members of the Managing Board base their actions on the recommendations of the German Corporate Governance Code to the extent they are adhered to in the annual Declaration of Conformity.

The Supervisory Board of PATRIZIA Immobilien AG currently comprises three members. It determines Group strategy and lays down the guidelines and principles for the corporate policy that is derived from it, as well as long-term objectives for the holding company, subsidiaries and special purpose vehicles. It coordinates key activities and decides on investments and the financial control and reporting functions of the Group.

The allocation of the business segments to individual Managing Board members is based on the allocation of duties plan, which is jointly devised by all the members of the Managing Board taking into consideration individual employment contracts. The Managing Board’s allocation of duties plan requires the approval of the Supervisory Board.

The members of the Managing Board bear joint responsibility for the management of the Company as a whole. They work together in a collegial manner and inform one another regarding important measures and events in their business segments on a regular basis. Every member is required to bring about a resolution of the whole Managing Board if they have serious concerns with respect to a matter in another business segment in the event that such concerns cannot be resolved through discussion with the other Managing Board member.

The Managing Board decides jointly on all matters of fundamental and material significance as well as in other cases laid down with binding force by statute or other authorities. The bylaws of the Managing Board provide a catalog of measures that require consideration and decision by the entire Managing Board.

Notwithstanding the joint responsibility of all Managing Board members, the individual members manage the business segments assigned to them independently in accordance with Managing Board resolutions.

Managing Board meetings take place on a weekly basis and are convened by the Chief Executive Officer. Other members may also convene a meeting. The resolutions of the Managing Board are passed by way of simple majority of votes cast by the Managing Board members participating in the resolution unless a unanimous vote is mandatory by law. In the event of a tie the Chairman has the casting vote.

The Chief Executive Officer is responsible for coordinating all the Managing Board’s business segments. He works toward ensuring that the Company’s management of all business segments is uniformly aligned with the objectives determined by the Managing Board’s resolutions.

As the Managing Board comprises three members, it does not form committees.  

Working Method of the Supervisory Board

The Supervisory Board of PATRIZIA Immobilien AG is the Company’s supervisory body. It monitors and examines the decisions of the Managing Board. The Supervisory Board comprises three members. Due to the number of members, the Supervisory Board does not consider it necessary or effective to form committees. The Mitbestimmungsgesetz (MitbestG – German Co-determination Act) is not relevant to PATRIZIA Immobilien with the result that no Supervisory Board members were appointed from among the employees. The Chairman of the Supervisory Board coordinates and chairs its meetings.

The Supervisory Board is consulted directly and without delay regarding all decisions that are of fundamental significance for PATRIZIA. The Managing Board briefs it regularly on business performance and the earnings, net asset and financial situation. The Supervisory Board also agrees the strategic orientation of the Company with the Managing Board and discusses with it the status of implementation of the business strategy on an ongoing basis. The Supervisory Board approves the annual planning and annual financial statements of PATRIZIA Immobilien AG and the PATRIZIA Group while taking the auditor’s reports into account. The Supervisory Board is also responsible for personnel matters relating to the Managing Board members. It appoints the Managing Board members and is involved in the long-term succession planning for the Managing Board. In line with the recommendation of the German Corporate Governance Code, the Supervisory Board plenary resolves on the compensation system for the Managing Board, including material contractual elements, and examines the compensation system on a regular basis. The tasks and resolutions of the Supervisory Board are presented in detail in the Supervisory Board report contained in the Annual Report.

The term of office of the current members of the Supervisory Board runs until the end of the Annual General Meeting that decides on the discharge of the Supervisory Board for fiscal year 2013. The Supervisory Board is independent and is not bound by mandates or instructions. 

Augsburg, Augsburg (Germany) – January 17, 2012

Managing Board

Wolfgang Egger
Arwed Fischer
Klaus Schmitt