Corporate Governance

Corporate Governance


The corporate governance of 1&1 AG is geared to responsible and sustainable value creation. Efficient cooperation between the Management Board and the Supervisory Board, respect for the interests of the shareholders and open and transparent decision-making structures are of primary importance.

Corporate Governance


Corporate governance is defined as the responsible management and control of companies, applied with the aim of creating long-term added value. Factors such as efficient cooperation between the Management and Supervisory Boards, acting in the shareholders' interests, and transparent and open corporate communication all play a key role in this.

1&1 is a listed stock corporation under German law, that is, it is run by a Management Board and Supervisory Board. We value corporate governance highly and to this end both of our boards work closely together. Intensive and ongoing dialogue is essential for the efficient running of the company. We have further intensified this dialogue and improved it step by step in accordance with national and international standards. By providing open, prompt and regular information, as well as a transparent decision-making structure, we promote the confidence of our investors, customers, employees and the interested public.

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The principles of the German Corporate Governance Code - responsible management and control of the company - are not new for the Management and Supervisory Boards of 1&1 AG. Many of these requirements arise directly from the German Stock Corporation Act (Aktiengesetz), the German Securities Trading Act (Wertpapierhandelsgesetz) and other laws. As a result, we have focused strongly on these principles in the past and in the main, they are already firmly anchored in our corporate governance.

Version December 2019

Corporate Governance

Declaration Of Conformity


The corporate management of 1&1 AG, a German stock corporation listed on the stock exchange, is governed first and foremost by German Company Law [Aktiengesetz, AktG] and the provisions of the German Corporate Governance Codex (DCGK).

The term corporate governance stands for responsible management and control of companies, applied with the aim of creating long-term added value. Efficient cooperation between management and supervisory boards, respect for shareholders' interests and openness and transparency of corporate communications are major aspects of good corporate governance.

The Management Board and Supervisory Board of 1&1 AG regard themselves to be bound by the obligation to secure the existence of the Company and sustained value creation by means of corporate management in awareness of their responsibilities and with an orientation to long-term results.

Show Declaration of conformity Archived Declarations of Conformity (German)

Declaration pursuant to Section 161 AktG regarding compliance with the recommendations of the German Corporate Governance Code

1&1 Aktiengesellschaft

Declaration of the Management Board and Supervisory Board of 1&1 AG

Regarding the Recommendations of the
“Government Commission on the German Corporate Governance Code”
Pursuant to Section 161 Stock Corporation Act [Aktiengesetz; AktG]

The Management Board and Supervisory Board of 1&1 Aktiengesellschaft declare that 1&1 Aktiengesellschaft has complied with the recommendations of the German Corporate Governance Code (“Code”) as last revised on 16 December 2019, on which the last Declaration of Conformity of 16 December 2020 was based, with the declared exceptions, and will continue in future to comply with the recommendations of the Code as most recently revised on 16 December 2019, which became effective upon publication in the Federal Gazette on 20 March 2020, with the following exceptions:

Clause A.2, second sentence
Possibility of whistleblowing for Company employees
The Company has not established a specific whistleblowing system for employees. In view of the statutory provision of Section 612a of the Civil Code (Bürgerliches Gesetzbuch; BGB) establishing labour law regulations prohibiting disciplinary measures, the Company sees no reason to establish further protective mechanisms for whistleblowers. The statutory prohibition of disciplinary measures prohibits the discrimination of employees because of the reasonable and lawful exercise of their rights. Moreover, given the open solution-oriented communication culture in the Company, the Company does not see any practical need for a complicated whistleblowing system.

Clauses D.2/D.3
Formation of committees
The Supervisory Board performs all its tasks as a whole and has not previously formed any committees. The Supervisory Board considers it appropriate for all Supervisory Board members to have the opportunity to participate equally in all Supervisory Board issues. Even a supervisory board with six members is small enough for the effective conduct of discussions and the intense sharing of views as a group. Consequently, the Supervisory Board does not believe that the establishment of committees would serve to enhance the efficiency of its work.

Clauses G.1 to G.5
Remuneration of the Management Board — remuneration system
The recommendations from G.1 to and including G.5 of the Code refer to a system of remuneration for Management Board members within the sense of Section 87a AktG (“Remuneration System”) that, following the reform of the German Stock Corporation Act by the Act Implementing the Second Shareholders’ Rights Directive (ARUG II), must now be adopted by the Supervisory Board and submitted to the Annual General Meeting for approval. The remuneration system must be presented for approval for the first time at the 1&1 AG Annual General Meeting in 2021.
A remuneration system is currently being developed by the Supervisory Board and will be submitted to the 2021 Annual General Meeting for approval. The remuneration system will not become the basis for determining the remuneration of the Management Board members in future until it has been submitted to the Annual General Meeting. Since the recommendations from G.1 to and including G.5 of the Code presume the existence of a remuneration system, an exception is declared in this respect. The remuneration system currently in preparation is expected to take into account the recommendations from G.1 to and including G.5 of the Code without any restrictions.

Clause G.10
Remuneration of the Management Board — long-term variable remuneration
According to G.10 of the Code, the variable remuneration components granted to members of the Management Board should be granted primarily as shares of company stock or granted on the basis of company stock. Moreover, any such grants to board members should be subject to a blackout period of four years. Share-based remuneration is awarded in the form of the Stock Appreciation Rights (SARs) programme as a long-term remuneration programme for the Management Board. The term of this programme totals six years. Within this period of six years, a Management Board member can redeem a portion (25 percent) of the vested SARs at certain points in time — at the earliest, however, after two years. This means that a Management Board member can obtain a part of the long-term variable remuneration after only two years.
The Supervisory Board is of the opinion that this system of long-term remuneration has proven its value and sees no reason to postpone any further the possibility of obtaining remuneration earned under the programme. The Supervisory Board believes that the linking of the programme to the 1&1 AG share price and the opportunity for Management Board members to redeem their shares to satisfy the claims from the programme secure reasonable participation of Management Board members in the risks and opportunities of the company 1&1 AG. Since the programme has been designed with a term of six years and the awarded SARs are vested proportionately over this term and at the earliest after two years, the Supervisory Board is of the opinion that the programme achieves an optimal commitment effect and incentive control in the interest of 1&1 AG and does not require any changes.

Clause G.11
Remuneration of the Management Board — withholding/clawback of variable remuneration
According to G.11 of the Code, the Supervisory Board should have the possibility to withhold or claw back variable remuneration in justified cases. The current service contracts of the Management Board members do not contain any such provisions. However, there are plans to include a so-called “claw back clause” regulating the return of variable remuneration in the remuneration system and to include the clause in future whenever service contracts of Management Board members are newly concluded.

Clause G.13
Remuneration of the Management Board — benefits upon termination of contract
According to G.13 of the Code, payments to a Management Board member in the event of premature termination of Management Board activities should not exceed the value of two years’ remuneration and should not remunerate the member for a period longer than the remaining term of the service contract. If and when there is a post-contractual non-competition clause, any such severance payment should also be offset against the waiting period compensation. The service contracts for Management Board members do not currently provide such an offset option. However, there are plans to incorporate this option into the remuneration system and into newly concluded service contracts of the Management Board members (and any related termination agreements).

Clause G.17
Consideration of the deputy chairmanship in the remuneration of Supervisory Board members
The remuneration system of Supervisory Board members has not previously given consideration to the deputy chairpersonship of the Supervisory Board in the sense of payment of increased remuneration in comparison with the other, ordinary members. There is the intent to amend the Supervisory Board remuneration system in future in that the Supervisory Board deputy chairperson will receive higher remuneration than a regular Supervisory Board member as compensation for the Supervisory Board deputy chairperson’s obligation to accept additional work in the event the Supervisory Board chairperson is hindered in the performance of his/her duties.

In addition, there is also the intent to supplement the Supervisory Board remuneration system by a position-related differentiation so that the members of the Audit and Risk Committee that has now been created will be remunerated for the associated additional duties and responsibilities in addition to the current remuneration for their regular activities as Supervisory Board members.

The new Supervisory Board remuneration system will be presented to the 1&1 AG annual general meeting for approval at the Annual General Meeting 2021.

Maintal, 24 March 2021

On behalf of
the Supervisory Board          The Management Board
Kurt Dobitsch                          Ralph Dommermuth      Markus Huhn      Alessandro Nava

Sustainability Report


For more than 25 years, we have been active as one of the major German telecommunications providers. Our work goes hand in hand with corporate and social responsibility, a topic that we take seriously.

For this reason we publish our annual Sustainability Report in which we describe, transparently and in detail, our measures to secure sustainable added value. As we strive to meet the increasing demands of our internal and external stakeholders, we remain in constant dialogue with customers, business partners, shareholders, investors and our employees. We would otherwise be unable to optimise our products and services and further specify our action areas relating to sustainability.

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Dear readers,

For more than 25 years, we have been active as one of the major German telecommunications providers. Our work goes hand in hand with corporate and social responsibility, a topic that we take seriously.

This is the third year for the publication of our Sustainability Report in which we describe, transparently and in detail, our measures to secure sustainable added value. As we strive to meet the increasing demands of our internal and external stakeholders, we remain in constant dialogue with customers, business partners, shareholders, investors and our employees. We would otherwise be unable to optimise our products and services and further specify our action areas relating to sustainability.

As in previous years, the core areas of "service, performance and safety" represent important elements of our sustainability efforts. From this year onwards, however, they are assigned to newly created action areas that we have developed on the basis of, among other things, an in-depth analysis of the requirements of the capital markets and ESG (environmental, social and governance) ratings as well as new frameworks and standards in the area of sustainability. The innovations include, for example, the expanded reporting on "Climate and Environmental Protection" as well as the action area "1&1 as a Business Partner"; this area will concentrate more closely on the supply chain and value chain. In addition, the third edition of our report includes the United Nations Sustainable Development Goals (SDGs) for the first time and shows how we as a telecommunications company are contributing to the achievement of these goals.

The integration of 1&1 Telecommunication SE into our Company has not only created synergies in hardware purchasing and logistics; it has also noticeably expanded the range of services offered to our employees. Besides a wide range of training and communication services, an external and independent family service has been introduced.

Overall, we can draw a clearly positive conclusion when we look at our development in the area of sustainability over the last three years. We are determined to maintain this course in the coming years and to continue to improve steadily. We are committed to meeting our social and environmental responsibilities as well as to achieving our goal of economic success, especially now as we launch our project for the construction of a state-of-the-art, high-performance mobile communications network.

Best regards,

Ralph Dommermuth, Markus Huhn and Alessandro Nava

Archived reports
Nachhaltigkeitsbericht

Disclosure of Securities Transactions


With the coming into force of the Art. 15 a of the Securities Trading Act (Finanzmarktförderungsgesetz) on July 1, 2002, the members of the Executive Board and Supervisory Board of 1&1 AG are obligated to disclose the purchase or sale of 1&1 shares under Art. 15 a of the Securities Trading Act (Wertpapierhandelsgesetz). In addition to the direct purchase or sale of 1&1 shares, other securities transactions relating to 1&1 shares (e.g. purchase or sale of option certificates for stock) must also be disclosed. Securities dealings by spouses, registered life partners or close relatives are also subject to disclosure.

Current notifications

There are currently no reportable securities transactions.

Archived reports

Accounting and audit


The Group’s accounting is based on the principles of the International Financial Reporting Standards (IFRS, as they are applicable in the EU) while taking into consideration the provisions of Section 315e HGB. The annual financial statements relevant for the disbursement and tax assessments, on the other hand, are prepared in accordance with the provisions of the German Commercial Code (HGB). Single and consolidated annual financial statements are audited by impartial chartered public accountants.

The General Meeting adopts a resolution appointing the auditor. Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft, Eschborn/Frankfurt am Main, has been appointed to perform the audit for fiscal year 2020. The Supervisory Board awards the audit engagement, determines the focal points of the audit and the audit fee and reviews the impartiality of the auditor.

Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft has been the auditor for 1&1 AG and the Group since fiscal year 2018. Mr Jens Kemmerich, chartered public accountant, has been in charge of the audit since fiscal year 2018.

Abschlussprüfer

Rules of Procedure of the Supervisory Board