Report of the Supervisory Board
Dear Shareholders,
Throughout the 2007 fiscal year, the Supervisory Board closely supervised and advised the Executive Board's management of the Company, and performed the tasks and responsibilities incumbent upon it by law, under the Company's Articles of Association and under the Supervisory Board's Code of Procedure. It was directly involved in all decisions of fundamental importance to the Company. The Executive Board provided the Supervisory Board with full, timely and regular oral and written reports on the Company's and the Group's financial situation and development, corporate planning, strategic roadmap, risk position and risk management, as well as specific material transactions. Any departures from the planned or targeted course of business were explained in detail by the Executive Board and examined by the Supervisory Board. When the Supervisory Board's approval was necessary for management actions, it received full written information from the Executive Board. The Supervisory Board covered such information and significant business transactions in depth at its meetings, discussed them with the Executive Board and took the necessary decisions. There was no cause to institute measures, such as inspection of the Company's books or documents, under the first clause of Section 111 (2) of the German Stock Corporations Act (AktG).
In the 2007 fiscal year, the Supervisory Board met five times– including one extraordinary meeting\– and concluded on each occasion that the management of the Company was both proper and appropriate. With one exception, each Supervisory Board member attended at least half of the meetings held during his tenure. In his period in office,
Outside of its scheduled meetings, the Supervisory Board was also kept fully abreast of events which were critical to an evaluation of the Company's position and development, as well as of projects and plans of special urgency. When necessary, Supervisory Board members were asked to approve specific actions by way of circularization. The Chairman of the Supervisory Board also maintained regular contact with the Executive Board outside of meetings and kept himself informed of developments in the business situation and key transactions.
During the reporting period, the Supervisory Board looked especially closely at the Group's strategic development, and in particular at its diversification into lucrative business segments. It likewise focused on the networking of the divisions at each link in the value chain (life cycle approach) and their harnessing of cross-selling potential. Among the aspects it considered in this context were the associated benefits in terms of further improved risk management. The deliberations therefore inevitably concentrated on the repercussions for acquisition policy – serving to complement existing activities and develop new business segments' in view of the diverse conditions that exist on the global markets. Special attention was paid to the German construction market (especially the building construction sector), its development and the ensuing consequences for this business segment. The Supervisory Board also examined the possible impact of the subprime crisis beyond the American housing construction market. The instability of the financial markets and the related likelihood of restraint among investors, as well as the direct influence of these factors on the terms of borrowing available to the Company, played a major role in these deliberations.
The performance and long-term value enhancement of the concessions portfolio remained a major topic of discussion.
In addition, the Supervisory Board analyzed the mediumterm corporate plans, based on value-driven management and the RONA return on capital metric, and considered
