Corporate Governance   

Corporate Governance at PUMA SE   

The effective implementation of corporate governance principles is an important aspect of PUMA’s corporate policy. Transparent and responsible corporate governance is a prerequisite for achieving corporate targets and for increasing the Company’s value in a sustainable manner. The Supervisory Board and the Management Board work closely with each other in the interests of the entire Company so that the Company is managed and monitored in an efficient way ensuring sustainable added value through good corporate governance.   

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Corporate Governance System

PUMA SE has a dual management and supervisory structure. The Management Board is composed of three members. The Supervisory Board is composed of six members, four of whom are elected by the Annual General Meeting and two of whom are elected by the employees. Another important corporate body is the meeting of the shareholders.

German Corporate Governance Code

Management board & supervisory board

 Management board 

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Bjørn Gulden Chief Executive Officer
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Michael Lämmermann Chief Financial Officer
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Lars Sørensen Chief Operating Officer

 Supervisory Board

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Jean-François Palus Chairman of the Supervisory Board
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Jean-Marc Duplaix Chief Financial Officer (CFO) of Kering S.A., Paris/France
Béatrice Lazat
Béatrice Lazat Senior Vice-President Human Resources of Kering S.A., Paris/ France
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Thore Ohlsson Deputy Chairman of the Supervisory Board
Bernd Illig
Bernd Illig Employees' Representative
Martin Koeppel
Martin Koeppel Employees' Representative
Articles of Association
Rules of procedure for the SUPERVISORY Board of PUMA SE

(Convenience Translation)

PUMA SE (the “Company”, together with its affiliates in accordance with Sections 15 et. seq. AktG, the “PUMA Group”) has a one-tier board system with an administrative board in accordance with Art. 43 sent. 1 of the Council Regulation (EC) no. 2157/2001 of 8 October 2001 on the Statute of a European Company (SE) (the “Board”). The Board is entitled to adopt its rules of procedure in accordance with Section 8 para. 2 of the articles of association of the Company (the “Articles of Association”). The Board unanimously adopts the following rules of procedure for the Board (the “Rules of Procedure”):

Rules of procedure for the SUPERVISORY Board of PUMA SE

Rules of procedure for the MANAGEMENT BOARD of PUMA SE

(Convenience Translation)

PUMA SE (the “Company”, together with its affiliates according to Sections 15 et. seq. AktG, the “PUMA Group”) has a one-tier board system with an administrative board according to Art. 43 sent. 1 of the Council Regulation (EC) no. 2157/2001 of 8 October 2001 on the Statute of a European Company (SE) (the “Board”). The Board is entitled to appoint managing directors of the Company (the “Managing Directors”) according to Section 13 para. 1 of the articles of association of the Company (the “Articles of Association”) and to adopt rules of procedure for the Managing Directors according to Art. 9 para. 2 of the Articles of Association. The Board unanimously adopted the following rules of procedure for the Managing Directors (the “Rules of Procedure”):

Rules of procedure for the MANAGEMENT BOARD of PUMA SE

Report by the SUPERVISORY Board of PUMA SE
Information concerning Takeovers

Information concerning Takeovers 2016  

The following information, valid December 31, 2016, is presented in accordance with Art. 9 p. 1 c) (ii) of the SE Regulation and Section 22 p. 6 of the German SE Implementation Act (SEAG), in conjunction with Sections 289 [4], 315 [4] HGB. Details under Sections 289 [4], 315 [4] HGB which do not apply at PUMA SE are not mentioned.

Information concerning takeovers 2017

Sections 289 [4][1][1], 315 [4][1][1] HGB

On the balance sheet date, subscribed capital totaled € 38,611,107.84 and was divided into 15,082,464 no-parvalue shares. As of the balance sheet date, the Company held 142,551 treasury shares.

Sections 289 [4][1][3], 315 [4][1][3] HGB

As of December 31, 2016 there was one shareholding in PUMA SE that exceeded 10 % of the voting rights. It was held by Messrs. François-Henri Joseph Pinault and François Jean-Henri Pinault via several companies controlled by them (ranked by size of stake held by Messrs. Pinault: Financière Pinault S.C.A., Artémis S.A., Kering S.A. and SAPARDIS SE). On August 3, 2011, the share of voting rights allotted to Messrs. Pinault and to the aforementioned companies exceeded the 75 % threshold and on that date stood at 75.12 %. 1.15 % of the share of voting rights concerned treasury shares of PUMA SE. The list of shareholdings of Kering S.A. on page 298 in the Reference Document for 2015 shows that Kering S.A. has an 85.81 % share of the voting rights in PUMA SE.

Sections 289 [4][1][6], 315 [4][1][6] HGB

Regarding the appointment and dismissal of Managing Directors, reference is made to the applicable statutory requirements of Section 40 of the German SE Implementation Act (SEAG). Moreover, Section 13[1] of PUMA SE.s Articles of Association stipulates that the Administrative Board shall appoint one or several Managing Director(s). It may appoint one of these Managing Directors as Chief Executive Officer and one or two as Deputy Chief Executive Officers. Pursuant to Section 13[4] of PUMA SE.s Articles of Association, Managing Directors may be dismissed only for good cause, within the meaning of Section 84[3] of the German Stock Corporation Act (AktG) or if the employment agreement is terminated, in which case a resolution must be adopted by the Administrative Board with a simple majority of the votes cast. Pursuant to Art. 9(1)c(ii) of the SE Regulation (SE-VO), the requirements for changing the Articles of Association are governed by Sections 133 and 179 of the German Stock Corporation Act (AktG). The Administrative Board is authorized to make changes to the Articles of Association that affect only the text (Article 9(3) of PUMA SE.s Articles of Association).

Sections 289 [4][1][7], 315 [4][1][7] HGB

Pursuant to the resolution of the Annual General Meeting dated April 24, 2012, the Administrative Board is authorized to increase the share capital by April 23, 2017 as follows:

1. By issuing up to € 7.5 million worth of up to 2,929,687 new no-par bearer shares on one or more occasions with a pro-rata amount of the share capital of € 2.56 per share in exchange for cash contributions. The new shares can also be acquired by one or several banks as determined by the Administrative Board, subject to the obligation to offer these to the shareholders for subscription (indirect subscription right). The shareholders are basically entitled to a subscription right. The Administrative Board is, however, authorized to exclude the subscription rights of shareholders to avoid fractional shares. The Administrative Board is authorized to determine the additional rights of shares and the conditions of the share issue (Authorized Capital I).

2. By issuing up to € 7.5 million worth of up to 2,929,687 new no-par bearer shares on one or more occasions with a pro-rata amount of the share capital of € 2.56 per share in exchange for cash contributions or contributions in kind. The new shares can also be acquired by one or several banks as determined by the Administrative Board, subject to the obligation to offer these to the shareholders for subscription (indirect subscription right). The Administrative Board is authorized to exclude the subscription rights of shareholders in part or in whole, once or several times
- to avoid fractional shares;
- in the event of capital increases against contributions in kind to carry out mergers or for the acquisition of companies, shareholdings in companies or parts of companies;
- for capital increases against cash contributions, provided the amount of the share capital attributable to the new shares does not exceed ten percent of the share capital and the issue amount for the new shares is not significantly below the market price of already listed shares, Section 186(3)(4) AktG. The ten percent limit of the share capital is valid for the date of the resolution of the Annual General Meeting on this authorization and on the exercise date of the authorization. The sale of treasury shares, which are sold during the term of Authorized Capital II under exclusion of subscription rights of shareholders in application of section 186(3)(4) AktG, and the issuance of shares to service options or convertible bonds issued during the term of Authorized Capital II under exclusion of subscription rights of shareholders in application of section 186(3)(4) AktG, shall be counted toward the ten percent limit of the share capital.

The Administrative Board is authorized to determine the additional rights of shares and the conditions of the share issue (Authorized Capital II). The resolution adopted by the Annual General Meeting on May 6, 2015 authorized the company to purchase treasury shares up to a value of ten percent of the share capital until May 5, 2020.

Section 289 [4][1][8], 315 [4][1][8] HGB

Material financing agreements of PUMA SE with its creditors contain the standard change-of-control clauses. In the case of change of control the creditor is entitled to termination and early calling-in of any outstanding amounts. For more details, please refer to the relevant disclosures in the Notes to the Consolidated Financial Statements (Section 18).

Remuneration Report

Compensation Report   

Compensation Report 2017

The Managing Directors

The Managing Directors. compensation, which is determined by the Administrative Board, consists of non-performance-based and performance-based components. The non-performance-based components consist of a fixed salary and non-cash compensation, whereas the performance-based components consist of bonuses and components with a long-term incentive effect. Along with job assignments and performance of each individual Managing Director, the criteria for calculating the total remuneration are the economic situation, long-term strategic planning and related targets, the long-term durability of targeted results and the Company's long-term prospects.

A fixed salary is paid out monthly as non-performance-based basic compensation. In addition, the Managing Directors receive non-cash compensation, such as company cars, pension contributions and insurance premiums. In principle, these benefits are granted to all Managing Directors in an equal manner and are  included in the non-performance-based compensation.

The bonus component of performance-related compensation is mainly based on the PUMA Group's operating income (EBIT) and free cash flow and is staggered according to the degree to which targets are met. In addition, qualitative individual goals are set. An upper limit is also agreed.

The previous performance-based compensation component with a long-term incentive effect (stock appreciation rights) as part of a stock option plan was not granted beyond the 2012 financial year. The existing options can be exercised until the end of April 2017 if the exercise criteria are met. Details on the parameters used for the respective programs are provided in Section 19 of the Notes to the Consolidated Financial Statements.

Pro-rata provisions totaling € 2.1 million (€ 1.9 million) were set up for the compensation program (virtual shares/monetary units) with long-term incentives (from the years 2013 to 2016) for Managing Directors. Under the performance-based program, 70% of the compensation will be based on the medium-term performance of PUMA SE.s share and 30% will be based on the medium-term performance of Kering SA.s share in relation to benchmark companies. Further information on this program can be found in Section 19 of the Notes to the Consolidated Financial Statements.

The fixed compensation for the three Managing Directors amounted to € 1.9 million in the financial year (previous year: € 1.9 million) and variable bonuses came to € 2.5 million (previous year: € 1.5 million). Non-cash compensation totaled € 0.1 million (previous year: € 0.1 million).

The Managing Directors receive pension benefits, for which the Company took out a pension liability insurance policy. The proportion of the pension capital that is already financed through contributions to the pension liability insurance is deemed to be vested. During the financial year, € 0.4 million was allocated for Managing Directors (previous year: € 0.4 million). The present value of the pension benefits granted to active Managing Directors in the amount of € 2.6 million as of December 31, 2016 (previous year: € 1.7 million) was offset against the pledged asset value of the pension liability insurance policy, which was of an equal amount.

Pension obligations to former members of the Board of Management, their widows and Managing Directors amounted to € 13.6 million (previous year: € 13.3 million) and are accordingly recognized as liabilities under pension provisions, unless they are offset against asset values of an equal amount. Pensions paid totaled € 0.2 million (previous year: € 0.2 million).

In 2016, a long-term incentive program, Game Changer 2019, was introduced for senior management and strategically important employees that will allow this group of employees to participate in PUMA SE.s earnings over the medium term. € 1.2 million has been set aside for this program. An additional € 1.0 million was set  aside for the predecessor program Game Changer 2018 (Tranche 2) (previous year: € 1.0 million) and an additional € 0.7 million was set aside for the program Game Changer 2017 (Tranche 3) (previous year: € 0.8 million) in the reporting period. Further information on this program can be found in Section 19 of the Notes to the Consolidated Financial Statements.

Administrative Board

In accordance with the Articles of Association, the Administrative Board has at least three members; it currently consists of nine members. The compensation of the Administrative Board is comprised of a fixed and a performance-based component. The total fixed compensation amounted to € 0.3 million (previous year: € 0.3 million).

In accordance with the Articles of Association, each member of the Administrative Board receives a fixed annual compensation in the amount of € 25,000. The fixed compensation is increased by an additional fixed annual amount of € 25,000 for the Chairman of the Administrative Board, € 12,500 for the Vice-Chairman of the Administrative Board, € 10,000 for each committee chairman (excluding the Nominating Committee) and € 5,000 for each committee member (excluding the Nominating Committee).

In addition, each Administrative Board member receives performance-based compensation equal to € 20.00 for each € 0.01 by which the earnings per share figure exceeds a minimum amount of € 16.00 per share. The performance-based compensation amounts to a maximum of € 10,000 per year. The Chairman of the Administrative Board receives twice this amount (maximum € 20,000) and the Vice Chairman receives one and a half times this amount (maximum € 15,000) in compensation. Since earnings per share are below the minimum amount in the financial year, no performance-based compensation will be paid.

Corporate Governance Report including the Statement on Corporate Governance