8. Incentive Systems

The company discloses how target agreements and remuneration schemes for executives and employees are also geared towards the achievement of sustainability goals and how they are aligned with long-term value creation. It discloses the extent to which the achievement of these goals forms part of the evaluation of the top managerial level (board/managing directors) conducted by the monitoring body (supervisory board/advisory board).

The system of remuneration for the Management Board is subject to regular consultations, review and revision in the plenary sessions of the Supervisory Board.

The Management Board contracts of Deutsche Wohnen SE contain fixed and variable remuneration components. The variable component for all members of the Management Board is adjusted to the requirements of section 87(1), sentence 3, of the German Stock Corporation Act. [AktG]. It is tied to the achievement of the company’s economic goals and is calculated primarily based on multiyear assessment criteria. The variable remuneration may only be claimed if there has been a correspondingly positive development in the company’s business. In this way, the compensation structure is aligned to sustainable corporate development and the incentive and risk effects of the variable remuneration are optimised.

The detailed Remuneration Report of Deutsche Wohnen SE for the financial year 2017 can be found on the company’s website under https://ir.deutsche-wohnen.com/websites/dewohnen/English/4600/remuneration-report.html

One of the goals contained in the sustainability programme is to establish long-term goals as a component of Management Board and executive remuneration by the end of 2019 (Criterion 3, Objectives).