Declaration pursuant to section 289a of the German Commercial Code (HGB)

The corporate governance declaration required by section 289a HGB includes the comply-or-explain statement in accordance with section 161 AktG (see 1. below), relevant disclosures on corporate management practices extending beyond statutory requirements (see 2. below), a description of the working methods of the Executive Board and the Supervisory Board, and a description of the working methods and composition of the Supervisory Board committees (see 3. below). The declaration on corporate governance pursuant to section 289a HGB is part of the management report. According to section 317 (2) sentence 3 HGB, the information provided in accordance with section 289a HGB does not have to be included in the audit of financial statements.

1. Comply-or-explain statement pursuant to section 161 (1) AktG

Section 161 (1) of the German Stock Corporation Act (AktG) requires the management board and supervisory board of a publicly listed company to issue an annual declaration stating that the company has complied with, or intends to comply with, the recommendations of the Code and also stating which recommendations it has not applied or does not intend to apply, and the reasons why. Detailed reasons must be given for any departure from the recommendations of the Code. The comply-or-explain statement must be made permanently available to the public on the company’s website.

KION GROUP AG has been a listed company on the regulated market of the Frankfurt Stock Exchange since 28 June 2013. It has not previously issued a comply-or-explain statement pursuant to section 161 (1) AktG. However, the Company has already stated in its IPO prospectus that with one exception, it complies, and will comply in future, with the recommendations in the Code.

The Executive Board and Supervisory Board have considered the recommendations of the Code in detail and on 19 December 2013 they issued the first comply-or-explain statement of KION GROUP AG as required by section 161 (1) AktG as follows:

  1. KION GROUP AG complies, and will continue to comply in future, with all but one of the recommendations of the German Corporate Governance Code government commission (dated 13 May 2013) published by the Federal Ministry of Justice in the official part of the electronic Federal Gazette.

    In departure from section 3.8 (3) of the German Corporate Governance Code (the Code), the articles of incorporation of KION GROUP AG do not provide for an excess in the D&O insurance policies for members of the Supervisory Board. The Company believes that such an excess is not typical at international level and would therefore make it considerably more difficult to find independent candidates, in particular candidates from outside Germany.
  2. KION GROUP AG has been a listed company since 28 June 2013 and has not previously issued a comply-or-explain statement pursuant to section 161 AktG. Since its initial public offering (IPO), KION GROUP AG has issued guidelines on diversity in the Company in order to document its compliance with the recommendations in sections 4.1.5, 5.1.2 (1) and 5.4.1 (2) of the Code. Since the IPO, KION GROUP AG has complied with all of the recommendations of the government commission (dated 13 May 2013) except for the recommendation in section 3.8 (3) of the Code, as described above.

    With respect to section 5.4.2 of the Code, the Supervisory Board believes that, taking account of the employee representatives on the Supervisory Board, it is appropriate to have two independent members of the Supervisory Board, who are elected by the shareholders.

Wiesbaden, 19 December 2013

For the Executive Board:

Gordon Riske

Dr Thomas Toepfer

For the Supervisory Board:

Dr John Feldmann

The comply-or-explain statement is available on the website of KION GROUP AG kiongroup.com/comply_statement.

2. Relevant disclosures on corporate governance

3. Working methods of the Executive Board and Supervisory Board and composition of the committees of the Supervisory Board