Statement on Corporate Governance

The Corporate Governance Statement pursuant to Sections 289f, 315d of the German Commercial Code (HGB) includes the declaration of conformity pursuant to Section 161 of the German Stock Corporation Act (AktG), information on key corporate governance practices, and details regarding the working methods and composition of the Supervisory Board and the Management Board, including information on the company’s corporate governance, the diversity policy for the Supervisory Board and the Management Board, and the legal requirements for the equal participation of women and men in leadership positions.

Declaration of Compliance pursuant to Section 161 of the German Stock Corporation Act (AktG)

In March 2023, the Executive Board and Supervisory Board of ACCENTRO Real Estate AG issued the following declaration in accordance with Section 161 of the German Stock Corporation Act (AktG), which was published on the company’s website at https://investors.accentro.de/entsprechenserklaerung:

Code (as amended), Recommendations A.1 and A.3 (Consideration of sustainability goals)

In 2022, the company began developing a sustainability strategy and taking the necessary organizational measures. However, the process has not yet progressed to the point where the social and environmental factors relevant to the company’s business activities can be definitively determined and, consequently, incorporated into the corporate strategy and planning or where goals derived from them can be defined. Therefore, Recommendation A.1 cannot be complied with for the foreseeable future. The statutory requirements, however, have been and continue to be met.

Code (New Version) Recommendation A.5 (Characteristics of the Internal Control System and Risk Management System)

According to Recommendation A.5 of the DCGK 2022, the management report should describe the key features of the entire internal control system and the risk management system and should also provide an assessment of the adequacy and effectiveness of these systems. The management report complies with the statutory requirements and describes the key features of the internal control system and the risk management system. However, no statement was made regarding the adequacy and effectiveness of these systems, as neither the Supervisory Board nor the Management Board, in their supervisory capacity, identified any issues regarding their adequacy and effectiveness.

Code Recommendation B.1 (Composition of the Executive Board)

The Supervisory Board and the Executive Board expressly welcome all efforts to counteract gender-based and any other form of discrimination and to appropriately promote diversity. When appointing members to the Executive Board, the Supervisory Board considers only the competence, qualifications, and experience of the candidates; other characteristics, such as gender or nationality, were and are therefore irrelevant to this decision.

Code Recommendation B.2 (Succession Planning)

There is currently no written plan for succession planning. Discussions regarding contract renewal are held between the Executive Board and the Supervisory Board well in advance of the expiration of the respective Executive Board member’s employment contract. Should these discussions not result in continued cooperation, the Supervisory Board believes it can ensure succession with sufficient lead time without the need for a written plan.

Code Recommendation B.5 (Age Limit for Executive Board Members)

No age limit for members of the Executive Board has been established at this time. In the Company’s view, age alone is not a suitable criterion for exclusion from the Executive Board. The Supervisory Board believes that it is in the Company’s best interest to be able to draw on the long-standing expertise of individual members of the Executive Board on a case-by-case basis.

Code (Revised Version) Recommendation C.1 (Competency Profile of the Supervisory Board, Qualification Matrix, Sustainability)

A competency profile exists for the Supervisory Board, with an emphasis on long-standing experience and in-depth knowledge in the real estate sector and commercial affairs. However, the competency profile does not currently include detailed experience in the area of sustainability. The Supervisory Board is closely involved in the development of a sustainability strategy for the company. Due to the size of the board—which consists of three members—and the broad experience of all members, the Corporate Governance Statement does not include a qualifications matrix that reflects the status of the implementation of the competency profile.

Code Recommendation C.2 (Age Limit for Supervisory Board Members)

In the Supervisory Board’s view, an age limit is not necessary for the Supervisory Board to perform its duties effectively and successfully; consequently, the company has deviated from this recommendation in the past and continues to do so.

Code Recommendation C.12 (No Executive or Advisory Roles with Major Competitors)

Supervisory Board members should not hold executive positions or perform consulting duties for the company’s major competitors and should not have a personal relationship with a major competitor. However, Supervisory Board members Axel Harloff and Carsten Wolff held executive positions at competitors. Mr. Harloff served as Chairman of the Supervisory Board of Consus Real Estate AG, Berlin, until May 16, 2022, and as a member of the Executive Board of ERWE Immobilien AG, Frankfurt am Main, until October 2022. Mr. Wolff is a member of the Executive Board (CFO) of A.D.O. Group LTD, Tel Aviv, Israel, and a member of the Supervisory Board of Eurohaus Frankfurt AG, Berlin, both of which are wholly-owned subsidiaries of ADLER Real Estate AG. In addition, Mr. Wolff served as a member of the Supervisory Board of ERWE Immobilien AG, Frankfurt am Main, until May 25, 2022. In the opinion of the Supervisory Board, no relevant conflicts of interest arose as a result during the 2022 reporting period. Through ongoing dialogue and case-by-case review of the facts, precautions are taken to ensure that no relevant conflicts of interest will arise in this regard in the future either.

Code Recommendations D.2 and D.4 (Code, new version) / D.5 (Code, previous version) (Formation of Supervisory Board Committees)

To date, the Supervisory Board has refrained from establishing committees—with the exception of the Audit Committee—and in particular has not established a Nominating Committee; it will continue to do so in the future, with the exception of the Audit Committee, because the Supervisory Board, given that it consists of three members, considers it possible to work efficiently even when acting as a whole, and the formation of committees—which must comprise at least two or at least three persons to constitute a quorum—does not appear appropriate for a Supervisory Board of this size.

Code (as amended), Recommendation D.3 (Competencies in the Area of Sustainability Reporting)

None of the Supervisory Board members appointed since 2019 or 2020, respectively, possesses extensive knowledge and experience in the area of sustainability reporting and its audit. The Supervisory Board does not currently consider a new appointment to be appropriate. However, as soon as a new Supervisory Board member is nominated for election, the Code recommendation shall be taken into account.

Code (New Version) Recommendation D.11 / Code (Previous Version) Recommendation D.12 (Training and Continuing Education for the Supervisory Board)

At the request of the Supervisory Board, the Company will provide the Supervisory Board with appropriate support for training and continuing education measures and will report on the measures implemented in the Supervisory Board’s report.

Code (New Version) Recommendation D.12 / Code (Previous Version) Recommendation D.13 (Self-Assessment of the Supervisory Board)

The entire Supervisory Board participates in the regular Supervisory Board meetings as well as in the Supervisory Board meetings with the auditors. The Supervisory Board coordinates its work in internal meetings and conference calls. The Supervisory Board is of the opinion that a more extensive self-assessment is not necessary due to the size of the Supervisory Board.

Code Recommendation F.2 (Publication of Interim Financial Information)

Due to organizational processes, Accentro Real Estate AG does not publish its interim reports within 45 days of the end of the reporting period, nor does it publish the consolidated financial statements and the Group management report within 90 days of the end of the fiscal year. The requirements of the Stock Exchange Regulations and the statutory requirements regarding the semi-annual financial report pursuant to Section 115 of the German Securities Trading Act (WpHG) are complied with in all cases. Accentro Real Estate AG aims to comply again with the Code recommendation regarding the consolidated financial statements and the group management report for the 2023 fiscal year.

Code Recommendation G.1 (Determination of Specific Executive Board Compensation)

In accordance with statutory requirements, the Supervisory Board sets a maximum total compensation for the Executive Board. A description of how the target compensation is determined, as well as a breakdown for each individual member of the Executive Board showing the relative proportions of the compensation components, was not provided and is not provided. At the time the resolution on the compensation system was adopted, the Supervisory Board was in the final stages of negotiations regarding the LTI, so that a target compensation amount could not yet be definitively determined. In the Supervisory Board’s view, a retrospective breakdown is not necessary.

Code Recommendation G.4 (Vertical Comparison of Appropriateness)

The Supervisory Board duly considers the appropriateness of the Management Board’s compensation. In doing so, it also takes into account the company’s internal wage and salary structure. However, the Supervisory Board is convinced that the formal comparative analysis with the workforce as a whole recommended in Recommendation G.4 is not necessary to assess the appropriateness of Management Board compensation. In the Supervisory Board’s view, a formal comparison with the Group’s workforce does not lead to improved decision-making.

Code Recommendation G.6 (Variable Compensation)

The Executive Board service contract in effect prior to June 2022 did not provide for a long-term variable compensation component, so the company deviated from the recommendation that variable compensation resulting from the achievement of long-term goals should exceed the portion derived from short-term goals. In the Supervisory Board’s view, such a provision was not necessary as an incentive for the Executive Board’s activities, as the current variable compensation arrangement sufficiently motivated the Executive Board to act in the Company’s long-term interests. The Executive Board service contract with Mr. Schriewer, which has been in effect since June 2022, now also includes a long-term variable compensation component whose target present value exceeds the target value of the short-term variable compensation component calculated on a fiscal year basis, meaning that the recommendation will be followed at least starting with the fiscal year 2023.

Since the Chief Investment Officer, Dr. Gordon Geiser, was appointed effective February 10, 2023, on an interim basis only for a period of two years, the Supervisory Board did not and does not consider the agreement of long-term goals to be effective in setting the right incentives for this member of the Executive Board. Accordingly, a deviation from Recommendation G.6 was and is being made.

Code Recommendation G.10 (Granting in Shares, Vesting Date)

The Executive Board service contract in effect prior to June 2022 did not provide for the granting of variable compensation components in the form of shares or share-based awards; consequently, the Company deviated from the recommendation that, taking into account the respective tax burden of the Executive Board member, variable compensation amounts be primarily invested in the Company’s shares or granted in a share-based form. In the Supervisory Board’s view, such a provision was not necessary as an incentive for the Management Board’s activities, as the Management Board was sufficiently motivated by the variable compensation arrangement in effect at that time to act in the company’s best interests over the long term. The Executive Board service agreement with Mr. Schriewer, which has been in effect since June 2022, now also includes a long-term variable compensation component whose target present value exceeds the target value of the short-term variable compensation component calculated on a fiscal year basis, meaning that the recommendation will be followed in any case starting with the 2023 fiscal year. In the 2021 fiscal year, the company did not grant any variable compensation components in the form of shares or share-based payments to the members of the Executive Board. There are no plans to grant variable compensation components in the form of shares or share-based payments under the existing Executive Board service contract, as the Supervisory Board does not consider this necessary to encourage the Executive Board to pursue the long-term and sustainable development of the company. However, it is intended to follow the recommendation when appointing new members of the Executive Board and extending existing Executive Board service contracts.

Since the Chief Investment Officer, Dr. Gordon Geiser, was appointed effective February 10, 2023, on an interim basis only for a period of two years, the Supervisory Board did not and does not consider equity-based compensation components to be appropriate for setting the right incentives for this Executive Board member. Accordingly, a deviation from Recommendation G.10 has been and continues to be made.

There are agreements regarding equity-based compensation between the majority shareholder and the Executive Board member, Mr. Lars Schriewer, which are recognized as compensation expense in the consolidated financial statements in accordance with IFRS 2, similar to stock options.

Code Recommendation G.11 (Withholding or Reclaiming Variable Compensation)

Neither has it been the case to date, nor is it planned for the future, that the Supervisory Board may withhold or reclaim variable compensation in its entirety. In the Supervisory Board’s view, in addition to the existing variable compensation components, no provision for withholding or reclaiming compensation is necessary to ensure sufficient incentives for sustainable management aligned with the company’s best interests.

Code Recommendation G.13 (Severance Pay Cap)

Offset of the leave of absence allowance against a severance payment is not provided for per se. In the Supervisory Board’s view, such a provision is not necessary as an incentive for the Management Board’s activities. Whether an offset takes place will be decided by the Supervisory Board on a case-by-case basis in order to ensure that the various objectives of severance pay and the leave of absence allowance are met in every instance.

Berlin, March 16, 2023

Executive Board and Supervisory Board of ACCENTRO Real Estate AG

Key Corporate Governance Principles and Practices

Sound and responsible corporate management and oversight (corporate governance), as well as compliance with laws and internal guidelines, are an indispensable foundation for the successful and sustainable management of ACCENTRO Real Estate AG.

The working methods of the Executive Board and Supervisory Board of ACCENTRO Real Estate AG, as a publicly traded German stock corporation, are primarily governed by the German Stock Corporation Act and the provisions of the German Corporate Governance Code (“DCGK”) in its currently applicable version. The DCGK ensures transparency regarding the legal framework for corporate management and oversight and contains recognized standards for sound, responsible, and sustainable corporate governance. In addition, the company’s Articles of Association, as well as the rules of procedure for the Executive Board and the Supervisory Board, contain further guidelines for the activities of these two bodies. The fundamental principle of governance is the dual management and control structure, which is characterized by a strict separation of the duties and powers of the Executive Board as the management body and the Supervisory Board as the supervisory body.

Risk management at ACCENTRO Real Estate AG and within the Group is an integral part of the central and decentralized planning, steering, and control processes and follows Group-wide standards. Open communication, periodic risk assessments, and the planning and steering system ensure transparency regarding our risk profile. Further details can also be found in the “Risk Management” section of the 2022 Annual Report.

Availability of the Remuneration Report and the Auditor’s Note, Remuneration System, and Remuneration Resolution

The compensation report for the most recent fiscal year and the auditor’s note pursuant to Section 162 of the German Stock Corporation Act (AktG), the current compensation system pursuant to Section 87a (1) and (2), first sentence, of the German Stock Corporation Act (AktG), and the most recent compensation resolution pursuant to Section 113 (3) of the German Stock Corporation Act (AktG) are publicly available on the ACCENTRO Real Estate AG website at https://investors.accentro.de/verguetungsbericht-gemaess-162-aktg.

Composition and Working Methods of the Executive Board

The Executive Board manages the company under its own responsibility, is bound by the company’s interests, and is committed to increasing sustainable corporate value. It develops the corporate strategy and ensures its implementation in close coordination with the Supervisory Board. The Executive Board is strictly separate from the Supervisory Board in terms of personnel: No member of the Executive Board may simultaneously be a member of the Supervisory Board. The Executive Board of ACCENTRO Real Estate AG currently consists of two members, Mr. Lars Schriewer (CEO) and Dr. Gordon Geiser (CIO), who manage the company’s business in accordance with the law, the Articles of Association, the Rules of Procedure for the Executive Board issued by the Supervisory Board, and their Executive Board employment contracts. The Executive Board reports to the Supervisory Board regularly, promptly, and comprehensively on all matters relevant to the company regarding planning, business development, the risk situation, risk management, and compliance. The Executive Board’s rules of procedure specify, among other things, in which cases a resolution by the Executive Board is required and which transactions and actions require the approval of the Supervisory Board.

Composition and Working Methods of the Supervisory Board and Its Committees

The Supervisory Board monitors and advises the Executive Board and is directly involved in decisions of fundamental importance to the company. It appoints and dismisses the members of the Executive Board, determines the compensation system for Executive Board members, and sets their respective total compensation.

The Supervisory Board performs its duties in accordance with statutory provisions, the Articles of Association, its Rules of Procedure, and its resolutions. The Rules of Procedure for the Supervisory Board are available on the company’s website at investors.accentro.de. In accordance with the Articles of Association, it consists of three members: Mr. Axel Harloff as Chairman of the Supervisory Board, Mr. Carsten Wolff, and Mr. Natig Ganiyev. The members of the Supervisory Board have equal rights and obligations; they are not bound by instructions or mandates. Resolutions of the Supervisory Board are primarily adopted at Supervisory Board meetings, but may also be adopted through written procedures or other means of communication. Four Supervisory Board meetings were held during the 2022 fiscal year. The Supervisory Board appoints the auditor elected by the Annual General Meeting to audit the annual financial statements and the consolidated financial statements and negotiates the fee agreement with the auditor. The Supervisory Board reviews the annual financial statements, the consolidated financial statements, the management reports of the AG and the Group, as well as the Executive Board’s proposal for the appropriation of retained earnings, taking into account the auditor and the audit report prepared by the auditor, and carries out the reviews and determinations required by law. The Chair of the Supervisory Board coordinates the work of the Supervisory Board. The Supervisory Board of ACCENTRO Real Estate AG has not currently formed any committees—with the exception of the Audit Committee, which by law consists of three members of the Supervisory Board—since, given the current number of Supervisory Board members, all matters are discussed in the plenary session.

Audit Committee

The Audit Committee is primarily responsible for overseeing the financial reporting process, the effectiveness of the internal control system, the risk management system, and the internal audit system, as well as the audit of the financial statements—specifically, the selection and independence of the external auditor and any additional services provided by the external auditor. The Audit Committee may submit recommendations or proposals to ensure the integrity of the financial reporting process. The Chairman of the Audit Committee is Mr. Carsten Wolff.

The Supervisory Board and its Audit Committee include at least one member, Mr. Carsten Wolff, with expertise in the field of accounting and auditing. According to the German Corporate Governance Code (DCGK), the Chair of the Audit Committee must possess the appropriate expertise and independence in at least one of these two areas. The Chair of the Audit Committee, Mr. Carsten Wolff, meets these requirements.

Handling Conflicts of Interest

If a member of the Supervisory Board has a conflict of interest between his or her activities for ACCENTRO Real Estate AG and for another company, this must be disclosed to the Supervisory Board. In the case of significant and not merely temporary conflicts of interest, the affected Supervisory Board member is obligated to resign from the position. If (potential) conflicts of interest exist, the Supervisory Board reports them to the Annual General Meeting.

Members of the Supervisory Board should not hold executive positions or perform consulting duties for the company’s major competitors, nor should they have a personal relationship with a major competitor. However, Supervisory Board members Axel Harloff and Carsten Wolff held executive positions at competitors. Mr. Harloff served as Chairman of the Supervisory Board of Consus Real Estate AG, Berlin, until May 16, 2022, and as a member of the Executive Board of ERWE Immobilien AG, Frankfurt am Main, until October 2022. Mr. Wolff is a member of the Executive Board (CFO) of A.D.O. Group LTD, Tel Aviv, Israel, and a member of the Supervisory Board of Eurohaus Frankfurt AG, Berlin, both of which are wholly-owned subsidiaries of ADLER Real Estate AG. In addition, Mr. Wolff served as a member of the Supervisory Board of ERWE Immobilien AG, Frankfurt am Main, until May 25, 2022. In the Company’s opinion, no relevant conflicts of interest arose as a result during the 2022 reporting period.

In this regard, we also refer to the Declaration of Compliance, which is available on the company’s website at https://investors.accentro.de/entsprechenserklaerung, and to the current report of the Supervisory Board. Further details regarding the specific work of the Supervisory Board can be found in the current report of the Supervisory Board.

Self-Assessment of the Supervisory Board

The Supervisory Board coordinates its work through internal meetings and conference calls. The Supervisory Board is of the opinion that a more extensive self-assessment is not necessary given the size of the Supervisory Board.

Cooperation Between the Executive Board and the Supervisory Board

The Executive Board coordinates the company’s strategic direction with the Supervisory Board and regularly discusses with it the status of the strategy’s implementation. In addition, the Executive Board regularly informs the Supervisory Board about the course of business and the company’s situation. Based in particular on this reporting, the Supervisory Board monitors the legality, propriety, appropriateness, and cost-effectiveness of the Executive Board’s management. The rules of procedure for the Executive Board, drawn up by the Supervisory Board, list the types of transactions and actions that require the Supervisory Board’s approval. Important topics discussed and coordinated between the Executive Board and the Supervisory Board include corporate planning, the earnings situation, risk management, corporate financing, and corporate structure.

Diversity Policy, Succession Planning, and Targets for Women

As a publicly traded company, ACCENTRO Real Estate AG complies with diversity requirements, particularly those set forth in the German Stock Corporation Act (AktG) and the German Corporate Governance Code (DCGK).

In March 2021, the Supervisory Board adopted a diversity policy for the Supervisory Board in accordance with the recommendations of the German Corporate Governance Code (DCGK). The policy also includes the Supervisory Board’s objectives regarding its composition and the competency profile of the Supervisory Board as a whole. According to this policy, the Supervisory Board must be composed in such a way that its members collectively possess the knowledge and competencies necessary to properly perform their advisory and oversight functions with respect to the Accentro Executive Board, as well as sufficient time to do so. The Supervisory Board pays particular attention to diverse, mutually complementary profiles, professional experiences, and life experiences. In addition, sufficient diversity should be ensured in the composition of the Supervisory Board so that the Supervisory Board as a whole can draw on as broad a range of personalities, experiences, and specialized knowledge as possible. When preparing nominations for the Annual General Meeting, consideration should be given on a case-by-case basis to the extent to which diverse, complementary areas of expertise, educational backgrounds, international experience, professional and life experience, and a balanced gender distribution would benefit the work of the Supervisory Board. In the Supervisory Board’s view, age is not a criterion that can decisively influence the effective and successful work of the Supervisory Board. Accordingly, age is not a criterion for the composition of the Supervisory Board, and therefore the Supervisory Board has not set an age limit for its members. However, the Supervisory Board will examine the extent to which the relevant recommendation in the German Corporate Governance Code (DCGK) can be complied with in the future.

Given the current age structure of the Executive Board, the company is also refraining from setting an age limit for its members at this time.

In recent years, the Supervisory Board has addressed the issue of diversity on the Supervisory Board both generally and in specific cases with great intensity; in the Supervisory Board’s view, the principles set forth in the policy were also observed in fiscal year 2022 and are reflected in the current composition of the Supervisory Board.

The Supervisory Board pursues the objective of promoting women and has set itself the goal of giving women appropriate consideration when filling positions on the Supervisory Board and the Executive Board. Based on the current Supervisory Board and Executive Board appointments, the Supervisory Board has, in accordance with Section 111(5) of the German Stock Corporation Act (AktG), set a target of 0% for the proportion of women on the Executive Board and the Supervisory Board for the period through December 31, 2024. The target figure is based on the current composition of the governing bodies. During the reporting period, the Executive Board and the Supervisory Board consisted of only one and three members, respectively. The Supervisory Board believes that candidate nominations should continue to be based primarily on suitability. For boards with only a few members, as is the case with ACCENTRO Real Estate AG, setting a target of more than 0% would significantly limit the pool of candidates. Particularly for smaller publicly traded companies, such as ACCENTRO Real Estate AG, recruiting suitable candidates in today’s competitive market is a challenging task. Therefore, it is in the company’s interest to maintain the greatest possible flexibility. Setting the target figure above 0% would make this task considerably more difficult and could have adverse effects on ACCENTRO Real Estate AG as well as all shareholders.

The Supervisory Board and the Executive Board expressly welcome all efforts to counteract gender discrimination and any other form of discrimination and to appropriately promote diversity. When appointing members of the Executive Board, the Supervisory Board focuses exclusively on the competence, professional qualifications, and experience of the candidates under consideration; other characteristics, such as gender or nationality, have been and remain irrelevant to this decision. The Supervisory Board always strives to select the most suitable candidates, and in the Supervisory Board’s view, these principles were also observed in the 2022 fiscal year.

Pursuant to Section 76(4), first sentence, of the German Stock Corporation Act (AktG), the Executive Board has set a target of 0% for the proportion of women in the first management level below the Executive Board for a period ending on December 31, 2024. At ACCENTRO Real Estate AG, there is currently only one management level below the Executive Board; two women are represented at that level. The Executive Board of ACCENTRO Real Estate AG follows the approach of making no distinctions based on gender, origin, age, or any other personal characteristic when filling positions at the management level. Rather, the Executive Board decides on the suitability of applicants solely on the basis of professional qualifications, work experience, and comparable criteria. Setting a rigid threshold above 0% would significantly restrict the above principles, particularly given that ACCENTRO Real Estate AG’s management level consists of only a few members. Nevertheless, the Executive Board is committed to and striving to steadily increase the proportion of women in management and specialist positions. To this end, the Executive Board will implement long-term measures that will enable it to identify and recruit suitably qualified female candidates for these positions at an early stage. ACCENTRO Real Estate AG will report on this on an ongoing basis in accordance with statutory provisions.

Further Information on Corporate Governance

Detailed information on the activities of the Supervisory Board and on the cooperation between the Supervisory Board and the Executive Board can also be found in the “Report of the Supervisory Board” section of the Annual Report. Further information on the compensation of the Executive Board and the Supervisory Board can be found in the “Compensation Report” section of the Management Report.

Berlin, April 2023