Deutsche Telekom AG - The 2009 financial year

The members of the Board of Management are in principle entitled to a company pension. Its structure depends on the final salary received which means that Board of Management members receive a company pension based on a fixed percentage (between 5 and 6 percent) of their last fixed annual salary for each year of service rendered prior to their date of retire- ment. The maximum pension entitlement, attainable after ten years of Board of Management membership, is 50 (or 60) percent of the last fixed annual salary. The rights to benefits are generally vested in accordance with statutory provisions (or contractually vested immediately, in specific cases). Benefits are paid in the form of a lifelong old-age pension, an early- retirement pension, disability pension, and widow and orphans’ pension. All other required details can be found in the notes to the consolidated financial statements on pages 208–214 of the Annual Report under “Compensation of the Board of Management and the Supervisory Board.” These disclosures in the notes to the consolidated financial statements are also an integral part of this Corporate Governance Report. Members of the Board of Management receive no third-party remuneration for their activity as Board members. For details of the compensation system and a specification of the long- term incentives containing risk elements, please refer to the notes to the consolidated financial statements, on pages 208–214 of the Annual Report under “Compensation of the Board of Management and the Supervisory Board”, or to the company website ( www.telekom.com) under Investor Relations/Corporate Governance/Incentive plans. These disclosures in the notes to the consolidated financial statements are an integral part of this Corporate Governance Report. Report on the compensation of the Supervisory Board. The compensation of the members of the Supervisory Board is specified in §13 of the Articles of Incorporation. It is designed to take account of the responsibilities and scope of activity of the members of the Supervisory Board, as well as the financial position and success of the Company. In addition to fixed compensation, the members of the Supervisory Board receive performance-related compensation based on the development of net profit per share. Performance-related compensation also includes variable components linked to the long-term performance of the Company. Special functions such as that of Chairman or Deputy Chairman of the Supervisory Board and chair or member of any of its committees are taken into account. The compensation of each member of the Supervisory Board is reported in the notes to the consolidated financial statements, broken down in accordance with statutory requirements into its individual components. For details please refer to pages 208–214 of the Annual Report under “Compensation of the Board of Management and the Supervisory Board.” These disclosures in the notes to the consolidated financial statements are also an integral part of this Corporate Governance Report. No other remuneration was paid by the Company to the members of the Supervisory Board, or advantages extended for services provided individu- ally, in particular advisory services or agency services. Lothar Schröder received attendance fees for his function as chairman of the Data Privacy Advisory Council. Share ownership by members of the Board of Management and the Supervisory Board. Total direct or indirect holdings of shares in the Company or associated financial instruments by members of the Board of Management and the Supervisory Board do not exceed 1 percent of the shares issued by the Company. Securities-based incentive systems. Specific details of the securities-based incentive systems of the Company are contained in the notes to the consolidated financial statements on pages 193–197 under “Stock-based compensation plans” and on pages 208–214 under “Compensation of the Board of Management and the Supervisory Board” of the Annual Report. These disclosures in the notes to the consolidated financial statements are also an integral part of this Corporate Governance Report. 44