The Austrian Corporate Governance Codex went into effect on October 1st, 2002. These regulations prescribe the principles of good business management and serve as an orientation aid for international investors. They are based on the regulations of the Austrian shares, stock market and capital market law as well as on the OECD Guidelines for Corporate Governance.
KTM Power Sports AG has undertaken to comply with the rules of the Austrian Code of Corporate Governance since preparations for the IPO in fall 2003. The Corporate Governance Code is now an integral part of cooperation between the Supervisory and Management Boards at KTM Power Sports AG.
June 2007 the Austrian Association for Corporate Governance decreed changes to the current code. The new guidelines require, besides a sufficient number of independent members in the Supervisory Board and its committees, the definition of a compensation schema for the members of the Supervisory Board as well as the disclosure of the principles of the compensation system of the Board of Directors and their individual remunerations.
The Codex, which goes beyond the legal regulations, becomes valid through the voluntary ratification by a given company. The endorsement of the Codex means that any non-compliance with the C-Code must be justified ("comply or explain"). The company must have its implementation of the Codex evaluated by an external institution on a regular basis and publish a report in this regard.
