The main functions of the supervisory board

– Appointment and dismissal of the members of the board of
management, including agreeing to the terms and conditions
of the employment contracts of the members of the board of
management
– Supervision of the board of management, including the exam-
ination of both legal and commercial aspects of management
board actions
– Representation of the AG in its dealings with the board of
management
– Representation of the AG (together with the board of man-
agement) in litigation relating to the validity of shareholder
resolutions
– Authorization of business decisions of the board of manage-
ment where required by the articles or by the supervisory
board itself
– Appointment of the statutory auditor, review and approval of
the annual financial statements

In the case of a GmbH, a supervisory board is mandatory only
if the GmbH has more than 500 employees. In all other cases,
shareholders are entitled to form a supervisory or advisory board
(Beirat) and to define the functions of said board in the articles.