Corporate Governance code declaration

Declaration of Conformity with the German Corporate Governance Code, issued by the Supervisory Board and Management Board in accordance with Section 161 of the German Stock Corporation Act

Pursuant to Section 161 of the German Stock Corporation Act (Aktiengesetz – AktG), the supervisory board and management board of exchange-listed stock corporations are obliged to issue an annual declaration stating that the recommendations of the "Code of the Government Commission on German Corporate Governance" have been and will continue to be complied with and, if applicable, specifying which recommendations have not been or will not be applied. Any departures from the recommendations must be explained.

The Management Board and Supervisory Board of ElringKlinger AG hereby issue a Declaration of Conformity pursuant to Section 161 AktG, stating that the Company has complied with, currently complies with and will in future comply with the recommendations of the "Government Commission German Corporate Governance Code" in the version dated May 15th, 2012, with the following exceptions.

• Section 2.3.2: As in the past, in 2013 the invitation to the Annual General Meeting of Shareholders will again be dispatched by mail.

At present, for organizational reasons the company does not comply with the Code's rec-ommendation on the electronic dispatch of the invitation to the General Meeting of Shareholders. As the company generally has no records of the e-mail addresses of its shareholders, from the company's perspective any additional dispatch would be associ-ated with disproportionate time and effort without actually offering any substantive bene-fits for shareholders. Within this context, it should also be noted that the invitation to the General Meeting of Shareholders has been and will continue to be available for download from the company's website.

• Section 3.8: The deductibles agreed as part of the company's D&O insurance are not the same for the Supervisory Board and the Management Board.

The D&O insurance policy for the Supervisory Board contains a deductible, however it is below the deductible of the Management Board. The company is of the opinion that inconsistency in the treatment of the Management Board and the Supervisory Board would be objectively justified because of the different functions. The legislative authority accepts such a differentiation, as it has not foreseen regulations comparable with the deductible for the Management Board for the Supervisory Board.

• Section 4.1.5: When filling managerial positions in the enterprise, suitability and qualification of the candidates were taken into consideration by the management board primarily.

When filling managerial positions the management board orients itself by requirements of the corresponding position and looks for the best possible individual, fulfilling these re-quirements. If there are more candidates with similar qualifications, the management board takes diversity into consideration and aims for an appropriate consideration of women without making these criteria a principal of priority. From the point of view of the company such regulation would be counterproductive, especially in view of the compara-tively small number of managerial positions to be filled.

• Section 5.1.2: When appointing the Management Board, the Supervisory Board orients itself by suitability and qualification. No age limit has been set for members of the Management Board.

The members shall be selected prior to their suitability and qualification. In the company’s view, the special weighting of further criteria given by the Code would limit the selection of potential candidates for the Management Board. Thereby, it has to be considered that the Management Board temporarily exists of only 3 members. There is no general age limit for Management Board members. The main focus for ElringKlinger is on the qualifications as well as the experience required by candidates to be appointed to the board. Given the provisions set out in the German General Equal Treatment Act (Allgemeines Gleichbehandlungsgesetz – AGG), which does not apply directly to this case but at the very least provides a basis for analogous application, the company is of the opinion that the approach of specifying an age limit is inappropriate.

• Section 5.3.3: At present there is no Nomination Committee to propose possible candidates for the election of shareholder representatives to the Supervisory Board.

Given the current size of the company's Supervisory Board, both the Management Board and the Supervisory Board are of the opinion that there is no need to form a Nomination Committee.

• Section 5.4.1: Regarding the composition of the Supervisory Board, concrete ob-jectives will not be predefined and according to this not published in the Corporate Governance Report. No age limit has been set for members of the Supervisory Board.

Relevant selection criteria for the appointment of the Supervisory Board are also suitabil-ity, experience and qualification. A commitment to specifications concerning prospective appointments constricts flexibility without ulterior advantage for the company. This ap-plies all the more as the representatives of the shareholders can temporarily only elect six members of the Supervisory Board with codetermination. Within this context, the specifications mentioned in the Code’s recommendation are per se further important cri-teria for the constitution of the Supervisory Board. So because of the mentioned reasons there is no need of a predefinition of concrete objectives.
No general age limit has been set for members of the Supervisory Board, as the expertise of the individual members is considered an overriding priority. Within this context, experience in particular is seen as an integral element. Given the provisions set out in the German General Equal Treatment Act (Allgemeines Gleichbehandlungsgesetz – AGG), which does not apply directly to this case but at the very least provides a basis for analogous application, the company is of the opinion that the approach of specifying an age limit is inappropriate.

• Section 5.4.3: Proposals regarding candidates for the Chair of the Supervisory Board are not disclosed to shareholders.

The election of the Chairperson of the Supervisory Board is the sole responsibility of the Supervisory Board, as it is best placed to assess the suitability of the candidates. Against this background, the company is of the opinion that prior disclosure of the names of can-didates for the Chair of the Supervisory Board would not be appropriate.

• Section 5.4.6: The compensation of the Supervisory Board consists of a variable respectively a profit-related part. The profit related part is based on earnings be-fore taxes of the Group in the last financial year.

The company is of the opinion that the current structure of the compensation of the Su-pervisory Board expresses the responsibility of the Supervisory Board for the develop-ment of the company adequately. Profitability is decisive for the sustainable development of the company. This shall be reflected in the assessment of the compensation.

• Section 6.6: No reports of the kind specified in Section 6.6 of the Code are made beyond the statutory disclosure requirements.

The company is of the opinion that transparent corporate communication is essential, particularly in order to maintain shareholder confidence. All relevant information is disclosed by the company in accordance with statutory requirements, which have been extended significantly in recent years. This information can also be accessed from the company's website. From the company's perspective, the other details recommended for disclosure under Section 6.6 of the Code are of no additional value to investors. The company believes that transparency is not dependent on the volume of information disclosed but rather on the quality and relevance of such information. Against this background, the company has chosen not to apply the Code's recommendations beyond those specified as required by law.

Dettingen/Erms, December 4, 2012

On behalf of the Supervisory Board:

Lechler

On behalf of the Management Board :

Dr. Wolf,                             Becker,                                    Schmauder