DEEN

CORPORATE GOVERNANCE

The Board of Management and the Supervisory Board of Deutsche Beteiligungs AG announced their decision to comply with the recommendations issued by the government commission “German Corporate Governance Code”. A Declaration of Conformity called for by the Stock Corporation Act was issued December 18, 2002. The Declaration provides for only a few exceptions largely due to the nature of the private equity company's business.

For the time being, the financial statements of Deutsche Beteiligungs AG will continue to be drawn up in conformity with the principles of the German Commercial Code (HGB): “The special principles of the International Accounting Standards (IAS) that would apply to us as a private equity company have not yet been adopted. We want to avoid drawing up our financial statements on a provisional basis,” said Wilken von Hodenberg, Spokesman of the Board of Management.

Deutsche Beteiligungs AG will, however, disclose the valuation reserves in its portfolio in the future. At the Annual Press Conference on February 10, 2003, the company will report the fair value of the shares of Deutsche Beteiligungs AG determined in conformity with the valuation principles of the International Financial Reporting Standards (IFRS).

“Largely complying with the recommendations of the Code documents our capital-market orientation,” von Hodenberg said. “We identify with the objectives of the Code in support of good, fiduciary corporate governance aligned to benefit shareholders, the staff and business partners.” The stock of Deutsche Beteiligungs AG is indexed in the S-Dax. According to temporary assessments by the German Stock Exchange, it will continue to be included in the S-Dax subsequent to the slated indices change. The company's stock has been admitted to the new Prime Standard.

The preamble of the Code expressly provides for deviations to allow for industry and company-specific requirements. By this, the Code intends to enhance the flexibility and self-regulation of German corporate governance.