Constitution
Articles of Association of the Foundation for Family Businesses dated 11 January 2005 with amendments dated 27 October 2009 and with amendments dated 19 January 2012
Non-profit foundation
Jahnstrasse 43, D-70597 Stuttgart
Phone: +49 (0) 711 / 725790
Fax: +49 (0) 711 / 77257922
E-mail: stiftung@familienunternehmen.de
www.familienunternehmen.de
I. General
§ 1 - Name, registered office, legal form, founder
(1) The foundation operates under the name
“Foundation for Family Businesses”.
(2) The foundation’s registered office is in Stuttgart.
(3) The Foundation for Family Businesses is a legally responsible foundation under
civil law, established in accordance with the Foundation Law (Stiftungsgesetz)
of the State of Baden-Württemberg.
(4) The founder within the meaning of these articles of association is Prof. Brun-
Hagen Hennerkes.
§ 2 - Purpose and tasks of the foundation
(1) The foundation solely and directly pursues non-profit purposes within the meaning
of the section „Tax-privileged purposes“ of the Fiscal Code of Germany
(Abgabeordnung).
(2) The purpose of the foundation is to provide support, information, training and
education as well as a platform for the sharing of ideas about family businesses
in Europe.
(3) The foundation realises its purpose by, among other methods,
a) publicly promoting ideas about family entrepreneurship;
b) organising and promoting congresses and events for the benefit of family
entrepreneurship in Europe;
c) imparting knowledge and skills needed for managing family businesses
through general training sessions and events in order to support succession
in family businesses;
d) convening owners of family businesses from across Europe in order to exchange
ideas;
e) pursuing an information policy to promote family entrepreneurship in
Europe among the general public;
f) supporting research projects, awarding research contracts, providing nonmonetary
resources or awarding stipends to young academics.
(4) The foundation may make use of aides within the meaning of Section 57 para.
1 sentence 2 of the Fiscal Code of Germany for fulfilling its tasks, if it does not
carry out the measures listed in para. 3 itself. Appropriate measures will be
taken to make research findings publicly accessible.
(5) As part of the measures listed in para. 3, research projects may also be funded
abroad if they align with the cultural, academic and other non-profit aims of
the Federal Republic of Germany.
(6) There is no legal entitlement to the foundation‘s services.
§ 3 - Non-profit status and use of funds
(1) The foundation is a not-for-profit organisation and the pursuit of its own economic
ends is not its primary motive.
(2) The foundation‘s funds may only be used for purposes in accordance with these
articles of association. No person may benefit from expenses unrelated to the
foundation‘s purpose or from disproportionately high remuneration.
(3) The activities having no detrimental effect on tax privilege set out in Section 58
of the Fiscal Code of Germany are permitted. The founder and his legal successors
shall, however, not receive any grants drawn from the foundation’s funds,
with the exception of any fees and reimbursement of expenses in accordance
with Section 6 para. 2 sentence 1.
§ 4 - Foundation assets
(1) The initial assets shall be transferred to the foundation by the founder as soon
as the foundation is approved.
(2) The value of the foundation‘s initial assets shall be preserved. The same shall
apply to assets accrued by the foundation through additional donations.
(3) Recourse to the capital value of the foundation’s assets shall only be permitted
with the advance approval of the regulatory body and only if it does not
contravene the founder’s intentions, the continued existence of the foundation
is guaranteed for a reasonable period of time and no adverse impact on its
non-profit status is anticipated.
(4) The foundation‘s assets shall grow as a result of donations by third parties,
insofar as these donations are expressly made for this purpose (endowments).
The foundation is entitled, but not obliged, to accept endowments.
(5) The foundation may collect or accept donations for spending in a timely manner
(contributions) in order to promote the foundation‘s purpose as listed in Section
- The particular use shall be determined by the donor’s specified purpose. If
no such purpose is specified, the Executive Board is entitled to exercise its own
judgement as to how the donation shall be spent within the meaning of Section
2 or to set aside reserve funds up to the legally permitted limit and in pursuit
of the foundation‘s purpose.
(6) No legal entity or natural person may benefit from expenses, donations or other
benefits unrelated to the foundation‘s purpose or from disproportionately high
remuneration.
§ 5 - Financial year
The financial year of the foundation is the calendar year.
§ 6 - Executive bodies of the foundation
(1) The executive bodies of the foundation are:
a) the Executive Board
b) the Board of Trustees
(2) In addition to reimbursement of their expenses, members of the foundation‘s Executive
Board are also entitled to compensation proportionate to the work involved
in managing the foundation. This is determined by the foundation‘s Board of
Trustees with due consideration of the state of the foundation‘s assets and income.
Members of the Board of Trustees work on a voluntary basis, but are entitled
to reimbursement of expenses.
§ 7 - Regulatory body
The foundation is subject to state regulation in accordance with the laws applicable to
foundations. The regulatory body is Stuttgart regional council.
II. Executive Board
§ 8 - Basic principle
The foundation‘s Executive Board has the status of legal representative. It represents the
foundation both in and out of court.
§ 9 - Number of members, terms of office and composition of the Executive Board
(1) The Executive Board shall have at least two and at most four members.
Two members of the Executive Board shall be appointed by the founder. The
founder is authorised to appoint replacement members for Board members
he appoints himself either when making the appointment or at a later date.
They shall take the place of the members initially appointed by the founder in
the order specified by the founder even after the founder’s death if, for whatever
reason, one of the original members resigns from the Executive Board.
The remaining members of the Executive Board shall be appointed by the Board
of Trustees.
After the founder‘s death, the successors of the members appointed by the
founder shall be appointed immediately by these members themselves by a
written declaration to all other Executive Board members, unless the founder
already appointed replacement members while alive in accordance with sentence
3 above
If a member appointed by the founder resigns from the Executive Board after
the founder’s death, before a successor has been appointed and without a
replacement member having been nominated in accordance with sentence 3,
then the regulation above in sentence 4 shall apply. The same shall apply if a
replacement member appointed by the founder in accordance with sentence 3
above resigns from the Board after the founder‘s death, or if a Board member
appointed by the Executive Board itself in accordance with sentence 5 above
resigns from the Board after the founder’s death.
(2) The term of office of an Executive Board member appointed by the Board of
Trustees is five years, unless a shorter or longer term is specified when the appointment
is made. The same applies to a member appointed by the founder or
appointed in accordance with para. 1 sentence 5, unless the founder (in the case
of para. 1 sentence 3) or the member nominating his/her successor (in the case
of para. 1 sentence 5) specifies a shorter or longer term. The term of office of
an Executive Board member begins on his/her assumption of the role. This also
applies to the terms of office of replacement members appointed in accordance
with para. 1 sentence 3. Executive Board members may be reappointed. The
founder may also appoint himself to the Executive Board.
(3) The Board of Trustees may dismiss members of the Executive Board it has
appointed, on compelling grounds. The founder may dismiss members of the
Executive Board he has appointed, on compelling grounds. After the founder‘s
death, members of the Board of Trustees appointed by him, i.e. in accordance
with para. 1 sentence 3, or appointed in accordance with para. 1 sentence 5
may be dismissed by the Board of Trustees before their term expires only on
compelling grounds. The dismissal shall proceed irrespective of any claims to
compensation under existing contracts. The dismissal shall be effective until
such time as its ineffectiveness is established in a legally binding manner.
§ 10 - The tasks and internal organisation of the Executive Board
(1) The foundation‘s Executive Board manages the foundation. In particular, it has
the following tasks:
a) managing the foundation‘s assets;
b) using funds to fulfil the foundation’s purposes;
c) account keeping for the inventory of and changes to the foundation‘s assets
and incoming and outgoing funds;
d) submitting an annual financial statement (balance sheet, profit and loss
account) in accordance with Sections 238 et seq. of the Commercial Code
of Germany (Handelsgesetzbuch, HGB), a comprehensive report on the
fulfilment of the foundation‘s purpose and an audit report by a financial
auditor regarding the annual financial statement of the previous financial
year to the foundation‘s Board of Trustees within four months following the
end of the financial year;
e) submitting the annual financial statement mentioned in point d), in addition
to the audit report and the report on the fulfilment of the foundation’s
purpose, after approval by the Board of Trustees to the regulatory body
within six months following the end of the financial year;
f) notifying the foundation authority of any changes to the membership of
the Executive Board;
g) commissioning aides within the meaning of Section 2 para. 4 sentence 1 of
these articles of association;
(2) If, temporarily, there is only one appointed Executive Board member, then s/he
shall represent the foundation alone. If the Executive Board consists of more
than one member, then the foundation shall be represented by two Board
members jointly. The Board of Trustees may grant sole power of representation
and exemption from the limitations of Section 181 of the German Civil Code
(Bundesgesetzbuch, BGB) to individual members of the Executive Board on a
general or case-by-case basis.
(3) Decisions made by the Executive Board must be recorded in writing.
§ 11 - Notification requirements
(1) The Executive Board is obliged to perform the following legal transactions only
after prior approval by the Board of Trustees and after notifying the regulatory
body:
a) taking out loans, acquiring guarantees, disposing of and mortgaging properties
and creating other obligations if fulfilling these obligations may
place a particular burden on the assets of the foundation;
b) issuing non-repayable grants from the foundation which do not serve to
fulfil the foundation‘s purpose;
c) accepting non-repayable grants with conditions or requirements attached
which may place a particular burden on the foundation‘s assets;
d) legal transactions performed by the foundation with members of foundation
executive bodies.
(2) A measure as laid out in para. 1 may only be taken if the regulatory body
confirms its lawfulness or has not objected to the measure within two weeks,
unless the regulatory body has granted the foundation a general exemption
from the requirement to notify for certain types of measures which are subject
to notification in accordance with para. 1.
III. Managing Director
§ 11a - Managing Director
(1) The Executive Board may appoint one or more Managing Directors of the foundation
to manage the day-to-day work of the foundation.
(2) The Executive Board may grant power of representation to the Managing
Director(s) individually or collectively. The scope of this power shall be limited
internally by rules of procedure or a corresponding directive issued by the
Executive Board.
(3) Each Managing Director is entitled to proportionate compensation for his/her
work which will be established by the Executive Board.
IV. Board of Trustees
§ 12 - Composition of the Board of Trustees
(1) The Board of Trustees consists of at least five members who must possess the
necessary expertise and personal qualifications for an appointment of this kind
by virtue of their education and social status. At least two thirds of the members
of the Board of Trustees must be shareholders of family businesses, the spouses
of such shareholders or (current or former) members of the management of
family businesses.
(2) The first twenty members of the Board of Trustees are appointed by the founder
for their first term of office. Further members of the Board of Trustees are voted
on by the Board of Trustees itself.
After the first term of office has elapsed, the entire Board of Trustees replenishes
itself by co-option. The members of the Board of Trustees may not also be
members of the Executive Board.
(3) Members of the Board of Trustees are appointed or elected for terms of five
years. Re-election is permitted.
§ 13 - Tasks of the Board of Trustees
(1) The Board of Trustees has the following tasks:
a) advising and monitoring the Executive Board;
b) annual discharge of the Executive Board;
c) auditing and approving the annual financial statement and report on the
fulfilment of the foundation‘s purpose submitted by the Executive Board;
d) approval of legal transactions which require consent.
(2) The Board of Trustees has full rights to information in accordance with Section
90 of the Stock Corporation Act (Aktiengesetz, AktG).
(3) The Board of Trustees may make the execution of transactions by the Executive
Board contingent on its approval at any time.
(4) The Board of Trustees may issue rules of procedure for the Executive Board.
(5) The Board of Trustees represents the foundation vis-à-vis members of the Executive
Board both in and out of court.
§ 14 - Internal organisation
(1) The Board of Trustees shall convene a meeting at least twice a year. The meetings
of the Board of Trustees shall be called by the Executive Board. A meeting
of the Board of Trustees must be called if a member of the Board of Trustees
requests it from the Executive Board in writing, indicating the grounds for the
meeting.
(2) The Board of Trustees is quorate if at least a quarter of the members of the
Board of Trustees in place at the time of the decision-making process participate
in that process. Decisions of the Board of Trustees shall be passed by a
simple majority of the votes cast; they shall be recorded in writing. In all other
respects, the Board of Trustees governs its own internal organisation using rules
of procedure; decisions on the rules of procedure must be made with a 75%
majority of votes cast.
V. Amendments to the articles of association, dissolution of the
foundation
§ 15 - Amendments to the articles of association
Amendments to the articles of association must be designed to facilitate the fulfilment
of the foundation’s purpose in accordance with the founder’s intentions and vision in the
face of changing circumstances. They require a decision by the Executive Board and the
approval of the majority of members of the Board of Trustees.
§ 16 - Amendments to the foundation‘s purpose, dissolution of the foundation
(1) Amending the foundation‘s purpose, dissolving the foundation or merging the
foundation with another foundation require a decision by the Executive Board
and the approval of the majority of the members of the Board of Trustees, with
the majority amounting to at least 75% of votes cast. The aforementioned
decisions also require the approval of the foundation‘s regulatory body and
may only be made if confirmation has been given by the appropriate financial
office that it will not be detrimental to the foundation‘s tax-privileged status in
accordance with Sections 51 et seq. of the Fiscal Code of Germany.
(2) In the event of the winding-up or dissolution of the foundation, the Executive
Board shall decide, with the approval of the majority of the members of the
Board of Trustees, whom the foundation’s assets shall go to. In doing so, the
Executive Board shall choose tax-privileged private or public corporations which
will use the foundation‘s assets directly and solely for purposes pursuant to
Section 2 of these articles of association or, if this does not seem appropriate,
for other tax-privileged purposes. Before making the decision, confirmation
must be received from the appropriate tax office that it will not be detrimental
to the assets’ tax-privileged status.
(3) Decisions regarding amendments to the foundation‘s purpose and the merging
or dissolving of the foundation are only permitted if the fulfilment of the
foundation’s purpose is no longer permanently possible in the long-term or if
the purpose is no longer feasible due to significant changes of circumstance. The
founder’s original intentions must be taken into consideration where possible.
VI. Final provisions
§ 17 - Severability clause
Should a provision of these articles of association be or become ineffective or should there
be a gap in these provisions, the legal effect of the remaining provisions shall hereby
remain unaffected. Any regulatory gaps of this nature must be filled in accordance with
the purpose and tasks of the foundation and the effective provisions of these articles of
association.