Expert Corporate Governance Service (ECGS)
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Lenzing April 17th, 2019

General: The Lenzing Group is an international producer of high-quality fibers and filaments from the renewable raw material wood with environmentally friendly and innovative technologies. These fibers form the basis for a wide range of textile and nonwoven applications, and are also used in work and protective wear and in industrial applications.

As of 31 December 2018, B&C Privatstiftung via B&C Industrieholding GmbH held 50% + 2 shares and Oberbank AG held 3.8% of the Company's shares.In financial year 2018, Group revenues decreased by 3.7% to EUR 2.2bn, EBIT decreased by 36.0% to EUR 237.6m and net income attributable to the shareholders of Lenzing AG decreased by 46.4% to EUR 149.0m.

Item 4: Supervisory Board Chairman Dr. Hanno M. Bästlein will resign from the Board with effect as of the close of the AGM 2019. The Company fails to disclose who will stand for the position of Chairman after the AGM. We raise our concerns over this lack of transparency. In line with our guidelines we would in principle recommend opposing the discharge of the Chairman of the Supervisory Board's Nomination Committee, Dr. Hanno M. Bästlein. As the discharge is proposed in a bundled resolution, we recommend shareholders to oppose the discharge of the Supervisory Board as a whole.

Items 5 and 6: Approval is sought for the Supervisory Board members' fees for financial years 2018 and 2019. We consider the absolute amount of fees as inadequately high and exceeding market average. We therefore recommend opposition.

Items 7.1 and 7.3: We recommend to oppose the re-election of Dr. Felix Fremeney to the Supervisory Board due to our concerns over independent representation on the Board. Furthermore, we recommend to oppose the election of Dr. Stefan Fida due to concerns over aggregate time commitments.

Lenzing AG

Lenzing is engaged in supplying the global textile and nonwovens industries with man-made cellulose fibers and is a supplier in many business-to-business markets. The portfolio ranges from dissolving pulp, standard and specialty cellulose fibers to high-quality plastic polymer products and engineering services. Co.'s operations are divided into three segments: Fibers, which produces and markets man-made cellulose fibers for the textile and nonwovens industry; Plastics, which produces weaving, labelling films, laminates and woven fabrics; Engineering, which implement projects, supply plant and equipment and provide services arond the world.


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