Four regular Supervisory Board meetings and the constituent meeting of the newly elected Supervisory Board following the Annual General Meeting were held in the year under review. At these meetings, we discussed current business developments, important business transactions and Executive Board measures requiring Supervisory Board approval. All necessary approvals were granted, in particular we approved follow-up financing for the Company’s share buyback program. In November, we held in-depth discussions about the Company’s medium-term planning, including its financial, investment, and human resources planning.

We issued the declaration of compliance with the German Corporate Governance Code for fiscal year 2004 at the end of December 2004 and made it accessible to shareholders on the Company’s website. Additional information on corporate governance at Beiersdorf can be found in the joint report by the Executive and Supervisory Boards on the following pages.

The Executive Committee of the Supervisory Board met three times. Among other things, the Executive Committee addressed the issues of succession planning for the Executive Board and the latter’s compensation, which consists of a fixed and a variable component. It was not necessary for the Mediation Committee, set up in accordance with § 27 (3) Mitbestimmungsgesetz (German Co-Determination Act), to meet. The Audit Committee met twice, in March and in September 2004.

BDO Deutsche Warentreuhand Aktiengesellschaft Wirtschaftsprüfungsgesellschaft, which was appointed as the Company’s auditors by the Annual General Meeting on June 3, 2004 and engaged by the Supervisory Board, audited the annual financial statements of Beiersdorf AG and the consolidated financial statements as of December 31, 2004, as well as the joint management report for Beiersdorf AG and the Group, and issued an unqualified audit opinion on them. In addition, they audited the report regarding dealings among Group companies drawn up by the Executive Board in connection with the majority interest held by TCHIBO Holding AG, Hamburg, as required by § 312 Aktiengesetz (German Stock Corporation Act) for fiscal year 2004, and issued the following unqualified audit opinion:

“Following the completion of our audit, which was carried out in accordance with professional standards, we confirm: 1. that the information contained in this report is correct; 2. that the Company’s compensation with respect to the transactions listed in the report was not inappropriately high; and 3. that there are no circumstances which would justify, in relation to the measures specified in the report, a materially different opinion than that held by the Executive Board.”

The annual financial statements, the joint management report, the report regarding dealings among Group companies, and the auditors’ report were distributed to all members of the Supervisory Board immediately after their preparation. The Audit Committee of the Supervisory Board performed a preliminary review of the financial statements, the reports, and the proposal on the utilization of the net retained profits.

In the meeting convened to adopt the annual financial statements on March 10, 2005, the above-mentioned financial statements and reports were discussed at length in the presence of the auditors, who reported on the key results of their audit. Our review of the financial statements, the joint management report, the report regarding dealings among Group companies including the concluding declaration by the Executive Board, and the auditors’ report did not raise any objections. Therefore, we concur with the auditors’ findings and approve the annual financial statements of Beiersdorf AG and the Group as prepared by the Executive Board for the year ending December 31, 2004; the annual financial statements of Beiersdorf AG are thus adopted. We endorse the Executive Board’s proposal on the utilization of the net retained profits.

The Annual General Meeting on June 3, 2004, elected new shareholder representatives to the Supervisory Board. Dr. Meinhardt, Dr. Claussen, and Mr. Wöbcke did not run again. Along with the shareholder representatives who had previously served on the Supervisory Board, Mr. Ammer, Dr. Breipohl, and Mr. Pöllath, the Annual General Meeting also elected Mr. Herz, Dr. Mahlert, and Dr. Sälzer to the Supervisory Board.

In the election of the employee representatives that had already taken place, Prof. Rousseau, Mr. Krause, Dr. Diembeck, and Mr. Nieber were re-elected, while Mr. Ganschow and Mr. Plechinger were elected to the Supervisory Board to replace the departing members, Ms. Buhse and Mr. Holland.

We thank the departing members of the Supervisory Board for their service to this body. Our particular thanks go to Dr. Meinhardt for his special contribution as the long-standing Chairman of Beiersdorf’s Supervisory Board.

Immediately after the Annual General Meeting the Supervisory Board elected Mr. Ammer as Chairman and Mr. Krause and Mr. Pöllath as Deputies in its constituent meeting. In addition, the Mediation Committee was set up and the members of the Executive and Audit Committees were elected.

We would like to thank the Executive Board and all employees for their hard work and achievements over the past fiscal year in what was a particularly difficult environment for Beiersdorf.

Hamburg, March 10, 2005

On behalf of the Supervisory Board

Dieter Ammer
Chairman