Corporate governance declaration of Heidelberger Druckmaschinen Aktiengesellschaft in accordance with Section 289 f and Section 315 d of the German Commercial Code (as of June 2018)

Our actions are guided by the principles of transparent corporate management and control (corporate governance). Corporate governance plays an important role at Heidelberger Druckmaschinen Aktiengesellschaft: It is the foundation for the trust of customers, investors, employees and the financial markets in our Company. The following declaration on corporate governance in accordance with Section 289a and Section 315(5) of the German Commercial Code includes the declaration of compliance in accordance with Section 161 of the German Stock Corporation Act, relevant details of corporate governance and the description of the working methods of the Management Board and the Supervisory Board.

As Heidelberger Druckmaschinen Aktiengesellschaft is a listed corporation (German Securities Number (WKN) 731400 - ISIN DE0007314007) based in Germany, its corporate governance is determined mainly by the German Stock Corporation Act, the German Codetermination Act, the suggestions and recommendations of the German Corporate Governance Code (most recent version), the Articles of Association of Heidelberger Druckmaschinen Aktiengesellschaft, and the Rules of Procedure for the Supervisory Board and Management Board.

The tasks, responsibilities and rules of procedure of the Management Board are set out in detail in the Rules of Procedure, the latest version of which can be found on the website of Heidelberger Druckmaschinen AG (www.heidelberg.com) under "Articles of Association & Rules of Procedure".

1. Declaration in accordance with Section 161 of the German Stock Corporation Act

The Management Board and the Supervisory Board of Heidelberger Druckmaschinen Aktiengesellschaft issued the following declaration of compliance on November 24, 2017:

“The Management Board and the Supervisory Board of Heidelberger Druckmaschinen Aktiengesellschaft hereby submit the following declaration of compliance in accordance with section 161 of the Aktiengesetz (AktG – German Stock Corporation Act):

"Since the submission of the last declaration of compliance on November 16, 2016, Heidelberger Druckmaschinen AG has complied with all recommendations of the “Government Commission on the German Corporate Governance Code” as amended on February 7, 2017 promulgated by the German Federal Ministry of Justice on April 24, 2017 in the official section of the Federal Gazette and will also continue to comply with these recommendations in future with the following exceptions:

Heidelberger Druckmaschinen AG deviated from the recommendations in Items 4.1.5, 5.1.2 Sentence 2 and 5.4.1 (3) of the Code as amended February 7, 2017, and will continue to deviate from Item 4.1.5 Sentence 1, which state that appropriate consideration of female participation or female participation should be intended or was or is provided for. Naturally the Management Board and the Supervisory Board have complied with the requirements of the German Act on the Equal Participation of Women and Men in Management Positions in the Private and Public Sector.

The Supervisory Board and the Management Board of the company have taken further measures to enhance the career prospects of women in the company in the 2016/2017

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financial year. It is agreed that, in the event of positions being reassigned and candidates having equal professional and personal aptitude, the appointment of women to the Supervisory Board and the hiring of women to the Management Board and the two levels of management below the Management Board should be considered in order to increase the share of women in the medium and long term. The Supervisory Board and the Management Board welcome all efforts to counter discrimination based on gender or any other form of discrimination and to appropriately promote diversity.

Heidelberger Druckmaschinen AG has deviated from and will continue to deviate from the recommendations in Item 5.4.1(2) of the Code as amended February 7, 2017, which state that the Supervisory Board should consider setting a standard limit on the time that members of the Supervisory Board can belong to this executive body. In the opinion of the Supervisory Board of the Company, above all personal qualifications, long-term experience, and expertise should be the key factors for proposals of suitable candidates for election to the Supervisory Board."

Following a due examination, the Management Board and the Supervisory Board provisionally intend to update the annual declaration of compliance on November 28, 2018. This declaration will be available under "Corporate Governance" at www.heidelberg.com; the same applies to earlier declarations of compliance that are also available there.

2. Corporate governance practices

Compliance is a key element of successful management and good corporate governance at Heidelberger Druckmaschinen Aktiengesellschaft, as Heidelberger Druckmaschinen Aktiengesellschaft is aware of its role in society and its responsibility towards its customers, suppliers, business partners, employees and shareholders. Dependability for its partners, the quality of its products and services, proper processes and legal compliance are key principles in the business activities of Heidelberger Druckmaschinen Aktiengesellschaft.

In its activities, the Company adheres to a comprehensive system of internal guidelines headed by the Company’s values. Five principles in the areas of management, organization, code of conduct, quality, and environmental protection form the framework for more detailed specifications in further guidelines, which also cover occupational safety and product safety issues.

Our philosophy is to lead with goals that extend across all divisions and hierarchy levels of the Company and that are reflected in remuneration systems and practice. Goals are derived from strategy; their content is honed, agreed and reviewed regularly. At the end of a set period, they are remunerated accordingly.

The purpose of the code of conduct is to give guidance to all employees around the world. This extends from clear requirements for legal compliance to recommendations on conduct in respect of business partners and employees and to the Company’s clearly formulated expectations regarding the careful handling of funds.

The Management Board and executives work together to adhere to internal regulations that are regularly reviewed by the internal auditing department. In addition, an external and independent ombudsman has been in place since the middle of 2016 to receive information confidentially from employees and third parties that gives rise to a reasonable suspicion of

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crimes or other violations of the law or (internal) regulations (in particular illegal business practices).

We have published our values and code of conduct on our website www.heidelberg.com under “Corporate Governance”.

3. Working methods of the Management Board and the Supervisory Board, their composition and the working methods of their committees

Heidelberger Druckmaschinen Aktiengesellschaft is a stock corporation under German law, entered in the commercial register of the Mannheim District Court under HRB 330004.

In line with the requirements of the German Stock Corporation Act, the management system of the Company is divided into a managing body, the Management Board, and a monitoring body, the Supervisory Board. The operation of this two-tier management system is clearly described in the preamble to the German Corporate Governance Code. The Code can be found on our website www.heidelberg.com under “Corporate Governance”.

At present, the Management Board of the Company consists of four members and the Supervisory Board consists of 12 members; in line with the provisions of the German Codetermination Act, half the members of the Supervisory Board represent shareholders and half represent employees. Information on the current composition of the Management Board and the Supervisory Board and the mandates of their members can be found on pages 148 to 150 of our annual report.

In addition to the legal requirements and the recommendations of the German Corporate Governance Code, the Rules of Procedure for the Management Board detail its activities, duties and internal organization in particular. In accordance with the Rules of Procedure for the Supervisory Board, the Rules of Procedure for the Management Board also regulate cooperation between both bodies. The two bodies work together closely and in an environment of trust for the good of the Company and to protect its interests.

We have published the Rules of Procedure for the Management Board, which include the current executive organizational chart, and the Rules of Procedure for the Supervisory Board on our website www.heidelberg.comunder “Corporate Governance”.

Among other things, the Rules of Procedure for the Management Board state the following:

The Management Board manages the Company under its own authority with the goal of creating sustainable value-added. It has an obligation to the interests of the Company and takes into account the concerns of its shareholders, the employees and other groups affiliated to the Company (stakeholders). The Management Board works together trustingly with the other bodies of the Company and its staff for the good of the Company.

The Management Board conducts the Company’s business in accordance with the provisions of law, the Articles of Association and these Rules of Procedure. It also ensures compliance with these provisions and corporate policy within the Group in addition to ensuring appropriate risk and opportunity management.

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The members of the Management Board are jointly responsible for overall management. They work as colleagues and inform each other mutually of key measures and processes within their departments.

The Management Board works closely with the Supervisory Board for the good of the Company. The Management Board is responsible for providing the Supervisory Board with sufficient information, which the Supervisory Board actively supports in line with its own Rules of Procedure. Each year, the Management Board and the Supervisory Board issue a report on corporate governance at the Company, which is published with this corporate governance declaration, and follows it. This includes the declaration on why recommendations of the Code have not been or are not complied with.

In the first three months of the fiscal year, the Management Board must prepare the annual financial statements, the management report, the consolidated financial statements and the Group management report for the last fiscal year and submit these to the Supervisory Board immediately upon their completion. At the same time, the Management Board must submit to the Supervisory Board the proposal it intends to make to the Annual General Meeting for the appropriation of net profits.

At least once per year, the Management Board reports on its strategy, its intended business policy and on other basic corporate planning issues at the Company and the Group. This report includes the main areas of management planned by the Management Board. In particular, this includes an explanation of the intended development and strategic orientation of the Group, the presentation of the financial and accounting policy for the Group and its divisions and an explanation of deviations in actual performance from previously reported objectives with reasons.

At the meeting of the Supervisory Board in connection with the resolution on the annual financial statements and the consolidated financial statements (the accounts meeting), the Management Board reports on the profitability of the Company and the Group and in particular on the return on equity. This report – with comparisons against the previous year and against planning – includes details of the earnings power of the Group as a whole and its individual divisions on the basis of informative profitability data.

The Management Board requires the approval of the Supervisory Board for acquisitions, disposals and the encumbrance of property and hereditary building rights, for acquisitions and disposals of shares in companies and for accepting warranties, guarantees or similar liabilities if the value of any one of these transactions exceeds ten percent of the share capital of the Company. The Articles of Association and both sets of Rules of Procedure stipulate other actions that require approval.

When filling managerial positions in the Company, the Management Board takes diversity into account and strives for the appropriate representation of women.

On October 23, 2017, the Management Board determined that the target set in 2015 for meeting the gender ratio of 5% for management levels 1 and 2 as of June 30, 2017 was not achieved (actual management level 1: 3.3%, management level 2: 4.5%). The key reasons for not meeting the targets for management were (i) the low level of recruitment (ii) the company’s restructuring situation (combining management positions) (ii) lack of interest from suitable companies (for new positions) even though the company had made appropriate

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specifications when mandating headhunters. For the future period to June 30, 2022, the Management Board has defined a target of 5% for management level 1 and 7.5% for management level 2. On November 24, 2017, the Supervisory Board resolved to maintain the current share of women in the Management Board and set a target for the share of women in the Management Board to be achieved by June 30, 2022 of 0 percent. This decision expressly does not affect the fact that the Supervisory Board overall strives to take diversity into account in its HR decisions.

Diversity concept

For the company, the aspect of diversity is an important selection criterion for the composition of the Management Board and Supervisory Board.

It is intended to achieve a composition of the two executive bodies which secures the comprehensive fulfillment of all tasks the Management Board and Supervisory Board have been assigned. In filling Management Board positions and in nominations for election of Supervisory Board members, the Supervisory Board is thus aligned primarily to the personal suitability of the candidates, their professional qualifications and relevant experience, their time availability, integrity, independence as well and commitment and performance. In addition, diversity of opinion is supported on the basis of differing ages.

The current composition of the Management Board and the Supervisory Board satisfies these requirements. All members of the Management Board and the Supervisory Board have high levels of professional experience and expertise enabling them to manage and monitor a company.

Particular consideration is taken of the career advancement of women. In the event of positions being reassigned and candidates having equal professional and personal aptitude, the appointment of women to the Supervisory Board and the hiring of women to the Management Board and the two levels of management below the Management Board should be considered in order to increase the share of women in the medium and long term.

With two of the six Supervisory Board members to be provided by the shareholder representatives being women, the legally required gender ratio of 30% for the Supervisory Board has been met. With only one of the six Supervisory Board members being provided by the employee representatives being a woman, this is not currently the case.

In the presentation of its targets and competency profile, further detail will be provided on the aspects of diversity which are important for the Supervisory Board and which it takes account of in its composition. These are included in the Corporate Governance Report.

The Rules of Procedure for the Supervisory Board describes its activities and cooperation – including in its committees. Among others, they also stipulate the following regulations:

The Supervisory Board advises the Management Board on and monitors its management of the Company.

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The Supervisory Board works closely with the Management Board for the good of the Company. The Management Board is responsible for providing the Supervisory Board with sufficient information, which the Supervisory Board actively supports in line with these Rules of Procedure. Each year, the Supervisory Board and the Management Board issue a corporate governance report on corporate governance within the Company, which follows this corporate governance declaration. This includes the declaration on why recommendations of the Code have not been or are not complied with.

Regarding the activities and responsibilities of the Supervisory Board, all of its members have the same rights and obligations. They are not required to comply with orders or instructions.

The Chairman of the Supervisory Board chairs the Annual General Meeting of the Company and determines the order in which matters are discussed and the voting procedure.

The Chairman of the Supervisory Board maintains regular contact with the Chairman of the Management Board and discusses the strategy, business performance and risk management of the Company with him.

From amongst its members, the Supervisory Board forms an Executive Committee, a Human Resources Committee, an Audit Committee, a Nomination Committee, a Strategy Committee and a committee in accordance with section 27(3) of the German Co-Determination Act. Members of these committees are usually elected in the constituting meeting of the Supervisory Board immediately after the Annual General Meeting that marks the start of the new term of office. Other committees can be formed if required.

The Supervisory Board appoints a member of each committee as the chairman of that committee unless stated otherwise in the Rules of Procedure. In selecting and appointing the Chairman of the Audit Committee, the Supervisory Board ensures that the Chairman of the Audit Committee has an expert understanding of accounting or auditing as well as internal control procedures. The Chairman of the Audit Committee must be independent and not a former member of the Management Board of the Company whose appointment ended less than two years ago.

The Rules of Procedure also permit the Supervisory Board to delegate Supervisory Board decisions to its committees. In accordance with the German Act on the Appropriateness of Management Board Remuneration, decisions on the remuneration of the Management Board lie with the Supervisory Board. They cannot be delegated to the Human Resources Committee and must be decided by the full Supervisory Board, see Section 107(3) Sentence 3 of the German Stock Corporation Act.

In accordance with Section s 96(1), 101(1) of the German Stock Corporation Act and Section 7(1) Sentence 1 number 1 of the German Codetermination Act, the Supervisory Board consists of six shareholder members and six employee members. In accordance with Section 96(2) Sentence 1 of the German Stock Corporation Act, the Supervisory Board must be at least 30 percent women and at least 30 percent men. The principle of overall fulfillment by shareholder and employee representatives that previously applied in the Supervisory Board of Heidelberger Druckmaschinen Aktiengesellschaft with respect to the minimum share requirement was abandoned on May 22, 2017 following an objection by the shareholder representatives, meaning that the minimum share of 30% shareholder representatives and employee representatives was required to be fulfilled separately for the

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court appointment of the twelfth Supervisory Board member (separate fulfillment). By resolution dated June 1, 2017, the shareholder representatives again objected to overall fulfillment, meaning that the minimum share for shareholder representatives and employee representatives will still be required to be fulfilled separately for the election of Supervisory Board members at the forthcoming Annual General Meeting 2018.

There were three women in the Supervisory Board in the year under review, two of whom were appointed by the shareholders and the third by employees. There was one new appointment to the shareholder representatives in the form of Mr. Oliver Jung, Dipl.-Ing., who was appointed by resolution of the Mannheim District Court - Registry Court - on May 23, 2017.

The composition of the Supervisory Board, including the necessary personal information and details of mandates on other supervisory boards, and the composition of its committees are described on pages 148 to 149 of our annual report. Details on the work of the Supervisory Board and its committees can be obtained from the current Report of the Supervisory Board in the annual report on pages 152 to 156. The annual report will be published on our website at www.heidelberg.com on June 12, 2018. It can be found there in the Investor Relations section.

Heidelberger Druckmaschinen Aktiengesellschaft has undertaken to uphold the principles of responsible and transparent corporate governance and feels this is an essential foundation for sustainable and successful business performance in the long term.

4. Annual General Meeting

All the significant regulations relating to our Annual General Meeting and the rights of our shareholders can be found in our Articles of Association, which have been published on our website www.heidelberg.com under "Corporate Governance".

Excerpts from the most important regulations can be found below.

The Annual General Meeting of the Company is held at the registered office of the Company, at the location of a German branch or operating facility of the company, or a company associated with it or at a different location within the Federal Republic of Germany with a population of at least 100,000 people.

The Annual General Meeting must be held in the first eight months of the fiscal year.

The Annual General Meeting must be convened at least 30 days before shareholders must register for the Annual General Meeting unless shorter periods are permitted by law.

The only shareholders authorized to participate in the Annual General Meeting and to exercise voting rights are those who register themselves with the Company before the Annual General Meeting and present proof – written certification in German or English – of their shareholdings from the custodian bank. The certificate must refer to the start of the 21st day before the meeting. Registration and certification must be received by the Company at the address specified for this purpose in the invitation no later than six days before the meeting. The date of receipt shall not be taken into account.

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Each shareholder can be represented by proxy at the Annual General Meeting. Written form is required for granting power of attorney, retracting it and demonstrating authorization to the Company.

The Management Board may allow shareholders to cast their votes in writing or by way of electronic communication even if they do not attend the Annual General Meeting.

5. Corporate governance report

In the past, the Management Board and the Supervisory Board issued a corporate governance report each year in line with the requirements of Item 3.10 of the German Corporate Governance Code.

Our declaration of compliance is published on pages 157 and 158 of the annual report for fiscal year 2017/2018.

In addition, the annual report contains the report on Section 315a (1) of the German Commercial Code and a reference to this corporate governance declaration (pages 61 to 63) and the remuneration report (pages 54 to 60). The annual report will be published on our website at www.heidelberg.com on June 12, 2018. It can be found there in the Investor Relations section.

This corporate governance declaration and the corporate governance and compliance report will be published on our website at www.heidelberg.com under “Corporate Governance”.

Heidelberg, June 2018

Heidelberger Druckmaschinen Aktiengesellschaft

The Supervisory Board The Management Board

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