We've always been asking ourselves one question: how can we help companies achieve more? Today, we are asking the same question in a new way. The car of the future, how can we inspire it? A business idea for a startup company, how can we make it real? Another goal-scoring opportunity in football, better therapeutic outcomes for diseases, how can we contribute to them? Time and time again, we're excited to see what happens when the things we invented and designed are being implemented. When our ideas, placed in the hands of our customers, become the tool to create new ideas. When our solutions lead to solutions in other areas. When people get going, feel curious, and get into contact with others. There's no such thing as too many questions or a thought too bold.
With SAP Cloud, powered by SAP HANA, we are taking the crucial step to be a trailblazer for everything our customers need today: simplicity, independence, fun, anytime and any place, here and now. SAP is ready. Let us simplify everything so that we can do everything together. Good morning, ladies and gentlemen. I'm pleased to declare the 27th Annual General Meeting of Shareholders of SAP AG open. As required by the company's articles, as Chairman of the Supervisory Board, I will be presiding over today's meeting. On behalf of the Supervisory Board and the Executive Board, I would like to bid you, our shareholders and shareholders proxies, a warm welcome. We're delighted that, once again, so many of you are able to attend.
I also welcome our guests, and especially the members of the press, whom, with few exceptions, we would like to thank for their detailed, objective, and informed reporting on our company over the last 12 months. Ladies and gentlemen, as usual, I first need to announce the formalities of this annual general meeting of shareholders. For the record, all members of the Executive Board and the Supervisory Board are here today. I would also like to welcome Mr. Ulrich Hoffmann-Remy, notary public from the notary office in Heidelberg, who will be taking the minutes. Welcome. He's right behind me. Mr. Hoffmann-Remy is assisted by Mr. Gerhard Sperker, also a notary public from the Heidelberg Notary Office, who's sitting next to the speakers table. Mr. Sperker is here to take down any observations and statements and to pass them to Mr. Hoffmann-Remy, who is taking the minutes.
Today's meeting was called with due notice in accordance with legal requirements and the provisions of the articles of incorporation. Notice of the meeting was published in the Bundesanzeiger on Monday, April 14th, 2014. A copy of the notice is available for your inspection at the speakers table. It will be annexed to the minutes. All notices required for convening the annual general meeting were properly issued. Prior to the meeting, the company received two shareholder counter-motions for agenda items two and eight, and the company posted them on the internet as required by the German Stock Corporation Act, sections 126 and 127. The counter-motions are available for your inspection at the speakers table. The official meeting zone includes this main hall of the SAP Arena, plus all other rooms and areas in the SAP Arena that are accessible to shareholders after passing through security at the entrance.
These include the training hall opposite the entrance area, where you will find the catering services, as well as the spectator stairs on the first floor, where there are more catering services and the SAP information booth. The official meeting zone will be considered the attendance area. The meeting will be broadcast on the PA system throughout the official meeting zone. There's also a big screen in the catering area in the training hall on which you can follow the meeting. The attendance register is computerized and is constantly being updated. There is a terminal at the speakers' table here in the main hall, at which you can inspect the register any time during the meeting. If you wish to leave the shareholders meeting early, you can also appoint the employees of the company, who are present for that purpose, as your proxy.
They will exercise your vote in accordance with your instructions. Please use the proxy and instruction card in your ballot card booklet. You are allowed to instruct the proxies provided by the company exclusively with respect to voting on the management proposals published in the invitation. You can, however, entrust your vote to another participant. To do so, detach the attendance card and proxy form from the back section of your ballot card book, fill in your proxy's name, city of residence, and ticket number on the proxy form, and give your proxy your ballot card book without your attendance card and proxy form. On your way out, hand your proxy form, completed and signed, to the staff at the door and keep your attendance card.
If you wish to leave the meeting temporarily or early and do not wish to appoint a proxy to vote on your behalf, please hand in your attendance card and your voting cards at the exit. As in the previous year, online participation is also possible. Shareholders participating online can follow a live webcast of the entire meeting, cast their votes in real time, and inspect the attendance register. In addition, shareholders participating via the internet proxy appointment and instruction system have until the beginning of voting on management's announced proposals to send or amend their appointments and instructions regarding these proposals. All shareholders and proxies who wish to speak or ask questions are kindly asked to report to the speakers' table as soon as possible. Here you can collect, fill out, and return the speaker's request form.
Please clearly and legibly write your name and meeting ticket number on the request form. I must insist that every shareholder or proxy wishing to speak, without exception, first hand in a request form at the speakers' table and then wait until called to speak. When it is your turn to speak, please approach one of the microphones in the main hall. The entire annual general meeting of shareholders is being publicly broadcast on the internet. However, only what I am saying now and the speech of CEO Bill McDermott will be recorded and posted on the internet after the meeting. As in the previous year, we assume with your approval, we are allowing some television stations to broadcast highlights from the speech of Mr. McDermott. These stations will only have the CEO's speech available for their recordings.
The entire meeting is also being documented in sound and video for the record. If a shareholder or proxy objects to the recording of his or her speech, we will not record that speech except for the temporary record needed for technical reasons in connection with transmission on the internet. The Executive Board will be using the services of stenographers to help prepare and keep a record of answers to questions from the floor. Ladies and gentlemen, I would like to remind you that you are not permitted to make any sound or video recordings of the meeting yourselves. Please do not film, photograph, or record the meeting. The same applies to shareholders who are following the meeting online. Ladies and gentlemen, let us now move on to the agenda. Let us first take item one.
For the record, I can report that the 2013 SAP AG financial statements and the consolidated financial statements, the combined management report for SAP Group and SAP AG, including the Executive Board's explanatory notes relating to the information provided pursuant to the German Commercial Code, sections 289, paragraphs 4 and 5, and 315, paragraph 4, the Supervisory Board report, and the Executive Board's proposed resolution on the appropriation of retained earnings, were available at the website www.sap.com/corporateen/investor/governance/meeting/index.epx. These documents are also available for inspection in the meeting room. You will find the documents at the speakers' table in the main hall and at the booth on the first floor. The auditor, KPMG AG, Germany, examined the SAP AG financial statements, the consolidated financial statements, and the combined SAP AG and SAP Group management report for fiscal year 2013 and issued an unqualified audit opinion.
At its March 20th, 2014 meeting, the Supervisory Board examined and approved the 2013 SAP AG financial statements, the consolidated financial statements, and the combined management report for SAP AG and the SAP Group submitted by the Executive Board. The 2013 financial statements and management report were thus formally adopted. The Supervisory Board compiled a written report, which is published on pages 21 to 31 of the annual report. I would like to highlight the following from the report from the Supervisory Board. As in previous years, the Supervisory Board relied on a close and constructive dialogue with the Executive Board to effectively perform its duties. The Supervisory Board regularly received full and timely reports from the Executive Board, both orally and in writing, on fundamental corporate policy issues, the economic situation, and performance of the SAP Group, and on significant transactions and business measures.
Part of the Supervisory Board's work is to look beyond the financial results at the company's wider strategy. In the Dynamic Cloud business, SAP HANA, the most successful product SAP has ever had, provides the springboard for lasting profitable growth and can help the company gain an even stronger market position. There were four ordinary meetings and two extraordinary meetings of the Supervisory Board in 2013. The Executive Board also kept the Chairman of the Supervisory Board fully and continuously informed in between meetings of the Supervisory Board, notably in the context of an ongoing dialogue with SAP's co-CEOs. In addition to dealing with matters in plenary sessions, the Supervisory Board delegates activities to its various committees, where topics are discussed in depth with the Executive Board and important Supervisory Board decisions are prepared.
The chairpersons of the various committees regularly report their committee's work to the full Supervisory Board meetings, allowing close cooperation and sufficient exchange of information. In all other respects, I refer you to pages 21 to 31 of the annual report. To conclude my remarks about the Supervisory Board report, I'd like to mention the changes in the membership of the Executive Board and the Global Managing Board. First, I'd like to put on record my thanks to Jim Hagemann Snabe for his outstanding work on the Executive Board. Together with Bill McDermott, he boldly launched a radical change in strategy. That was four years ago. Together, they have steered the company towards success. Bill McDermott and Jim Snabe have worked brilliantly together. If they hadn't, SAP wouldn't be what it is today, the undisputed cloud market and cloud innovation leader with more than 35 million users worldwide.
SAP HANA is the most advanced business platform for real-time applications anywhere in IT. For that, I thank Bill and Jim most sincerely on behalf of everyone on the Supervisory Board. Together, they have impressively demonstrated that as a team, you can work better, innovate better, and be more agile. I have every confidence that the new team of managers under Bill McDermott will continue in the same spirit. They will develop SAP into a cloud company powered by SAP HANA. When Jim Snabe told us in July 2013 that he was going to leave the Executive Board, I said, "Jim is a proven expert. A lot of companies would put a high value on his knowledge. SAP certainly values his expertise very highly indeed. We don't want to lose him.
We think it is important that he joins our Supervisory Board as soon as possible." To wait two years would be to run a risk. He could be committed to other responsibilities by then. His recent appointment to the Supervisory Board at Siemens and Allianz speak for themselves. SAP cannot afford to miss out on Jim's experience. There is no one else in Europe who can match Jim's expertise as a manager in IT. Getting Jim on the company's Supervisory Board is of strategic importance, not just for SAP, but for the IT industry in Europe as a whole. The German Stock Corporation Act spells out that when someone ends their time on the Executive Board, they can be voted straight onto the Supervisory Board, provided 25% or more of the voting stock support the nomination. That proviso has been met.
It remains for the general shareholder meeting to vote on the appointment. I really hope you will vote Jim onto the Supervisory Board with a good majority. I also want to say a big thank you to Werner Brandt on behalf of everyone on the Supervisory Board. For 13 years, Werner has been this company's highly dependable and prudent Chief Financial Officer. He has kept a firm guiding hand on the company's finances all that time. Just as importantly, in recent years, he played a key role in setting the new course towards becoming a cloud company with sound financing for all the strategic acquisitions, large and small. Werner Brandt stands for continuity, dependability, and vision at SAP. These are not just invaluable traits of Werner Brandt, the man. They are factors that materially contributed towards the significant rise in SAP's shareholder value in recent years.
The fact that SAP is today one of the most highly valued companies in the DAX is, in good part, down to you, Werner. On top of all that, Werner Brandt stepped in three times at crucial junctures to shoulder responsibility on the Executive Board for labor relations and human resources. That's no simple job at SAP, as the recent comings and goings of Chief Human Resources Officers show. Well-managed human resources is and will remain a critical factor in the increasingly tough competition for the best people. For this, too, Werner Brandt deserves our appreciation and gratitude. By the way, as I speak, Werner Brandt is the longest-serving Chief Financial Officer at any DAX 30 company. I didn't know that myself. That in itself is no small achievement, especially considering that IT is easily one of the most dynamic industries in the world.
Thank you again, Werner, for your long exemplary service to the company. We will miss you. Another good example that Werner set, and proof of his forward-looking vision, is that he took care to identify and develop his own successor. As we announced when we met here last year, SAP has found an outstanding replacement from within the company, Luka Mucic, who will take up the CFO reins on July 1st when Werner Brandt lets them go. Luka Mucic joined SAP in 1996. Like Werner Brandt, he stands for continuity, dependability, and vision. He knows the company and is very familiar with the business model. He set up SAP's risk management. He managed the finances of the sales subsidiary in Germany, and most recently, he was head of global finance. In all of those roles, he showed what a good manager is.
I warmly welcome him and look forward to working with him. Where is he? Now I'd like to thank Vishal Sikka for his huge support and passionate commitment to SAP. To Vishal Sikka, we owe SAP's position as leading innovator in IT with the SAP HANA platform and in the cloud. He was the trailblazer who brought about and nurtured SAP's intellectual renaissance. He deserves our respect, gratitude, and appreciation. I have worked very closely and very openly with Vishal Sikka, and we became friends over the years. He has enormous dedication, a visionary, innovative mindset, and great passion for his work. He set himself very high standards for his work as a manager at SAP, but his family is just as important to him, and his commitment to them is just as strong.
He never found it easy to do right by both at once all of the time. In the end, Vishal Sikka decided to leave the company to have more time to devote to his family. We regret that, but we respect his decision. For my own part, I can well understand his reasons for making that decision. Vishal Sikka will still be a friend of mine. As you know, at an extraordinary meeting on May 4th, the Supervisory Board appointed Bernd Leukert and Rob Enslin to the Executive Board with immediate effect. These appointments are part of the drive to transform SAP into a cloud company. Rob Enslin heads the company's global customer operations. Bernd Leukert leads the global development organization. They both know SAP and the IT industry very well indeed.
Both have many years of experience, both are authorities in their field, and both enjoy enormous prestige among the people who work at SAP, the people who partner SAP, and the people who run SAP software. I have every confidence that their input will be decisive in penetrating the global market and speeding the company to success in this new era with the SAP HANA Cloud Platform. I'd now like to ask Rob to introduce himself to you, the shareholders.
Thank you, Hasso, and shareholders. It's an honor and privilege to be here today. My name is Robert Enslin, and I've been a proud employee of SAP for 22 years. It's my great appreciation to the Supervisory Board for the honor to serve on the SAP Executive Board. I currently lead the company's go-to-market efforts as it relates to license sales and consulting revenues across all geographies and for the full portfolio of SAP solutions. Throughout my career, I've remained fully committed to supporting our customers in all geographies with SAP solutions. It's an honor to serve on the SAP Executive Board. Thank you.
Thank you, Rob. Now, perhaps Bernd would like to say a few words. Bernd Leukert.
Thank you very much, Hasso. I'd also like to welcome you most warmly here at Mannheim. It's my special honor to head the best development team in the IT industry worldwide. Thank you, Hasso, as CEO, and I'd like to thank all members of the Supervisory Board for the trust and confidence you are showing in me. My colleagues on the Executive Board and myself are driven by the same emotion. We've been long associated, firmly associated, with SAP with one goal, to make SAP successful in the cloud. SAP HANA is our innovation platform for all products. About my person, I was born in Ravensburg, Germany. I studied at the Karlsruhe University and then at Trinity College Dublin. Right afterwards, I very soon joined SAP.
SAP, in the meantime, has turned 42, and almost exactly half of that time, I was privileged to be part of this fantastic team, and I wouldn't want to miss any of those nearly 21 years. I began my career in SAP as a software developer and later on as a project leader in R3, responsible for international customer projects. In the late '90s already, I was privileged to introduce innovative technologies in memory, SAP liveCache, SAP APO, SAP SCM, and SAP HANA. In 2011, I assumed global responsibility and development for our entire core business, the SAP Business Suite. In 2013, I was appointed member of the Global Managing Board of SAP. What remains decisive to me is that we succeed as a team, and as I said, I can rely on a world-class development team. Software is in the center of digitization, which right now is changing entire industries.
SAP HANA, as an innovation platform, is an immense technological breakthrough. More than 3,000 clients are using it now. Cloud is no longer the future. Right now, we are reinventing ourselves. We raise all products to the SAP HANA platform, make them fit for the cloud, and develop modern user interfaces. An interesting challenge with the best development team, and each of these 20,000 people of this team bear a decisive part of this responsibility. Quite certainly, we'll not forget our present clients, whom we'll support in any way they need, also in the future, in order to provide a successful path into the future for them. SAP HANA enables us to be ahead of our competitors by one step again, and the cloud offers us much more flexibility and very new business models for our customers. SAP's success was based and will be based on innovation.
This is particularly close to my heart, a topic such as Industry 4.0, which you can see at this general annual meeting, is only one example showing how SAP HANA Cloud predictive mobile and other technologies, combined with other scenarios, will be used to create added value for customers. We enjoy an excellent position for our future. Thank you, and have a nice day in Mannheim.
Thank you, Bernd. Ladies and gentlemen, aside from the changes on the Executive Board, I also have changes to tell you about on the Global Managing Board. Rob and Bernd used to be members of the Global Managing Board before. Now, I'm delighted to announce two new members of the company's Global Managing Board, Helen Arnold, who is the Chief Information Officer, and Stefan Ries, who heads SAP's Global Human Resource Management. They are both highly experienced, and in their respective fields, I expect them both to greatly expand SAP's potential. The best of success to both of them. Ladies and gentlemen, now it is time to hear from the Chief Executive Officer. I would like to ask Bill McDermott to address you. Because Bill does not speak German, his speech will be interpreted into German so that everyone can follow.
Bill's answers to questions from shareholders will also be interpreted into German. Bill.
Thank you, Hasso. [Foreign language] Good morning, ladies and gentlemen. Welcome to the SAP Arena. Okay. I know my German isn't getting much better, but it's been a busy year running SAP. I'd like to thank you for your. 2013 was a strong year of profitable growth for SAP. Today, I'm pleased to share the details of our business results and our ambitious plans for 2014 and beyond. First, let me thank our more than 66,500 employees for making our success in 2013 possible. Dear shareholders, please join me. I'm sure I speak for all of us when I thank SAP people because their hard work and dedication makes the big difference for this company each and every day. I would also like to thank our Chairman, Hasso Plattner. SAP was built on his passion for innovation and courage to challenge the status quo.
This is in fact, the foundation of the SAP culture, which continues to inspire us all today. Hasso Plattner, thank you for everything you do for SAP. Dear Supervisory Board members, thank you also for your continued confidence in the Executive Board. We rely heavily on your trust. As Hasso Plattner mentioned, we have a number of changes to our board, which I would also like to recognize today, so please allow me to also welcome Bernd Leukert and Rob Enslin to the SAP Executive Board. We're looking forward to a great showing from them both. I also welcome Helen Arnold and Stefan Ries to our Global Managing Board. It's just great seeing you out there this morning. May I please also recognize former SAP Executive Board member, Vishal Sikka, for his role in evolving SAP HANA into a leading technology platform.
The board has full trust in Bernd Leukert and the global development team who built SAP HANA to continue to drive our technology leadership. Next, let me also recognize our distinguished colleague, Werner Brandt, for his service to SAP. As Hasso said, for over a decade, he has played a key role in guiding SAP through many changes in the market, while always keeping the company in a very solid financial position. Werner, it has been an honor for me and for the entire board to serve side by side with you. I also wanted to thank you, Werner. Thank you. Excellent leaders always pick great successors. With Luka Mucic, we have found an outstanding successor, and we are very pleased to welcome him as the CFO of the company in July. Finally, let me also recognize my Co-CEO, Jim Hagemann Snabe.
His vision and leadership have been instrumental in reinventing SAP and making it the company it is today. He has earned an extremely high level of respect, not only from our global customers, but also our employees, for his personal integrity, openness, and always down-to-earth leadership style. On a personal note, without a doubt, it has been the highlight of my professional career to work alongside Jim as co-CEO. Please join me in recognizing his tremendous service to SAP. Jim. You will be invited to vote on Jim's election to the Supervisory Board later in today's meeting. As Hasso said, it would be highly valuable for SAP to keep him as a close advisor to our company. I am honored to build on the achievements of my esteemed colleagues, and ladies and gentlemen, to have your trust and support in leading SAP forward as the sole CEO.
Leadership changes naturally come, and they bring uncertainties. These uncertainties can only be faced by looking forward. Just as our market is evolving, we must also evolve. I assure you that the Board is as united and committed to the success of your company as ever before. In 2010, we set out to reinvent SAP. We began with our vision that SAP's technology would have a positive impact on the world and would improve the lives of individual people. We bet on innovation and growth as our lead strategy. We predicted the world would change, and therefore invested in mobility, which is rapidly transforming the way we work. We also recognized that with data in the world doubling every 18 months, in-memory computing would be a driving force. So we invented SAP HANA to redefine the database market. And we invested in the cloud.
Where we did not have the assets we needed for the customer, we bought the best ones in the market. Over the past 4 years, we have grown software and cloud subscription revenue by 93%, software and software-related services revenue by 71%, and we increased our operating profit by 88%, and at the same time, nearly doubled our market cap for SAP. In the process, employee engagement has increased by 8 percentage points to 77%. This is one of the highest scores in our industry. And finally, we strengthened our customer relationships and increased customer loyalty. So it is clear that our strategy was the right one for our customers and for SAP. Looking at our cloud business today, our annual cloud revenue run rate exceeds EUR 1 billion. The acquisitions of SuccessFactors and Ariba, in combination with organic innovations, are paying off.
Today, more than 36 million people use our cloud solutions and approximately 1.5 million companies trade over a half a trillion U.S. dollars of goods and services through our Ariba network. And key partners, such as Accenture, are investing in Ariba knowledge and skills, and this will help to expand the network even further. In August of 2013, SAP acquired Hybris, a leader in commerce software. Technologies such as the internet, mobile phones, and social media have radically changed how we behave as consumers. We all expect to get the same information and the same experience, whether we are in a retail shop or shopping on a mobile phone. This creates both an opportunity and a technology challenge for our customers, so they are turning to SAP.
By combining the Hybris e-commerce offering with SAP CRM and SAP HANA, we can offer the customer a next-generation solution for managing their customer relationships. Our investment of roughly EUR 1 billion is already paying off. In the first quarter of this year, we delivered triple-digit revenue growth in the Hybris platform in combination with SAP Cloud for Sales. With the recent acquisition of Fieldglass, we are addressing another customer challenge, which is finding, onboarding, and managing contingent labor services. Once we combine the Fieldglass assets with SuccessFactors and the Ariba Network, customers will be able to manage their business needs for permanent employees, flexible workforce, and goods and services, and this will all happen in the SAP Cloud. SAP HANA is also now a key growth driver.
In the three years since its launch, SAP HANA has generated EUR 1.2 billion in software revenue, and more than 3,200 customers worldwide have adopted it, making HANA one of the fastest-growing products in the history of enterprise software. In 2013 alone, SAP HANA generated EUR 664 million in revenue at constant currencies. This is an increase of 69% year-over-year. Wow. Wow. Come on. At the beginning of 2012, we put our entire Business Suite on SAP HANA. Since its general availability just one year ago, approximately 1,000 customers have chosen the solution, and this has far exceeded our initial predictions. Mobile and end-user experience are now at the center of our product design. With SAP Fiori, we are renewing the SAP Business Suite with an intuitive, beautiful user experience for both mobile and desktop.
Today, we have over 200 SAP Fiori applications available, and our ambition is to run all SAP applications with SAP Fiori. We also have a healthy core business with software revenue growth at 2% at constant currency in 2013. This is a very important metric, which proves we can expand into the cloud and still deliver growth in our core software business. While we recognize that there have been concerns that our move into the cloud would be at the cost of our traditional business, our results, in fact, prove otherwise. In 2013, we continued to invest in attractive growth opportunities for our core business. We strengthened our focus on industries such as public services, financial services, and retail, and we continued our investments in emerging markets, including the BRIC countries, the Middle East, and Africa.
In established markets, we are creating new growth opportunities by offering customers the choice of consuming our applications and analytics on-premise, in the cloud, or in an integrated model. I'd like to share a short video about how this is giving one of our local German customers a real competitive edge.
Whenever I said that I need an ERP system in three months, all the others said, "You're mad." SAP was the only one to say, "Yes, we can do that, and let's do it together." When it was established, Scheidt & Bachmann was a purely production site without its own infrastructure. As an independent company, you obviously need an IT infrastructure, which includes an ERP system. Without that, you've got no chance of survival. You can't even process any orders, and you cannot even order materials. We use SAP ERP on HANA in the cloud. We looked at the benchmarks, and 85% of the companies in the industry use the solution. Why should we have a different setup to 85% of other firms? It's of fundamental importance because you're implementing a system developed from the automotive industry, so you're immediately talking your customer's language in the process.
By deciding on SAP HANA, we obtained the flexibility we can also supply to other industries. SAP HANA means that we have a competitive edge. We are very much faster in all the processes the industry now requires. We managed to do all this within the three months we set ourselves, and that was three months, because of the RDS solution. With the cloud solution, ERP HANA gives us the option of keeping the cost variable over the term of the contract so that we don't have to make a big investment at the start. It made a great sense from a business point of view because it meant that we could concentrate on our own business and could leave the operation of an ERP solution to the experts. The automotive sector requires that we actually work with very safe systems in our environment.
I have 24-hour direct support from SAP, giving me a whole new meaning to performance. We have the possibility of using further cloud modules because we have an integrated solution and can add to that at any time. The SAP decision was clearly the right decision. I would definitely make it again.
With the market position and innovation portfolio we have today, we are a stronger partner to our customers than ever before. The reinvention of SAP could not have been possible without the support of our shareholders. I know on behalf of the Supervisory and Executive Board, we'd like to thank you for standing behind us and believing in this amazing opportunity. Thank you, dear shareholders. Turning to 2013 specifically, SAP had a very successful year of profitable growth. Looking at how the year unfolded, during the first half it became clear that the global economy would recover more slowly than originally predicted. At the same time, the market shift towards the cloud was accelerating even faster than anticipated, particularly in North America. We predicted that other regions would soon follow. We were correct. We took action, adjusting our targets and accelerating the execution of our cloud strategy.
I am pleased to report that we achieved or exceeded all dimensions of our guidance. Note that all figures are non-IFRS at constant currencies, unless otherwise indicated. We achieved our guidance on cloud subscription and support revenue with EUR 786 million, or approximately 130% growth. We exceeded our guidance on software and software-related service revenue with 11% growth. We delivered on our operating profit in the mid-range of our guidance with EUR 5.9 billion, or 13% growth. These are solid results that we can all be proud of. Our effective tax rates, both IFRS and non-IFRS, were in range or better than guided. I would also like to add a comment on currency effects. We faced strong currency headwinds in 2013, with impact on both revenue and profit. We continually monitor the effects of exchange rates on our cash flow and hedge these when necessary.
Finally, I would like to mention our growing network of over 11,500 partners, which contributed more than one-third of our total revenues in 2013. Now turning to 2013's regional performance, we again demonstrated our strength as one of the most global companies in our industry. The Americas region delivered a 16% increase in software and cloud subscription revenue, which was largely driven by a triple-digit increase in cloud subscription revenue in North America and very strong core business in Latin America. The EMEA region had a very strong year with 8% software growth, and this also includes cloud subscription revenue. We were especially proud to deliver strong growth in our home market right here in Germany.
In the APJ region, the economic environment proved challenging, but we closed the year with a strong fourth quarter, and this helped us return to modest 4% growth in software and cloud subscription for the full year. Think about this, in comparison to competitors, most of their growth was either flat or actually declined. The emerging economies continued to be important growth markets for SAP. Key markets including China, Russia, and Brazil all achieved strong results. We remain firmly committed to our growth plan for China. Our investments in the world's second-largest economy are paying off. China is now one of our top seven global markets. In 2013, we placed a strong focus on building local partnerships. For example, by partnering with China Telecom, we are the first company to offer a full human capital management system in the cloud in China.
With this strategy, we are increasingly gaining the close trust of companies in China, our second home. Let me also comment on the situation in Eastern Europe. Our primary concern has been securing the safety of our employees in the region. Overall, we did not experience a significant economic impact on SAP's business in the first quarter. Although we see that customers are still investing in software, recent EU sanctions on Russia could in fact lead to longer sales cycles. We are confident, however, that any impact can and will be counterbalanced by our global sales. We are monitoring the situation very closely. In summary, 2013 was another strong year for SAP. We were able to grow our core software business and expand our operating margin while transitioning the company to a cloud business model.
This combination of achievements is unique in our industry and shows that our strategy for innovation and growth is the right one. We believe our shareholders should benefit from SAP's profitable growth in 2013. Therefore, the Executive Board and the Supervisory Board proposed to raise the dividend by 18% to EUR 1 per share. This represents a dividend payout of approximately EUR 1.2 billion and a payout ratio of 36%. You will be asked to vote on this later in the meeting. Now turning to our stock performance, the market has clearly validated our innovation strategy over the past four years. Since 2010, our share price has increased approximately 85%. SAP is a growth company and a strong investment opportunity. We realize that as shareholders, you experienced some fluctuations over the past year.
After significantly outperforming the major indices in 2012, SAP stock increased 2.7% in 2013, while the DAX increased 25.5%. SAP stock declined slightly compared to the benchmark indices in the first quarter of 2014. The DAX 30 was virtually unchanged, while SAP stock declined 5.7%. In 2013, we accelerated our move to the cloud, and the market is now digesting what this transition means for SAP. But our direction could not be clearer. We embrace the cloud because this is what our customers want and expect SAP to do. With the cloud, we are building a strong recurring revenue stream and aggressively taking market share in a valuable fast-growth market. At the same time, we continue to grow our core business by expanding our leadership in emerging markets and leveraging our deep expertise in business processes to design solutions for strategic industries.
In established markets, we bring our core solutions into the cloud, onto HANA, and offer a beautiful user experience, reinvigorating them and making them accessible to even more customers. Finally, we are becoming a simpler and more productive company. Our employees and our customers have told us we are complex, and we are listening. We are simplifying our own business processes and focusing our people on the front line, close to our solutions and our customers. We are confident this will continue to drive solid business results for your company, both in the short term and in the long term. From this position of strength, the time is right for us to take our strategy now to the next level.
Ladies and gentlemen, standing here today in Mannheim, I am reminded of the famous quote by legendary Mannheimer and football manager, Sepp Herberger, who said, "Der Ball ist rund." The facts are clear. While we have been very successful over the past four years, and we remain committed to our vision, our market and the expectations for our customers have clearly evolved. The game is changing and we have a clear strategy to stay ahead. The most significant change by far is that our customers no longer accept complexity. They clearly tell us that complexity is the greatest challenge to running and growing their companies, and too much of their IT budget goes to hardware and services to manage all of that complexity. Their business processes, their IT landscapes have gotten out of hand. They're asking SAP to help them run simpler.
They need solutions that are easy to consume, that make their employees immediately more productive, and that make it easy for them to grow their business. Since 2010, we have successfully added many new innovations to our portfolio. Now, we must dramatically simplify by reducing the time and effort it takes for customers to consume those wonderful innovations. Solving this challenge is also our greatest opportunity. Let me be very clear, dear shareholders, that by simplify, I do not mean SAP should do simple things. For over 40 years, we have managed highly sophisticated mission-critical business processes that drive the value chains of entire industries. This is our foundation. It is what makes us SAP. By simplify, I mean we must make it dramatically faster and easier for our customers to adopt and use our solutions.
Our traditional on-premise model provides ongoing value and growth, it does not always make it simple for customers to adopt new innovation. Customers need options, and they're looking for a trusted partner in the cloud. Let me give you an analogy to better explain the opportunity. Imagine a utility like electricity. Today, we all take electricity for granted. Once businesses such as industrial factories had to generate their own power. It was complex. It required costly equipment and special skills, and as their businesses grew, they couldn't meet the demand any longer. Electricity became available as a central service through massive power plants. It simplified everything. Now, factories no longer had to deal with cost and complexity of generating power. They could simply consume what they needed when they needed it. In simple terms, this is what is happening today with cloud computing.
In the traditional IT model, every business has to implement and manage its own business applications. At times, it can be too costly and too complex. Cloud computing changes this for our customers. SAP can now manage this complexity for them. Much like electricity, customers can get instant consumption, instant value, and radical simplicity. This is why more and more customers are moving to the cloud, and this is why we have clearly set the direction that SAP must be the cloud company powered by SAP HANA. I would like to briefly address two important points regarding cloud security and the transition of our business model. One of the key reasons customers choose SAP Cloud is because they trust in our security and data protection practices. The availability, security, and data protection of our cloud operations meet the highest standards in our industry.
We continue to expand our global network of data centers to give customers a clear choice about where their data resides. In 2013, we saw some of our most conservative customers who have been unsure about working with smaller cloud companies now turning to SAP as a trusted innovator in the cloud. We take their trust very seriously. On the business model, as shareholders, you recognize that our traditional on-premise business model is very profitable. Customers buy licenses, they implement the solution in their IT landscape, and usually invest in services and support. SAP books the total initial purchase price upfront and receives ongoing maintenance fees. In the cloud, the revenue pattern is different. When a customer decides on a solution, no implementation in their IT landscape is required. Instead of a license, the customer pays a ratable fee, which is fixed over the contract duration.
Initially, SAP receives less revenue compared to the traditional model. However, over time, when scaling the business, we have a more predictable revenue stream and a higher net present value. If you compare the deals in this example, in the cloud model, we break even in revenue after 4 years and in profit after 5 years. Looking at our total revenue, we anticipate that in the future, our fast-growing cloud business, along with growth in support revenue, will drive a higher proportion of more predictable recurring revenue for the company. Therefore, we have moved our 35% operating margin target from 2015 to 2017 to fully capture this market opportunity. As we demonstrated in 2013, we are managing this transition gradually as we have the advantage of our solid and growing core business. We have talked about simplification and the cloud.
How will SAP become the cloud company powered by SAP HANA and make businesses run simpler? We will simplify our solutions by moving all of our applications and analytics to the SAP HANA platform. SAP HANA simplifies IT landscapes by reducing the amount of data in applications, which reduces the need for hardware. Further, we simplify how customers consume our solutions by bringing them into the SAP Cloud. We offer applications for line of business such as HR, sales, finance, or procurement in the public cloud, where all users connect to the same solution, like in the electricity example. We also offer our solutions in the private cloud, where customers have their own version of the applications and can run their highly customized business processes. We then provide deep integration between all our cloud solutions and also with our customers' on-premise applications.
We are confident that this strategy will in fact make businesses all over the world run simpler and drive the next phase of our growth. Our vision is to make the world run better and improve people's lives, we take sustainability and social responsibility very seriously. While we have many examples of how our solutions are positively impacting the world, I believe this example is really one of the most compelling. Please enjoy this brief video about how SAP HANA is changing healthcare right here in our own region.
I think one has got to maintain a positive attitude. That's most important. On the other hand, one thing is for sure, when you've got breast cancer, then you're chronically ill. The NCT is the first comprehensive cancer center in Germany. We aim to identify therapies which are tailored exactly to the specific molecular profile of a patient and to treat exactly those molecular defects that have caused the tumor. Matters of cancer research can thus be combined with aspects of patient treatment. This means we've got two highly different data worlds, which are characterized by highly comprehensive data complexes. I guess that we have got up to 1,200 different types of data fields per patient. The new system based upon SAP HANA allows us to analyze these different data fields in a combined manner.
On the one hand, we've got unstructured data obtained from medical reports or medical findings created through imaging. On the other hand, we've got large volumes of data that are based upon genetic analysis of tumor material, cancer registry data. In the final analysis, a tool like HANA helps us very much in our daily work, for example, to recruit groups of patients for certain clinical studies or to assess the effectiveness of a new therapy. This applies above all in situations where we have exhausted the standard therapies and are looking for new possibilities. With the means currently available, we can do this only for about 5%-10% of the patients. In many cases, this is an issue of staffing and capacity, and by optimizing this process, we can significantly increase the share of patients for which new treatments can be made accessible.
Using SAP HANA, we can scan our data pool much faster. We can see things we didn't see before, and those things we had to work hard for can now be handled much faster. For the patients, this means that we can apply more effective therapies together with the patient. I feel like finally getting the right medication for my needs and the right therapy to fight my disease. As long as I come here, I'm alive.
In 2013, we were ranked the number one software company in the Dow Jones Sustainability Index. In 2014, we continue our efforts with a commitment to power all of our data centers with 100% renewable energy. Most importantly, we continue to listen closely to our employees. Our employees have told us that they are ready for the next phase of our innovation strategy, and they're eager to work with the board to make SAP a simpler company for our customers. That's why I'm particularly pleased that Stefan Ries has rejoined SAP as our global head of human resources, reporting directly to me. While we had many programs focused on our employees in 2013, I would like to comment on two in particular. First, we will continue to increase the number of women in leadership roles at SAP.
We've already seen an increase from 18.7% in 2010 to 21.2% at the end of 2013. We clearly aim to have 25% of management positions held by women by 2017. The recent appointment of Helen Arnold as CIO and managing global board member is an excellent example of how women at SAP are growing their careers to very senior levels. You can congratulate Helen and Stefan. That's good. Second, we launched a truly unique diversity program in 2013, Autism at Work. Recognizing the valuable abilities that people with autism bring to the workplace, we aim to have 1% of our global workforce represented by people on the autism spectrum by 2020. We remain deeply committed to developing the unique talents of our people and believe that a variety of cultures, lifestyles, opinions, and interests creates an environment that fosters innovation and happiness.
Let me now turn to the specific agenda items 6 and 7. More details on these items can be found in the joint reports by the SAP AG Executive Board and the management of the respective subsidiaries, and are also summarized in the invitation for today's meeting. Regarding agenda item 6, we are asking you to approve two amendment agreements to existing control and profit and loss transfer agreements between SAP AG and two subsidiaries. These agreements have been in place since 2006. The primary rationale of the agreement was to establish a fiscal unity between SAP AG and the two subsidiaries for both corporate income and trade tax purposes in order to optimize the SAP group's tax burden and group tax cash flow. Furthermore, the agreement also aimed to ensure uniform control of the subsidiaries' managements and their integration into the SAP group.
Due to a recent change in German tax law, which took effect in 2013, these agreements need to be amended. The amendments are intended to clarify that the references to the statutory loss transfer provisions pursuant to Section 302 of the German Stock Corporation Act, already contained in the agreements, always relate to the latest version of the provision. German law requires that in order for the amendments to become effective, they must be approved by the respective shareholders' meetings of the subsidiaries, as well as of SAP AG as the controlling entity, with a majority of at least 75% of the votes cast. The amendments will only become effective upon registration in the commercial register of the respective subsidiary.
Regarding agenda item 7, you are requested to approve a new control and profit and loss transfer agreement between SAP AG and one of its subsidiaries, which was concluded in March 2014. The conclusion of this agreement also primarily serves to establish a fiscal unity between SAP AG and the subsidiary for both corporate income and trade tax purposes, and it is also aimed to ensure uniform control of the subsidiary's management and its integration into the SAP group. The agreement will only become effective upon approval by the general shareholders' meeting of both SAP AG and the subsidiary. Subsequent registration in the commercial register of the subsidiary. The agreement is concluded for a minimum term of full five years, which is required for the establishment of a fiscal unity.
The subsidiary is a wholly owned direct subsidiary of SAP AG with the legal form of a German limited liability company. Its activities are limited to holding partnership interests in two U.S. investment funds. The first is SAP Ventures Fund II LP, which has a volume of $651 million investing in innovative and rapidly expanding IT companies that have already established their success of their business model. The second is SAP HANA Real Time Fund, which has a volume of $406 million, mainly investing in international venture capital funds at the beginning of their respective terms, as well as in newly founded companies that focus on the development of IT, cloud solutions, and real-time technology in order to make use of the economic potential of controlling large amounts of data.
The funds have a remaining term of around nine years for the SAP Ventures Fund II and 15 years for the SAP HANA Real Time Fund. Having said this, I would like to ask you to approve these agenda items. Let me also briefly address agenda item 8, the intended conversion of SAP AG to an SE. The complete documentation can be found on our website. We are proposing the change of the legal form of SAP AG from a German stock corporation into a European company or SE. This requires the consent of the annual general meeting of shareholders, and ladies and gentlemen, you are therefore requested to vote on this under agenda item 8A and B. The conversion has several advantages for SAP AG. First, this change emphasizes that SAP is truly an international company with European roots, reflecting the importance of our European and international operations.
Even more importantly, this allows us to develop a model for the involvement of the European employees that is tailored to our unique needs. The framework of this model is defined in the employee involvement agreement, which we negotiated with the representatives of our European workforce. According to this agreement, we would limit the size of the Supervisory Board to 18 members with the opportunity to further reduce its size to only 12 members from 2018 onwards. This allows us to optimize both the corporate governance structure of SAP and the work of its corporate bodies. Without the change of legal form to the SE, a larger Supervisory Board of 20 members would be inevitable due to the development of the number of German employees affecting the efficiency of the Supervisory Board.
With the agreement with our European employees, I am confident we have found a very balanced solution that assures the contribution of all employees to the success of SAP. What does this mean for you as shareholders? The SE conversion will have no implications on our shareholders, our shares, or our stock exchange listings. You will simply become shareholders of SAP SE upon the conversion. You will retain the same number of shares that you held in SAP AG immediately prior to the effective date of conversion, and the shares will carry the same rights. The trading of SAP shares will not be affected by the conversion either. Only the quotation will have to be adjusted to SE due to the change of name. For these reasons, I ask for your approval for this significant step forward in SAP's history.
Ladies and gentlemen, in summary, our strategy has never been clearer. We are transitioning SAP to the cloud to be the cloud company powered by SAP HANA, helping our customers to simplify and grow their businesses. We are confident in our core business and will continue to focus on profitable growth. You can see this in the ambitious goals we set for 2014 and for 2017. We have spoken a lot about success today. I'm confident in the success of SAP. I'm also confident that in a few weeks, the German national football team will be equally successful in Brazil. That's right. I wish them all the best in playing Team USA in the first stage. I do. I'd like to share a short video from a good friend of SAP, who knows the importance of finding a competitive edge.
Dear shareholders. As an SAP brand ambassador, it's a true honor to talk to you today on the day of the annual shareholder meeting. I would have liked to be there with you, as I'm a shareholder myself. Today, everywhere, large amounts of data is captured and analyzed, also in sports. We gather a lot of important information about our own players as well as our opponents. We use that data to gain more detailed knowledge and pass this information on to the coaching teams to make even smarter decisions. SAP supports the German national team with its products and employees, but also with its innovative technology, so we can better prepare our players in a simpler and faster way.
We will actually use this technology on-site in Brazil. I'm certain that this partnership will have a significant impact on sports, specifically for soccer, and hopefully that we will thus also gain a competitive edge over other nations. Now I wish everyone a successful shareholder event. Good luck for the future and new projects. Dear Bill, in our personal meeting, I was able to discover your enthusiasm and excitement for SAP. Let me wish you and the entire leadership team, and also all employees of SAP success, strength, and luck to realize the SAP's dreams. Finally, I hope to be in Walldorf soon, hopefully holding the World Cup trophy in my hands.
In conclusion, on behalf of the entire board, I'd like to thank you very much for your continued trust. We're all looking forward to a successful year and a great future for SAP. [Foreign language] Vielen Dank
Thank you, sir.
[Foreign language]
Thank you, Bill. Well, he now understands German, right? Ladies and gentlemen, let me briefly comment on the SAP AG Executive Board compensation. On pages 32 to 45 in the annual report, you will find a detailed account of the Executive Board compensation package. There were no changes to the package last fiscal year. The current German Corporate Governance Code only recommends a detailed review of the package at the annual general meeting of shareholders when the compensation arrangements change. I can be brief this year, unlike in years past. If you have any questions, I will, of course, be happy to answer them when we come to the discussion section of the meeting.
I am now calling for speakers to item 1 and all other agenda items, that is to say items two to eight in the invitation to the meeting, of which copies are available in the meeting rooms and which also contains the management's proposals. In relation to item two on the agenda concerning the appropriation of retained earnings, please note that the Executive Board and Supervisory Board have adjusted their proposal as advised in the meeting invitation to reflect a change in the number of shares entitled to dividend. However, the proposed dividend of EUR 1 per share that qualifies for dividend has not changed.
The Executive and Supervisory Boards therefore now ask that the meeting resolve that the retained earnings of EUR 7,595,363,764.58 from the 2013 fiscal year reported in the annual financial statement and management report be applied as follows: That a dividend of EUR 1 be paid for each qualifying no-par share, which makes EUR 1,194,057,084. That EUR 400 million be transferred to other revenue reserves, and that the remaining amount of EUR 6,001,306,680.58 be carried forward to the new financial year. The text of this proposal is available on the speaker's table. In connection with item 8B concerning the election of SAP SE supervisory board members to represent the shareholders, I'd like to draw your attention to the following.
As noted on page 43 in the invitation to today's meeting, shareholders with more than 25% of the voting rights have written to the Supervisory Board in support of the nomination of Jim Hagemann Snabe, so his nomination meets the requirement in the second part of the sentence in the German Stock Corporation Act, section 100, paragraph two, sentence one, subsection four, in connection with SE Regulation, article nine, paragraph one, letter C. Jim Hagemann Snabe's election would therefore not contravene the two-year statutory extension period otherwise required before an Executive Board member can join the Supervisory Board. Supporters of his nomination include the founders of the company with their trusts, companies, and families, and also Allianz Global Investors Europe GmbH, and Deutsche Asset & Wealth Management Investment GmbH.
In their letters to the Supervisory Board, each of the supporters states that they will vote in favor of electing Mr. Snabe to the Supervisory Board as proposed at this annual general meeting of shareholders. I can therefore establish that the legal requirements for electing Jim Hagemann Snabe onto the Supervisory Board of SAP SE today have been met. I hereby open the debate, which I would like to hold as a general debate on all agenda items. We will then give you our answers, having collected a number of comments and questions. I will now invite Ms. Jella Benner-Heinacher of the German Association of Retail Investors, DSW.
Chairman, ladies and gentlemen, I'm Jella Benner-Heinacher. I represent those SAP shareholders who were charged by DSW to exercise their voting rights. SAP, ladies and gentlemen, is the fastest-growing mega-cap company in the industry, so I've read. I didn't quite understand what I read, but it sounds great. It sounds impressive. What we've seen and heard about the 2013 business year, well, except for the share price of the SAP share, it's really excellent. EUR 2.79 was the output per share, according to IFRS. All forecasts by the Executive Board, all the guidances have been met, and we get EUR 1 as a dividend. The payout quota was increased slightly, as you told us. We can only say congratulations, Bill and Jim. That was good work. The speed at SAP seems to put us on the right way.
You remember, ladies and gentlemen, for many years, we've been looking for a business model that pays well. As we've heard today, we can say that HANA and the cloud, that is the data cloud, not only have potential for the future, but also are now beginning to make money. We should not forget. After all, we come from the classical business, the licensing business, where we still make good margins. As Bill McDermott just showed, in the new business, there are different structures of revenue and different margins as well. SAP right now is in the middle of a transformation, a metamorphosis. But I'm safe to say, prospects seem to be rosy. To judge by the videos we've seen and the presentation by Bill McDermott, I also must confess to a certain amount of euphoria.
We shouldn't forget, ladies and gentlemen, when we look at Silicon Valley in California, we see an IT world in which milk and honey are abundant, a country in which we, as shareholders of SAP, can benefit in the future. Bill, you explained how the cloud contract differs from a traditional on-premise contract, especially as far as revenue structures go. That was a very important explanation because now we understand that for the data cloud, we need a scale effect. We need bulk business to make money as well as in the classical business. A question for you, Bill, very briefly. This transformation we are seeing in SAP, how does that affect our guidance for the current fiscal year? What are the consequences with respect to the medium-term goals of revenue for 2017? You slightly reduced the margin guidance.
Perhaps you could tell us more about this and more specifically. The cloud business, ladies and gentlemen, developed well in 2013. We ran up losses, admittedly, but in 2014, we are fully on the profit line. It looks like a real success story. The objectives for the cloud business were just underlined by you. I should like to know what is the distance between us and competitors like Salesforce? Have we really overtaken them for good, or is it still possible that Salesforce will take up and catch up with us in the near future? IT security and data privacy, you addressed that point, too. Since the NSA affair, Germany is talking and has been talking about data privacy and security. Many European countries want to have a national European cloud where the Americans will not be able to see everything.
I should like to know to what extent SAP, in actual fact, has benefited of that debate. Have you generated any additional revenue in that field? What about a Schengen Agreement on IT and data privacy, which might come from Brussels? The most beautiful daughter of SAP, ladies and gentlemen, is called HANA, and it doesn't come from Palo Alto, not from California, but from Walldorf. HANA was grown in-house, the fastest-growing and the most successful product launch in SAP. Ladies and gentlemen, I'm sure we can be proud of that. In 2013, HANA made revenue of EUR 1.2 billion, and in the future, HANA is going to be the platform for any software of SAP. Right now, 3,200 companies are already joining HANA. My question, how many customers do you want to have with HANA by late 2014?
Please be so kind as to explain to us the market position of the market shares in that area. Where are we number one, and where do we have to catch up? SAP, as we heard, is growing not only on an in-house basis like HANA but also as a result of purchases. We bought Hybris last year. Question, did Hybris come true to its promise? How does it match the complete portfolio? This year, it's about Fieldglass, not a name as nice as Hybris, but it's a company which is going to be interesting as well. Perhaps you could give us some more explanations and tell us to what extent Fieldglass matches your concept. Given all these acquisitions you've made over the years, what about the management? Do you take over the management, and how do you integrate it into the group?
Looking at the current fiscal year, I'm interested, especially when looking at the overall investment volume, to know how much you want to invest into internal growth and how much you want to spend on purchases. Ladies and gentlemen, investments, of course, this means talking about growth markets and automatically looking at China, the growth market of the future also for SAP. Up until 2015 or by 2015, SAP at least wants to invest $2 billion in China, and in 2015, also generate $1 billion revenue in China. That are the plans. Now, there's already a joint venture with China Telecom. Here I'd like to know a bit more and more precisely what you expect of this partnership with a Chinese telecommunication company. What are your specific concepts in this regard, and is this joint venture perhaps only the beginning, a blueprint for more strategic partnerships in China?
Mr. Brandt, last year, we briefly heard about a potential public listing of SAP at the Shanghai Stock Exchange. We've heard nothing about that point today. My question, what's the current state of affairs? Let me rather ask the other way around, what's the reason for not being quoted at the Shanghai Stock Exchange with our SAP stock? In addition to opportunities, we'll also have to look at the risks associated with SAP. For those who have been attending this meeting for a long time, we've often talked about process risks, about the litigation with TomorrowNow. This is the risk inherent in doing business in North America. TomorrowNow, a chapter which hasn't yet been closed. Let me ask, what's the current status, and when can we expect an end to this story? There's also a new litigation in the U.S., Versata this time.
It's supposed to be about patents and an order of magnitude of $400 million. I should like to know your assessment of the outcome of that litigation. With respect to all these lawsuits going on in the U.S., I'd like to know what your track record is. What's the success rate? How many court cases have you won in the U.S. over the past couple of years? How many have you lost? Should losses outweigh the success, I might suggest changing your lawyers. Ladies and gentlemen, talking about legal risks means that we also have to talk about the risks and opportunities of personnel. We all know that a company like SAP lives on its good personnel, the most important asset of this company, and it is also its future.
It's all the more important, ladies and gentlemen, to see a person on the Executive Board taking care solely of this aspect. We had a few ladies responsible for personnel at Executive Board level. They all left, then Mr. Brandt took that on in addition to his usual business. Now we have no member of the Executive Board in charge of personnel, but you gave us hope. You said there was somebody on the global managing board. Question for you, Mr. Plattner. Will that person also be appointed Executive Board member in charge of personnel? How do you want to handle the important subject of personnel at SAP? Of course, one might also feel, Mr. Plattner, that you have taken this on board because we read in the supervisory report that you set up a committee on staff matters.
It looks as if the Supervisory Board now had taken over the duties of the Executive Board member in charge of personnel. Ladies and gentlemen, you recall last year we had the twin heads of the company, a Dane and an American. It worked for 3 years. Now we have only one CEO, Bill McDermott. We must also find that the so-called crown princes, as they were called, Shai Agassi and Vishal Sikka, also resigned somewhere on the way. Probably, SAP in the meantime has become too big and too cumbersome for these innovative people. Maybe it's a dinosaur in the industry, which is less versatile than a Californian smaller animal. Mr. Plattner, what about the top personnel at SAP? Why doesn't it work the way we would wish it to work?
Is it perhaps simply true to say that this is quite ordinary and normal in the IT industry, and that you have to cope only with the usual problems? Jim Hagemann Snabe is leaving the Executive Board of SAP, switching to the Supervisory Board right away. This is unusual because the legal cooling phase, the cooling off phase of 2 years, in this case, is bypassed, as it were, because we have a minority vote. That is the motion by a minority to have this switch to the Supervisory Board permitted. This is very rare, ladies and gentlemen. Only very few German joint stock corporations have acted in this way so far. To be frank, we don't have a problem. We would consider it a problem only if the Chairman of the Executive Board would directly switch to the Supervisory Board as Chairman.
That would cause us problems because here and there, we've had bad experience with this direct change. We have no problem when Jim Hagemann Snabe becomes a regular member of the Supervisory Board, because we must also see in those 2 years of cooling off, a lot of know-how will be lost. DSW, my organization, will support this switch, especially also because as far as remuneration is concerned, clear separations have been made. Ladies and gentlemen, item 8 of the agenda, SE, the new Supervisory Board for the SE. In addition to Jim Snabe, there are only familiar faces on the Supervisory Board. We've known all of them for a long time. I'd only want to see You wrote, Mr. Plattner, that all members of the Supervisory Board, whom you propose for re-election, also correspond to the definition of independence.
I'd like to know, how do you define independence precisely for these individual candidates? Ladies and gentlemen, despite all the fluctuation on the Executive Board, which I just criticized, we should also look at the positive side. There are still some rocks amidst the wave of the SAP Executive Board, Gerhard Oswald and Brandt. For many years, they've been members of the Executive Board, and they stand for continuity in SAP. I can only say, Mr. Brandt, hats off, respect from our side for the smooth and highly successful work you've done as the Chief Financial Officer of SAP. You've succeeded to buy up one company after the other and integrate them. The last ones were SAP SuccessFactors, SAP Ariba, Hybris, and now soon Fieldglass, and this without a lot of commotion. Not every CFO can handle it in this way, let alone with that high rate of success.
Another very positive thing, you ever stepped into the breach when a board member in charge of personnel was lost. Mr. Werner Brandt, we wish you all the best in your so-called retirement, and we'll have to see whether your successor will be just as good. SAP, ladies and gentlemen, has meanwhile become a global company. We think and do research in California and at Walldorf. We grow in Asia, and we control the finances out of Walldorf. All this works well. I read that Bill McDermott has moved to Heidelberg with his family. Welcome to Germany, Bill. We are happy to hear about that because that's a very important sign for SAP and the SAP staff. Last year, you announced that move. Today, it's on the agenda. Item 8A, SAP is going to become a European company.
To the shareholders, to us, I'm sure this is not going to change very much. The whole thing will cost us EUR 4 million, and we'll have to see whether it's really a benefit to SAP. I was surprised to see that the supervisory board wasn't reduced right away to 12 members. First of all, we'll have to go on for one term of office with the 18 members. You announced that in 2018, 2019, at the next election, we'll only have 12 supervisory board members. I was truly surprised, Mr. Hasso Plattner, to see that the SE thing was not fitted out with a one-level board because that would have matched your very active role as the supervisory board chairman. Ladies and gentlemen, when the term of office of the new board is over, that's to 2018, 2019, we'll then have only 12 members.
Mr. Hasso Plattner, if I did my sums correctly, you'll be 74. I know you're very fit, you're very dynamic, a highly active supervisory board member, no doubt about that. I wish all of us that you remain in that position for a long time still. Yet, sometimes we'll have to look forward. Let me ask you, have you made sure that there will be a successor? Did you prepare for a successor on the supervisory board of 2018, 2019? Could it be that Jim Hagemann Snabe will then succeed you on the supervisory board of the new SAP SE? I think it would fit, even though we would miss you very much, Mr. Hasso Plattner. At least I would.
Ladies and gentlemen, at the end, let's look forward into the current fiscal year. What are we expecting? I think the outlook is bright. From what we heard and saw, SAP, once again, will grow more than the IT industry as a whole. Even if you slightly moved the margin goal for 2017, I think that's all right. We want to continue living in that fantastic IT country. Ladies and gentlemen, I think it's like this. There's still a lot of room at the top for the dividend, EUR 1.20, EUR 1.30, and for the share price I also see a lot of potential. Today, it's about EUR 55, but I think EUR 70 as the goal of the stock price, that would indeed be milk and honey to us, the shareholders of SAP for next year. Thank you very much. Thank you very much. I can only agree. Your wish about the share price, EUR 70. Well, we'd all be happy, including myself. We cannot simply determine this.
You can only create the preconditions for this to happen, we are working for it, and as hard as possible. Let me read out the list of attendance. The capital stock amounting to EUR 1,228,504,232, broken down into the same number of shares. Of this, 805,624,391 shares, or the same number of votes, are represented here. That corresponds to 65.74% of the capital stock. On top of that, written votes for 921,857 shares have been received. In determining the outcome of the vote, they will later be added to the votes about the decisions by 806,446,248 shares are represented or represented by written votes. That's 65.6% of the capital stock. The written votes will be included in the counting of votes. Mr. Lars Labriga of SdK, the Schutzgemeinschaft der Kapitalanleger, now has the floor.
Chairman, ladies and gentlemen. I'm Lars Labriga. My association is the Schutzgemeinschaft der Kapitalanleger.
We represent those investors who are not small or minority shareholders. That's why the name was changed. For decades, we had a different name. I'm so enthusiastic that I can hardly understand how you added to the standard of your presentation. This indeed is positive stresses. That can have been the only prime mover. Incredible. You see, I had to listen to the statements by the chairman, which had no competence whatsoever. I criticized them. Let me start with you, Professor Plattner. You are in such an amiable mood today as you normally are only 2 hours after the meeting. You also explained how Mr. Hagemann Snabe had to be won over. I understand your explanation why Mr. Apotheker had resigned. You can do it in much less time, and you did so this time. Great. Mr. McDermott, there was real content in your presentation.
I hate the marketing contents, admittedly, I'll bear with them if you try to explain the business model. This is what I want to hear. You recall my statements in the past, which were devoid of any respect. Your speech had been the worst of all DAX-listed company chairman, I had listened to Mr. Ron Sommer. Mr. McDermott, formerly, we had pains listening to your presentation, now welcome to the DAX: figures, numbers, hard facts. Really great for anybody who loves SAP. Thank you. The other items should go unnoticed, that you present the members of the Executive Board is an amount of rest given the fast rotation on the board you have. You explained this great, that you transmit this meeting is great.
Had you also added the fact that the Chairman of the Supervisory Board should move to the rostrum to present his report, as I saw with Deutsche Telekom, that would have been great, I would have shouted with enthusiasm while you continued speaking, probably with the whole meeting. Very good. You are under pressure, you observe it. Customers, of course, want to know the way. You are under change in a situation of change. Customers like certainty. You perhaps, too. Staff may be unsure of what's going to happen. I represent shareholders, 4 years ago, you showed a film where staff members said, "I can feel it." Now they will say, "I can feel it." A loss of confidence, especially against the backdrop of the implementation, the change. You want to have more people on board after this change.
Perhaps you could explain the press reports in the past. What is going to be your line? In what areas will you hire new people? That Mr. Plattner, in the interest of the company, that in the backdrop also plays Franz Beckenbauer, criticizing the inertia of the team also adds to the unsure feeling. The investors. It's not just Oracle. We have other companies, as big mouth Salesforce said, "In 10 years, we are far ahead of SAP also and company software." That's what they say. Investors feel that you started fighting for the cloud, but you might lose that fight because your competitors are very big and very fast. The whole thing is becoming serious, and at the general annual meeting, this tends to inject more facts. Great. Let's not wait until the end. You're fighting. This is something I greatly appreciate.
You're fighting. You are taking brave steps. Fantastic. A pay model which is about to expire, a model which pays. It's to be replaced by a new model. That takes courage. It hurts. You take a risky step. I'm only a representative of a shareholder. I'm only responsible for corporate governance. My impression is that you're moving in the right direction and that it might work. A few words about the agenda. I have a difficult point. Let's first address the agenda in order to get it off my chest. The dividend is a bit lower than we as SdK would ask for. That's all right by way of exception. It's the start of argument. You're now moving into an area where you haven't been working for decades past. You may need investment funds.
I think the shareholders we represent share that view. SE, that's not a bad idea. Of course, this means that old corporate governance problems will be injected into the articles of incorporation. Several strokes to hire all the rights of the chairman of the Supervisory Board, limiting the time spent on each item on the agenda. That's against the system. We find the dividend in the remuneration of Supervisory Board members as a criterion which shouldn't be used to express the variable remuneration. We're against the variable share anyway. The Supervisory Board can design its own remuneration. We wouldn't agree with that. We can only refuse. It's all right in general. Elections to the Supervisory Board, he will refuse to reelect five out of nine. It's different with Mr. Snabe. This accumulation of offices is the reason why we refuse.
An active member, still active operatively, should not have more than three Supervisory Board positions. The top number of well-retired members of the Supervisory Board who do this as their main job, it shouldn't be more than five. The frontrunner now works actively and holds 10 mandates. That's a bit too much. Of course, these are the good ones. Let me address the row in the back. If you listen to these arguments, you are a good member of the Supervisory Board. You are wanted. You're a member of many of these boards. Still there should be a limit somewhere. This is the limit we'd like to see. Why do we reject Mr. Snabe? Not because he has too many offices. We find that the cooling-off period was not preserved. That's the formal reason.
If you want to protect his know-how, you could also agree to have him as a consultant, the typical method. He may be paid well and adequately if you want to attract him to your company. The second reason is in the position of the chairman of the supervisory board. Let me explain. The output of former Executive Board members, carriers of hope, has been very high, although they remain friends of Professor Plattner. Too many have left. Seen from the outside in abstract terms, that might give reason to worry in a company. The reliability is a source of trust to clients. It's not good if there are too many changes. Now, I don't have any insider knowledge. I don't know how things go on.
You can look at it from the outside and consider whether the chairman of the supervisory board is a sort of bulldozer moving in the right direction, but moving in that direction, cutting things off right and left. I don't know. Maybe it's just bad HR policy. In both cases, the question comes to mind in abstract terms, mind you, who will stop Hasso Plattner should he miss his goal? It's not going to happen. I don't say it's going to happen, but we'll have to think along systematic lines. Anyway, nobody can do it who is obliged to be grateful to Professor Plattner for professional reasons, as in the case of Mr. Snabe. We need people who are independent and whose outstanding, seen outwardly, Mr. Snabe may show that interiorly, must enjoy half the reputation of Professor Plattner, so that two of these candidates can join forces against him.
Well, these are abstract, external observations, but if in this situation you ignore a cooling-off period, I think it's really bad in this situation, and we reject it. That I agree in terms of contents, Professor Plattner, that you are brave. Running the company in the right direction is what I said before, just in case it should have been forgotten. Things don't become any easier because Dr. Brandt is leaving. Dr. Brandt, seen from the outside, well, I experienced him more frequently also with the German Audit Inspection Company. When SAP SI was removed back into SAP, we spent hours and hours at an annual general meeting. Dr. Brandt always was very competent in what he did and said. A last word, whenever I was about to despair about the answers which didn't convey any meaning by other supervisory board members, then Dr. Brandt intervened.
That was at the last meeting and the one before. For this, and also for his activities, which I can't judge personally, we owe him thanks, as do all shareholders, I'm sure. I didn't know how things go on today. Normally, when I asked and asked and asked, "You invested EUR billions." Those who listen to me for the first time went there, then. "You invested EUR billions into the cloud." Then I said, "Explain, please, why this makes sense." Then the Executive Board said, "Companies are developed well. The decision was all right." For EUR billions, mind you. This is almost like entertainment, cabaret. It can't be. The shareholders who come here learn less about their company at this meeting than they could read in the local economics section of any daily paper. Impossible.
There was another ritual, namely that Professor Plattner, on the average, four hours after the beginning of the meeting, took the floor and then answered in points of fact. Let's keep that. This was great. Right. Professor Plattner. Mr. McDermott. Dear Mr. McDermott, I think you walk and operate in the right direction. I think the shareholders I am representing want to believe that we are moving in the right direction. One thing is certain, if you improve your products in the same way as you did your presentation today, we are right. Thank you very much.
Thank you very much, Lars Labriga. Well, I am sure we will hear more from each other later on. Well, I have got a lot of time to get prepared for this, and I will prepare, mind you. May I ask the next speaker? It is going to be Hans-Martin Buhlmann of Universal Investment Gesellschaft MBH.
Chairman, ladies and gentlemen, my name is Hans-Martin Buhlmann. So much is uncontested. I am the chairman of the VIP, and I represent, amongst others, your company, but also others, and I represent around 500 million shares today. You said you are going to prepare to answer the questions, which was deemed a good thing. Then you actually tick off what I am going to say about the SE. The SE is a good thing. The European company legal form is ex ante the right way to be for a company which is active across borders.
Now, we heard about EUR 1 of dividend. Now we have one chairman of the board. Are we now going to get EUR 2 dividend as the next proposal? That would be only logical. Please write it down. Please, Mr. McDermott, don't forget that 2 to 1 will mean 1 to 2. Why is it that last year the cash flow actually did go down a little bit? So maybe you could tell us about that, because HANA actually learned to walk. No, actually, HANA can fly now. HANA is to be found on cloud seven.
And since HANA is exactly there, and since that is so instrumental, and in a company where employees play an even greater part than in most other companies, I would already like to say thank you to the staff of 66,000 people, because the results you achieved last year, and that is going to be the subject for today, notwithstanding the way it was presented. So we would like to say thank you to everybody. Be it in Germany or in China, they are responsible for this performance. Goodwill is only half of the balance sheet total. It is people who count. Well, we are supposed to elect members of the Supervisory Board, and these members are independent. This is what we can read somewhere. But the fact that they are not is in the heads and minds of everybody who thinks about corporate governance. Everybody is clear about that.
It cannot be that everybody is independent by definition. We have to actually discuss these things on an individual basis, we can't just say we want everybody to be independent, and now they are because we want them to be. This is not enough. Whether industrious people are a good thing or a bad thing for a Supervisory Board, well, opinions differ. Whether three mandates are the right thing or 30, opinions differ. We have Josef Abs, for example, and opinions differ on him as well. We're going to elect the members of the Supervisory Board. Mr. Mehdorn, is it really necessary for you to leave the airport for such a long time to work with us? It is certainly a question of friendship, and I'm only saying this by way of an example. I'm not ad personam. It's certainly a question of friendship, it is.
We also have to be rational about the evaluation. Who is going to be the Chairman tomorrow? Mr. Plattner, of course, you are the father of the child, we are not going to release you from the duties of fatherhood. Even if your actions are ratified, you're still the father of the child, be it an independent or a dependent one. At some point, even you must be given the opportunity of listening to a Chairman, whenever that may be. At that point, well, let me mention this issue of the cooling-off period. It's a good thing that Chairman of the Executive Board cannot just like that, change over to the Supervisory Board.
For too long, it's been German practice for people to do so, this is why we now have this law which says it's generally not possible anymore, that's a good thing. It's also good to have this exception. Whether you are the first or the second-best exception to this rule, I don't know, Mr. Snabe. I am sure that we're going to have a good example of an Executive Board member changing over to the Supervisory Board without being a Chairman of the Supervisory Board, that's certainly a good thing, we will support him in doing so. Let me ask yet another question about the SE. In such a system of the European company, of course, one single board may be set up where everybody sits and some people are actually working and others are making sure they do.
The other option is to have a board of people working and another board monitoring the other board, these two have interfaces between them. When it comes to harmony, you have to make sure that these interfaces are taken into account. Mr. Leukert, maybe I misunderstood you, I heard you say that you said thank you to the Executive Board. It's not true. It wasn't the Executive Board who appointed you. It was the Supervisory Board. We have to make sure that these interfaces and the boundaries between the organs also exist in the future. SAP is very much focused on Plattner's SAP. My dear Hasso Plattner, that also makes you a biological risk for the company. Do understand this as an opportunity, I urge you. Ariba becomes an Alibaba of expectations.
The cloud replaces licenses and will now get revenues that are growing through payments by many people around the world, and they will only accumulate after some time. They imply less risk, but they will come at a later stage. When are we going to hit the break-even point? When is the sales revenue going to match that of revenues through licenses? It's a hypothetical question, but it's an important one from a financial point of view. When are we going to achieve the license revenue's quality, and for how long are we going to be the number one in the global cloud business? Is it correct that revenues from maintenance will go down once we generate cloud revenues? Does that mean that 2017 is going to be the end point in growth of return? What is your target in the cloud business?
Is this just being an Oracle in the cloud business? Maybe you can tell us about your strategy in more detail. One final question on HANA and the cloud business. Is it actually simple selling a cloud? Because everybody who has HANA will basically get the cloud on top, and you would have to know exactly, in that case, how quickly your sales revenues would grow and how you would get there. By the way, Mr. McDermott, 35% of revenue growth, 35% margin. If that's not the case by 2017, how much of your compensation are you going to repay? Does Herr Bierhoff, by the way, do marketing in Brazil as well? I don't know him very well. Does he actually do marketing on behalf of SAP in Brazil as well?
Mr. Chairman, if we do not sell licenses, but if we have this small scale revenue instead, does the organization and our processes have to change as well? If so, is this process ongoing or is it only being prepared at this stage? Was this maybe the reason for the Supervisory Board to set up a new committee for personnel matters and organizational matters? You were trying to do that maybe because you were going to earn more, but that's certainly not the case, I'm sure. Were you trying to discuss the share of women in your company as part of this committee, or make sure that members of the Executive Board actually stay for a longer period of time than in the past? When members of the Executive Board finally leave, and when they leave prematurely, they actually have to take something along leaving.
When they take something along, they usually find that money isn't too heavy to carry. That's what they take. In the annual report, you can read that EUR 6 million in compensation were paid for Jim Hagemann Snabe. The person leaving. That's among miscellaneous amounts. We also paid a fixed amount as severance pay, and these are minor amounts, like EUR 4 million, as we can read 2 pages afterwards. Maybe you can elaborate on that. Is this probably a new compensation model that you forgot to put on the agenda? Speaking of compensation models. We're capital investors, you're not just taking our capital from us, the shareholders, but we also pass on capital, and this is why we see there's item seven on the agenda. Venture capital.
Money we pay and maybe run a high risk with that and hopefully also high returns. Is that your hobby or is that a strategy which you follow? What is the track record that you've seen in the past? Whenever we conclude such a company agreement, we should have asked that question beforehand. Speaking of questions, Skills for Africa. Well, you might see this as a preparation of Africa getting ready as a market for SAP, or are we supposed to understand this as charity activities? What is the real reason? This is something you'll find on page 77 of the annual report. Unfortunately, we haven't got an answer to the question yet. Energy consumption is to go down. We need a lot of energy because we're running servers. Now, when we're running servers and employ people, we need boxes to put this into.
I'm speaking of houses and buildings. Now you're going to shift locations. The local press tells us today that locations are going to be closed down or relocated, and if you do that, you have to think about where it makes the most sense from an energy point of view and where it makes most sense to invest the energy, and I'm told that there are big server farms in the eternal ice regions because they don't have to get cooled there anymore. What about the CapEx? The investment sum distributed across the various categories like people and on the other hand, server farms. Maybe you could give us some details about what you do with our money in this respect. By the way, such a server is, after all, a risk, because if somebody drills into it, they can take everything out of it.
Data security is an issue for us. Now that we are discussing individual persons on the Supervisory Board critically, wouldn't Edward Snowden be the best possible member on the Supervisory Board of a company like SAP? I've asked a similar question at a similar event recently, and the chairman said, "At the moment, we don't have a vacancy." You have to think about how you increase data security and not just speak about it, but actually reflect this in your Supervisory Board of the company. In the U.S., of course, Edward Snowden would be something of a sales problem. I can understand as much. In the United States, fear of data security is so great that we, as SAP, might have an advantage in not being American, but instead of being able of running servers elsewhere and not just in the U.S.
What is the actual effect we see? The world doesn't only consist of Walldorf and the U.S., of course, but as we heard, there's also China. Now, if we invest EUR 2 billion in order to get EUR 1 billion in revenues, it might be easier to just keep the EUR 2 billion, so we don't have to have any revenues at all. Why don't you take a look at the timeline and look into the future more? Can you tell us how much you're actually going to sell in China? On page 95, you can read that Asia shows the greatest growth rates, and the question could be about the Supervisory Board members. Can everybody speak Mandarin? Somebody can speak Mandarin, I heard that. Now, the balance sheet of this company is very sound and stable. Mr. Brandt, we know as much.
We redeemed EUR 600 million in the current year. How did you do that? Did you do refinancing? Did you maintain the balance sheet numbers at the same level as before by refinancing them? There's goodwill as well. This is the value of the company is hardly tangible. It's worth 15% of the balance sheet or of the overall equity of shareholders, that's quite a lot. The CEO tells me today the acquisition of Success will pay out. I ask myself, is that really the case? Looking at the list, it says, Success Factors Incorporation, San Mateo, California. That seems to be success. Loss EUR 174 million. If that means that an investment pays off, then please tell me why the loss of a company just acquired is supposed to be an advantage to me. Where are you going to invest in the future?
That brings us to Hybris. Hybris is a relatively small company, maybe it's wrong, but I heard it's 83% growth rate in revenues. If you have as much on a continuing basis, you grow quickly. What is it we bought there? Are these sales jewels, or are these technical solutions that we've bought? Again, EUR 780 million. Not everybody in this room has EUR 780 million at their disposal, EUR 780 million in goodwill is what we have to report on our balance sheet. That's what page 192 reads. On page 206, you say that this is technology and EUR 140 million is customers, one thing is lacking here. What is this number of EUR 480 million? There's another very important topic. It's not just money, but something that's particularly important in a company like this one.
It's also the people that are being managed by you, Mr. Brandt. You were looking after them, in doing so, you looked after the most important parts of this company, capital and people, or people and capital. The sequence doesn't matter. At any rate, you supervised these two most important factors of this company for a total of 13 years. In a stock-listed company, you always have to take a look at the stock price. I don't know if you can read this, but I think you can read it. Where this line is marked, that's where Mr. Brandt came, if it wasn't for Lehman, it would have been a very clear trend. Mr. Brandt, this is your time. You are the financial conscience of this company. You are the rock of reliability for the capital market. Now you are free to look after your family.
It would be my wish that you have a share of the company and that you're going to keep it, because that means we're going to see each other again in years to come. I also hope that you will see good health, that you can have plenty of time to devote to your family, that you'll enjoy working with SAP in the future. I would only like to say thank you at this point. Thank you, Mr. Brandt.
[Foreign language] Well, thank you very much, Mr. Hans-Martin Buhlmann, for your contribution, which has been full of commitment as usual. I now would like to ask Mr. Bernhard Koller, who represents the Association of Employee Shareholders, to take the floor.
Mr. Chairman, ladies and gentlemen. Unfortunately, probably, I will not be as good an entertainer as the two previous speakers. My name is Bernhard Koller, and I represent those employees holding shares of the company. Of course, you can imagine that the financial aspects are not that relevant to us. I rather would like to talk about those matters that are related more to the employees. Nevertheless, of course, the things are connected, the product and the staff, I'd like to start with the product strategy and the product.
We have heard a lot of new aspects about the cloud today, it has been said several times that with our move towards the cloud and towards the new product world of SAP, many questions arise that relate to the staff and relate to the potential sales to be generated. Let me, first of all, once again repeat what you can find on page 258 of the annual report. Here it says that the sales of the cloud portfolio are based upon the provision of cloud software, which is software customers use in the cloud, and services related to this software, including support, consulting, and training. Because everybody will have a different view of what the cloud is. If you are a Deutsche Telekom customer, probably you have received their offer for your private cloud, this is not what we at SAP are talking about.
What's missing in that definition is one element which highlights what the SAP offer is. With these sales, what is included there is also the provision and the operation of the infrastructure. This is what our customers require on top of the software which they receive through the cloud. One thing which has not become very clear so far is who are our key competitors in this market. In the past, on this occasion, we always received some indications about the market share SAP is holding in its various activities and who our key competitors are.
Therefore, it really would be interesting to know who our main competitors are, what the market shares are that we're holding in this segment, namely providing cloud-based software, what are the margins of our competitors and what's our own margin, and how do we expect those margins to evolve. That model, which has been presented to us, according to which, within four or five years, four years, I think it was, these cloud-based sales will reach the regular sales that we achieve from our traditional business. That's something which I think should be a bit more substantiated. In order to achieve our goals, this has also been said before, it is of course also required to invest. In St. Leon-Rot, you can also experience this optically because this is where we are currently building a major computer center.
What are the required infrastructural investment of SAP in the next couple of years? This includes the infrastructure, machine, and equipment, but also potential takeovers for that purpose. That transformation towards the cloud not only entails a change of our license model, but also means that the staff has to meet new requirements. I'm sure that you've read the press coverage during the last couple of days. There have been various articles, in some cases based upon assumptions. SAP so far has been rather hesitant to confirm these numbers. There's rumor about 1,500 to 2,500 employees who will be affected by this transformation of our business more towards the cloud business.
We do not exactly know yet how that is to be handled, and I think this would be the right opportunity to give the employees at least a bit of an indication of what is supposed to happen in the months to come. What does Change in our business mean for our staff, will there be special training and further training offers for that specific change? Will employees be moved from their traditional jobs towards new ones? How many people will be affected in general by job changes emanating from that transformation towards the cloud business? We have seen the expected cloud sales for the years to come. EUR 2 billion is roughly the expected sales for the year 2015 generated by the cloud business. What's the breakdown of the remaining EUR 18 billion if the SAP sales in 2015 will amount to EUR 20 billion?
Usually, that is mainly generated by our standard business. However, this would also mean that this traditional business also would have to grow by about 10% if we are really to reach the total of EUR 20 billion. Bill McDermott said there will be growth. If you take a close look at the annual report, then the growth approximates around zero. That is in the traditional business. My question rather is, which new products will allow us to achieve this 10% growth in our traditional business, actually? I'd like to repeat a question which I already raised at the same point on the same occasion last year. The USP of SAP, an important competitive edge, has always been the integration of the business processes, which means the SAP processes cover all of the processes a company has to run.
My question, once again, is whether this offer is already available in the cloud. Do we have any clients in this regard yet? If not, or if you do not have this integrated offer yet, is there a plan to develop it, and when will it be available at the end of the day? Business ByDesign has been one of our hobby horses of the past. It has not even been mentioned today at all. It's hardly mentioned in the business report and the annual report either. Once again, my question, how many customers do we have for Business ByDesign? Did we attract any additional ones in 2013? Will the product be further developed and maintained in the first place? What are the sales generated so far?
One important question for us, are there any risks based upon existing contracts if we decide not to further develop that product? If you look at the press coverage, you see that there are many partners who have programmed their own extensions, and of course, they very much rely on SAP's further development of their product. The question is, do we run any risks based upon existing contracts if we decide not to further develop that product? Back to the key subject of staff. I already told you that we need some clarification regarding the cloud business. Last year's statement made at the AGM, namely that no dedicated HR director on the Executive Board level is to be appointed. That's something which we are not really happy with.
We believe SAP would be well advised to actually designate a Board member in charge of HR because the employees represent the only production asset of the company. Of course, our customers are very important on top of that as well. We have already said that due to this dramatic development and dramatic rate of the development, the employees will also have to face key challenges in terms of further training and their specific commitment to new jobs. In spring, we heard from the media that there's going to be a global HR manager who is to be recruited. At that time, we were a bit shocked initially because no further explanation was given about the final position of that person to be held within the company. Fortunately, he was then nominated as a member of the Global Managing Board some time ago.
We believe that this is the right step, Stefan Ries, who took over that position, we wish him all the best and good luck for the next couple of months to come, considering the questions and issues he has to face in terms of transformation of the staff as well in the wake of the cloud transformation. Bill McDermott briefly told us how employee engagement changed from 2012 to 2013. However, he didn't tell us how it had deteriorated from 2012 to 2013. During the last employee satisfaction survey, the employee engagement was rather shrinking. I remember very well when the Board members promised that they would keep a close eye on this in order to make sure that the employee commitment comes back to the levels that we had been accustomed to in the past.
Our question now is Why do you think did the employee engagement decrease during the last employee survey? Which actions do you intend to take to bring this employee engagement back to former levels? Therefore, at this point, we also would like to ask the Supervisory Board whether it wouldn't make sense to take the subject of employee satisfaction and customer satisfaction and make it one of the targets of the short-term variable compensation of the Board members. This would just put a bit more emphasis on this target, signaling that customer and employee satisfaction is important and not only shareholder satisfaction. This brings me to an aspect which has also been briefly touched upon before.
On one hand, if you look at our annual report and articles in the media, that the go-to-market and the rate of development have significantly accelerated during the last 3-4 years. Which means you're faster in making new products available to customers, and we are also faster in developing these new products. That's why it's always getting more and more annoying to read press articles about the cumbersome structure of SAP. Who benefits from these kind of comments? Because sometimes these are statements coming from our own, and who benefits from that? One might also ask what the reasons for this kind of cumbersome and sluggish attitude are. Is it due to the employees?
Because they, of course, they feel that the fingers are being pointed at them, and the question is, which actions will the Board take in order to further accelerate the overall business and development rates of SAP? Let me also comment on the votes to be taken. We will endorse the proposal for an SE conversion, although not all of the advantages that we have been given seem really relevant to us. However, it seems that the employees' representative bodies have already accepted and approve this kind of conversion. We will also endorse it. Now, it's been said that the entire conversion will bear costs of about EUR 4 million. My question now is that all, or are there any additional costs? What are the total costs of this conversion into an SE, or does this EUR 4 million really include everything already?
Of course, from a corporate governance point of view, it's a bit of a problem to have Jim Hagemann Snabe moving from the Executive Board into the Supervisory Board straight away. Nevertheless, we support that move and will fully endorse it because we feel that on the Supervisory Board, it's important, also in the medium and long run, to have SAP products and systems being represented by somebody who's got the internal know-how. That's why we believe that Mr. Hagemann Snabe is the ideal person to fulfill that task. We also would like to thank Werner Brandt for his hard work. Now, the CFO is not always the employee's darling. Sometimes this looks like a natural contradiction.
Nevertheless, and I can speak on my own personal experience, it is absolutely true to say that Werner Brandt has always been a fair partner who has also always been willing to enter into a compromise. With his absolutely friendly manner and his objective attitude, he's always been a good person to talk to. Werner, thank you very much for supporting our staff, and all the best for the future. Of course, we also would like to congratulate Luka Mucic on his appointment, and we hope that in the future, he will always be able to present such excellent figures to you as his predecessor did. Thank you very much.
Thank you very much, Mr. Bernhard Koller. We now continue with Mr. Karlheinz Günther.
Ladies and gentlemen, I apologize because this is the first time that I'm taking the floor at an AGM.
I'd like to comment on this conversion of SAP into an SE. It's a bit of a personal story I'd like to relate to, which does not seem to be connected to SE. However, our tax authorities, they're really hard to understand. I own Vodafone shares. Now, that company outsourced or spun off part of its activities into a new company, which is called Verizon. Now, the share price of the Vodafone share decreased, but as a compensation, I received Verizon shares. Now adding it all up, still I suffered a loss. However, the German tax agency didn't think so. They say I have become richer due to the additional Verizon shares. Therefore, I have to pay the additional taxes, church tax, and so on and so forth.
My objection to that was rejected by the German Finanzamt, the tax authorities, my objection was heavily rejected as well. Now I'd like to quote from the SAP investor brochure 2014. Now here it says, "What are the tax implications of the conversion?" I like the first sentence. "Now we expect," it says, "that the conversion of the company into an SE will not lead to any other further revenues, which means that neither German corporate tax have to be paid. Furthermore, SAP expects that the conversion does not lead to any loss or gain for the shareholders, which would be subject to taxation. SAP SE will be treated like a German joint stock company and is subject to the respective taxation." Now here's the point.
If shareholders sell SAP SE shares, they will be treated in the same way as the sale of SAP AG shares. Now I'd like to know the following. Do we have the guarantee that the date I purchased my old SAP AG shares also is the one which is considered my purchase date of the SAP SE? According to the old law, this conversion would not bear any tax obligations for me. I know my guys at the tax authority, they will rather probably say that the date of purchase is the new date when my AG shares were converted into SE ones, and then they will say that I would have to pay taxes on that. I hope that you are right, and I hope that the German tax authorities will fully agree with you on that. Thank you.
Thank you very much, Mr. Günther, this brings us to the last speaker in this round of questions, then we will start giving you the first couple of answers. The next speaker is Mr. [Wernecke].
Ladies and gentlemen on the Executive Board, the Supervisory Board, dear shareholders. I also apologize for my not-so-eloquent wording. Mr. Böding, well, it's his job. However, I'm only a shareholder holding a couple of shares, I try to explain things to other shareholders like I am, which various shareholder representatives may have forgotten to mention. For this reason, I'd like to thank Mr. Buhlmann, who really is doing an excellent job in this regard. However, I would especially like to thank the employees of SAP AG, who've done an excellent job in 2013, which really has been the basis for the successful event we are currently holding.
I also would like to thank all those employees who are working here at the AGM, who are providing beverages and foods and who are organizing everything. Thank you very much for that. Personally, I believe that there's not so much reason for us to thank the Executive Board and the Supervisory Board. A lot of gratitude has already been voiced. I think the board members, they earn so much money that this is enough of gratitude for them. As I told you before, I'm a small employee, and for me, earning money is really still a very hard job. This brings me to the main aspect I'd like to discuss. Hans-Martin Buhlmann already touched upon it, and I'm surprised that others didn't follow along the same lines as well.
I'm referring to Mr. Mehdorn, and that's why I'd like to add the one or the other aspect. I don't remember exactly the name of the speaker before Hans-Martin Buhlmann, I've got to admit, I'm shocked. He was absolutely happy, he said. On the other hand, I am shocked if I see the proposal to elect Mr. Mehdorn to the Supervisory Board. For me, this is a horror scenario. I wonder, who was the one who thought that SAP would be well off with that gentleman? I've got nothing personal against Mr. Mehdorn. However, he is really a tough turnaround guy in the industry. Do we need somebody who's an expert in company turnarounds? Does SAP need that?
My personal impression is, Professor Hasso Plattner, you are the godfather of SAP, and while we've got that guy at Oracle, and similar to that, you are the one who is in charge, you're the one who's got the biggest influence. Therefore, it seems to me that it must have been you who had that great idea of proposing Mr. Mehdorn. Let me give you my reasons. I'm sorry. I'm a bit nervous. Please remember the time when Mr. Mehdorn was the CEO of Deutsche Bahn, the German railway system. He left behind a sheer disaster. What he's currently doing now in his new office as the boss for the new Berlin Airport, that doesn't really look like a triumphant story to me either. Actually, there's a lot of important criticism you can read about in the media.
If you've got a regular employee who wants to apply for a job with SAP, he's going to be really scrutinized. Maybe he even has to pass a suitability test. Here we're talking about salaries of EUR 10,000, EUR 20,000 or maybe EUR 50,000. That employee isn't even given the chance to prove his or her worth. By the way, it's a joke. He's already a member of the Supervisory Board. He's already there because it's almost for sure that he's going to be elected. I think that's a shame. That's also the big disadvantage in the German Stock Corporation Act, that this opens the door to cronyism. One guy proposes his buddy to be elected, we, the shareholders, we cannot change that at all. There's one more thing I'd like to add.
This is a saying which we heard quite often at my own company. In politics and in Supervisory Boards or in Executive Boards of a publicly listed company, even failures cannot prevent the continuation of a career. Being a critical citizen, I feel that this is a disadvantage in politics because it goes to the detriment of democracy. When we're talking about a publicly listed company, this goes to the detriment to the rights of the shareholders and goes to the detriment of capitalism in general. I'd like to see the same strict selection procedure applied, which is also applied with a regular, simple employee or trainee. I'm still waiting for the representatives of the German Lawyers Association, who at every AGM have asked for more women represented on the Executive Board and the Supervisory Board. Mr. Mehdorn, you have heard the applause.
The retail shareholders, they don't want to have you on the Supervisory Board. Maybe you withdraw your application. You would make room for a lady representing the German Female Lawyers Association, because then you would have to meet the expectations of that group as well. Thank you very much for your attention.
That was Mr. Gerd Weidenhaus. Thank you. Do we want to start answering? Let's begin answering your questions. The first question is about the cloud, the product, competition, investments, et cetera. This is for Bill McDermott.
The question is, SAP is going through a period of transformation. Please, would you explain to us how the changes in the revenue model will affect the targets in the future, both for the current fiscal year as well as midterm 2017? Our medium-term targets for 2017 already assume a gradual transition of our revenue model from one-time software license payments to the more subscription-based revenues. For 2017, we expect an annual total revenue of at least EUR 22 billion, with total cloud revenue between EUR 3 billion and EUR 3.5 billion, and an operating margin of 35%. Our cloud target depends on a compounded annual growth rate in our cloud business of about 35%. Let's compare the cloud growth rates in 2013 and in the first quarter of 2014. In 2013, our cloud subscription revenue, adjusted for acquisition effects, grew roughly 32%.
In quarter one 2014, we reported a 38% growth at constant currencies. In the future, the suite on HANA Cloud will also be available as a subscription. We believe this will increase growth in cloud subscription revenue in the next four years. We expect effects to be incremental, they will be minor in 2014. We are committed to scaling our cloud business, that's for sure. We also expect that our highly profitable traditional on-premise business will keep growing. As you've heard today, we are really moving the company to become the cloud company powered by HANA, enabling our customers to simplify everything so they can do anything. We believe that this strategy will enable us to further increase our profitability by 35% in 2017. I got another one. Yep.
The next question is, "Please tell us about your market share and position where you are not number 1. How are we doing in the database segment, what are your strategic goals?" The relevant market is defined as technology platform market, which is growing at a healthy rate, driven by in-memory database, mobile, cloud adoption. The technology platform market, excluding the relational database market, is expected to be an approximately EUR 78 billion market in 2018, based on data from IDC. SAP is currently number 4 in technology platform in the market, but we had the highest share gains among the top vendors year-over-year. In the technology platform market, Oracle is currently the largest share, about 1/3, followed by IBM with 20%, Microsoft with 12%, followed by SAP with 7%. The overall market was EUR 52 billion and grew at 4.7% in 2013.
SAP continued to benefit from the strong momentum of HANA. What's interesting about SAP, we are the fastest-growing database company out there. With regards to your question on expectations for HANA customers in 2014, let me emphasize, the SAP HANA technology has evolved from a real-time database to a true in-memory platform. SAP HANA now allows companies to radically simplify their IT infrastructure. In 2013, very interesting, we put our entire SAP Business Suite on SAP HANA. Going forward, our solutions portfolio and innovations, that of our ecosystem, will all be built upon HANA as the foundation. This is an excellent starting point for SAP HANA, being the technology basis for all SAP applications. On this basis, we expect a strong increase of HANA customer numbers in 2014, further building on our strong momentum from 2013. I also have the next question.
Let me just make sure I got the right one for you here. Okay. Security and data protection. The question is European or national cloud, to what extent has SAP benefited from this discussion and incurred additional revenue? How about a Schengen Agreement for IT and data protection, which may be encouraged by Brussels? We fully support the goal of the European Commission to initiate an European Cloud Partnership and a fully functional EU market for cloud computing. However, we do not think that this should limit the exchange of data with countries outside the EU, provided that the requirements of EU data protection and security laws are complied with. Customers decide for SAP and SAP cloud offerings because they know that their data is safe with us. We are the trusted innovator.
Next question: "Which are the business areas where you already are number 1, and where do you need to catch up?" We are clearly number 1 in our core business of applications and analytics, and also in mobile business. In the cloud, we are currently number 2, and in database technology platform, we are number 4. We gave our view on both of these markets in the respective answers regarding cloud and database technology. Question number 5. Okay. "Can you please talk about your position versus your competitors such as salesforce.com? Have you left them behind you?" With great pleasure. There are two types of vendors in the cloud market. The pure-play cloud players who provide subscription-based cloud solutions only, and companies that are expanding their offerings and moving their products to the cloud.
Recently, we have seen more and more vendors enter the market who sell software in the cloud only. Their revenue is growing rapidly, and they're starting from a small base. Most of them focus on line of business applications, such as salesforce.com's CRM solutions. The trend at the moment is for these companies to develop solutions for more lines of business and to partner with traditional software vendors. Traditional vendors are responding to market demands by offering cloud-based solutions. As we said earlier, we believe that SAP is leading this transition and will become the cloud company powered by SAP HANA. The cloud market is estimated to be worth EUR 24.5 billion, and we have the second-largest share in that market, 4.5% after salesforce.com, which has 16.8%. Oracle has 4.3%.
Having acquired SuccessFactors, we are now the market leader in cloud-based human resource software and ahead of Oracle, and we are by far the market leader in cloud-based business commerce networks. That includes SRM and procurement after our acquisition of Ariba. I do have the next question as well. SAP does not only grow through its organic innovation such as HANA, but also through acquisitions. You acquired Hybris last year. Did Hybris meet your expectations? How does this fit to the whole product portfolio? The acquisition position, SAP and Hybris, now we're positioned to deliver the next-generation e-commerce platform on-premise and in the cloud, as enterprises around the world seek to optimize the customer experience for businesses and consumers across an ever-growing number of delivery channels, devices, and touch points.
The addition of Hybris' e-commerce platform, together with SAP HANA and the social collaboration platform, SAP Jam, will give SAP a significant edge in delivering customer insight and seamless engagement across multiple channels. It will provide SAP with immediate leadership in the e-commerce space, an increasingly important market that is redefining the customer experience across the growing number of channels. The e-commerce industry is worth an estimated $37 billion today and is growing at a rate twice the rate of retail industry. Hybris, in combination with SAP Cloud for Sales, saw triple-digit growth in software and cloud subscriptions and support revenue in the first quarter of 2014. As companies redefine customer engagement and retention and unlock new cross-sell and upsell opportunities, and they're doing this in real time. Next question. How much does SAP plan to invest into organic growth, and how much into acquisitions?
Our strategy is centered on innovation as the main driver of growth. We will continue to invest in product development and technical innovations to enable us to innovate faster and increase the number of development projects and new products. The question is always, which innovation should we build ourselves, and when would it be better to buy innovation? We don't believe that buying market share makes companies successful. That's why we have a different acquisition strategy than our competitors. Acquisitions should complement our existing business and extend our product portfolio. They should enable us to better serve strategic markets and best meet our customers' needs. We want to achieve our growth targets by organically growing and by making select acquisitions. Next question. This year, your acquisition strategy is about Fieldglass. Can you please give us some more background on Fieldglass, and how does this fit into your overall approach?
Fieldglass is the leading provider of cloud solutions for procuring and managing contingent labor and services. Contingent workforce is a large and fast-growing market that represents one of the biggest and most poorly managed spend categories at most companies. The acquisition is a great fit with both our HCM and business network. Companies can now collaboratively manage all their business needs, permanent employees, flexible workforce, and goods and services, all in the SAP Cloud. Major competitive differentiator. Contingent labor and statement of work services is a $3.3 trillion US high-growth market. Companies are rapidly moving to more variable operating models that enable them to quickly dial up and down infrastructure, talent, and expertise to accommodate changes in market dynamics, business needs, and special projects. Contingent workforces are expected to grow nearly 30% over the next three years, according to research. Fieldglass is headquartered in Chicago with approximately 350 employees.
Fieldglass is used in more than 100 countries in 16 different languages, and is the current market leader in their space. Fieldglass also earned the highest vendor rating in Forrester's 2014 published report, and their customers include great brands like GlaxoSmithKline, Johnson & Johnson, Monsanto, and Rio Tinto. GlaxoSmithKline, Johnson & Johnson, Monsanto, and Rio Tinto. Next question. Next question. "Please explain what you expect from the joint venture with China Telecom, and what are your concrete expectations? Is this joint venture just beginning? Is it a blueprint for further strategic partnerships in China?" As mentioned earlier, we want to grow our business in China. To enter the Chinese market and quickly gain access to Chinese companies, we have to set up joint ventures with local enterprises.
The requirements of Chinese law mean that it is vital to establish joint ventures in the cloud business and in the telecom industry there. Foreign companies operating in China are not permitted to offer internet services from within that country. The licenses required are issued to Chinese companies only. That is why our joint venture, called China DataCom, with China Telecom's ChinaCom Services, in which SAP has a 28.3% holding, is so important. The joint venture enables us to use the telecom licenses of our joint venture partner so that we can offer cloud services to the Chinese market. We offer cloud applications for HR, for instance, from China Telecom's data centers in China. This is what we have to do to tap into the Chinese market. The joint venture is already profitable and growing in the double-digit range.
We expect that revenue from this joint venture will continue to grow, especially as the cloud business expands. We're open to new joint ventures. We are watching this very exciting market with great interest. I'm finished with my segment.
Well, you haven't finished by long. Next question is for Ms. [Isabella Heinrich] . One question referred to acquisitions. In all the acquisitions you did over the past couple of years, I'd like to know, what about the management of the companies acquired? Do you handle this as well? How you get it integrated into the group? As SAP, in line with its acquisition strategy, is interested in excellent technologies which supplement our solutions, it's important to SAP to keep the staff inclusive of the management acquired, and to further tap their know-how for SAP. Within the integration phase, the respective top management of the acquired companies plays a decisive role in successful integration. A few executives later on accepted important functions in the SAP Group. Others, as is customary in an integration, decided for a career outside the company. Next question, what about the current status of going public?
Why haven't we been listed with the SAP share in Shanghai? We are still interested in listing in China because the Chinese capital market is one of the fastest-growing capital markets worldwide, which makes it very attractive to SAP for that very reason. We are engaged in a dialogue with the Chinese stock exchange supervision and informed ourselves on the process required for listing in Shanghai. We haven't yet clarified the boundary conditions for listing of an international company such as SAP, so that before such a listing can be considered specifically, we first have to define these framework conditions. Thus, it's important for us, for instance, that an IFRS statement is accepted in English.
The Chinese exchange supervision isn't yet ready to give the green light for the international board. We will continue observing and then have to take a decision as to what's going to happen to this listing. The litigation with Versata, what's your assessment of the outcome of that court case? I'm sure you'll understand that at the present stage, we cannot comment on the chances of success. Especially as this is handled by U.S. courts, it's difficult to predict, but we have a lot of information in our annual report. There was a fundamental question about litigation in the U.S. What's your track record? What's the success rate? How many court cases have you won? How many lost in the U.S. in the past few years? Well, court cases cannot be judged like soccer matches.
Unfortunately, the outcome of court cases, especially in the U.S., cannot be predicted reliably. You can be sure that we will represent SAP's position to an optimum extent at any time. A detailed rundown of ongoing court cases can be found in the annual report. A footnote, Stanford University once had a look at patent litigation in the U.S. between 2000 and 2014, 1,750 cases all told. SAP was involved in 14. Apple, with 377, was at the top, followed by Microsoft with 279. You see that against this backdrop, as SAP, we aren't too badly off. You asked a question relating to SE. SAP is going to become a European company. I'm surprised that the supervisory board cannot be reduced to 12 members at the same time, that we'll continue with 18 members, and that the SE won't have a single-tier board.
I have a reply here. This is a reply where the chairman of the supervisory board must deliver, so I'll pass it on. I think I've answered your questions, Ms. Bella Heinrich. Mr. Plattner, you go on. Next question. You don't have an executive board member in charge of HR, you said that there was somebody on the management board whom you included. Do you want that person made responsible in matters of HR? How do you want to handle that important subject? So far, Werner Brandt has been the labor director responsible for HR in the executive board. Personnel and social matters will be an important problem on the supervisory board also for the future. A member of the executive board will continue to be responsible for labor and social relations and be referred to as labor director.
In the conversion of the SE, we'll stick to the scheme, although it's not required. This was defined in the agreement discussing with the special negotiation group. The appointment to the post is subject to the approval by the supervisory board of the SAP SE. There's no intention in the near future to appoint an executive board member exclusively acting for HR matters. The executive board, with the approval of the supervisory board in May 2014, has appointed to the global managing board, Mr. Stefan Ries, head of global HR. He'll continue to run the HR organization and be a member of the global managing board and consult with the executive board. It's to be assumed that Stefan Ries will report to the future labor director. The committee for personnel and social matters. What's the precise name? Personnel and organization. That's it.
We felt that the supervisory board, that in addition to finance, technology, and there's also the subject of HR, enjoys the same importance. This is why we set up a committee, not in order to allow me to exert even more influence. On the contrary, it was supposed to leave us enough time at the committee to discuss the important points of HR and organization, then make proposals to the supervisory board at large. Next question by Ms. Bella Heinrich. You have only one executive board spokesman. The so-called crown princes were left on the way. What about the top personnel at SAP? Why doesn't it work the way we imagined? Is it true that this is normal in the IT industry and you just fight the usual problems?
The most recent change in the Executive Board were due to personal decisions, which we have to respect. We don't think it's a particular characteristic of SAP or the IT industry. We're convinced that the new colleagues on the SAP Executive Board and our global Managing Board, whom we introduced today, will afford us an excellent position. Shai Agassi, how long ago was that? Seven or eight years ago. He left because he found a better place. He has a high capital budget, which he invested into the launch of the electric car he wanted to organize worldwide. It was obviously a more interesting matter than spending time at SAP on accounting and other software. Vishal, here, the situation is entirely different. SAP is in a process of transformation. Christensen describes it in his publications about innovator's dilemma and disruptive innovation and sustainable innovation.
He clearly exactly describes the situation. Read it up if you feel like it. You know about the situation of SAP. After 40 years, we must change skills and processes and attune to different values. You heard it today. Different revenue stream in the cloud. We need different staff in the cloud. We need the appropriate HR measures in SAP. We have to change processes. One final sentence in the paper by Mr. Christensen is, companies have a hard time doing this. It causes stress. There's no doubt that it's causing stress to SAP. That it is also causing stress to people on the Managing Board who have to design that development.
When family problems are added to this, which I'm not going to dwell on, with which familiar stress can loom too large. You have to take a decision. Is it worth having stress in a company like SAP and having stress in one's own area, or is one's own area more important, as Vishal rightly felt? Nevertheless, I think we will be good friends also in the future. I greatly regret his leaving us. I can assure you and can assure the shareholders that we are not in a good position, but a particularly good position. Three top-level staff members, managers of SAP, staff for many years, and young people go to the U.S., one lady and two gentlemen. They will fill the appropriate positions there. The next question by Ms. Jella Benner-Heinacher.
It says that all members of the Supervisory Board proposed for re-election meet the independence definition. How do you define independence for these candidates? The answer. The Supervisory Board regularly checks on the efficiency of its activity. In this connection, also whether a sufficient number of independent members in the sense of the German Corporate Governance Code is on board. According to that, a Supervisory Board member is not independent when it enjoys personal or business relations to the company, its organs, a controlling shareholder, or an associated company, which could give rise to a major and not temporary but permanent conflict of interest. Supervisory Board members should not have an own functional consulting functions with major competitors of the company.
This is why we especially examine which members of the supervisory board themselves or the companies in which they have a high-level position or in which they hold major interests, have business relations with SAP. Our outcome was that there are such business relations, that this business of SAP with these persons is organized at arm's length. We feel that these business transactions, because of their limited scope and economic weight, do not affect the independence of these members of the supervisory board, and they do not imply a major, more than temporary, conflict of interest in the sense of corporate governance. Haven't we become supervisory board of the year twice or for the second time this year? Only once. We were elected supervisory board of the year only once last year. Well, maybe we'll be elected again this year. Why didn't you mention that? Question of Mike.
He just whispered in my ear because I didn't know whether it's for the second time. I thought it had been for the second time, but alas, it's not. We don't see any indication that there are conditions for individual supervisory board members which impair the independence or efficiency of activity with respect to the availability and time of individual members of the supervisory board. This is documented by the practically complete attendance of supervisory board members in meetings of the body. I think only one member has not participated in one of the six meetings. Well, I'll take the next two ones, and then you go on. SAP is now becoming a European company. I'm surprised that the supervisory board can't be reduced to 12 members. You read it out. I'm surprised that there wasn't a single-tier board.
The 18 members with the possibility of reducing the board to 12 at the 2018 shareholders meeting, effective as of 2019, was laid down in the agreement of the participation of European staff members in SAP SE. This is a tailor-made model, tailored to the needs of the company, which was created after detailed negotiations between company management and the European staff and was approved by the supervisory board. SAP decided in favor of keeping the two-tier organization because the model proved to work in SAP AG already. Last one. As of 2018/19, the supervisory board has only 12 members. You are then 21-- No, I'm sorry. 74 years, Mr. Plattner, have you made sure that their successor in the 2018/29 supervisory board, could it be that Jim Snabe will be your successor, chairman of the supervisory board in the new SAP SE?
Well, the question of planning for a successor in the supervisory board is very important, and the supervisory board knows it. Right now, for the term beginning in 2019, we have no plans, but we'll deal with the question in time and not now start a discussion about persons.
I've got the last question by Jella Benner-Heinacher. This is the topic of TomorrowNow. What is the current state of affairs, and when can we hope for an end? The TomorrowNow proceedings have been under appeal since September 2012. On 13th of May 2014, we have the hearing before the appeal court, when we hope to have a decision in the next few months. We come to Mr. Labriga. I don't know whether first comment was just a comment or remark, or a question. Let me say that, of course, Mr. Labriga, I can go to the rostrum to give my report on behalf of the Supervisory Board. If you want that, please, I'd ask you for a round of applause so I know that I'm going to do it from the rostrum next year. Yeah, well. That wasn't a real majority, was it?
At least I'm not going to do it here from a throne. I'm going to do it over there next year, and you'll just have to wait to see whether that's better for you or not. Okay. One question about who will stop Hasso Plattner should he be wrong at some point. Okay, I am now deviating from the script that I was given. Well, the truth is, well, the real truth, if there is such a thing, philosophically speaking, it's not the one you can read in the press. I can assure you here, and I may add, that this is also a confirmation from a legal point of view, that I only intervene in SAP's business to a very limited extent, in addition to my function as a Chairman of the Supervisory Board. I'm a chief software advisor, though.
I fulfill this function and to the best of my knowledge and abilities, and there cannot be too many of them since I'm so old already. I try to give advice to the company in that function. It has worked well because for 10 years now, I've been a professor at an institute of an ordinary German university, namely University of Potsdam. With the number of PhD students I have, namely 15, I have a rich pool of people giving ideas to me, making me think, and also, of course, help me try to pass on those things that I deem important for the SAP. The Executive Board and Supervisory Board have given me a mandate to look after the topic of HANA in particular for four years now, and the use of HANA in the standard products of SAP.
It was even the case that the development of HANA was my responsibility for years now. I was a project manager. I don't have to do it anymore. The child can walk. I am still a consultant when it comes to questions like the conversion of SAP products to HANA. We're witnessing a revolution. This is not a topping for an AGM. SAP definitely is going through a revolution without disrupting business for our customers. If you're interested in more details, please feel free to visit us in Orlando or visit the SAP Sapphire on the internet. You'll hear various presentations by Bill, by Bernd, and by myself together with Clayton Christensen on that very subject, namely disruptive and non-disruptive innovation. I do not meddle into sales.
I do not interfere with legal matters and such things, except when this is a responsibility of the Chairman of the Supervisory Board. Everybody who says otherwise is not telling the truth. Mr. Labrigga No, that was Mr. Buhlmann, but never mind. I can summarize this at this point. It may look differently sometimes. This is due to the fact that I do feel I owe it to SAP to talk to the people there. Of course, you can't do that when you're not in the business anymore. You do that at larger meetings or occasions like the town hall meeting, which we hold regularly. This is what I did. I told SAP what I believe, where we stand, what the risks are, what needs to be changed.
For example, I only recently talked about what it means to do disruptive innovations and the fact that most companies didn't manage to do it right. I think SAP stands a good chance to do it right. Now, of course, we need to develop new skills because of the cloud, because of HANA. Processes must be changed as well. You cannot deliver new software services every one and a half years. It's not possible anymore. You have to be much quicker than that. In the cloud, user-friendliness is much more important than functionality. User-friendliness comes first, and only then comes functionality. For over 40 years now, the paradigm was different at SAP. We need to change that. It's a shift of values.
When you talk to SAP employees like that, by the way, I've got dozens of very positive confirming emails after that, no negative email at all. There could have been some negative ones. The fact that there are employees at SAP who obviously have time to just pass on the recording they did on their iPhone to the press directly and pick out things selectively. For example, relating to the very difficult aspect that Vishal Sikka is leaving the company. This is definitely a roller coaster of the press. Now, I said it was a personal roller coaster with Vishal. It's not simple to take a decision after 13 years and eight years of project work revolving around the topic of HANA to say, "Well, I can't do this anymore. I have other priorities." Then, "Well, maybe not.
How can we do things differently?" That is a roller coaster. To just quote me saying, "Plattner produces roller coasters at SAP," or, "Plattner coming up with new ideas all the time, driving the company mad." Well, I can only tell you that Plattner didn't do anything but HANA for seven years now, outside SAP with the Plattner Institute at the University of Potsdam and within SAP when looking after the project of conversion to HANA. This is the truth. It may not be so interesting to report on. It may be too normal. Yeah, well, Plattner is not so extraordinary as you may think.
I'm not an eccentric, certainly, running around in the company, influencing the company wherever he doesn't have to do it and is not allowed to do it because the company is managed by the co-CEOs, and now just one of them, Bill McDermott. I assist them. I provide advice, but I have nothing to do in the things that the Executive Board is responsible for. That's the truth, and everything else is reporting that is not true. Thank you. Who stops me? Well, I can only point out that on the Supervisory Board, there is a critical and open atmosphere of discussion. You can rely on my colleagues to stop me if they believe that I'm about to make a mistake. If I didn't make any mistakes? No, certainly not. I made a lot of mistakes, especially when I was a CEO or co-CEO.
I utterly regret those mistakes, but I can't change them now. Thank you. Mr. Labriga, you also asked the question about the press reports of the past. What about development of employees? In which areas do you plan to hire new employees? For companies, we need to become simpler, more agile, and quicker, Bill said it, so that working with SAP every day becomes easier to them. At the same time, we need to strengthen our innovation leadership in this quickly changing IT market. Our change into the cloud requires that we win over additional external talent for SAP. This includes employees with a track record in innovation technologies like in-memory technology and cloud computing. By the end of the year, we hope to have more SAP staff than at the beginning of the year.
We're going to create new jobs around the world so that our strategy and innovation leadership can be boosted successfully. I think questions by Hans-Martin Buhlmann which were related to me, I hope that I already answered them in answering the previous questions. If that is not the case, please let me know, Mr. Buhlmann. Maybe we'll get more answers, right? Okay. We don't want to sit around waiting, and this is why I would suggest we continue with the next speaker. It's Mr. Guido Brunner.
[Foreign language] Herr Guido Brunner.
Mr. Guido Brunner, please.
Okay, done.
Right. I would then like to ask Mr. Rolf Hänggi to the microphone.
My name is-
My name is Rolf Nestle, as has been said. Ladies and gentlemen of the Executive Board and Supervisory Board, dear shareholders. Mr. Plattner, I wanted to also speak about the potential tax issue with the conversion of a stock corporation into an SE. Another gentleman earlier, Mr. Karlheinz Günther asked you this question, and I believe this might be a problem indeed. I would like to ask you to answer this question because I believe it's a very important topic. Next, people. I wanted to speak about that in greater length. You said that you're not dictating things into the company, of course it would be a good thing for SAP AG if such losses, like the loss of four people in just a short period of time, could be avoided. So much for my remarks about people.
When was the last employee survey in your company? This year we're going to have a new employee survey. My question is the following: what are the changes? What is the consensus you gathered from the last employee survey? On the topic of margins. In 2011, you had a margin of 34.3% already, according to the annual report of 2013, the margin went down to 26%. This was a margin target of 35% five years ago already. This is what you said, Mr. Plattner. Now 2017, you said you believe you'll have a margin beyond 35%. Now that Oracle has a much better margin, this seems a necessity. On the stock price. I can't just gloss over that because the stock price development in April and May was very poor indeed. The stock price dropped a lot.
It would be a good thing if the future were rosier for the rest of the year. On the payout of 1%, or rather one EUR, this is something the previous speaker already mentioned. The longer shares are in a portfolio, the more important dividends become, this means that higher dividends should be a target for you. Could you also give us more information on the topic of market shares, Oracle, IBM, Microsoft? Next item. What are the reserves you made for potential litigation? Next topic, Mr. Mehdorn. I also believe that the airport gives Mr. Mehdorn enough to do, there's no success that he can show for himself yet.
I also believe that he has enough on his plate in Berlin urgently needs a success to make sure that the airport doesn't become more expensive still, costs are getting higher every year. Thank you very much for your attention. Right. I want to state very clearly that the personal attacks to the member of the Supervisory Board, Mr. Mehdorn, are not a good thing. They're not the right thing to do. I've known Hartmut Mehdorn for many years now, since the early '70s, when he was still with Norddeutsche Flugzeugwerke in Bremen as an engineer. For many years now, we have worked together or known each other when he was with Heidelberger Druckmaschinen or with Deutsche Bahn. With the Berlin Airline as well. With the airport.
I am not an expert when it comes to the Berlin airport, I go to Berlin very often by plane, the disaster of the Berlin airport is not the works and the responsibility of Hartmut Mehdorn. Everybody was laughing about the jug and the milk. He said it at some point, and you blamed him for that because it related to Mannheim. Now, starting a chase for such a supervisory board member is definitely not the right thing to do. Just imagine we had a member of the supervisory board like Deutsche Bank is going to have in the future, or other major German corporations where stocks are held by organizations or people abroad. If we were to attack a member of the supervisory board in just the same way, it would be a total disaster.
Your opinion may be what it is relating to the person. I can only tell you that Mr. Mehdorn did an outstanding job and an impeccable job, as a member of the supervisory board of SAP. Thank you. Let's come back to Mr. Guido Brunner, who reappeared, and he's just now walking to the microphone.
Yeah. Hello.
Well, hello. First of all, I wanted to congratulate you on 42 years of successful entrepreneurship. What? Why?
That's all.
I wanted to say something about the business strategy, but before I do that, I wanted to raise a few critical points. Mr. Plattner, you may be very good when it comes to operations, and still in some fields, you have very poor people in management, and that starts at the very top. The presentation by Bill McDermott that I heard today, didn't give us anything but figures. What good is that? He should tell us where we're headed with SAP. This is what we want to hear. About your acquisitions. You bought Business Objects. At the time, this was about buying customers. To this very day, and that was approximately eight years ago, up until this very day, you didn't replace the web application designer in the BW. Sybase. It's an unwired platform, and your engineers are just now trying to do this right.
Two years ago, at the annual general meeting, I asked a question about Ariba, and I would like to hear an answer to that question yet, because, I don't think highly of that either. SuccessFactors. You may argue about that, but we also had a presentation today, saying that SuccessFactors didn't meet the expectations. You need to reposition yourselves. When it comes to investors, I still believe that SAP is a good company, but you have a massive problem when it comes to explaining your business model to investors. How can it be that this doesn't work? In April, May, the stock price went down. How can that be? Sales. I believe SAP is selling itself. They don't need sales staff. Just recently, I wanted to buy an SAP license. Do you know when I got called back? No. They're just saturated, and they're lazy bums.
They're just couch potatoes. Nobody's working. About the products. With Business ByDesign, I don't know how many man-years were invested in this project. May I interrupt at this point so that you know our sales director also understands German. He's South African. The new one is hopefully better than the old one. The old one, but he understands German, so be careful with the terms you use. You have to find clear words about that. About the products. With Business ByDesign, you have a great product. Every technician you talk to at SAP will tell you that Business ByDesign is a great product. You invested so many man-years, maybe thousands of man-years in that product, but it doesn't work in the market.
You've got a cloud solution here that's going to replace R3. The question I have to ask myself is: why does it get lost in some drawer? Why don't people discuss it? I wanted to say something on the company landscape right now. I think you need to become the SAP of the 21st century. Let me explain what I mean by this. If you take a look at the [Franz Färber] and Google's office work, well, they have a massive data protection issue. The European Court of Justice now ruled that entries need to be deleted. They're not able to do that. Of course, I agree with the previous speaker who said that Edward Snowden must be a member of our Supervisory Board. You have to master the knowledge processes of the 21st century.
When you think about acquisitions, you need to think about seeing Twitter, these companies, but not these strange solutions that you're coming up with. That was it, basically. Now, I hope that you'll enjoy the rest of the AGM. Good luck. Can you give this to me?
Yeah, that was refreshing.
Well, that was refreshing. I really have to go to Google and Wikipedia and look up a couple of terms that were used right now. I'm not quite familiar with them, I have to say. Are we supposed to respond to this? Well, let me tell you one thing, otherwise they won't let me. I don't think very highly of Ariba. Well, it's probably the cleverest thing we have at SAP, a network, namely, that handles a huge business volume, professional business volume. The figures will show, in due course, that Ariba, together with Fieldglass, on HANA in the cloud, it's always been on the cloud, nevertheless. We'll show that it is a very important strategic horse in our stables of SAP. This is the view of the Supervisory Board. The next speaker is Mr. Patrick Nichel. Mr. Chairman, ladies and gentlemen.
We can be proud of the technological and financial successes of SAP AG, despite the difficult surroundings. Let me mention a topic today, which is a different one. This is about health protection of SAP employees, the most important resource of the company. Mr. McDermott, in the last video you showed, you gave me a cue as to what I was going to say. You spoke about the successful use of SAP solutions at German Cancer Research Center. My name is Rainer Nickel, by the way, not Patrick, he's my son, and I'm chairman of Pro Rauchfrei, the greatest non-smokers association in Germany, and I've got four questions about the smoking rooms at SAP. Mr. McDermott, you're from America, and you may be familiar with other regulations pertaining to non-smokers protection. In Germany, we have something like smokers rooms, unfortunately.
My first question to Mr. McDermott and to Mr. Brandt as well is the following. The SAP CEO also speaks about cost-cutting measures in order to achieve the margin target. How does that fit in with what we could read in the press recently, namely, that there are rumors about staff reductions and that there are also smokers rooms in many German and Swiss buildings of SAP? They have flat screens, some of them have. This is a picture of one of them. This is what they look like. My concrete question would be the following: Can you please tell me how many square meters all the smokers facilities of SAP in the three countries, Germany, Switzerland, Austria, account for? What are the annual costs for all smokers rooms, including rent, operating costs, maintenance costs, replacement and repair, cleaning, and personnel costs?
I've got a second question. Also a question to Mr. McDermott. By invitation of SAP, the head of tobacco control of the German Cancer Research Center, Ms. Pötschke-Langer, at the beginning of 2014, gave a presentation on smokers' rooms in front of the relevant people at SAP. This publicly accessible presentation, and I've got it with me here, this is what it looks like, gives scientific proof that smoker rooms are a source of toxic fumes to all employees, especially those who need to be close to the smokers' rooms. This source of toxic fumes cannot be eliminated by remodeling the rooms, but only by shutting them. What are the implications that SAP derives from that in relation to the smoking rooms? Third question, also a question to Mr. McDermott. The cleaning ladies at SAP are required to clean all the smokers' rooms at SAP.
Section five of the pertinent law in Germany says that all employees must be protected against smoke. Maybe, I assume you have regulations and agreements with the cleaning company, but there are complaints by cleaning ladies claiming that this article or this section is not being complied with. What is it that SAP wants to do in order to make sure that this section of the law is adhered to? After the financial disaster of TomorrowNow, SAP will probably not run easily into a difficult financial situation or risky situation that may come to higher amounts of damage claims. Fourth question to Mr. McDermott as well. We have a preliminary version of a press article entitled, "A lot of cold smoke at SAP non-smokers' protection." This is a yet unpublished article which is supposed to be published. I've got this preliminary version with me.
In this article, we can read that the smokers rooms exist at SAP, the disadvantages of the smokers rooms are also being described in the article, that's certainly not a good image we get here from SAP. Question to Mr. McDermott, what about these highly toxic smokers rooms, how do they fit in with your statements vis-a-vis the press saying that SAP is a modern company with green efforts and with environmental sustainability and employee health as their motto? Let me end by giving the following recommendation to the Executive Board of SAP. Please close down all the smokers rooms so that the highly toxic danger to the health of employees and cleaning staff are eliminated and to restore the image of SAP. Last but not least, by the way, you will save a lot of costs by doing that.
Mr. McDermott, as the chairman of the association Pro Rauchfrei, I would like to share with you our long-standing experience in non-smokers protection. I would offer you to help you become a non-smoking company, a smoke-free company. If you're interested, I'm happy to give you my business card, here best practices on how to become a smoke-free company. Thank you very much.
Well, I can only fully subscribe to what you have said. For many years, I have felt that within the regular buildings of companies, smoking should not be allowed. In the U.S., you are not even allowed to smoke in public space anymore, for example, in football and soccer arenas. I also think that the SAP Executive Board shares this view. However, we've got co-determination in Germany, we also have got a works council in Germany. We need the works council consent in that case. I think it was discussed already on the same occasion last year, so far, we haven't received the works council's approval. Speaking on behalf of the Supervisory Board, I follow up on your proposal, I recommend to the Executive Board to team up with you if you can help the Executive Board to persuade the works council.
What we've got here, you're absolutely right, is absolutely unacceptable. However, we've got employees in the company who've got their representative bodies who do not share this view, therefore, we are happy about getting your advice. I think if you agree, we don't need to give you all of the details about the floor space of the smokers rooms and the cost and so on. Please accept my promise that as a Supervisory Board, we will try to remedy that, we will also report back to you before the next AGM in order to tell you whether we can bring this matter to a successful end. Do you agree to that? Ms. Nickel, do you agree to that? The answer was yes, I agree. "Thank you," says Hasso. This brings us to Ms. Eva Schübel, representing the German Female Lawyers Association.
Thank you very much, Mr. Chairman, for being correct about the name of our association, the Deutsche Juristinnen Bund, Female Lawyers Association. My name is Eva Schübel, and I work as a lawyer in Karlsruhe, and I also hold an honorary office as the vice president of the German Female Lawyers Association. We are a well-respected association. We've got about 2,700 members. We all work on an honorary basis. In order to achieve the goals ensured in our German constitution, namely giving the same rights to women. Women in executive positions in public service or in the private sector is something we've been focusing on for many years. In our project, female shareholders ask for equal rights. Since 2010, when we launched that program, we've been attending AGMs regarding this matter.
In the last four years, we have attended thus more than 300 AGMs of 75 publicly listed companies, including the 30 DAX companies. On the 28th of November 2013, we took stock of what we achieved so far in Berlin, and we held a discussion with representatives, male and female, from private industry and the public service. Our analysis has shown that companies still do not feel that women should be better promoted to executive bodies and especially supervisory boards have set themselves only minimum goals. The appropriate procedures to select suitable candidates are absolutely unsuitable. Our analysis has shown that in the last four years, women on executive levels below the Executive Board and on all executive levels, now that number has been more or less stagnating. The annual increase is less than 1%.
This is a shame considering the large number of excellently trained companies, and that is also confirmed by the status report of the German DAX companies and by a study published by the German Business Magazine. Looking at your annual report, I have seen that within the technology industry, SAP considers itself a pioneer in equal rights for men and women. We will keep a close eye on your progress that you're making, and we really hope that things will change on the Supervisory Board and the Executive Board, because this time there are new three positions that had been vacant. Once again, three gentlemen have been proposed for election. We will continue to attend AGMs in the years to come, but not only in Germany, but also in 12 member countries of the European Union.
The European Commission promotes the project Women's Shareholders Demand Gender Equality, which is a project of several European organizations, including the German Female Lawyers Association. We want to attend the AGMs of the EURO STOXX 50 companies in the near future. With our campaign for equal rights of our association, we have significantly contributed to the German government establishing an act in the future requiring a stronger share for women in corporate bodies. Against this backdrop, I've got the following question. The German coalition agreement requires for publicly listed companies with full codetermination that a women's share of 30% is to be achieved on the boards of German companies. Otherwise, the positions have to remain vacant. Public tendering certainly will facilitate the selection process and will also ensure transparency for the criteria.
How do you find the candidates for vacant positions on the supervisory board and Executive Board? Publicly listed companies or companies with codetermination will be required as of 2015 to establish binding targets for the increasing of the female share in executive and supervisory boards and on other executive bodies, and to present annual reports on this progress. How do you intend to implement this requirement? Apart from that, the German coalition agreement also stipulates that companies have to take actions to improve the equality of women in the entire hierarchy of a company. How many female employees do you have in Germany on the 4 executive levels below the board level? Please give us the absolute numbers and also the respective percentage for every executive level. Women do not benefit from promotions to top-level positions.
Last year, how many women in your company have been promoted to the first and the second executive level below the Executive Board? Please give me the absolute number for both levels separately, and at the same time, I also would like to know how many men were promoted to such positions in the same period. What are the specific actions you do to identify female talents and to promote them as well? Here I'm not referring to general promotion programs, for example, about kindergartens. Are these sustainable actions, which means will they be implemented and monitored continuously on the basis of a quality management system in order to apply corresponding adjustments if necessary? Your personnel development programs. Have you analyzed them as to whether they meet the modern requirements of a work-life balance?
Please ensure that the persons taking personnel decisions do not apply unconscious prejudices regarding male and female candidates. For that purpose, for example, awareness trainings could be applied. It's mainly women working part-time due to family reasons. How do you involve these women working part-time into your personnel development campaigns? Are there offers for men and women for a temporary reduction of their working time or to have it applied more flexibly? Is there a promise to return to a full-time employment if they once have switched to part-time employment? If so, to what extent has been accepted by men and women in your company? Thank you very much for listening, and I'm looking forward to your answers.
Thank you very much, Ms. Schübel. The next speaker is Mr. Horst Schmitz. Once again, Mr. Horst Schmitz, you've got the floor.
If Mr. Schmitz is not present right now, we continue with Mr. Michael Ruoff.
Mr. Chairman, ladies and gentlemen. I've got only few questions, they apply to the agenda. In order to prepare for the contents of the agenda, I didn't receive anything in comparison, in contrast to the good old times. I found a copy of the annual report when I came here. What I didn't find was the annual report. To be more precise, the approved annual financial statements of SAP AG. We have been asked to vote on these annual financial statements today, I guess that most shareholders who have convened here today haven't seen that document either.
I had the chance to look at your inspection copy here at the speaker's desk, if all shareholders wanted to do so, we would have a massive migration here to the speaker's desk. Please, next year, make sure that copies of these annual financial statements are available at the entrance. If your answer is that this is something we can read on the internet, this is not acceptable for the shareholders. I don't read anything on the internet. Certainly not any reports, maybe just an email here and there. Much for this. This brings me to the litigation that has already been mentioned, especially in the U.S. You say that it's difficult to put numbers behind that. I agree. Nevertheless, certainly, you do have numbers which we, the shareholders, are interested in. That's why I'm inquiring about these numbers.
The legal risks and damage claims in the United States, but also worldwide. What was the total amount at the end of fiscal year 2013? For better comparability, give us the same number for the previous year. However, those numbers which you can give us very specifically are the following ones. In 2013, also for the sake of comparison in 2012, what were the lawyers and consulting costs which SAP and the SAP Group spent on dealing with these matters of litigation? That was my first question. What I said before was just a wish, actually. There's another question. What are the total costs of this annual general meeting and also the cost of last year's AGM?
Two weeks ago, I attended the AGM of Commerzbank, Mr. Blessing told us the cost of the AGM of Commerzbank, that came as a real shock to me. Thank you very much.
Well, interesting question. I agree. The next speaker is Ms. Barbara Grimberg. Well, she says she's having lunch, quick lunch.
Ladies and gentlemen, Mr. Chairman. I think it's funny that they really told you, Mitarbeiterin, that I had told the ladies at the speaker's desk that I will definitely come here, that I'm having lunch first. It's funny that they told you exactly this way. Well, my name is Barbara Grimberg. I studied business management. I also got my doctoral degree on that subject. Your breakfast, the way you received us here was very generous and also diverse and was also top quality. That was really nice.
Your lunch, which I have now enjoyed as well, was also very nice. It tasted good, it was also quite rich. Your free ticket for public transportation here in the Mannheim area, well, that is really very nice because it covers the entire region here, which is not really the case in my region where I'm coming from in North Rhine-Westphalia. There's also a couple of negative aspects I'd like to mention. Several gentlemen left the board. One of the previous speakers also already commented on this, it seems there's only one new lady coming in, that's really sad. You've got a couple of ladies on board, having more ladies up there would really make it nicer. We've got women who are well qualified academically, they can and want to take up such positions.
Women with an academic background and with professional experience, however, can only take such positions successfully if they are given the chance and are being nominated for such a position. I've been trying this for years myself. I never succeeded. The gentlemen on the board already have got other additional jobs on the side. The women don't. Academically trained and skilled women really have to be given the chance, because you have underlined repeatedly that your employee represent your most important assets and your most important contributor to added value. Maybe your success would even be greater if you had more women on the board. One thing which is not really very positive is the new CEO, Mr. McDermott. He might be a very qualified IT and communications person. However, SAP is a German company.
Looking around at your counters, I found out that you're offering also training programs for the German language. Therefore, it would also be recommendable to the new Mr. CEO to learn the German language. Actually, it is really unacceptable, to put it bluntly. You're a German company, your AGMs in Germany are held in German, and then the CEO cannot really address us in German and cannot properly understand everything we're saying in Germany. This also means that he will need an interpreter for every single matter and for every legal detail he wants to inquire about. For example, if he wants to find out what the German wording in the German Commercial Code on the German Stock Corporation Act is or in other kinds of German acts. Even for such simple matters, interpreters will be required. Mildly speaking, this is really unacceptable.
There's one more thing I didn't like so much about the new Mr. CEO, namely, the few facts which he presented. At other AGMs, more details on the balance sheet on the annual financial statements are presented, especially the equity capital ratio and the borrowed capital ratio, and then also the business activities and divisions are described, and their shares of the revenues and profits and contribution margins. In the presentation of Mr. CEO, we saw only two slides containing data, and I really didn't believe the data very much. On the one hand, there were data from the year 2010. That's ridiculous because this is a rapidly changing business, and actually, these are data which are four years old. Then a forecast for 2017 was also presented to us. That is not really highly remarkable and respectable.
All of the data should have been presented at greater detail. Maybe you look at the presentations given by other CEOs of German or other international companies. On all of these matters I have discussed so far, you're certainly not the leader in innovation. You talked about your cloud, and well, during lunchtime, I also noticed that you are in the position of number 4, 5, or 6 in terms of the world market share. Yes, that's something I can understand because your cloud, well, I've heard about it under a different name. At that time, it was called APS, Applied Programs System, and that was already in the year 1999 or 2000.
At that time, it was said that in the future, companies would not have to purchase the software anymore themselves, and they would not have to run databases on their own servers anymore, but that rather instead, they could lease such services on a monthly basis, and in exchange, they would always get the latest updates, and they would have international access to their data. That was already in the year 2000. I think this is also maybe the point why you're only number 4, 5, or 6 on the world markets. There's a couple of more positive and negative aspects. There's one thing which I like about your company, which is, of course, strong in the IT or ITC business.
I like that I can still find you in the traditional telephone register with the old numbers of your sites and also with some of your service providers, such as SAP Consulting, Finance, job offers, or additional modules. Many companies, including Deutsche Telekom, surprise, you can't even find their entry anymore in their own telephone register, although they are the ones compiling the data. You can't find the telephone number of their headquarters. However, if you want to enter into contact with a company, then in the some old, outdated world, people will tend to look up the telephone register, or you've got it on a CD-ROM, and then you look for the company, you click on it, and then you will have the entire postal address, including the telephone number.
The postal address can then also be simply copied into a sticker which you put onto your package. If, on the other hand, you're looking for the details of other companies, you've got to click through the website, and maybe then on the sixth or seventh page at the bottom, you can find some data. Therefore, I really would like to praise you for your entry still being available in the telephone register. I'd like to know how many shareholders actually registered for the internet dialogue with you regarding the AGM in the years 2012, 2013, and 2014. There's one more thing I really find regrettable, and you should think about it and maybe also adjust your policy and also your compensation agreements.
These compensation agreements should also contain certain provisions saying that if there's no success for the company, that no success-based compensation will be paid out either, which means the executives would then only receive their fixed compensation. The other file and rank employees, they've got an employment contract based upon collective negotiations. Of course, this is all just fixed compensation, and they do not have any variable one. Just for this fixed compensation, they've got to work hard, work extra hours, and so on and so forth. Executives, somehow they receive also their variable compensation, although there's no success which can be proven at all. Regarding the Supervisory Board, is there any supervisory function supervising the efficiency of the Supervisory Board?
Who keeps an eye on the supervisory board, on the basis of which criteria, and how is the final assessment reached at the end of the day? One thing I'd like to praise, once again, is your decision to pay a dividend of EUR 1. That's quite nice to have. If all of the calculations have been done properly, then you have also generated significant profits, namely EUR 7.5 billion, and EUR 1.2 billion of this is paid out to the shareholders, and the remaining EUR 6.4 billion will be retained. That's quite commendable to retain EUR 6.4 billion for future R&D. Maybe it's not that praiseworthy because we also heard about some litigations and other problems. Are these just provisions? If a dividend is paid, then this dividend should be one-third or one-fourth of the profits. That's actually it. EUR 7.5 billion, EUR 1.2 billion of that.
Very roughly speaking, you could call it one-third, which is paid out to the dividends. Therefore, my proposal is, if you really generated real profits, then you divide it by three or by four. You reserve one-third for new investment, which means one-third should stay in the company for repairs, modernization, further development. The second third should be paid out to the shareholders, which you are roughly doing. These shareholders, even they act in a somewhat arrogant way from time to time, well, these shareholders are the ones one could call your employers. One more third should go to the employees for compensation, for further training, and so on and so forth. This last third should also include the board compensation because they're also part of the staff.
You could also divide it into four equal parts, and you could say, we break it down separately, and we then also form provisions for any crisis or major capital investments. Please bear in mind, you're all really sitting in the same boat, in the same corporate boat. How do you really act as a role model for the regular rank-and-file employees who receive a fixed compensation and have to deliver a good, motivated performance without receiving any success-based compensation? Whereas the board members receive performance-based compensation, sometimes only for being present. Well, coming back to that sitting in the same boat. The CEO as the captain, the supervisory board as the navigator, and the team being the sailors setting the sails.
If there's one setting the false course or heading for the false harbor, then the others, well, no matter how much they work hard to set their sails, you will not be able to make any progress. Please bear in mind, in the true sense of the word, you're sitting in the same boat. A disciplined board and an appropriate compensation strategy also is an important contribution to maintain Germany as a useful production site for a company, because this is also part of Germany as a production site. The board compensation, which is often granted although no real success has been achieved, this compensation also is a cost item, and on the other hand, this also makes it a problem, and this also regarding the shareholder value.
Maybe all your consolidated results would look a bit better if you had more women on the board and not the men, because the men, as I said before, the men have got the numerous jobs on the sidelines. Sometimes, well, people say, "Well, these additional jobs, they also produce synergistic effects." You can also view it differently. On the one hand, it's time confusing. You cannot really be properly focused. Secondly, you might end up in conflicts of interest, and that would then once again be the source of distraction. Please bear in mind, the true president of a group is the customer and the shareholder, and the customers, they are the employers of the board members. How many employees did you have in 2013, 2014? Employees includes the blue-collar and white-collar workers, if you still have that outdated distinction.
How many of them did you have in terms of temporary workers, in terms of workers under collective agreement, outside of the collective agreement? This, once again, broken down into their numbers and their minimum and maximum gross salaries. In connection with the transformation of the bank code as part of the SEPA procedure, which had initially been scheduled for the beginning of the year, which had been postponed. What were your additional costs to integrate this into your own business processes? On the other hand, what were the revenues you generated by introducing this with your company? How high was the value-added tax which you received on sales, and what is the value-added tax that you paid on your purchases? Please give us the absolute numbers and not only the %.
This is something that one of the previous speakers also asked about. What are the costs of this year's AGM and last year's AGM broken down into catering, public transportation tickets, security, rent, invitations, and decoration? What is your total number of shareholders? Do you know that? How many of the shareholders have been invited? How many actually registered to come? How many have actually come here? How many guests do we have here today? Apart from the committees, are there any advisory councils according to individual clusters, projects, or technical subjects? What's the total number of these advisory councils? What's the number of their members? What are the fees paid out to the individual persons? What are your expenditures on research and development? What in general is the structure of R&D expenditures, such as laboratories, staff, equipment, devices, and so on and so forth?
How many purchase orders did you receive last year as software development orders, how many of them did you reject? What is the number of improvement proposals presented by your employees? What is the number of improvement proposals submitted and implemented? What's the number of projects resulting from them? What's the total of savings generated or license revenues generated? How old was the oldest person which you recruited in 2013, 2014? What kind of employment contract did that person receive? A full-time employment contract or a temporary employment contract? What position was that person selected for? Thank you very much for your attention and all the best for the future, but please with more women on the Executive and Supervisory Board. Thank you.
Thank you very much. It's very simple. We have no advisory boards. Madam, balance sheet profit is not identical with annual surplus. The EUR 7.5 billion is the profit carried forward according to the balance sheet. The dividend is paid out of the annual surplus, which is listed in a different place of the annual report. It's clearly lower, EUR 2.5 billion. You even have the number paid out. It's not too difficult with the Supervisory Board members in the AG. We still are, and we were 4 out of 16 in the SE. If it were to be determined today, after all questions have been answered, it will be 5 out of 18. 5 women out of 18 members. Everybody knows that when appointing new Supervisory Board members, I urgently look for women, but it's not that easy, as I keep saying every year.
When at my institute, HPI, we're looking for somebody with knowledge in computer science, when out of 100, only 14 or 15% are female students. And there won't be any more once they have been in the profession for a couple of years. And it's not that easy if you pick somebody who's out of the profession. And supervisory board members, well, they have to show their qualifications and prove them in a different place. Really, it's not our fault, and I think it's superfluous for you to harp on the subject. We are in a very good position as far as this is concerned. And after 2016, well, we shouldn't have invited another woman because only one-third of the newcomers have to be women. 50% of the newcomers, in our case, are women. So, well, that's all. No, sorry.
Let's now answer the questions, and then we'll get the new answers right away. By wire. Will you start? Well, I'll start with the questions you raised, Mr. Buhlmann. You said we had two CEOs and got one euro as a dividend. Now, with one CEO, will we then get two euros as a dividend? That would be logical. Well, it's a strange thing about logics. I think even as a shareholder, you can surely back this. You know the key figures of the current year. We simply took your suggestion on board. Balance sheet. Why did the cash flow drop a bit last year? The answer, out of current business in 2013, €3.82 billion were added to the finance unchanged. The increase went from 193 million to 2.3 billion.
That is the tax burden, the cash flow out of operations. The receivables, average days between the date of invoice and the income of the payment, 62 days. 3 days longer than in 2012. Your next question was when was the sales or what would the revenue be with cloud offerings, as it were, if the license income would be generated. How do we get the license sales quality and have the earnings quality with the new structure? In today's speech by Mr. McDermott, a typical case was presented, cloud versus on-premise. The cloud model, after 4 years, will reach the same revenue, and after 5 years, also generate the same profit, which means we have additional profit potential from the 6th year on. As a result of our sound, high-margin core business, we decided to take the steps to the cloud step by step.
When will you be number one in cloud worldwide? As explained, we are just now number two in cloud. With 36 million users, we have the largest user base in the cloud market. SAP positions itself on a clearly broader basis in this market with a dedicated offering of all solutions in the public or private clouds. We add to our product range by in-house developments or by acquisitions such as Fieldglass, referred to above. With our strategy to become the cloud company based on SAP and HANA, we are confident to win further market share. Again, on cloud, is it true that maintenance proceeds have to be reduced if we generate revenue through cloud? Is 2017 then the end of the line as far as return is concerned? What is the actual goal with respect to cloud?
Customers acquire a use right for loading down the software from the internet and using it. Contracts are signed for that, which may combine the use of the license and maintenance. This is shown in the P&L statement in the line of cloud subscription and support revenue. Our maintenance revenue arises from the fact that customers in the on-premise business have to acquire a maintenance contract in addition to the license they acquire. This is shown in the P&L statement because of the high renewal rate of existing maintenance contracts. We assume that in the future, further growth rates can be shown. As Bill said, we benefit of the fact that we continue to grow further, both in the profitable core business and Have high growth rates in the cloud business. Another question about cloud business, is it simple to sell a cloud?
Everybody who has HANA will be given one cloud on top. This would mean you'd have to know exactly how fast revenue will rise and how you achieve that. The use model of clouds indeed facilitates the sales of software solutions because also end users can use them directly via the cloud. SAP HANA is a real-time database which simplifies all the IT landscape. It offers new possibilities to handle business processes. SAP HANA in the future will be part of every SAP solution, which means we will not show any separate expectations of revenue. Our expectations for 2014 and 2017 with regard to our cloud business are as follows: 2014, EUR 950 million to EUR 1 billion in cloud subscription and support revenue, corrected for currency effects and non-IFRS. 2017, EUR 3 billion to EUR 3.5 billion revenue in the cloud business. You also talked about the remuneration model. SAP is also an investor.
A company contract is to be authorized today under item seven. You are a risk or a venture capital donor. Is that a hobby or is it a strategy? What's been the success rate in the past? Venture capital activities are very important to us. SAP is pursuing a two-track strategy. On the one hand, investments help us to acquire extensive knowledge about new technologies, trends, and companies, and early on discover market developments of strategic importance. Many innovations come from start-up companies and can be tracked best by investing into venture capital. On the other hand, our investments are made to generate an attractive financial income. SAP Ventures so far, with its investments, has generated attractive financial earnings at comparable low losses and has a very attractive portfolio of start-up companies. The portfolio is highly diversified and thus ensures a considerable confinement of financial risk.
The next topic is move of locations, investments into energy savings. Where is energy invested most meaningfully? After all, you hear of large server farms in the region of eternal ice because they do not have to be cooled any longer. In the expansion of our cloud business, we also expand the number of locations of our computer centers by the end of the year. This includes China, Australia, Russia, Canada, Mexico, India, and Brazil. These locations follow the rising demand by our clients. Indeed, they do require special construction requirements and cooling systems. We use co-locations and expand the equipment, including cooling systems. We make sure that our computer systems are supplied 100% renewable energies, as we are firmly bound to sustainability principles. Next question, CapEx and cloud investments, how does it break down total investments into staff members, IT, and then in server farms and brickwork?
The SAP computer centers are the mainstays of cloud business of SAP, inclusive of SAP HANA Enterprise Cloud and cloud solutions and solutions like including customers and SAP Cloud for HR. This year, SAP has opened up three new computer centers in Sydney, Australia; Tokyo; and Osaka, Japan. As part of the open ecosystem strategy, investments were made into existing computer centers by partners in Moscow, where cloud solutions are to be hosted by SAP. Also, the opening of further computer centers in Brazil and Canada is planned for 2014. Data security ranks at the top for SAP, which is why computer centers must meet all high data protection and safety standards. SAP worldwide runs its cloud solutions in 16 computer centers in the regions of EMEA, Europe, Middle East, and Africa; Middle and Eastern Europe, North America, China, and Australia, into which investments are being made continuously.
Besides investments into computer centers, SAP invests into the further development and new development of our cloud solutions and worldwide distribution. The integration of our on-premise solutions plays an outstanding role in this regard to offer the customers integrated and comprehensive software solutions. The expansion of our data centers, as I said, will be continued at a high rate, and we will hire more staff members in the cloud environment in order to expand our existing know-how continuously. The question about the balance sheet, which you considered very stable. EUR 600 million debt was repaid in this year. Was it repaid and the money is gone, or did you extend the amount of credit by refinancing? Did you keep the balance sheet total at the same level by refinancing?
In April 2014, the dual loan of EUR 500 million and a promissory note about EUR 86 million, inclusive of interest, was paid back according to plan. Payback was based on existing liquidity so that this payback must cause the balance sheet total to be reduced. This follows our practice of many years to reduce gross indebtedness quickly and according to deadlines. SuccessFactors. Please explain why the loss of a company you just bought is to be a benefit. Well, the loss you saw in the list of companies in which we had an interest is due to the sales and the cloud model. The sales come in on a pro rata basis per month, but the cost for developments must be paid in full immediately. More and more contracts are signed by SAP worldwide, so that the sales revenue is not anymore achieved in SuccessFactors, but rather companies elsewhere.
That's one reason. We have a company in California which bears all the development expense. This is accounted for in other SAP or SAP SuccessFactors companies, which is borne out, or not borne out rather, by the annual accounts you saw. Where do you invest into the future, or will you invest into further holdings? Well, when buying other companies, SAP wants the solutions to be complementary, matching in corporate culture and showing an adequate price. That applies to any acquisition, irrespective of size. Acquisitions upstream always beg the questions for the right point in time, a suitable candidate, and the fact whether the acquisition can generate innovation and added value for customers, shareholders, and staff. Our strategy is based on innovation in all business areas as a key basis for our growth.
In each case, it needs to be decided whether in-house development or acquisition would be the most meaningful choice. You raised a question about Hybris. The goodwill of Hybris, according to page 192, is EUR 780 million. On page 206, you explain EUR 160 million of this being technology, EUR 140 million being customers. Something's missing. What's the other EUR 480 million? The goodwill of Hybris was set at EUR 780 million. In addition to the goodwill amounting to EUR 780 million, EUR 167 million were set for technologies acquired and EUR 144 million for customer relations. This is not separate but is added up and results in the purchasing price we paid. The goodwill of EUR 780 million resulting from the acquisition of Hybris, especially due to the expected synergies based on the changed customer requirements. I then have a last question of yours.
When we generate small sales, do we have to change our organization? The structure of the organization or the management, if so, is that underway, or is it being prepared? Well, we explained this in our answers to similar questions. We speed up the transformation process of SAP in order to strengthen SAP's competitive position and become a cloud company. For this purpose, we not only have to strengthen our cloud distribution model, but for instance, also ensure that a customer has a permanent contact in the sales region in our global customer organization. For customers, we have to become more agile and faster so that the daily contacts with SAP become clearly easier. That applies to us internally as well. Our leadership and innovation must be strengthened by further reinforcing our position in the quickly changing IT market.
This means that duplication of work has to be reduced and the number of clients, very small teams need to be reduced by merging teams and tightening up and streamlining hierarchies. Our worldwide network has to be optimized by combining locations and closing down small locations. Those were the questions for me, Chairman.
Let's go on. Mr. Mehdorn. Is it really possible for you to leave your airport for so long a time and staying with us? Answer to that. Mr. Mehdorn, because of his many years of management activity in the air industries, is a very important member of our Supervisory Board. We're happy that he takes the time to continue to work for us despite his commitment to the Berlin airport. Did you hear it? Once again? Okay. Henceforth, who is going to be the Supervisory Board Chairman? I'd like to know that also.
It's me, as long as I am Chairman of the Supervisory Board and with respect to the rights of the Supervisory Board with respect to its internal organization, there are no specific plans for my successor. It's too early. In time before 2019, we'll deal with that important question. Should I be unable to do so mentally, I'll speed up things, of course. Mr. Hans-Martin Buhlmann. Next question. The Committee of Staff and Organization, will you discuss quotas for men and women or even discuss the permanence of contracts of Executive Board members? That committee has nothing to do with the Presidential Committee, which discusses the contracts of the Executive Board members. It's the Presidential Committee and the distribution by gender. The Committee for HR and Organization question deals with fundamental changes to organization and key personnel decisions at levels below management levels.
Of course, the diversity and gender problem plays a role. The committee enables us To discuss the subject on the Supervisory Board level, including especially the workers bench, together with other important topics before that committee. Is the change to cloud the reason for the supervisor to set up a new Committee for HR and Organization? The Committee for HR and Organization deals with central personnel decisions, fundamental organizational changes, management levels below the Executive Board. Same thing I read about a minute ago. Of course, the comprehensive changes resulting from the disruptive innovation coming from the cloud and which will have to have an impact also on processes, on personnel and skills, and need to be dealt with accordingly. Page 34 of the Annual Report, you can read that EUR 6 million of other remuneration was paid to Jim Snabe leaving. You paid EUR 6 million for such trifles.
The next page, it says in a footnote that a fixed amount was paid as a severance pay. Two pages on, it's another EUR 4 million. Could you explain or is it a new remuneration model which you happen to forget in putting on the agenda? No, it's not. For Jim Hagemann Snabe, this amount under miscellaneous on Page 34 of the Annual Report is an anticipated gross payment of his claim already earned to the share-based remuneration of the RSU milestones plan tranches 2012 and 2013 within the existing pay model. That's what has been presented. This advance payment was agreed upon in the Supervisory Board in order to prevent conflicts with an activity in the Supervisory Board. The amount under miscellaneous includes a gross payment of EUR 2.2 million for RSUs of 2012 and a gross payment of EUR 3.8 million for RSUs from 2013.
Total amount of the 2012 tranche of the RSU milestone plan is EUR 6.5 million, of which the amount of EUR 4.3 million was already shown in the Annual Report for 2012. This amount was also listed on Page 35 of the 2013 Annual Report for completeness's sake. The last but one question by Mr. Buhlmann addressed to me. Wouldn't Edward Snowden be the best born Supervisory Board member of SAP? Yes. If we were to give up one third of our revenue in the U.S., it would be a brilliant idea. Before seriously considering Mr. Snowden, first the status of this person would have to be clarified. We don't know exactly whether we can reach Mr. Snowden, nor whether he would be able to leave Russia. Excellent answer, but mine wasn't bad either. Okay. Let's leave Mr. Snowden out of the picture. Page 95, Annual Report.
You can see that in Asia we have the highest growth rates. Hence the question, does every supervisory board on we are supposed to elect know Mandarin? Well, that's different. The gender quota and then knowing Mandarin, and then you must be boss of an airport. That's too much. Really? Is he? Yeah. He's here. It's really not that easy, Mr. Buhlmann. Mr. Buhlmann assumed that in the supervisory board, we'll be able to do our business in Asia and the market there and assess it quite well without knowing Mandarin. The Chinese are very diligent in learning English, which is how we can communicate. Then Bill.
Continuing with questions from Mr. Buhlmann. Question is, how big is your business in China? We do not report revenue for China separately in the revenue by region section of the annual report. China is in fact included in the Asia-Pacific, Japan region, and both software and cloud subscription revenue increased by 20% in 2013. Interestingly, in the fourth quarter, it impacted us greatly because it increased 40% as the economy improved there. We are built for scale in China. As we talked earlier, we aren't just focusing on our own involvement in China, but we're also building local partnerships to strengthen our presence and our leadership position. Next question. Skills of Africa, page 77 in the annual report. Should this be seen as preparing Africa as a growth market for SAP, or is it a charity project? What is the reason for this?
Africa is a very high growth market for SAP. We are enjoying tremendous success there. This pilot program was officially launched in May 2012 in Kenya, and it was officially kicked off in 2013 to support our growth ambitions. It is not a charity project. It's based on growth. As part of the growth plan, other chapters will be opening up across the continent this year, including South Africa, Angola, Nigeria, to name a few. Next question. Will Mr. Bierhoff support you with regards to marketing in Brazil? I had such a great time meeting Oliver in New York City on a personal level. He's just a truly class act. I'm exceptionally proud that he's a brand ambassador for SAP. He really is helping us build the next generation innovation technology for the sports industry.
Clearly, we do have an agreement with him as a brand ambassador. In addition, he will take public appearances on behalf of SAP, which is very helpful for us. We're looking forward to working with Oliver to further develop performance analytics that'll help the German national team's preparation for the 2014 World Cup in Brazil. We wish him the greatest of luck. The next question is based upon the 35% margin. If the company doesn't hit the 35% margin, what happens to my personal compensation? Of course, my personal compensation correlates with the financial success of SAP, and it's a major part of my compensation. Of course, margin is part of the financial targets derived from the SAP strategy. Therefore, if we don't hit targets, it does directly impact my compensation. In case we don't recognize the target, we don't recognize it in my comp.
I am sure perhaps after today, I'll have a further target based upon learning more German. I'm working on it. Got to have some fun together, right? Is the return on cloud investments actually at 35%? We have set the following goals for 2017, just to repeat them. We intend to achieve at least EUR 22 billion in revenue as a company. EUR 3 billion to EUR 3.5 billion of those euros would come from the cloud, and we offered a blended operating margin rate at the 2017 target to date of 35%. It is true that the cloud comes in at a lower margin initially, but over time, we expect it to perform at margins commensurate with our core business. Next question. On Hybris. I have read that Hybris had an 83% growth rate in revenue. What did we buy? Did we buy sales ideas or a technical solution?
I'll tell you what we did buy. We bought the next generation omni-channel e-commerce. That's what we bought. The addition of e-commerce from Hybris together with HANA and the social collaboration platform called SAP Jam, we give a significant edge in delivering customer insights and a seamless engagement across multiple channels to our customers. I know firsthand in global boardrooms, the CEOs are very focused on the data of their consumer and the behaviors of those consumers, and offering them real-time propositions and also being able to fulfill in a supply chain like SAP's, gives us a competitive differentiator that no other software company in the world has. This is a next generation CRM platform, and it really has given SAP not just growth, but real competitive advantage.
I have to apologize. I was a bit premature in answering your question because I thought I could do it as a supervisory board chairman. Namely, the changes in my supervisory board were incomplete. The labor member, Inga Wiele, has left SAP, and in the change between AG and the planned institution of this year, is no longer a member of the SE Supervisory Board. It's only four women out of 18. The 50% thing wasn't right either. Sorry. I should have followed the advice by my colleagues and wait for the answer to be presented in writing. That would have been right. Sorry, the numbers were wrong. Now, before going on answering, two other gentlemen asked for the floor. Mr. Horst Schmitz, could you please step up to the microphone?
No activities here. Oh, he's coming. Is he? Well, somebody else there. Another one. No, it's a different story. Anyway, Manfred Götzinger is next. May I ask you to come forward. Manfred Götzinger, please.
My name is Manfred Götzinger. I would like to say hello to Mr. Plattner and the other members of the Executive Board and Supervisory Board, and all of you as our shareholders. Mr. Plattner, I owe you a great deal of respect. I know what you do for SAP. I know it from personal experience when you started to develop ABAP first. Just now, you made a mistake, and I was a bit disappointed. It related to the distinction between the annual surplus and the balance sheet numbers. You're correct, of course. There is a difference here, and I would like to elaborate on it.
Your wrong statement was that the dividend is not paid from the annual surplus, but from the balance sheet profit. You should know that. The dividend is paid from the balance sheet profit and not from the annual surplus. The annual surplus reflects the actual performance of the company with operating result, for example, financial result, used to be called a neutral result, then taxes are shown as well. What remains is an annual profit or loss. This annual profit is now being changed. For example, there's a profit carried forward to the next year, EUR 5 million, then the annual surplus of the AG, EUR 2.5 million. For 2013, more concretely put, we have a balance sheet profit of around EUR 7.5 billion. I was referring to billions as well. "Well, you make mistakes as well," said Mr. Plattner.
Anyway, I'm talking about billion, not million figures here. Excuse me. I think we can be brief here. My statement related to the fact that we had a payout ratio. The question was about the payout ratio of 25% or 30%. You agree that the dividend is based on the balance sheet profit. Yes, of course, but the payout ratio is related to the annual surplus. You were wrong here. I wanted to correct you. "Okay, we'll delete it from the minutes," says Mr. Plattner. My question is the following. The annual profit of the AG amounts to around EUR 2.5 billion. Now, when you take a look at the consolidated financial statements, you'll see that there is a bottom line result of EUR 2.8 billion, roughly. My question is the following. What about the difference?
Is it because of the different valuation criteria, namely that you report according to the German regulations or the others? According to International Financial Reporting Standards, or International Accounting Standards rather, you have to apply the fair value principle. My question is, where does it come from? Is it because the valuation principles differ? The writing off the lower of cost or market, namely the German regulations, or on the other hand, the international regulations applying the fair value principles. Third question. If SAP AG is to be converted into an SE, I assume that, as usual, the financial statements according to German law, as we see here in this very brief booklet, we should be accessible to everybody. That is true. Is this going to be eliminated, or are we going to see it optionally as well?
Is this going to be something that will be published as well? Or are we only going to get accounting according to the fair value principles, according to the International Accounting Standards? The fair value, by the way, from a scientific point of view, cannot be proven, but the acquisition accounting is a value that can be traced back. I believe, as do many other experts, that who is active in the U.S. and in Germany should know both reporting principles, and everybody knows that the fair value principle is suitable to use manipulations. These were my remarks, and I would like to ask you to answer the questions that I put forward.
Thank you very much, Mr. Götzinger. Of course, your questions are going to be answered. Is Mr. Schmitz here now? Nope. We've got Gerd Verden again.
He would like to take the floor again.
Thank you very much for giving me the opportunity to speak again. Mr. Plattner. I think the accuracy of my statements were confirmed by you in your response, Mr. Plattner. That was one thing. Many people have left, so it doesn't really make sense to say anything about this because you don't get any applause anymore. I'm not here for the applause. I'm just here in order to show the small shareholders what is actually going on here. I wanted to say the following. Maybe you know that Albert Einstein once said that the universe and the stupidity of people is limitless, but I'm not so sure about the former.
Let me just adapt this a little bit, saying the universe and the arrogance of the members of the boards and the stupidity of shareholders is limitless, right? That's just joking, of course. Mr. Plattner, please don't get me wrong if I criticize you a little bit, but I really compare you, but this is not criticism, mind you, to the former head of the Apple Corporation. The difference is, of course, that you're still alive. I'm referring to the general attitude and charm you have and the course you steer at SAP. I think many people will concur with me here. One final item that I had wanted to raise again, about one of the previous speakers, I think, who said that he was a member of SAP as a company and also a representative of the shareholders at SAP.
He said, I believe, that the SAP staff get the feeling that they're not being listened to. I get the feeling that this is because within the group, there's no such thing as open communication. Maybe you could look into that. As far as the group is concerned, I believe people are money, and you should actually step up your efforts here. Thank you very much.
Thank you very much, Mr. Verden, I still didn't get your question. You said something and said, "I don't like it," it's not positive or something like that, I didn't hear a question. I don't think I interrupted you, did I?
No. I just said that the statement by various shareholders were just put aside by you, your statement is correct. What I was trying to say is that your response basically proved that my statement was right. Do you understand?
Not quite. Was that something positive, or? Yes. Of course. You're right at any rate. We don't have to argue about that. I think I have understood. You said something about jobs and Plattner. Mr. Plattner, to put it bluntly, you are not so much interested in the fact that the shareholders, there were a number of speakers here who are shareholders who do not like Mr. Mehdorn as a member of the board. If we were just to summarize this, as I said, I've got nothing against Mr. Mehdorn myself. Stock prices of former companies in which Mr. Mehdorn worked show a very clear tendency, I would imagine that the SAP stock price could go towards EUR 50.
Would be a shame, but I've only got four shares anyway, so I could live with it. I can assure you that Mr. Mehdorn is not on the Executive Board of SAP, so the operating business is being managed by the Executive Board. There's not so much disagreement between the two of us anyway. First question, we're going to answer the first question. No. Right.
The first question is, to what extent does SAP need to invest in infrastructure in the cloud area in order to be successful? How high are those costs expected in the coming years, both with regards to infrastructure inventory, but also personnel and acquisitions? Since 2010, we've increased our focus on innovation, and our strong growth shows this is the right approach. We will continue pursuing this strategy to be the cloud company powered by SAP HANA. As we've mentioned, we'll continue to invest in data centers and hire more people so that we gain even greater global expertise. This is important if we're to remain competitive in a rapidly changing market. We plan to increase our workforce this year, and our 2014 and 2017 targets reflect the investments that we need to make. Next question. I'm just looking for the English version of it. Okay.
Transition into a new product world. Who are the main competitors in this market? What's your market share in that cloud, and what are the margins of the competitors and your own margins? What will be the margin development in the future? There are two types of vendors in the cloud market. They are the pure cloud players who provide subscription-based pricing for cloud solutions only, and companies that are expanding their offering by moving their core products into the cloud. Recent years have been more and more vendors entering the market who sell software in the cloud only. Their revenues are growing fast because they started from a very small base. Most of them focus on line of business applications such as Salesforce for CRM.
The trend at the moment is for these companies to develop solutions for more lines of business and to partner with traditional software vendors. The traditional vendors are responding to the market demands by offering cloud-based solutions. As we said earlier, we believe that SAP will win this transition by becoming the cloud company powered by SAP HANA. The cloud market's a $24.5 billion USD market, and we have the second-largest share with 4.5% of that market after salesforce.com with 16.8%. Oracle has 4.3%. Most of the cloud competitors are not profitable. Having acquired SAP SuccessFactors, we're now the market leader in cloud-based human resource software, and we are ahead of Oracle. We're far ahead of most, and by most measures, the market leader in lots of categories, including definitely the market leader for cloud-based business commerce networks in the area of SRM and procurement after the acquisition of SAP Ariba.
Our cloud business has the potential to become as profitable or even more so than our on-premise business as we scale the cloud over the next years. Next question: What will happen in the coming months? What does the transition mean for your employees? Are there special training and development measures for the transition? Will employees transfer out of their traditional areas of work? Are there corresponding offers, and how many employees will be affected? We are accelerating the transformation at SAP to strengthen our competitive position and become the cloud company. To do this, not only do we have to strengthen our cloud business model, but we must have one face to the customer in our global customer organization. Therefore, we have become simpler and faster and more agile, and we are making it easy for our customers to do business with us.
We also now need to do the same thing inside of our own company. At the same time, we have extended our leadership as an innovator in the rapidly changing marketplace, and that is having good consequences with customers. We, for example, had 150 separate development locations, many of them without any critical mass, and that is too much. We have to strengthen our global network and stop redundancies in our company. That is all part of our simplicity messaging. We will help affected employees to find career opportunities inside of SAP or externally if they apply for new opportunities with skills and experiences required for these positions. We are being extraordinarily fair with our employees. That was a top priority in thinking through the redesign of SAP.
Our transition to the cloud requires that we also attract the top talent in the world, and we will, as a true global market leader. Therefore, you should expect us to have more jobs, not less, as we move the company forward. Next question: With regards to your move to the cloud, we heard that this affects 1,500-2,000 employees. We do not know yet which locations are affected and how you will handle this. Today, you have an opportunity to give your employees an idea which plans you have in mind. We commented on this topic already in an earlier answer in question number 53, and I also touched on it just a moment ago. You mentioned that your plan to achieve around EUR 2 billion in cloud revenue in 2015 was on track.
What is included in the remaining EUR 18 billion if you assume that the total revenue will hit around EUR 20 billion in 2015? The rest will come from our classic on-premise business. This still remains the biggest slice. From recurring support revenue, that is the biggest of all slices, followed by software and a smaller piece in professional services. All of them add up to EUR 20 billion, thereabout. Next question: It seems that the growth in your on-premise business, i.e., your normal license business, is trending towards zero. With which new products do you expect to reach the expected EUR 2 billion in the cloud? Let me clearly state that we continue to expect growth in our core business on-premise. Our cloud business also will, however, grow much faster. Today, SAP offers one of the most comprehensive cloud portfolios on the market.
Very exciting. We're evolving our entire product category to offer the deployment option of cloud for our customers so we can simplify the consumption for them. Offerings span areas such as cloud applications, business networks, thanks to Ariba and Fieldglass cloud platforms. In addition, we offer our customers a choice of different cloud deployments to fit their business needs, such as public or private cloud models. The SAP cloud powered by SAP HANA, particularly the SAP HANA Enterprise Cloud, will be very fast to grow. The HANA Cloud Platform is also a development platform being offered as a service. They call that in the industry platform as a service. SAP supports a hybrid model, allowing customers to integrate new cloud services with their on-premise applications. Customers really like knowing that they have choice with SAP. We deliver these solutions through the cloud as a service.
We call this software as a service. Some of the names that you'll be familiar with include SuccessFactors for human resources, SAP Cloud for finance, SAP Cloud for sales, service, marketing, Ariba for procurement, and of course, our Cloud Suite. The next question. At last year's AGM, I asked about SAP's unique selling proposition. SAP's advantage is the so-called integration of business processes of a company. When do you expect this offering to be available in the cloud? Do you already have customers? If not available yet, is it planned to develop such an integrated offering, and when will it be available? Customers absolutely want the richness of the SAP Business Suite. Combine this with flexibility, user experience, and a rapid pace of innovation in the cloud, you then have a robust HANA Enterprise Cloud service.
This offers all the richness of the SAP Business Suite, the SAP Business Warehouse, and the SAP HANA platform, and you can get all of this also on a subscription model. Customers like McLaren and Levi Strauss, as an example, are example of our hybrid customers, and they're innovating with us in a highly non-disruptive way, which is truly exciting. We have more than 15,000 professionals in several delivery centers across the globe. SAP services will help migrate customers to SAP HANA Enterprise Cloud, offering more simplicity for the customer to run their business and more speed of execution so they can win in the market. That's why we're here. Next question. On Business ByDesign, how many customers do you have? How many new customers since 2013 did you get? How much revenue did you achieve? Are you continuing to sell, develop, and maintain the product?
How big are the risks from existing contracts if the product is not developed further? A key success factor for all SAP solutions will be a uniform innovation platform. We're concentrating first and foremost on our SAP HANA Cloud Platform, which we aim to make the platform for all enterprise applications in the cloud. We have an opportunity to use SAP Business ByDesign innovations on it and intend to do so, giving customers the full benefit of the only true in-memory cloud platform in the world. We and our partners will continue selling SAP Business ByDesign in the future, and our partners will continue developing functions for our applications, which SAP will be supporting. Money our partners and customers have invested is not wasted and no current contracts are at risk. In light of our much expanded cloud offering, we do not disclose solution-by-solution revenue.
SAP Business ByDesign powered by SAP HANA gives our customers a full suite in the cloud, and there now are also two complete cloud suites in our product portfolio for subsidiaries and small businesses, the SAP Business ByDesign, and importantly, the SAP Business One cloud solutions, and that just shows how our offering covers customers of all sizes. Our next question. Let's see here. What do you think is the reason that the employee engagement has been declined according to the last people survey? What do you intend to do to increase it again and keep it stable long term? Even if we saw a slight decline in the employee engagement index year-over-year from 2012 to 2013, the 2013 score of 77% is still in the target corridor that we outlined in our 2010 to 2015 journey.
We still stick to our ambitions to reach a level engagement of 82% by 2015. The decline in engagement had two strong observations associated with it. In September 2013, we conducted a survey with our employees. Some said they were uncertain about our strategy. The second was despite huge efforts to create efficient processes in SAP and efficient structures, the employees perceived back then that we're not where we want to be, which is yet another reason why we keep reinforcing how we have to simplify this company. The board revised the results thoroughly. We looked at everything, and we took these results as a mandate to change. We have a well-elaborated-upon plan that's been communicated to the employees, including a refresh of our strategy, which we've highlighted here today for you. Up to now, we are continuously monitoring the adoption of that refresh strategy.
We see in the latest results of this monitoring, which we use SAP Jam, which is our social networking platform to get real-time feedback, that our employees overwhelmingly understand the refresh strategy, and more importantly, are totally committed to contributing to it. This quarter, we're heavily focusing on translating what that means to the employees in their day-to-day work life. Again, I reiterate my own personal excitement and that of Werner's, of course, to have Stefan Ries leading the human resource department going forward. In order to address these process topics, we are focused on simplification as a board, and we are also focused on simplifying everything for our customers. The market message should really help our employees get it. With these two measures, we're very confident to increase the level of engagement in 2014 and beyond.
A question by Bernhard Koller. It was said that the SE conversion would cost a certain amount of money. Is that everything? What will the conversion cost as a whole? What is the total cost of conversion? We believe that it's going to be EUR 4 million, all in all. This includes all the costs that are incurred in connection with the conversion. We do not expect other costs to be incurred by the conversion. Right. One more question about the development speed and go-to-market. The innovation speed going up in the past three years. This is why it seems strange that you have to read in the press that the organization of SAP is very sluggish. What sense does it make to publish this in the press also from an SAP point of view? What good does it do?
Why don't we ask ourselves the question, what the reason for this sluggishness is? Is it because of our staff? What measures are planned right now by the Executive Board? There are various answers to this question. First of all, any statements relating to my person within SAP, being made in meetings are passed on to the press directly. If that's the case, any connection between the Supervisory Board and the staff is no longer possible. You can't just sit there and say nothing. Doesn't make any sense. If you're not allowed as a Chairman of the Supervisory Board to say that there might be risks for the company and the staff should actually use Google in order to inform themselves to see what NetSuite is doing versus Business ByDesign or Workday versus SAP. Workday just said that they're having weekly deliveries of software.
There's a difference in magnitude here. Let me come back to disruptive innovation. What does it mean? It means that in part, we need different skill sets, and you notice that every day within SAP. We have to work on these skill sets, developing them. There's only a certain amount of time that we can do it, and it takes a special commitment by our staff. Otherwise, we would have to replace many more people. We believe that we have to train them. The processes are changing. It's very hard to change processes within the company, processes that everybody got used to. If you ever worked in a big company like ours, we'll know that. That hurts.
These changes of processes are something you have to go through, you have to discuss them, and it's a bad idea if you can read about them in the press, such internal things, purely internal things. I don't know why there are people within SAP who find it such great fun to relate those things to the outside. I don't know. Is it because of the staff? I've said it, skill set. I think that change of values is probably the most important factor here. They hit the whole company, especially the Executive Board. Namely, getting from license fees to having people join the cloud at a relatively small fee and grow them over time. It's a pay-as-you-go model, and that gives you different cash flow, of course, and that is something that the company has to struggle with.
There are fundamental changes that we need to implement. Not everybody's happy about them. Some people think it was so nice during the 1990s. Why can't it be that way now? Well, it can't because the world keeps turning and our competitors in other countries like the U.S. or China follow a different time scale and have a different speed to go by. Okay. Another question to the Supervisory Board about employee engagement. Wouldn't it make sense to look at employee engagement and have them as a short-term variable compensation component for the Executive Board? It has already been implemented is the answer. The Supervisory Board came up with financial targets as a priority, but there is also a discretionary component where employee engagement and customer satisfaction play an important part.
The discretionary component that the supervisory board can decide on ex-post will also look at the future viability of SAP with a view to market position, innovation, customer satisfaction, employer attractiveness, and employee satisfaction. This answers all questions by Mr. Koller. I would now like to call Ms. Barbara Grimberg again. We will hear again, and five minutes from now, I will close the list of speakers. If you want to take the floor, please come here. Now, attendance of the share capital of EUR 1,228,504,232 divided into as many NPV shares, 805,692,322 shares amounting to just as many votes are present, which amounts to 65.68% of the share capital. Mail votes also came in, which add up to a total of 806,614,181 votes are represented, which amounts to 65.66% of the share capital. Ms. Grimberg, please. Hello for the second time.
I just said that I had applied various times to get such a position on the supervisory board of SAP. The response by the board was that the appointment to the supervisory board must have a qualification such a member to show for itself. My question is, what is the real qualification to become a member of the supervisory board? What quality criteria apply ideally for this function? Quality management, training management, and audit? What are you referring to here? Or, as you said in connection with your staff, skill sets? I would like to know what kinds of criteria these are in detail. That is one question. Another question, something that came to my mind just now. Mr. McDermott, does he also have his own SAP shares, and if so, since when, and if so, how many? I would also like to know the following.
Well, you have been talking about SAP, the cloud, and in connection with the cloud, you have been talking about HANA. What does HANA really stand for? What is it an acronym for? Then another question for Mr. McDermott. For the whole of today, we have got an interpreter, maybe two interpreters here to do the translation. How much does the interpreter cost for simultaneous translation? How costly is it, and what additional costs are incurred by texts, legal texts, and such things to be translated from German, since they were published in German. So maybe comments by the German government, what have you, or legal texts to be translated so that Mr. McDermott can follow. Thank you.
Yeah. Thank you.
Right. Thank you. Let's continue answering the questions. Mr. [Giesecke], I think. Or Wernecke. Sorry, Mr. Wernecke. Mr. Günther? Mr. Günther first. Your question was about the SE. Is it the acquisition date that counts for tax purposes when it comes to the purchasing of the old SAP shares? When there's a legal conversion from an AG into an SE, the identity of the company will be maintained, and the identity of the shareholding will be maintained as well. This is why the shares in SAP SE are subject to the same acquisition date as for the old SAP shares. You gave us an example that was a little different. We had a number of conversions in Germany already going from an AG to an SE so far. We have some experience here. Next question by Mr. Wernecke.
Who was it who actually came up with the idea of suggesting Mr. Mehdorn as SAP Supervisory Board member? He's a turnaround person after all. Does SAP actually need that? This question is directed against Mr. Mehdorn. The Supervisory Board stands behind Mr. Mehdorn. What counts for us is what Mr. Mehdorn does as a member of the Supervisory Board. He's been doing an excellent job for many years in our company. As I said in an earlier response to the question, Mr. Mehdorn is applying his long-standing experience from various management positions in different industries as part of the Supervisory Board work. My colleague, Dietmar Hopp, when he was the Chairman of the Supervisory Board, he proposed Mr. Mehdorn as a member of the Supervisory Board. Right. We'll continue with Mr. Nessler. Okay.
Let me start by answering the question by Mr. Nessler, the first one, namely, when was the last employee survey in your company? The last employee survey took place in the autumn of last year. A question, this year there's going to be yet another employee survey in your company. What changes are there going to be based on the earlier employee survey? Mr. McDermott answered that question earlier on. Let me summarize this briefly. We have triggered a very comprehensive follow-up process, which includes all units at all levels of the organization. The activities that were defined at Executive Board level and that were implemented in recent months or being implemented as we speak, still apply to the new strategy and simplification. Mr. McDermott gave you more details about that in his earlier response. Next question from Mr. Nessler to me.
What about the provisions you've made for litigations? We form provisions when the criteria are fulfilled according to IFRS. In total, by the 31st of December 2013, provisions amounting to EUR 235 million were formed. This amount includes all obligations from the TomorrowNow litigation in particular.
You ready for me? Question is, can you please provide more information on the topic of market share of Oracle, IBM, and Microsoft? With Oracle, IBM, and Microsoft, you've named the most important large U.S. technology companies, and all of these companies have different business routes and models and therefore different core businesses. When analyzing the market share, you need to take a very differentiated perspective. The IT market itself, as well as the companies you mentioned, have many differences due to the strategic focus of various companies, and therefore, direct market share comparisons are difficult. It is important to analyze market share data for the different categories. We have already provided information on our market share data for the new categories such as cloud, as well as database and technology in a previous answer.
Now that the 5 minutes is over, I'd like to close the speakers list. There's 1 further request for the floor by Mr. Paul Wilhelm Böckle. As it's late, I'd like not to repeat the things expressed by various other speakers, but I keep reading in the press that often criticism of the cloud is being expressed because of data security, that data stored in the cloud and then called back can be retrieved by others without any encryption, so that companies don't like to put data in the cloud because they are afraid that this data could be used by unauthorized other parties. As we just heard, stolen from the cloud. That's a major danger which keeps many people from using this implementation. That's my question. Thank you. Thank you very much, says the chairman.
Mr. Brunner, you said at the meeting 2 years ago, I asked a question about SAP Ariba. Could I have an answer? I don't think much of it. Hasso Plattner mentioned it in a spontaneous reaction. With SAP Ariba, we've acquired the leading vendor of commercial networks in the cloud. On the SAP Ariba network, 1.4 million companies trade goods and services worth more than half a billion USD. The SAP Ariba portfolio combines this worldwide biggest cloud-based commercial network with cloud-based applications for sourcing and selling and liquidity management. Companies around the globe use their network for operation with commercial partners. The success of this acquisition is borne out by the revenue figures. In the segment SAP Ariba, in 2013, we generated a total revenue of EUR 461 million. Now, Schübel. The question raised by Ms. Eva Schübel.
Under the coalition agreement, there's a provision that starting in 2016, the supervisory board members to be appointed must have a 30% quota of females. Indeed. There's a quota of 30% for the supervisory boards of DAX-listed companies. A specific wording of the draft legislation is not in place, so there are no specific plans available at SAP for implementing these regulations. As soon as such a law will be enacted, which affects SAP as well, of course, we will stick by the binding quota, and in the next elections use all the sources available to find the suitable candidates. I had said in addition that we endeavor right now to look for suitable candidates. Next question by Ms. Schubert. Public tendering procedures make it possible to select the best candidates. Add to the pool of candidates. How do you staff supervisory boards and Executive Boards? The general requirement profile.
The requirement profile for Supervisory Board members can be taken from the objective listed in the Corporate Governance Reports. Where the Supervisory Board has to distinguish between two persons eligible for elections to the Supervisory Board, it's not gender, but the quality which counts. After all, the Supervisory Board is to do the best job, and the Supervisory Board is to make available to shareholders the candidates at the Annual General Meeting, irrespective of their gender. With respect to the future staffing of Executive Board positions, the Supervisory Board laid down in Code recommendations that there should always be a search for candidates in which 50% women are on the shortlist. For the decision about appointment, qualification, and experience should have greater weight than the gender.
There's the plan of the Executive Board to promote right here in staffing leadership positions, Executive positions, which comprises several elements, in order to add to the share of female executives and in the long run, build up candidates, male and female, under diversity aspects, also for Executive Board positions. Mr. Brandt. Then I'll handle Ms. Schubert's other questions. The first two are almost identical but apply to different organs of the company. According to the Coalition agreement, listed companies or companies under Code determination are to be obliged after 2015 to define binding target numbers for the increase of the quota of women in the Supervisory Board, Executive Board, and top management, publish them, and report transparently. How do you want to do it? Indeed, the Coalition agreement foresees a legal duty to introduce a target for the Supervisory and Executive Board and the 2 lower management levels.
About the target and the achievement or non-achievement of targets, a transparent report is to be compiled, but there's no specific wording of this legislation as yet, so that we haven't yet any specific ideas about the implementation of that legislative endeavor. The Coalition agreement also foresees that companies must take measures to promote women in the entire company hierarchy. How many women in your company in Germany work at the 4 Executive levels below the Executive Boards? Please mention absolute numbers and the percentage share for each individual level. At the 4 Executive levels below the Executive Board, the following picture about the share of women in Executive positions is this. The numbers I'm going to give you includes the members of the Global Managing Board who are not at the same time members of the Executive Board. First Executive level below the Executive Board: 4, 25%.
Second level: 16.8%. Third Executive level below the Executive Board: 45, 13.8%. And fourth level: 73, that is 14.6%. The information relates to Germany only. Next question, Ms. Schubert. Women do not benefit of promotions to top positions. How many women last year in Germany in your company rose to the first and second Executive levels below the Executive Boards? Please give me absolute numbers for both levels separately. Women in 2013. The information and your additional question was, what about the men? Women promotion to the first Executive level below the Executive Board in 2013: 2. Promotion to the second leadership level below the Executive Board: 10. Men, promotion to the first Executive level below the Executive Board: 7, and the second level: 57. Next question. What are you doing specifically to detect female talents, and what do you do to promote women?
I'm not talking about general promotion programs and nursery places. Are these measures sustainable? That is, are they evaluated and maybe readjusted continuously, as is usual in quality management? The programs in place will be continued in 2014/15, such as mentoring programs specifically for women among the members of top management in SAP. They act as mentors for female top executives. Leadership Excellence Acceleration Program, LEAP, piloted successfully in the U.S. and now globally rolled out. Compulsory global management trainings create the basis for changes. For instance, women and men leading together. Local training programs of female and male executives, such as encouraging female talent. As before, the individual Executive Board areas are responsible for defining and implementing specific promotion measures for women. There's an active business women's network in 12 locations worldwide, with more than 6,000 members, of whom 1,700 roundabout are in Germany.
The corresponding evaluations are done for these measures, which when necessary, are used also for readjustment. In this way, it's ensured that the existing programs meet their objectives and act sustainably on the staff and the company. Your next question, Ms. Schubert. Have you checked your personnel development programs to find out whether they meet modern ideas of a work-life balance? The answer, SAP regularly matches the personnel development programs to the most recent scientific findings. There are also thoughts spent on work-life balance. We support the aspect of work-life balance in [this area] by the following measures. Workshops, not run consecutively packed on several days, but broken down into various models, and virtual and recorded training courses, which can be used as a function of the individual working models. Next question. It's mainly women who, for family reasons, work part-time.
How do you incorporate these women in their personnel development measures? Are there any offerings for women and men about a terminated reduction of flexibilization of working time? Is there any claim in your company to enjoy full-time activity after working part-time? If so, how is it used by men and women? Fundamentally, the answer, all full-time and part-time employees can use personnel development measures. For a couple of years, some measures have been taken to make life easier for part-time forces. Whole-day training programs are shared to two half days, or if the subjects make it possible, they are switched to e-learning, so that staff can participate in line with their individual working times. In the light of life-family agreement, SAP is offering its staff members, men and women, an attractive additional range of offerings. Flexible working times, working part-time, child kindergarten places, parent-plus-child offices, internal, external consulting, and mediation offerings. These staff members have no unrestricted claim to return to full-time employment. In line with the current legislation, part-time staff members who want to extend their working time will be preferred when a respective free position is to be filled.
Last question. Do you ensure that persons taking personnel decisions get rid of subconscious patterns of behavior in assessing and promoting women? If so, let me recall the awareness training buzzword. For managers and staff in sourcing and recruiting, awareness training are being carried out in order to be sensitized to various aspects with respect to selecting women and men and looking for specific jobs.
In this way, traditional criteria of evaluation and choice are criticized and reviewed, and the entire process put on a less biased and more neutral basis. This answers Ms. Schubert's question. Mr. Ruoff. Mr. Brandt goes on. Questions by Mr. Ruoff. First of all, you asked, please make sure next year that the annual statement of SAP AG is written, is available. I think it's indeed not acceptable to have it available on the internet only. The annual accounts of SAP AG is available as a printed report available here, and can also be obtained from investor relations of SAP online or through the investor telephone. We can make sure that you get a copy after this meeting. Second question that referred to litigation, especially in the U.S. You said that it's difficult to put numbers to all this.
I agree, but there are numbers of interest to shareholders, so let me ask for them. What are the legal risks and claims for damages in the U.S., but also worldwide at the end of fiscal 2013 and the year before? The answer. I think I said so when answering to a different question, at least I tried to. In court cases, claims for damages, especially in the U.S., are put into more concrete terms only in the course of the proceedings, so a reliable total amount cannot be established against this backdrop. But in our Fiscal report item 23. We mentioned the amount of damages claimed where the opposite side provided such information. So where we have numbers, they are contained in the annual report. Next question. Give us precise figures. What has SAP and the SAP group spent on legal counsel and advisers in 2013 and 2012?
Those who had to deal with proceedings and claims for damages in the U.S. and worldwide. The cost of defending against IP litigation in 2013 were EUR 4 million. In 2012, EUR 7 million. Your last question, Mr. Wolf, what's the expense of this annual general meeting? What was it last year, for instance? Direct costs for organizing the annual general meeting last year amounted to EUR 2.2 million. That was EUR 200,000 less than the year before. These costs, in Australia, include renting the SAP Arena and catering expenses. Opportunity costs, for instance, for the attendance by Executive Board members and SAP staff are not included in these costs, of course. Then there's a question for me by Mr. Götzinger. No, Ms. Grimberg first. We don't have the answers yet. If you agree, I'll first handle Mr. Götzinger's questions.
The annual statement of the AG is about EUR 2.5 billion. In the group statement, there's an overall result of about EUR 2.8 billion. The difference, is that due to the different rules in HGB, German Commercial Code, and IFRS? The difference, the answer, primarily results from the fact that the statement of the SAP AG reflects only the results of the SAP AG as the parent company of the group. The group statement includes the result of all group companies after elimination of transactions within the group. The different accounting rules also result in deviations with respect to the listing assessment and showing of different balance sheet items. Next question. After conversion into an SE, will then the annual statement according to German law no longer exist? Will we only use the fair value principle and according with international accounting standards?
The answer, the conversion into an SE does not result in any changing in the accounting rules for the SAP, consequently, the single statement will continue to be based on regulations in the German Commercial Code. Chairman. We've covered Mr. Verrier. Now we are waiting for the answers to the question raised by Ms. Barbara Grimberg. I've tried to answer it a bit, but I've been forbidden to do that. Having erred in the number of women on the supervisory board in the not existing SE. May I perhaps take one? No. Well, yeah. There's one. Control of the supervisory board. Well, this is you and the auditors. They look to see whether the supervisory boards have truly discharged their supervisory functions. The supervisory board is supervised again. Well, let me state that this is a new record performance, I think, says the chairman. Huh.
Somebody's saying we're still on time. I hope there's something to eat after the meeting. Otherwise, we'll have to order a pizza. Jella. Okay, I'll start. Ms. Grimberg. You asked how many shareholders in 2012, 2013, and 2014 decided in favor of the internet dialogue for the general annual meeting. The internet dialogue, that is the online participation and online authorization of voting, was used by the shareholders of SAP AG in 2012 to 2014 as follows. 2012, 312 shareholders or representatives of shareholders used the internet dialogue. The shareholders or their representatives in part represented a considerable number of shares. In 2013, it was 286 shareholders. 2014, it's 447 shareholders. Next question. That was about the introduction of SEPA. What were the additional costs? In introducing this into your business transactions or the income resulting from this launch in customers.
SAP had completed its internal SEPA project on the treasury side before the end of the deadline. Our SEPA project was used to observe the new rules, on the other hand, with the implementation of the SAP software bank communications management, we also achieved gains in efficiency in payments. The additional benefit by these efficiency gains and the avoidance of fees for returns exceeds the project cost and the amount of EUR 120,000. On the product side, the software components were delivered to our customers under the heading of product maintenance, that is, under existing contracts. Within our maintenance strategy, we regularly deliver these regulatory changes within the framework of maintenance in order to support our customers and clients' management. The additional customer benefit arising in format harmonization allowed us to position additional sales products, such as products in liquidity management, software about bank communication, and so-called payment factories.
On the sales side, our SEPA balance is positive. Next question. What's the value-added tax you collected on purchases, and what is the pre-tax you paid for purchases in absolute amounts? Well, for SAP AG and the German sales subsidiary, we'd like to answer your question on the basis of the pre-registrations of sales tax for 2013. Sales tax in 2013 for the SAP AG amounted to about EUR 280 million, and pre-tax, EUR 200 million. For the German sales subsidiary, the sales tax amounts to about EUR 510 million and pre-tax to a sum of EUR 300 million. Next question by Ms. Grimberg. How many orders did you receive last year for software development, and how many of those did you refuse? In addition to standard development, we run special projects or developments for clients. These customers projects are, of course, called custom development projects, CDPs for short.
In 2013, we recorded 814 CDPs as incoming. This number includes change requests for ongoing projects. Costs for the general annual meeting. What are the costs of this meeting and for this of last meeting, differentiated with respect to catering, tickets for public transit, security, rental, invitations, decoration? As I said, direct costs for the annual general meeting last year amounted to EUR 2.2 million. In 2012, it was EUR 2.2 million. We have a lump sum contract with the arena covering several years, which covers the organization of this meeting, which includes rent, catering, security, and decoration. No differentiation is possible. For the invitations, we spent about EUR 60,000 last year. Costs of public transit tickets amounted to EUR 4,028.64. Please bear with me that we can't tell you anything about the actual costs of today's meeting. Next question. Of the profit, EUR 6.4 million are to be used for research and development.
That's praiseworthy or not because we heard something about complaints and negative conditions. Is this only provisions to correct those mistakes? Well, the balance sheet profit of EUR 7.5 billion available for payout. Our dividend policy provides for paying out more than 30% of the group profit after taxes. The quota paid out, the ratio between the sum paid out and the group performance, given the dividend payments of we proposed of EUR 1.9 billion, 36% of the group result. After deducting the dividend payment, this leaves EUR 6.4 billion in the company to finance corporate activities and especially future growth. Next question. I've referred to proposed improvements in the company. What's the number of proposals for improvement made by your staff members? What's the number of proposals filed and those implemented, and of the projects realized and the savings or license income resulting therefrom?
In our Idea Management 2013, 1,372 ideas were handled. Of those, 214 were implemented. These ideas have a quantified benefit of EUR 21 million. We refer to internal ideas about improvement, not product ideas. The quantified benefit referred to is comprised of many effects across all corporate divisions. Next question by Ms. Grundberg. What was the age of the oldest person you recruited in 2013/14? That is the maximum age of somebody recruited. What kind of employment contract did this person get? An employee contract or a fixed-time contract? What was the position to which that person was appointed? The oldest person permanently recruited in 2013 at that point was 65 years old. She was recruited as Solution Sales Senior Executive. In 2014, São Paulo has been a person, 68 years old, in the function of a Senior Account Executive. Next question.
How many of the shareholders were invited to this meeting? How many registered? How many appeared, and how many guests? Of course, as provided by law, the publication of the invitation to the general annual meeting in the Federal Gazette invited all shareholders to this meeting. A total of 9,000 shareholders registered for the meeting, 3,300 appeared in the flesh, and about 200 guests came. Next question, R&D. What is your expense on R&D? What is the structure for R&D expenses, such as lab, personnel, devices, equipment, et cetera? The importance we attach to R&D is expressed in numbers. In 2013, our R&D costs, according to IFRS, amounted to EUR 2.3 billion. This is the previous year's level. R&D quota, that is the share of R&D costs of total sales or revenue in 2013, was 13.6%. The major share of development costs is 73%, namely our in-house personnel costs.
Total expenses include also costs of external service providers and partner companies with which SAP cooperates in new development and advanced development of products. What is the headcount, employees, and manual workers in 2013? In 2014, differentiated by short-term workers, employees working under tariff contracts, employees paid outside these regular contracts. Well, SAP doesn't employ any manual workers, and there's no distinction between personnel employed under a collective agreement and those not. Well, number of employees, end of April, 66,906. Average pay, end of April, EUR 85,493. Number of leased workers, about 2,000. Payment of these companies providing staff to us, here we have no figures, but what applies are the collective agreements used by those companies. Let me go on with the next two questions. Well, you've handled them already. Well, let's go on again with Ms. Barbara Grimberg.
The audit of the Supervisory Board was cast into a more precise framework. Is there supervision of the Supervisory Board also with respect its own efficient activity? Who checks on the Supervisory Board? What are the criteria used, and how is this assessed finally? The Supervisory Board regularly checks the efficiency of its activity. In August 2013, for the last time, the questionnaires were sent to the Supervisory Board and members of the Global Managing Board. The results of the questionnaires evaluated by the chairman of the Supervisory Board were submitted in writing to the Supervisory Board members prior to the meeting on the 10th of October 2013 and discussed at the meeting. Within the most recent poll about the efficiency of the Supervisory Board activity, proposals were submitted on the composition of the Supervisory Board.
Since information supplied by the Executive Board, time and type of reporting, and focus of discussions in Supervisory Board, including detailed reporting about meetings of the committees to the whole plenum of the Supervisory Board, no decisions to implement improvements were taken. What is the total number of your shareholders? Well, we have only owner's shares. We do not know the names of the shareholders nor their total number. From the point of view of our investor relations work and the reports about voting rights we saw and read, we know a number of shareholders by name, but this allows no conclusion to be drawn to the total number.
What is the model function for lower-level employees when they do successful, highly motivated work at a fixed salary but do not get a bonus in case of success, while the board gets bonuses for success, in part only for being present? The board. What board? Is it the Supervisory Board or the Executive Board? Well, I'm not sure. Our staff, too, in addition to their fixed salaries, always receive a variable component. With this variable pay component, they participate in the success and the performance of the company. In addition, our staff have a performance-based pay in the format of one-off performance bonuses. Our Executive Board members, in addition to their fixed pay, get a performance-oriented variable pay. Fees for just being present are not paid. I thought it referred to me. I wasn't sure. Well, it wasn't. What is the real qualification for a Supervisory Board member?
What quality criteria are required? Quality management, training management, an audit, or skill set? To be able to duly discharge the duties of control and consultancy of the Executive Board, the members of the Supervisory Board must have the necessary abilities and knowledge. There are no general qualifications which all members of the Supervisory Board have to have. It's decisive that the Supervisory Board is composed so that it can adequately advise and monitor the Executive Board in all questions of corporate management. A Supervisory Board, in agreement with the German Corporate Governance Code, has laid down its objectives for the composition. This is published in our corporate governance report, available on our homepage, and also in the annual report on display here. Next question. Does Mr. McDermott hold SAP shares? If so, how many?
As shown on page 43 of the annual report, our Executive Board members, as per December 31st, 2013, held 30,201 SAP shares. Mr. Bill McDermott has shares of SAP, but we don't want to give any further information about the precise number of shares held by the different Executive Board members. The transactions with SAP shares are published within the framework of director dealings reports. Next question. What's the expense today incurred for simultaneous interpretation? The answer, the costs of simultaneous interpretation today are really insignificant and not essential for the order of magnitude of SAP. Thanks from the interpreter. I'd like to thank the interpreters for their stamina and endurance. What are the additional expenses for texts, writings, legal transactions to be translated from German into English so that Mr. McDermott can follow?
We're an international company which has to bear in mind not only German laws, but laws of all countries in which we work. Our global legal department reports to the Executive Board about important legal developments in the different countries in the internal corporate language, which is English. A verbatim translation of legal text from the national language can be provided in exceptional cases. It's internal and does not incur any additional external costs.
Stand for? What is the long name of HANA? The name HANA originally comes from High-performance ANalytic Appliance. SAP HANA is a flexible, data-agnostic, in-memory platform that helps organizations analyze their business operations using huge volumes of detailed transactional and analytic information from virtually any data source. There is much more on page 299 in our German annual report in the glossary section. Thank you.
Another footnote about HANA. We made a mistake when we called it that because HANA is not just an analytic appliance, but also an in-memory database, which stores data in columns and in other formats. It's more than a database. It's still called HANA. This is why we don't explain what HANA means. HANA is a name. I think we don't have any answers. Let me ask Ms. Grimberg. In answering your questions, have we handled them all? Ms. Grimberg? Ms. Barbara Grimberg.
Sure. Done.
Ms. Grimberg. It seems that no questions have been left open. The list of requests for the floor has been closed. Huh? Where is Ms. Grimberg? Did you listen? Is everything fine? Good. Thank you.
I guess it's over to me again. Now, be prepared for something. Mr. Werner Brandt promised me that he did his utmost together with his team, nevertheless, we have to get into the nitty-gritty right now. Right. I have no more requests to speak on my list, and the list is closed. I ask on behalf of the Executive Board, have all questions been answered? See. Right. I would ask you, please
Mr. Brandt, I had asked about the difference in the amount of EUR 0.3 billion, EUR 300 million approximately. The difference between the annual surplus of the AG and the result of the consolidated financial statements. The answer you gave was one that I was familiar with. There may be different valuation principles that are applied, but I wanted to know exactly how much of that relates to the inclusion of companies on the one hand, and on the other hand, and that's my main part of the question, is based on different valuation principles. Out of the EUR 300 million, let me give you an example, EUR 100 million may come from a different consolidation area, other companies, and EUR 200 million may be accounted for by other valuation principles. Please give me an answer like the one I gave you in this example.
Well, I don't know if we've got this down to this very level of detail because the consolidation is automatic, and we don't make any distinction here between what drives the difference, whether it's the consolidation area or different valuation. If you agree, we would analyze this and send you the information. I'm sure we don't have it right away. Would that be okay? Great.
The topic is data security in the cloud. I have read in various press reports that there are concerns about the cloud regarding data security, meaning companies are afraid that data stored in the cloud could be accessed by unauthorized persons. This could prohibit companies from using cloud-based implementation services. What are your thoughts on this? SAP is one of the world's leading providers of cloud services. Companies purchase these services to run their software or to save and process data in the cloud via the provider's server. Data privacy is important for the customer and has the highest priority at SAP. We strive to comply with all customer and legal requirements in the countries we do business in.
This also applies to data protection, which in Europe is still largely influenced by the EU Data Protection Directive of 1995 and the privacy laws that were adopted in response to the various member states. We have implemented a variety of technical and organizational measures over the years in order to meet these requirements. In particular, these include measures to protect data controlled by SAP and SAP customers from unauthorized access and processing, as well as from accidental loss or destruction. SAP regularly conducts external audits of these measures to ensure that all technical and organizational controls are effective and meet the latest technical standards. Further, we have implemented a certified data protection management system in areas that are particularly data protection critical, including support, HR, global services, marketing, application innovation, and custom development, whereby implementation is audited internally and externally by the British Standards Institution on an annual basis.
Furthermore, customers are provided with security certifications such as ISO 27001, security white papers, and reports from our independent auditors and certification bodies. We are also monitoring the current debate on reforms to the European data protection legislation so that we can respond quickly to any change in requirements.
I'd like to ask you once again on behalf of the Executive Board and the Supervisory Board, whether all questions have been answered. This is not the case. For the record, all questions from the floor have been answered. I'm now closing the discussion on all eight agenda items. I've already read out the attendance list and changes to the attendance. We'll now come to the remarks for the vote. Ladies and gentlemen, now we come to the vote on the management proposals in respect of items two to eight on the agenda. As last year, we will take all of the votes on the management proposals for items two to eight on the agenda at a single pass.
I will first explain the voting procedure for the shareholders and proxies who are present in the official meeting zone. Then I will explain the procedure for the participants online. Finally, I shall provide some additional details. The vote here in the official meeting zone will use a multi-item voting card, namely multi-item voting card one, near the front of the ballot card block. Voting results are determined using the subtraction procedure in which only the no votes and abstentions are recorded and counted. In other words, you only have to submit multi-item voting card one if you vote no to one or more of management's proposals or wish to abstain. The yes votes are then counted by subtracting the no votes and abstentions from the current attendance count.
Multi-item voting card one shows each item by number from item two through item eight, including the sub-items in six and eight. By each item and sub-item requiring a resolution, there are no and abstain checkboxes. Check the no or abstain box as appropriate by any item or sub-item on which you wish to vote against the management proposal or to abstain. To vote yes to a management proposal, do not check either box for that item or sub-item. If you wish to vote yes for all agenda items and sub-items, you do not need to hand in multi-item voting card one. To check the boxes on the voting cards, please use the SAP pen that you were given in the foyer with your booklet of voting cards. If you use any other pen, the machine may not be able to read your vote.
Voting cards will only be collected here in the main hall. All shareholders and proxies who are against one or more of the proposals that are now before the meeting, or who wish to abstain, should come to the main hall to vote, raise their hand when the vote is called, and have multi-item voting card one ready to put in the ballot box. I would like to emphasize once again that with the chosen method of voting, any shareholder or proxy who is present in the official meeting zone and who does not submit a voting card is voting in favor of all the management proposals concerning items two to eight. The official meeting zone includes all rooms and areas in the SAP arena that are accessible after passing through security at the entrance.
The shareholders and proxies participating online will vote by means of an online form, namely multi-item online voting card one. This is transmitted to the company by pressing the send online voting card button. Voting results for the online voting are likewise determined using the subtraction procedure, in which only the no votes and abstentions are recorded. In other words, you only have to submit multi-item online voting card one, which you do by pressing the send online voting card button, if you want to vote no or abstain on any of the management proposals now being voted on. Multi-item online voting card one shows each item by number from item two through item eight, including the sub-items in six and eight. By each item and sub-item requiring a resolution, there are no and abstain checkboxes.
Click the no or abstain box as appropriate by any item or sub-item on which you wish to vote against the management proposal or to abstain. To vote yes to a management proposal, do not check either box for that item or sub-item. You don't have to send it, do you? Well, anyway. If you wish to vote yes for all agenda items and sub-items, you do not need to send multi-item online voting card one. Here it is. I would like to emphasize that with the chosen method of voting, any shareholder or proxy who is present online during the voting and who does not submit multi-item online voting card one is voting in favor of all the management proposals concerning items two to eight.
I would like to inform shareholders who appointed employees of the company as their proxies, that the proxies present will cast your votes by releasing your voting instructions as they have been entered in the IT system. On release, the instructions flow into the vote counting system and are reflected in the results. Some of the institutional investors and shareholders associations have used the facility we offer to have no's or abstentions pre-entered in our computer system. Shareholders once again had the opportunity to submit their votes prior to the meeting by postal vote. These votes have likewise been entered in the IT system. To help ensure that attendance counts are accurate, I would kindly ask shareholders and proxies not to leave the official meeting zone and not to end their online participation during the voting.
I'm now calling for votes on the management's proposals in respect of items 2 to 8 on the agenda. Item 2 on the agenda. As I explained earlier, the Executive Board and Supervisory Board have adjusted their proposal concerning the appropriation of retained earnings. They propose the following: the retained earnings of EUR 7,595,363,764.58 from the 2013 fiscal year reported in the annual financial statements and management report be applied as follows, that a dividend of EUR 1 be paid for each qualifying no-par share, which makes EUR 1,194,057,084. That EUR 400 million be transferred to other revenue reserves, and that the balance of EUR 6,001,306,680.58 be carried forward to the new financial year. The wording of the management proposals for items 3 to 8 is the same as was published in the announcement in the German Federal Gazette on Monday, April 14th, 2014.
In the interest of avoiding repetitions, I refer you to this announcement. The wording is also provided in your invitation to this annual general meeting of shareholders. With regard to items 3 and 4, I expressly draw your attention to the voting exclusion in Section 136 of the German Stock Corporation Act. A simple majority of all valid votes cast is required for the resolutions on items 2 through 5 and on item 8B, a three-fourths majority of all valid votes cast is required for the resolutions on items 6, 7, and 8A. From this point, shareholders who have appointed proxies in our internet system cannot give or change voting instructions on these items. I now put the management's proposed resolutions on items 2 to 8 to the vote.
Shareholders and proxies in the official meeting zone who wish to vote against any or all of the proposals made by the management for items 2 to 8 or who wish to abstain on any of them, please go to the main hall, raise your hand, and put your completed multi-item voting card 1 in one of the ballot boxes. I would like to ask the staff to start collecting the voting cards now. Voting can now begin. Shareholders and proxies online who wish to vote against any or all of the proposals made by the management for items 2 to 8 or who wish to abstain on any of them, please submit your completed multi-item online voting card 1. For the record, the online participants have now had enough time to send their multi-item online voting cards 1.
The time for submitting multi-item online voting card 1 will end when I close the voting, which I will do as soon as I see that shareholders and proxies present here in the official meeting zone have been able to submit their multi-item voting card 1.
Hat jeder im Versammlungsbereich anwesend?
Have all shareholders and proxies present in the official meeting zone who wish to cast a no vote or an abstention on any of the management proposals been able to submit multi-item voting card 1 yet? Could you please call out? Okay, I repeat, because it says here to repeat the question if necessary. Have all shareholders or proxies present in the official meeting zone who wish to cast a no vote or an abstention on any of the management proposals been able to submit multi-item voting card 1 yet? I see they have. I am closing the voting now. The computer is working. I will announce the results of the voting as soon as I have them.
Was ist jetzt das neue? Kann ich den schon vorlesen?
Ladies and gentlemen, I now have got the results of the votes. The annual general shareholders meeting has accepted all of the management's proposed resolutions at items two to eight of the agenda with the required majority. Full details of the voting results can be obtained at the speaker's desk or the speaker's table. If you all agree, I would like to spare all of us a lengthy determination and instead, as permitted by law, limit the following determination of resolutions to those resolutions that they obtained the required majority. The gentlemen have not fully agreed yet. Do you all agree that we apply the procedure as proposed? Is anybody against it? I have now established that this is the case, which means that nobody objects to this abbreviated procedure. This brings me to the individual results.
Let me now disclose the results of the votes on the proposed resolutions of the management on items two to eight. I hereby declare the resolutions as taken by the AGM. With an attendance of 806,070,575, each with a share carrying one vote, which corresponds to 65.61%, which corresponds to the 1,228,504,232 shares with a pro rata share of EUR 1 of the stock capital, which also includes 34,447,148 own shares, has passed the following resolution.
On item number two of the agenda, the AGM, with 99.95% of the votes cast, which means with the required simple majority, has approved the appropriation of the net income of the year from fiscal year 2013 in the manner as it has been proposed in the adjusted proposal of the Executive Board and Supervisory Board on item number two of the agenda, which I have read out to you once again before we entered the general debate and before we started the voting procedure. On item number three, 98.84% of all of the votes cast of the AGM, which means with the required simple majority, the AGM ratified the acts of the members of the Executive Board for fiscal year 2013 for this period. On behalf of the Executive Board, I'd like to thank you for your trust.
On item number four, with 98.24% of all of the valid votes cast, which means with the required simple majority, the AGM has ratified the acts of the members of the Supervisory Board holding office during fiscal year 2013. On behalf of the Supervisory Board, I'd like to thank you for your trust. On item number five, with 99.63% of all of the valid votes cast, that is with the required simple majority of the votes, the AGM has appointed KPMG AG Berlin as auditors and consolidated auditors for fiscal year 2014.
On item number six, eight, 99.99% of the valid votes cast. Including the stock capital present at the vote, which means with the required simple majority of votes and three-quarter majority of capital, the AGM has approved the amendment modification on existing control and profit and loss transfer agreement with SAP 2 Beteiligungs- und Vermögensverwaltungs GmbH in a manner as proposed in the initial resolution by the Executive Board and the Supervisory Board in the announcement of the agenda under item 6B.
99.99% of the valid votes cast, the AGM has approved with the required majority of the stock capital present and also with the required simple majority and three-quarters of the capital majority, the AGM has approved the amendment agreement on the existing control and profit and loss transfer agreement with SAP 2 Beteiligungs- und Vermögensverwaltungs GmbH in a manner as presented in the proposed resolution by the Executive and Supervisory Board in the announcement of the agenda.
On item number seven, 99.99% of the valid votes cast of the AGM have approved with the required majority of the stock capital present and also with the required simple majority of votes and three-quarters majority of capital, has approved the conclusion of the control and profit and loss transfer agreement between SAP AG and a subsidiary in the manner as presented for the vote and as presented by the Executive and Supervisory Boards in the announcement of this AGM under item number nine.
On item number 8A, 99.57% of the valid vote present and the stock capital present during the vote, which means with the required simple majority of votes and three-quarter majority of capital, the AGM has approved the conversion with the change of legal form of the company into a European company, SE, and has also approved the articles of incorporation of SAP SE in a manner as presented in the proposal put up for the vote and as presented by the Executive and Supervisory Board in the announcements of this agenda on item number eight. Item number 8B, option number one, 73.72% of the valid votes cast and the stock capital present during the vote, which means with the required simple majority, the AGM has elected Professor Dr. Hasso Plattner as a member of the first Supervisory Board, SAP SE.
Item 8B2 of the agenda, 76.71% of the valid votes cast and the stock capital present during the vote, which means with the required simple majority, the AGM has elected Mr. Pekka Ala-Pietilä, member of the first Supervisory Board of SAP SE. Item number 8B3 of the agenda, 98.20% of the valid votes cast and the stock capital present during the vote. That is with the required simple majority, the AGM has elected Professor Anja Feldmann, member of the first Supervisory Board of SAP SE. Item number 8B4, with 66.88% of the valid votes cast and the stock capital present during the vote, that is with the required simple majority, the AGM has elected Professor Dr. Wilhelm Haarmann, member of the first Supervisory Board of SAP SE.
Item number 8B5, with 94.1% of the valid votes cast and the stock capital present during the vote, which means with the required simple majority of votes, the AGM has elected Mr. Bernard Liautaud, member of the first supervisory board of SAP SE. Item 8B6, with 76.77% of the valid votes cast and the stock capital present during the vote, which means with the required simple majority of votes, the AGM has elected Dr. Hartmut Mehdorn, member of the first supervisory board of SAP SE. Item number 8B7, with 76.67% of the valid votes cast and the stock capital present during the vote, which means with the required simple majority of votes, the AGM has elected Dr. Erhard Schipporeit, the member of the first supervisory board of SAP SE.
Item 8B8, with 71% of the valid votes cast and the stock capital present during the vote, which means with the required simple majority of votes, the AGM has elected Jim Hagemann Snabe, member of the first supervisory board of SAP SE. Item 8B9, with 91.59% of the valid votes cast and the stock capital present during the vote, which means with the required simple majority of votes, the AGM has elected Professor Dr. Klaus Wucherer, member of the first supervisory board of SAP SE. The term of the capital representatives elected under item 8B in the first supervisory board of SAP SE is in accordance with the proposed resolution of the supervisory board, limited for the time up to the end of the ordinary AGM, which votes on the ratification of the act of the supervisory board for the fourth fiscal year after the start of their term.
With the fiscal year in which their term begins is not included, but for six years by the longest. Ladies and gentlemen, I'd like to thank all of you most cordially for having borne us company until the very end. All of the agenda items of the meeting have been settled. I hope there's still some drinks available. I know we'll close SAP AG's 27th annual general meeting. It's not the SE yet? No, it's still the AG? All right. Thank you. Well, I cannot deviate. On behalf of the supervisory board and the executive board, I'd like to thank all of you very much for attending. I would like to add my own thanks also on behalf of the shareholders to the