Literature Review Women on boards and in TMTS and firm performance108 Surprisingly the Management Board in October signed a long term contract with US based wafer manufacturer MEMC Electronic Materials for the fu ture supply of solar wafers from July 2008 onwards up to 2018 with a total value of US 7 to 8 billion CONERGY AG 2007 Oct 25 Volumes were to in crease every twelve months whereas prices were to decline steadily over the period of the agree ment in order to secure a normal manufacturer s margin when prices for solar systems would start to erode as expected The optimism behind the decision to conclude a nearly 8 billion dollars con tract was at conflict with the company s profitabi lity situation and is hence again indicator of over confidence Rueter pursued his growth plans with total determination Although the decision in general enjoyed a po sitive market response Citi 2007 Oct 29 this contract should prove fatal for the company s fate Rueter s decisions on these various capital intense long term commitments with suppliers but parti cularly with MEMC amaze in view of his awareness of the overall market development There is rea son to presume that it was an act of desperati on driven by the fear for insufficient supply for its Frankfurt Oder plant Price erosion for solar silicon products was expected in the near future due to the global increase in silicon capacity even accor ding to CONERGY s own statements International competition was becoming fiercer mainly due to the market entry of low cost producers from Asia Solar markets worldwide and particularly in Europe were to be flooded with low cost silicon wafers cells and modules Back in 2007 there were cle ar signs for a considerable ramp up of production capacities for solar technology in Asia although it was unclear when exactly the low cost products would hit the established PV markets worldwide Serious difficulties occurred at CONERGY in 2007 nearly leading to the Group s collapse The way how they were managed expresses Rueter s hu bris Only one day after having announced it would become a fully integrated solar producer CONERGY had confirmed its sales and profit forecast for fiscal year 2006 stating that full order books had put CONERGY fully on course CONERGY AG 2006 Nov 13 The respective ad hoc announcement was later basis for accusing the management of market manipulation In January 2007 CONERGY released a profit war ning a bitter surprise In contrast to its own claims and although revenues had increased by 42 percent to EUR 752 2 million in 2006 CONERGY missed its sales target and also its net income tar get of EUR 40 million Due to delays in delivery of solar modules and wind turbines so the company claimed CONERGY had to postpone the comple tion of two important projects power plants until 2007 meaning a shifting of revenues of about EUR 53 million into the following year The compa ny now guided for a net income of between 2005 s EUR 27 8 million and the originally expected EUR 40 million Analysts showed only a yel low card for now Citigroup Company in depth 2007 Jan 15 but stated that CONERGY s credibility had been negatively affected and that their confidence was shaken Table 4 2 presents CONERGY AG s key financial figures for the years 2006 to 2011 CEO optimism and overconfidence

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