In December 2003, the final version of a new Dutch Corporate Governance Code was adopted. The code is titled: The Dutch Corporate Governance Code. Principles of good corporate governance and best practice provisions. The Dutch Corporate Governance Code was prepared by a committee instituted for this purpose by the Minister of Finance and the Minister of Economic Affairs whose members represented a number of leading organizations from the Dutch business community. The committee was chaired by Mr. Morris Tabaksblat, who is also the chairman of AEGON’s Supervisory Board. The purpose of the code is to reflect the latest generally held views on good corporate governance in the Netherlands. These views have been expressed in principles of good corporate governance as well as more concrete best practice provisions through which the principles are applied. The code thus purports to provide Dutch listed companies a guide to improving their corporate governance. The code came into effect on January 1, 2004. In accordance with its terms, the code requires a Dutch listed company to formally report on its application of the code in its annual report over the financial year 2004. The report should also serve as the basis for a discussion on this subject in the General Meeting of Shareholders to be held in 2005.  AEGON has welcomed the institution of the Corporate Governance Committee and has actively participated in the discussions within the Dutch business community that have accompanied the preparation and publication of the code.  AEGON endorses the code and the principles of good corporate governance included therein. AEGON intends to use the code and the principles contained therein to continue and intensify its ongoing discussions with its stakeholders on corporate governance with the view to bringing its corporate governance standards in compliance with the code. Immediately subsequent to the publication of the definitive Dutch Corporate Governance Code AEGON has initiated a review process aimed at implementing the code in the company’s corporate governance. In line with the recommendations of the code, the current chapter gives an overview specifically indicating where its corporate governance is already compliant with the code. To the extent that AEGON does not fully comply with best practice provisions of the Dutch Corporate Governance Code, the reasons therefore are explained and the actions the Supervisory Board and the Executive Board contemplate taking are set out. This chapter will be discussed as a separate item during  the annual General Meeting of Shareholders to be held on  April 22, 2004. Whilst not all principles and best practice provisions of the Dutch Corporate Governance code are cited, the discussion set forth below closely follows the structure of the Dutch Corporate Governance Code. Where appropriate the headings of the chapters and paragraphs of the Dutch Corporate Governance Code have been included for easy reference in addition to references to the individual clauses. The Executive Board and the Supervisory Board will continue to take responsibility for the corporate governance structure of AEGON. The paragraphs in the annual report dealing with corporate governance already customarily included are expanded. Starting with the 2004 annual report, the annual reports will include a separate chapter describing AEGON’s application of the principles and best practice provisions of the corporate governance code.  [I. Principle; I.1] Each time a substantial change in the corporate governance structure of the company is contemplated, the compliance of AEGON with the code shall be submitted to the General Meeting of Shareholders for discussion under a separate agenda item.  [I.2] The current members of the Executive Board are appointed for an indefinite term. Giving due regard to the existing employment positions of the individual members, the Supervisory Board intends to investigate whether these employment positions can be reconciled with the best practice provision to limit the term in office of members of the Executive Board to (consecutive) four year periods. The Supervisory Board intends to limit the term in office of members of the Executive Board to (consecutive) four year periods.  In accordance with past practice within AEGON, the Executive Board will submit to the Supervisory Board for its consideration and approval the operational and financial objectives of AEGON, the strategy to be used to achieve these objectives, as well as the parameters that are applied in relation to the strategy (including the financial ratios and capital adequacy levels). A summary hereof will continue to form part of AEGON’s annual reports.  [II.1.2] IMPLEMENTING THE CORPORATE GOVERNANCE CODE COMPLIANCE WITH AND ENFORCEMENT OF THE CODE AEGON AND CORPORATE GOVERNANCE EXECUTIVE BOARD AEGON GROUP ANNUAL REPORT 2003 63 DUTCH CORPORATE GOVERNANCE CODE