The Code is still a long time coming. And who knows – maybe at least a small litter will succeed? The government commission must be measured against these four criteria.


The day for which the Government Commission on the German Corporate Governance Code has eagerly awaited has arrived: Today, Friday, the Federal Council is dealing with the new ARUG II shareholder rights directive, which nobody really loves. And although the Bundestag’s Legal Affairs Committee scheduled a public hearing on the same subject on 5 June, the Government Commission now wants to conclude the Code Reform: Commission President Rolf Nonnenmacher scheduled a telephone conference next Wednesday at which he will inform “about the resolutions on the Code Reform 2019”.

I confess: I would like to be there when he and the responsible ministerial official in the Ministry of Justice, Ulrich Seibert, discuss the revised version.

Because I would like to know if the two of them discuss controversially – but I can’t really believe in it. It also seems unlikely to me that Minister of Justice Katarina Barley will intervene shortly before her departure for Brussels. The subject just doesn’t win any votes. She has reason enough for this, as we made clear in our open letter. After all, it is about entrepreneurial freedom, the rule of law and thus also about Germany as a business location.

What matters now

One thing is clear: we must no longer expect a breakthrough like the one we are calling for and will continue to call for within the framework of the CodeWende initiative. But perhaps at least a first step forward will be made. The following criteria would have to be met:

  • Preamble: The Code needs a clear job description in the preamble. This work order must come from the Federal Ministry of Justice and be available in written form. The preamble should also clearly and unambiguously describe from what the so-called government commission derives its legitimation to draft a binding code for German listed companies ‘ex cathedra’ without having submitted it to the acting bodies of the companies concerned for a vote beforehand. Only that would be a self-commitment in the sense of the rule of law.


  • Comply or explain: The code should have a section next to the preamble dealing with the ‘comply or explain’ principle. It would be desirable to draw up a simple checklist that does justice to the interests of all stakeholders. Companies should then complete this checklist in a uniform format and publish it on the website of the Commission (or even better: of Deutsche Börse). Our proposal to this effect, which we have drafted in consultation with many relevant stakeholders, has been before the Commission for some time.


  • Apply and explain: Another section should be devoted to the ‘apply and explain’ principle and explain principles that should be a stakeholder-oriented corporate communication. The Commission is aware of the internationally groundbreaking King IV Report from South Africa – as well as the draft #Kodex2018, which I submitted at the end of 2017 and which is based on the ‘Apply and Explain’ principle.


  • Co-determination and more. Finally, a further section of the new Code was to deal with the issues that had to be left out 15 years ago for reasons of political raison d’être. These include co-determination, corporate governance within the Group and issues of international corporate governance.

These are our modest demands on a new code that not only makes companies responsible, but at least gives them the necessary freedom in communication for individual, tailor-made solutions. And one thing is clear: if the Government Commission continues to think ‘one-size-fits-all’ in this area as well, we have made no progress – and the new Code would be inappropriate.

In any case, I am curious to see what will come and look forward to a lively discussion with all stakeholders. Then more than ever.

Any additions, comments, objections? I look forward to your feedback:

Editorial by Peter H. Dehnen -> About the Person.