ThyssenKrupp & Wirecard: Excesses of the corporate governance system crisis – and opportunity for real change.


Dear readers of the GermanBoardNews,

two weeks ago I announced at this point that I would be carrying out an updated assessment of the ThyssenKrupp case. Seiher has made the issue more explosive: The Supervisory Board was severely criticized for its decision to grant the Executive Board members special compensation.

I also consider the bonuses to be very questionable in view of the situation of the Company. Admittedly, the whole thing would not be all that bad if it were a slip-up. Unfortunately, however, this is not the case: The special bonuses fit like a glove with a group that has significant corporate governance deficits.

How did it come to this? For me, the root of the problem remains the combination of the foundation model with a stock market listing. Because this opened the door for ThyssenKrupp – also for those types of investors who are not familiar with long-term entrepreneurial thinking. A “clash of cultures” was preprogrammed.

“The end of Rhenish capitalism”

And the same thing happened when the activist investor Cevian joined the company in 2013 and a little later became a member of the supervisory board. There, the Swedes gradually increased the pressure, and the Krupp Foundation, as the major shareholder, unfortunately had too little to oppose them – especially since it did not send any high-caliber members to the supervisory board.

The consequences are well known: Due to a lack of backing from the foundation, CEO Heinrich Hiesinger took his hat off (we were titling at the time: “The End of Rhenish Capitalism”). A little later, Supervisory Board Chairman Ulrich Lehner followed, who stands like no other for stakeholder value and corporate management in the spirit of the social market economy.

The decline of ThyssenKrupp is thus also an expression of a corporate governance system crisis: Listed companies are too easily becoming the plaything of short-term investors.

Since Lehner’s resignation, little has improved and much has gotten worse at ThyssenKrupp. And the special compensation is a significant damper on cautious hopes that Supervisory Board Chairman Siegfried Russwurm will bring about a genuine cultural change. I am skeptical, but I am willing to be proven wrong.

2021: Turn to #FutureGoodGovernance?

In any case, next year we will take a close look at how ThyssenKrupp and other groups are acting in terms of corporate governance. We are also eagerly awaiting political developments, above all the Wirecard investigation committee and the planned legal requirements for good corporate governance.

I am convinced: The Wirecard scandal and the decline of ThyssenKrupp have revealed a corporate governance system crisis – and thus hold the opportunity for real change. 2021 could therefore herald a turnaround to #FutureGoodGovernance.

Until then, on behalf of the entire GermanBoardNews team, I wish you a peaceful Advent and Christmas season. Defy the adverse circumstances, stay healthy (!) and start well into the New Year, in which we (hopefully) will defeat the Corona Pandemic. We will report back on January 14th.


Your Peter H. Dehnen