Corporate Governance is understood as the legal and factual regulatory framework for the management and supervision of an enterprise. The German Corporate Governance Code (the “Code”) contains principles, recommendations and suggestions for the Management Board and the Supervisory Board that are intended to ensure that the company is managed in its best interests.
The Code highlights the obligation of Management Boards and Supervisory Boards – in line with the principles of the social market economy – to take into account the interests of the shareholders, the enterprise’s workforce and the other groups related to the enterprise (stakeholders) to ensure the continued existence of the enterprise and its sustainable value creation (the enterprise’s best interests). These principles not only require compliance with the law, but also ethically sound and responsible behaviour (the “reputable businessperson” concept, Leitbild des Ehrbaren Kaufmanns). The Government Commission will already present the new Code, in order to help enterprises and capital market participants prepare for the new recommendations and suggestions. Within the meaning of best practice, enterprises may adopt individual new recommendations and suggestions prior to the official adoption date. The GCGC version dated 7 February 2017 acts as the basis of the Declaration of Compliance until the new Code has been published in the German Federal Gazette.