Campus

The German government committee for Corporate Governance is asking for understanding

The Regierungskommission Corporate Governance (DCGK) intends to ratchet its dialogue with politics up a notch to press home the importance of transparent decision-making processes, clear attribution of responsibility and guarantees within companies. On February 4, the “Die Welt” daily newspaper invited a number of high profile CEOs and Supervisory Board chairs to take part in a conference entitled “Zukunftsplan Corporate Governance [What Future for Corporate Governance]”. Participants included Manfred Gentz (chair of the Deutscher Corporate-Governance-Kodes government committee), Joachim Faber (chair of the Supervisory Board of Deutsch Börse), Manfred Schneider (former chair of the Supervisory Board of Bayer). Renowned personalities from academia also took part in the conference that was held on the 19^th floor of the Axel Springer Building as did corporate governance experts and representatives of large-scale asset managers. Good Corporate Governance (CG) said Gentz to the assembly, must foster transparency. After legislation has completed its task and the committee has no further recommendations to give, governance’s lifeblood is dialogue. Many lawyers and many companies feel, instead, that signing the declaration of compliance required by the government committee is enough  to  meet the needs of good Corporate Governance. Investors on the other hand, tend to favour a more general model of CG according to which not only do companies have to act within the law but, first and foremost ought to take the investors’ aspirations and rights very seriously. In their view, not even the most transparent declaration of compliance can guarantee good practice CG. For their part, large-scale German companies fear for their liberty of manoeuvre, looking on in dismay  as the new government plots further forays into their company freedom. Fears of quotas, regulations on remuneration and such like measures threaten to make life difficult for German companies vis-à-vis their foreign competitors. According to the chair of the Supervisory Board of TUI, Klaus Mangold, politics should keep more of a distance from company affairs and not produce any more rules and regulations. In the light of the situation abroad, there is no need for them.