Corporate Governance Book

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Corporate governance covers standards and behaviours that define how a company is managed and supervised. Good governance should ensure a balance between the interests of shareholders, management and other stakeholders. It is one of the core values of the company and should achieve transparency in management. This implies adequate control over performance, risk management and supervision of compliance with implemented procedures.

Good governance is not an end in itself but aims to create long-term value for shareholders and more generally for all stakeholders.
For Belgium, corporate governance is regulated by Belgian law and European directives as well as governance codes («soft law»).
There are currently two applicable governance codes:

  • The Belgian Code on Corporate Governance (2009), prepared by the Corporate Governance Committee, applies to listed companies.

  • The Buysse Code II (2009) applies to unlisted entities.

With the laws of 17 December 2008 (MB of 29/12/2008) and 6 April 2010
(MB 23/04/2010), Belgium has transposed into national law the obligations imposed by the European Directive 2006/46/EC) in terms of corporate governance and in particular established an audit committee, a remuneration committee and the publication of a statement of corporate governance and remuneration report in the annual report.

The purpose of these laws is to help improve the quality of accounting and financial information, the relationship with the registered auditor and the risk analysis by the Board of Directors.

In addition, a new version of the Belgian Code on Corporate Governance was published in 2009. The main changes from the previous version are:

  • An explicit reference to the social responsibility of the company that it should take into account when setting its strategy

  • Separation between the roles of Chair of the Board and CEO for a balanced leadership in the company

  • Clarification on the role of the Board

  • The update of criteria defining independent directors to the content of -Article 526ter of the Companies Code

  • Encouragement of dialogue with shareholders

  • Recommendations on the remuneration of executive members.

The Belgian Code on corporate governance is based on the «comply or explain» principle except for the provisions of the Code that were made mandatory by law.

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