Germany: executive pay - new legal rules

The Financial Times newspaper reports that new legal rules governing directors' remuneration are likely to be introduced in the next few months. In a report titled "Germany gets tough on executive pay", Bertrand Benoit writes:

German companies could have to cap executive pay under a bill agreed on Friday [today] by legislators in what is shaping up as the toughest crackdown in Europe against excessive boardroom compensation. The new, tougher-than-expected rules, which are almost certain to be enacted before the summer, would also allow supervisory boards to give shareholders a non-binding vote on executive pay packages at annual general meetings. The provisions are part of a broader package of measures that legislators on Friday said would add much-needed transparency to the traditionally opaque and secretive procedures that have long governed boardroom compensation at large German companies".

Germany's Corporate Governance Code Commission also met today to discuss changes to the Code. Information (in English) about the outcome of the meeting has not yet been published but see here for the issues under discussion.