Response to the consultation document to update the Dutch Corporate Governance Code

On 21 February 2022, the Monitoring Committee (the 'Committee') published a consultation document containing proposals for updating the Dutch Corporate Governance Code (the 'Code'). The Code applies to Dutch listed companies and contains principles and best practice provisions on the governance of listed companies and their accountability to their shareholders. CMS regularly advises on corporate governance and has therefore noted the consultation document with great interest.

In order to keep the Code up to date, future-oriented and relevant, the Committee has made a number of proposals relating to amended legislation and regulations, the integration of ESG (Environmental, Social & Governance) factors into the strategy of companies as an important feature of long-term value creation, and revised provisions on the role of shareholders. The Committee aims for the updated Code to come into force as of the financial year starting on or after 1 January 2023.

The proposals relating to amended legislation and regulations concern, among other things, the introduction of increasing gender diversity in boardrooms and new regulations governing the remuneration policy and the remuneration report. In addition, provisions have been revised with the aim of further encouraging dialogue between shareholders and companies. For example, rules have been added with regard to the engagement policy of institutional investors, on abstentions by shareholders with larger short than long positions and with regard to the recall of lent shares in case of voting on significant issues.

Martijn van der Bie, Bob van Zijl and Anne Fleur Krijthe responded on behalf of CMS to the consultation document to update the Dutch Corporate Governance Code. They have commented on a number of articles of the consultation document. Their response can be read below.