Stewardship and Shareholder Engagement in Germany

45 Pages Posted: 9 Mar 2020 Last revised: 11 Mar 2020

See all articles by Wolf-Georg Ringe

Wolf-Georg Ringe

University of Hamburg - Institute of Law & Economics; University of Oxford - Faculty of Law; European Corporate Governance Institute (ECGI)

Date Written: February 26, 2020


Corporate stewardship holds great promise for the improvement of shareholder engagement and the encouragement of more responsible and long-term oriented value creation. Many countries have now adopted a best practice code for the stewardship role of institutional investors and asset managers, but Germany has so far refused to follow that trend. This paper explores the reasons for this reluctance, as well as whether the adoption of a Stewardship Code would still make sense in the regulatory framework of Germany today.

Despite the increased presence of shareholder engagement (and even activism), several reasons may be put forward for why lawmakers have refused to adopt a stewardship code. This paper argues that the main political reason for this reluctance lies in the limited geographical reach of such a code, which would primarily apply to the (limited) domestic fund industry and would be unable to prescribe any meaningful principles to foreign-based asset managers. Still, I argue that the adoption of a code in the German context may make sense, for example to define expectations and to clarify the obligations of investee companies. Most importantly, it would benefit domestic investors that are typically ‘home biased’ and thereby frequently disproportionately invested in domestic funds.

Keywords: stewardship, shareholder engagement, institutional investors, Germany

JEL Classification: G34, G38, K22

Suggested Citation

Ringe, Wolf-Georg, Stewardship and Shareholder Engagement in Germany (February 26, 2020). European Corporate Governance Institute - Law Working Paper No. 501/2020, Available at SSRN: or

Wolf-Georg Ringe (Contact Author)

University of Hamburg - Institute of Law & Economics ( email )

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University of Oxford - Faculty of Law

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European Corporate Governance Institute (ECGI) ( email )

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