Constitution of Belgian boards

Governance profile

Corporate governance practices are influenced and determined in different countries by an uneven mix of law, regulation, culture and custom. This article highlights a number of areas where these influences manifest themselves most strongly. Each section focuses on the features and practices that make corporate governance in Belgium different from that in other countries, including information about how Belgian boards are typically constituted, requirements for audit and remuneration committees, the breadth of shareholder rights on offer, and more.


Belgian corporate governance regulations are mainly set by the Belgian Companies Code as well as several corporate governance codes. Belgian listed companies are governed by the Belgian Corporate Governance Code of 2009. This Code is a best practices code that is not included in the law but that has been recognised by a Royal Decree (Nl / Fr) as the reference code for listed companies. It is based on a ‘comply or explain’ basis. However, some of the provisions have been incorporated in Belgian legislation and are as such mandatory for listed companies. Listed companies are also required to disclose their corporate governance practices in a corporate governance statement that is part of their annual report. Non-compliance with the recommendations of the Code must be explained in this statement.

The corporate governance statements are monitored by both the Belgian regulator (FSMA) as well as the Belgian Corporate Governance Committee. Furthermore, Belgium was the first country to publish a code for non-listed companies in 2005. The Koning Boudewijn Stichting/Fondation Roi Baudouin has developed in 2010 recommendations and best practices for the social profit sector.

Board of directors

As per the Belgian Corporate Governance Code, directors of Belgian companies are elected by their shareholders. The boards of Belgian listed companies are generally composed of a mix of executive and non-executive (independent) directors. In that respect, the Corporate Governance Code recommends that at least half of the board members are non-executive. In principle, three of these non-executive directors must qualify as independent directors. The board has a double role, with regard to strategy and control. Furthermore, it has an important role in the choice of the management structure and the appointment of the CEO. The board of directors also needs to establish an audit committee as well as a remuneration committee.

Audit committees

Since 8 January 2009, listed companies are legally obliged to establish an audit committee within their board of directors. The law transposes the provisions set out by the European Directive 2006/46/EC. The audit committee must be composed of only non-executive members with at least one member being independent. This independent member of the audit committee must have the necessary expertise in the field of accounting and auditing and needs to fulfill the new independence criteria set out by the law. These new criteria will also be applicable to independent directors who are member of the committee entrusted with the assessment of intra-group transactions. 

Remuneration committees

On 6 April 2010, the Corporate Governance Law (Nl / Fr) was passed by the Belgian legislators. This law obliges most listed companies to establish a remuneration committee within their board of directors. The remuneration committee has to be composed of only non-executive directors, the majority of which must be independent. The remuneration committee must also demonstrate the necessary expertise with regard to remuneration-related issues. The main tasks of the remuneration committee consist of making proposals to the board of directors on board and executive remuneration. The committee is also charged with drafting the remuneration report that is part of the Corporate Governance Statement in the annual accounts. 

Shareholder rights

The law of 20 December 2010 on the exercise of certain rights of shareholders in listed companies (Nl / Fr) was adopted and published on 18 April 2011. The law foresees in the transposition of European Directive 2007/36/EC with the purpose to enhance shareholders’ rights in listed companies. The law entitles shareholders to vote and participate to the annual general meeting by electronic means. They are also able to consult documents of the annual general meeting and proxy voting on the company’s public website. 

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