An Overview of German Business or Enterprise Law and the One-Tier and Two-Tier Board Systems Contrasted

Abstract

It is hardly possible to judge the merits of the German corporate governance system without also having a basic knowledge of German business or enterprise law and without analysing it within its wider cultural context and linguistic background. Whereas business law or enterprise law refer to all legal aspects pertaining to businesses or enterprises, the focus of this book is on corporate governance in context of primarily large companies or corporations. A distinctive feature of German companies or corporations is the particular relationship amongst the various corporate organs and the unique synthesis between corporations law and labour law. Understanding this synthesis is fundamental when the merits of the English and American one-tier system and the German two-tier system (the management board and the supervisory board) with employee participation are analysed and compared. These aspects have often been neglected in the academic literature attempting to analyse the German corporate governance system from a traditional Anglo-American perspective.