Dutch Corporate Governance Code: Why It Matters Beyond Listed Companies

Governance expectations, board accountability and risk management in Dutch transactions

The Dutch Corporate Governance Code formally applies to Dutch listed companies. It sets principles and best practice provisions for management boards, supervisory boards, shareholders, long-term value creation, risk management, culture, remuneration and accountability.

For foreign investors, private equity funds, venture capital investors and international counsel, the Code is relevant even when the target or portfolio company is not listed. Dutch governance expectations often influence how boards, shareholders and investors look at decision-making, supervision, conflicts of interest, risk management and reporting.

In Dutch M&A, PE and VC transactions, the Code is not usually incorporated as a binding transaction document. But its themes often appear in due diligence, board governance, investor rights, reporting obligations, supervisory board structures, reserved matters and post-closing governance discussions.

This article explains why the Dutch Corporate Governance Code can matter in Dutch transaction practice, even outside the listed-company context.

This article is part of the Governance Insights series on Dutch BV shareholder arrangements and decision-making and is relevant for foreign investors involved in Dutch M&A transactions, Dutch private equity deals and cross-border Dutch deal implementation.

The latest version of the Dutch Corporate Governance Code is available through the Monitoring Committee Corporate Governance Code. Although the Code is formally aimed at Dutch listed companies, its principles on board accountability, supervision, long-term value creation, risk management and shareholder engagement are also useful reference points for foreign investors assessing Dutch governance structures in private M&A, VC, PE and joint venture transactions.

What is the Dutch Corporate Governance Code?

The Dutch Corporate Governance Code is a set of principles and best practice provisions for listed companies in the Netherlands. It addresses the relationship between the management board, supervisory board, shareholders and other stakeholders.

The Code is based on the “comply or explain” principle. Listed companies are expected either to comply with the Code or explain why they deviate from it. The Monitoring Committee Corporate Governance Code promotes the relevance and usability of the Code and monitors compliance by listed companies.

For non-listed Dutch companies, the Code is not automatically binding. A private Dutch BV does not become subject to the Code simply because it has foreign shareholders or professional investors. But the Code does influence what is seen as serious Dutch governance practice.

Why foreign investors should pay attention

Foreign investors often focus on contractual control: board seats, veto rights, information rights, consent matters, drag-along, tag-along and exit rights.

Dutch governance thinking adds another layer. Directors and supervisory directors are expected to act in the interest of the company and its business. Decision-making should be properly documented. Conflicts of interest should be managed. Risk management should not be treated as an afterthought. Supervision should be meaningful rather than symbolic.

These themes matter in private transactions too. If a governance dispute later arises, or if a portfolio company faces financial pressure, the quality of the decision-making process can become important.

For foreign buyers and investors, this means that Dutch governance is not only about getting veto rights into a shareholders’ agreement. It is also about designing a workable board and shareholder process.

Listed-company rules versus private-company practice

The Code is primarily relevant for listed companies. That distinction matters.

A Dutch BV used as a startup, scale-up, acquisition vehicle, portfolio company or joint venture does not usually need a listed-company governance framework. Applying the Code mechanically to a private company may be unnecessary and burdensome.

However, certain principles are useful beyond listed companies. These include clear allocation of board responsibilities, proper supervision, risk management, conflict-of-interest procedures, transparent decision-making and meaningful reporting to shareholders or investors.

The practical question is therefore not whether a private company must “comply” with the Code. The practical question is which governance principles should be translated into the articles of association, shareholders’ agreement, investment agreement, board rules and reporting framework.

Governance in Dutch BV transactions

In Dutch BV transactions, governance is usually implemented through multiple documents.

The articles of association define the formal corporate structure. The shareholders’ agreement regulates shareholder rights, transfer restrictions, reserved matters, information rights, drag-along, tag-along and exit provisions. An investment agreement may include financing obligations and investor rights. Board regulations may define the internal allocation of tasks.

Foreign investors should ensure these documents work together. A governance right that is commercially agreed but poorly implemented in Dutch legal documents may be difficult to enforce or operate in practice.

This is particularly relevant for US-style VC terms, private equity control rights, management rollover structures, joint ventures and cross-border acquisition vehicles.

Board accountability and the company’s interest

Dutch governance places significant weight on the company’s interest and the business connected with it. Directors and supervisory directors are not simply representatives of the shareholder who appointed or nominated them.

This can be important for foreign investors who are used to stronger shareholder-centric governance models. An investor-nominated director may have access to information and influence, but that role also carries Dutch-law responsibilities.

Where investor interests and company interests diverge, the governance documents and board process should provide a clear way to manage conflicts. This may involve reserved matters at shareholder level, observer rights instead of formal board seats, conflict-of-interest rules, recusal procedures and careful documentation of board decisions.

Risk management and the 2025 Code update

The Dutch governance debate increasingly focuses on risk management. The 2025 update to the Dutch Corporate Governance Code included the risk management statement, known in Dutch as the Verklaring Omtrent Risicobeheersing or VOR. This statement is aimed at giving stakeholders more transparency on the management of operational, compliance and reporting risks.

For listed companies, this affects reporting and board accountability. For private companies, the lesson is broader: risk management is becoming a more visible governance issue.

In transaction practice, this can affect due diligence and post-closing governance. Buyers and investors may ask how the company identifies operational, financial, legal, compliance, cyber, reporting and regulatory risks. PE funds may expect stronger reporting. VC investors may seek information rights around runway, security, product, compliance and regulatory risk. Strategic buyers may want governance systems that can integrate into group reporting after closing.

The Code therefore reinforces a trend already visible in Dutch transactions: governance is increasingly linked to risk control, reporting quality and board accountability.

One-tier board, two-tier board and supervision

The Code is often discussed in the context of Dutch board structures. Dutch companies may use a two-tier model with a management board and supervisory board, or a one-tier model with executive and non-executive directors in one board.

For foreign investors, the board model should be chosen based on the company’s size, shareholder structure, investor involvement and need for supervision. A one-tier board may feel more familiar to US and UK investors. A two-tier board may be useful where management and supervision should be clearly separated.

In either model, investor control is usually not achieved through board structure alone. Reserved matters, shareholder consent rights, information rights and board regulations are often more important in practice.

See also One-tier Board or Two-tier Board in the Netherlands and Dutch BV Governance for US Investors.

Private equity and portfolio governance

For private equity investors, Dutch governance expectations are relevant after closing.

A PE sponsor may control key decisions through the shareholders’ agreement, but the portfolio company still needs a functioning board process. Management must have enough authority to run the business. The sponsor may need consent rights over strategy, budget, debt, acquisitions, senior hires, capex and exit. Supervisory or non-executive roles must be aligned with Dutch law responsibilities.

The Code does not dictate how a Dutch PE portfolio company should be governed. But its themes are relevant: long-term value creation, risk management, accountability, supervision and stakeholder awareness.

In a dispute, a refinancing, a distressed situation or an exit process, poor governance documentation and weak board minutes can create avoidable legal and commercial risk.

Venture capital and growth company governance

In Dutch VC-backed companies, governance is usually more founder-driven but still investor-protected.

Investors may request information rights, protective provisions, investor consent matters, board seats, observer rights and reporting covenants. Founders want speed and operating flexibility. The Dutch implementation must balance both.

Governance inspired by listed-company standards would usually be excessive for a startup. But certain principles are still useful: clear decision-making, conflict management, cap table discipline, reporting, risk awareness and documented approvals for material decisions.

This is especially relevant where foreign VC investors use US-style term sheets for Dutch BV companies. The commercial rights must be translated into Dutch documentation rather than copied into the shareholders’ agreement without legal adaptation.

Practical conclusion

The Dutch Corporate Governance Code is formally directed at listed companies, but its influence reaches further.

For foreign investors in Dutch companies, the Code is useful as a reference point for governance expectations: board accountability, supervision, risk management, reporting, conflicts of interest and shareholder interaction.

Private Dutch companies do not need to copy listed-company governance. But in M&A, VC, PE and joint venture transactions, the underlying principles often help shape better transaction documents and more workable post-closing governance.

The practical objective is not to over-regulate a Dutch BV. The objective is to translate investor rights, board responsibilities, supervision and reporting into a governance structure that works under Dutch law.

FAQ

Does the Dutch Corporate Governance Code apply to private Dutch BVs?
No. The Code formally applies to Dutch listed companies. Private Dutch BVs are not automatically subject to the Code.

Why is the Code relevant for foreign investors?
Because the Code reflects Dutch governance expectations around board accountability, supervision, risk management, shareholder interaction and conflicts of interest.

Should a PE portfolio company follow the Code?
Not as a formal requirement, unless specific circumstances apply. But Code principles can be useful when designing board supervision, reporting, reserved matters and risk management.

What changed in the 2025 Corporate Governance Code update?
A key development was the inclusion of the risk management statement, the Verklaring Omtrent Risicobeheersing or VOR, aimed at increasing transparency on operational, compliance and reporting risks.

How should governance be implemented in a Dutch BV?
Usually through a combination of articles of association, shareholders’ agreement, investment agreement, board regulations, reserved matters, information rights and clear decision-making procedures.

About Dirk de Waard

Dirk de Waard is a Dutch corporate and M&A lawyer, partner at Venture Lawyers in Amsterdam, and advises foreign investors, founders, private equity funds, VC investors and international counsel on Dutch BV governance, shareholder arrangements, investor rights, board structures, reserved matters, M&A, venture capital and private equity transactions.

Applying Dutch governance expectations in transactions?

Dutch governance is not only about statutory rules. In private M&A, VC, PE and joint venture structures, governance expectations must be translated into workable Dutch documents, including articles of association, shareholders’ agreements, investment agreements, board rules and reporting frameworks.

Dirk de Waard advises foreign investors, founders, PE funds, VC investors and international counsel on Dutch governance structures and transaction implementation. Contact Dirk de Waard at dirk.dewaard@viottalaw.com to structure Dutch governance before investor rights or board processes become difficult to operate.