What is Corporate Governance in Turkey?
Corporate governance refers to a framework of rules, practices, and processes that direct and control a company. The primary responsibility for corporate governance typically lies with the board of directors, who are accountable for managing senior leadership, conducting audits, and organizing key meetings, such as general assemblies and board meetings. These activities must be carried out according to both Turkish regulations and international standards to promote transparency and accountability within the company.
The Four Principles of Corporate Governance
Globally, corporate governance revolves around four key principles that all companies must follow:
- Transparency – Ensuring openness in all business dealings and communication.
- Fairness – Maintaining an impartial approach to stakeholders and employees.
- Responsibility – Making decisions that prioritize long-term success while upholding ethical standards.
- Accountability – Being answerable for decisions and the overall governance of the company.
Companies that adhere to these principles can build stronger relationships with investors, employees, and customers, ensuring sustainable growth.
What is Corporate Governance Advisory?
Corporate governance advisory involves offering professional advice and services to companies to help them establish and maintain sound governance structures. A comprehensive corporate governance advisory service includes:
- Drafting policies for hiring and overseeing senior executives.
- Ensuring regulatory compliance across all operational areas.
- Developing strategies for investment and risk management.
- Guiding structural changes within the company, such as mergers or capital alterations.
Corporate governance consulting services also play a vital role in establishing companies in Turkey by aligning their operations with international standards for accounting, auditing, and management. By enhancing transparency and accountability, these services help companies operate more efficiently and ethically.
Legal Framework Governing Corporate Governance in Turkey
In Turkey, corporate governance is primarily governed by the Turkish Commercial Code (TCC) No. 6102 and the Capital Markets Law No. 6362. These legal frameworks have evolved in response to global economic changes and emerging commercial needs. The 2024 amendments to these laws reflect the ongoing transformation of corporate governance practices, offering companies clearer guidelines and more flexibility in managing their affairs.
Key revisions to the Turkish Commercial Code include changes to the roles of the board of directors, such as eliminating the annual election requirement for chairs and vice chairs and updating procedures for calling board meetings. Additionally, the minimum capital requirements for both limited liability and joint-stock companies have been increased significantly to encourage stability and growth in Turkey's corporate landscape.
Corporate Governance Services by Pi Legal Consultancy
Pi Legal Consultancy offers a wide range of corporate governance services designed to help companies comply with Turkish and international regulations. Our corporate governance consultants provide legal and strategic advice on various matters, such as:
- Organizing board of directors and general assembly meetings.
- Managing capital increases or decreases.
- Ensuring good governance during structural changes, such as mergers and acquisitions.
- Addressing legal liability issues for company founders, members, and managers.
- Assisting with taxation and taking legal action when necessary.
Our firm also specializes in helping foreign companies establish and operate in Turkey, providing tailored solutions to improve their competitiveness and legal compliance. For more information about this topic https://www.pilc.law/practice-areas/corporate-governance-law/