Corporate Governance International Series - Turkey Chapter
1. GENERAL PRINCIPLES
1.1 What are the general principles of corporate governance in your jurisdiction? What are
the main objectives of the corporate governance principles? Is your legal system based on
common law, civil law, Islamic law or something else?
A historical weakness of corporate governance in Turkey (a civil law jurisdiction) is that dominant shareholders tend
to control a significant portion of Turkish companies. This has meant that many of the formal rights of shareholders
have been ineffective in practice, and has necessitated a legislative framework that stipulates extensive shareholder
protection mechanisms. The investor-friendly governance culture introduced by the Turkish Commercial Code (TCC)
in July 2012 rests on equal treatment, transparency and effective shareholder participation principles.
1.2 Have there been any recent developments in the law, codes and rules of corporate
The concept of corporate governance was first introduced to a Turkish audience in 2003 by the Capital Markets
Board of Turkey (the CMB Principles) based on the OECD’s corporate governance rules. The CMB Principles were
initially applicable to companies listed on Borsa Istanbul (formerly known as the Istanbul Stock Exchange) only on a
comply or explain basis.
© Thomson Reuters 2015
This article was first published in the International Series 2nd Edition 2015
and is reproduced with the permission of the publisher, Thomson Reuters.