Italy’s corporate law reform (Legislative Decree 47/2026, in force since April 29, 2026) has fundamentally restructured the division of duties and liabilites within the boardrooms of Italian limited companies. To grasp the significance of this reform, one must first understand Italy’s traditional governance model.
Italian traditional and most common system features a Board of Directors (Consiglio di Amministrazione) responsible for managing the company alongside a separate, independent supervisory body called the Board of Statutory Auditors (Collegio Sindacale) – distinct from the external auditor – whose role is to oversee compliance with the law, the company’s by-laws and the adequacy of the company’s internal organization.
Within the Board of Directors, Italian law has long allowed the delegation of managerial powers to one or more executive directors (Amministratori Delegati, i.e. managing directors or CEOs), who are entrusted with day-to-day operational management. The remaining board members, who do not hold such delegated powers, are referred to as non-executive directors (NEDs).
Within this framework, the reform clarifies the boundaries between executive and non-executive directors, mitigating the risk of retrospective liability for the latter.
A key concept in Italian corporate law is the corporate structure (assetto societario)–the organizational, administrative, and accounting framework. Under the amended Article 2380-bis of the Civil Code, establishing and ensuring an appropriate structure (adeguato assetto) is an exclusive collective duty of the directors. Under Article 2381-bis, however, a clear division of duties is established: executive directors must actively design, maintain, and monitor this framework, reporting on its status at least every six months; whereas the board as a whole (including NEDs) must evaluate its adequacy based on these reports.
Although the 2003 corporate law reform abolished the notion of a general duty of constant vigilance by directors, replacing it with duties of informed oversight and intervention where warning signs emerge, NEDs were still routinely held liable for failing to prevent harm if courts deemed that they “should have known” about executive misconduct, creating a de facto strict liability risk.
The 2026 reform corrects this imbalance by introducing the principle of reasonable reliance (ragionevole affidamento) in the new Article 2381-ter, paragraph 4, where it explicitly states that non-executive directors, when making decisions, may rely on the information and reporting received from executive bodies through proper corporate channels. This acts as a statutory safe harbor, provided there are no obvious anomalies or “manifest unreasonableness” that should have prompted further investigation.
Furthermore, this reliance is modulated by the director’s specific professional expertise. While Article 2392 has long required diligence to be measured against a director’s skills, the new framework means that a financial expert will face a higher standard of scrutiny regarding balance-sheet data than a director with a purely industrial background.
By protecting NEDs who act in good faith on structured reporting, the reform shifts the pressure back to executive directors. Executives now bear heightened responsibility for the absolute integrity and completeness of the data they feed to the board.
Future developments
It will be for the courts to define the practical boundaries of the new framework, particularly with regard to the concept of “manifest unreasonableness” of a director’s reliance on delegated bodies or officers. The first judicial decisions will therefore be crucial in determining the extent to which NEDs may invoke the protection afforded by the new regime.
Nevertheless, the direction of the reform already appears clear: to create a governance system that is more efficient, realistic, and better aligned with the actual allocation of responsibilities within the board of directors.
