Voting arrangements in the ECB’s Governing Council

KEY POINTS

According to the Statute of the European System of Central Banks, each member of the Governing Council has one vote. To maintain the Governing Council’s capacity for efficient and timely decision-making as new Member States join the euro area, the Governing Council members agreed that the number of governors from NCBs exercising a voting right should not exceed 15. The decision adjusts the method of voting accordingly.

Governing Council

• The Governing Council is one of the three decision-making bodies of the ECB. The other two bodies are the Executive Board and the General Council.
• The Governing Council is the main decision-making body. Its main tasks are:
  • to define the monetary policy for the euro area;
  • to adopt guidelines and decisions to achieve that aim; and
  • to adopt general supervisory decisions.
• The Governing Council is composed of the six members of the Executive Board and the governors of the NCBs of the euro-area Member States (currently 20). The number of governors therefore increases each time a new Member State joins the euro area.

Rotation of voting rights by groups

• The total number of voting rights in the Governing Council of the ECB is limited to 21. The six members of the Executive Board have permanent voting rights. The remaining governors share the remaining 15 voting rights, which rotate among them every month.
• The governors are allocated to groups which are formed in accordance with a ranking of euro-area Member States, based on:
  • their share in the aggregate gross domestic product at market prices (GDP mp)¹ in the euro-area Member States;
  • their share in the total aggregated balance sheet of the monetary financial institutions² of the euro-area Member States.
• Within each group, the governors keep their voting rights for equal amounts of time. A governor in the first group cannot vote less frequently than a governor in the second group.
• These criteria aim at ensuring transparency and objectivity, by taking into account the economic weight of the Member State in the euro area and the size of its financial sector.
• The decision provides for the voting rotation system to be implemented in two stages.

Stage one (current stage): allocation of voting rights when the number of governors exceeds 15 but is below 22

• As from the date on which the number of governors exceeds 15 and until it reaches 22, the governors are allocated to two groups:
  • the first group is composed of the five governors of the NCBs which rank the highest based on the criteria above (currently Germany, France, Italy, Spain and the Netherlands);
  • the second group is composed of all the other governors.
• The five governors in the first group share four voting rights and the remaining governors in the second group share 11 voting rights.
• Stage one would have normally applied as from January 2009, when Slovakia joined the euro area as its 16th Member State. However, in December 2008 the Governing Council took a decision to postpone the start of the rotation system, so as to avoid the situation where governors within any group have a voting frequency of 100%.
• Instead, stage one of the new rotation system was introduced on 1 January 2015, when Lithuania joined the euro area as its 19th Member State.

Stage two (future stage): allocation of voting rights when the number of governors reaches 22

• As from the date on which the number of governors reaches 22, the governors will be allocated to three groups:
  • the first group will be composed of the five governors which rank the highest based on the criteria above;
  • the second group will be composed of half of the total number of governors. This group is composed of the governors of the NCBs of the Member States holding the subsequent positions in the ranking based on the above criteria;
  • the third group will be composed of all the other governors.
• Four voting rights will be assigned to the first group, eight to the second and three to the third.

Implementation, adjustments and future changes

• Whenever the number of governors increases, the composition of the groups will be adjusted as of the day on which the governor(s) join the Governing Council. Whenever the aggregate GDP mp is adjusted (required every 5 years), the composition of the groups will be adjusted in line with any changes and will apply from the first day of the following year.
• Any decision which is necessary to implement the operational details of the rotation system will be taken by all members of the Governing Council, acting by a two-thirds majority of all its members, with and without a voting right at the time of the decision.

  In 2009, the Governing Council adopted Decision 2009/328/EC regarding:

  • the rotation rate;
  • the rotation period;
  • the order of governors within groups; and
  • the transition from system from two to three groups.