This paper describes the evolution of german model of industrial relations: the so-called ‘co-determination’. In Germany, ‘co-determination’ (Mitbestimmung) has a long tradition. Beginning in the late 19th century, the system has been developed over more than 100 years. Employees’ co-determination in Germany becomes visible in two different forms: employees’ participation in ‘works councils’ and labor’s participation in ‘supervisory boards’ on board level. This paper focuses on the participation in supervisory board (unternehmerische Mitbestimmung). Compared with other EU member states – especially with Italy - Germany has one of the most highly developed systems of board-level co-determination: we can assume employee participation at board level as typical element of the local system of corporate governance.