Comments made by Schalke president Clemens Tonnies regarding Africa were racist but there will be no proceedings against the billionaire, who has stepped down from his post for three months, the German FA (DFB) said on Thursday.
Tonnies, owner of a meat processing company, had told a conference earlier this month that instead of increasing taxes to protect the environment there should be more power stations built in Africa.
"Then the Africans would stop cutting down trees and produce babies when it is dark," he had said in his speech in Paderborn.
His comments triggered a wave of angry reactions and calls for his immediate resignation.
Tonnies issued a public apology saying his comments were wrong and inappropriate and temporarily stepped down.
"The phrase was deemed by media as being racist," the DFB's ethics commission said. "This is rightly so."
But during a hearing Tonnies convinced the commission he was not a racist himself, presenting details of what it said was his "above-average" work and engagement in Africa.