I've done alot of research into this recently as I was chasing a brake issue.
You're probably unhappy with your brakes and are thinking of changing them.
There's really only one upgrade that someone with a 520 should do and that is to switch to 525 ventilated front discs and the bigger callipers that come with it.
I've checked everything else and it really doesn't make a difference if you have ABS brakes which the M50TU surely had. No matter how good your brakes, as soon as they locked up...the abs unit took over, and stopped the car in accordance with the ABS functioning (if you kept your brakes applied).
If you had much bigger and better brakes, you would get to the ABS lockup point faster, but after that it was basically ABS all the way. The time it takes you to get to the ABS lockup point would not be significantly changed, if you upgraded the brakes much.
So think of it as two stages to braking. The pre abs and post abs stage. Both stages combine to bring the car to a complete stop.
You can only affect the pre abs stage, and not the post abs. And the changes you make to the pre abs stage are not sizable enough to justify the huge costs involved.
This is a very backhanded way of saying that the stock braking system that came with the E34 was excellent out of the factory. You can't do much better than that. The E34 did hold the world stopping distance record (from 60-0mph) when it was introduced. I think that says alot about it.
So how do you improve your brakes? Three things, and all of them are well known.
1. Make sure your brake system components are in good shape. No leaks in brake lines and the master cylinder. No persistent fault codes on the ABS unit. Brake oil that is clean and is Dot4 at a minimum. Brake discs and pads that are not too thin. Brake discs are flat not warped. Brake hoses - make sure your stock hoses are in good shape or switch to steel braided brake hoses - this DOES NOT create better braking, but better braking feel alone. But that is nice and steel braided brake hoses cost the same as stock hoses. You can buy them on ebay for US$50 before shipping. Any brand will be fine.
2. Bleeding. Only use piston bleeding, even for single pot callipers. Don't use normal bleeding. Tyres need to be removed and a little more brake oil is required, but this removes ALL the dirty brake oil and mud that is frequently trapped right behind the piston and does not get removed easily.
3. Tyres. Tryes with good thread for braking, tyres which are not bald ie still well within tolerances, and tyres which have a fatter contact patch with the ground, improves braking.
Other than that, you will only need to get bigger brakes (callipers, pistons, brake pads, brake rotors), if your car became much heavier. This only happens if you swop in a much bigger, heavier engine typically. A heavier car requires more force to stop. Unless you are planning to upgrade to an M60 engine, you don't need to bother thinking about it. Even if you do, you should try out your car with the new engine first and see if it needs better braking. And you should only upgrade your brake hardware if your maintenance, brake system, and tyres are already in good shape and its still inadequate to the job.
Why switch to the 525 ventilated brakes ? Well, they are ventilated. This dissipates heat better. The 520 brakes were not ventilated. Hotter rotors lead to degraded braking. So the 525 rotors were a better form of basic technology to begin with as they were ventilated....so despite the outstanding stock braking system on the E34, its better to upgrade to those. And of course, since they are larger rotors, you need to get the bigger 525 front brake callipers as well.
In short....if you are not happy with your brakes, please look at your maintenance, tyres and piston bleeding first and foremost. Only when that is in good shape....and you are STILL unhappy with your brakes...then consider an upgrade.
And remember, brake kits can only help the pre-abs portion of the braking process. The post abs portion is really only affected by changes in the tyre patch and tyre thread. So its not worth the investment in a bbk. Most brake upgrades that make you happy - are only psychological. If you measured it in terms of physical braking distance you would not notice any proper difference. Of course, when a mechanic upgrades your brakes for you, he will change the brake oil, probably the brake hoses too, and do solid bleeding, and you are using new flat rotors and pads - which are that stuff that I feel actually improve your brakes. But of course we would think it was the bigger multi pot callipers etc that does it. And of course many mechanics will not tell you this if they are the ones selling the bbks to you.
It took me many years, alot of reading, experience, and consulting with both mechanics and forum buddies, and spending money on stuff that didn't really work when i checked carefully to arrive at this understanding. It took you ten minutes to read this post. I hope that helps.
Roberto