The Importance of Board Independence - a Multidisciplinary Approach
Einde inhoudsopgave
The Importance of Board Independence (IVOR nr. 90) 2012/2.2.1.0:2.2.1.0 Introduction
The Importance of Board Independence (IVOR nr. 90) 2012/2.2.1.0
2.2.1.0 Introduction
Documentgegevens:
N.J.M. van Zijl, datum 05-10-2012
- Datum
05-10-2012
- Auteur
N.J.M. van Zijl
- JCDI
JCDI:ADS600602:1
- Vakgebied(en)
Ondernemingsrecht / Algemeen
Ondernemingsrecht / Corporate governance
Toon alle voetnoten
Voetnoten
Voetnoten
In theory, more board structures are applied around the world. Since the countries in this study have either a unitary or dual board structure, unitary and dual board structures are described in this section.
Deze functie is alleen te gebruiken als je bent ingelogd.
Prima facie, boards can be categorised into two different groups: unitary (one-tier) and dual (two-tier) boards.1 The main characteristics and differences are given in Table 2-1. Figure 2-1 shows graphically a unitary board structure in the left hand panel and a dual board structure in the right hand panel. Both structures are described below.
Table 2-1: The characteristics of unitary and dual board structures.
Unitary board structure
Dual board structure
Number of corporate organs at the top of the company
One (board of directors)
Two (management board and supervisory board)
Responsible for daily business
Executive members of board of directors (executive directors)
Management board
Principal of daily business
Chief executive officer (CEO)
Chairman of management board, also referred to as CEO
Responsible for supervision/advice
Non-executive members of board of directors (non-executive directors, NEDs)
Supervisory board
Principal of supervision/ advice
Chairman of the board
Chairman of supervisory board
Supervisors without affiliation
Independent non-executive directors (unaffiliated, outsiders)
Independent supervisory directors (SDs)
Supervisors with affiliation
Non-independent non-executive directors (affiliated, grey directors)
Non-independent supervisory directors (SDs)
CEO-duality
Possible
Not possible due to separation of management board and supervisory board
Board independence measurement
Ratio of the number of independent non-executive directors and the total number of directors (executive and non-executive directors)
Ratio of the number of independent members of the supervisory board and the total number of members of the supervisory board
Figure 2-1: Unitary board structure and dual board structure.