2.5 Conclusion

(Consideration 2.1) Independence is defined as a situation in which a supervisor is independent in fact and in appearance. Such a supervisor has an independent mindset that leads to unbiased work and there are no facts and circumstances that are so significant that a reasonable and informed third party would question the supervisor ’s independence. In order to determine his independence (in form) the independence criteria from the disinterested outsider model – with a focus on the lack of ties with the company and its management – should be used. This definition should also include requirements about the ability, competence and quality of the objective monitor model and the time commitment requirement of the unaffiliated professional model. These independent supervisors must function in a (supervisory) board with such a composition that they can effectively monitor and advise the executive directors or management board. Furthermore, a structure with board committees is essential, because these board committees function in areas where conflicts of interest may arise.

This definition of independence, which answers the central research question in this chapter, addresses the person building block as well as the composition/ structure building block of independence. Both the person and the composition/ structure must be right to ensure independence of the (supervisory) board. A good board composition with board committees is useless without supervisors who really execute their tasks with an independent mindset. The opposite is also true, independent supervisors cannot perform their work properly without the right composition and structure of the board. The preconditions building block of independence is addressed in Part II of this study about the legal approach to independence. The other two building blocks are elaborated upon below.