11.4.6 Conclusion

(Consideration 11.3) Groupthink is a ‘desperate drive for consensus at any cost that suppresses dissent among the mighty in the corridors of power’. The consequences or symptoms of groupthink may lead to decision-making of lower quality and lower performance of the organisation. The theory has received serious criticism, but is accepted based on intuition rather than evidence. In order to prevent the antecedents of groupthink – group cohesion, structural faults in the organisation and a provocative situational context – measures are recommended that are closely related to corporate governance reforms with a focus on independence. Stronger independence criteria, separate supervisors meetings, establishment of board committees, maximum tenure, diversity on the board, prohibition of CEO duality, a ban on related party transactions and evaluations are examples of these measures. So more independence lowers the probability of groupthink and improves the quality of decision-making.

The measures in order to prevent groupthink can be categorised in the three building blocks of independence: person, composition/structure and preconditions. Besides an enhancement of the independence of the board, these measures lower the probability of groupthink. This entails that more independence does not only lead to better monitoring, but also improves the quality of the discussion within the board and ultimately results in better decision-making. It appears that these measures against groupthink are incorporated in the legal frameworks of the United Kingdom, the Netherlands and Sweden. However, the involvement of shareholders in the nomination committee in Sweden, the possible position of executive directors in the British nomination committee, and no requirements regarding external evaluation in the Netherlands and Sweden are not in line with the measures against groupthink. These examples should not only be reconsidered from an independence viewpoint, but also from a groupthink viewpoint.