The Importance of Board Independence - a Multidisciplinary Approach
Einde inhoudsopgave
The Importance of Board Independence (IVOR nr. 90) 2012/11.5.2:11.5.2 Aim of independence
The Importance of Board Independence (IVOR nr. 90) 2012/11.5.2
11.5.2 Aim of independence
Documentgegevens:
N.J.M. van Zijl, datum 05-10-2012
- Datum
05-10-2012
- Auteur
N.J.M. van Zijl
- JCDI
JCDI:ADS593678:1
- Vakgebied(en)
Ondernemingsrecht / Algemeen
Ondernemingsrecht / Corporate governance
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The cultural aspects of independence show that levels of board independence are based on a demand from the society or the people in a country. Due to cultural differences people have a higher or lower demand for independent monitoring. Societies with high levels of individualism, uncertainty avoidance and power distance have relatively high levels of board independence. Highly masculine societies have low levels of board independence. The social relationships section states that independence, which is independence in fact or an independent mindset, is necessary to see things differently and objectively. Therefore, according to this section the aim of independence is to have supervisors that dare to challenge executive directors or members of the management board and so improve the quality of decision-making. According to the groupthink theory, the aim of independence is to address these antecedents of groupthink – group cohesion, structural faults in the organisation and a provocative situational context – and to lower the probability of groupthink and to improve decision-making.