8.2.4.4 Other independence recommendations

Tenure of supervisors is considered to be an impediment for independence as well. Due to a long-term relationship as supervisory board member, management board member and board of directors member, the critical view may diminish. The DCGC has not opted to include a tenure criterion in the list of independence criteria, but has included best practice provision III.3.5. This provision requires that a supervisory director may be appointed for a maximum of three four-year periods. The DCGC therefore chooses to allow supervisory directors to serve at most twelve years on the supervisory board. In order to avoid a situation where many supervisory directors cease their activities at the same time, best practice provision III.3.6 requires a retirement schedule, which should be made generally available and posted on the company’s website. Chapter III.8 about the unitary board structure does not make reference to the best practice provision about the maximum tenure. This implies that this maximum tenure requirement does not apply to NEDs, which can be considered remarkable.

With respect to remuneration, the DCGC states in principle III.7 that the remuneration of the supervisory board members may not be dependent on the results of the company and that the general meeting shall determine the remuneration. In order to comply with this principle, best practice provision III.7.1 provides that a member of the supervisory board may not be granted any shares or options as remuneration. In addition, best practice provision III.7.2 adds that all shares of the company have the purpose of long-term investments. Best practice provision III.7.3 furthermore states that the company may not grant the supervisory directors any loans or other guarantees, unless approved by the supervisory board itself. Remission of loans may not be granted either to the members of the supervisory board. Again, the DCGC does not seem to make these best practice provisions explicitly applicable to NEDs in a unitary board structure.