228 Towards supervisory board as corporate conscience.

All perspectives point towards a dual responsibility for the supervisory board, oriented both towards assisting the executive board and monitoring the constitutional basis of the corporation itself. The supervisory board is not merely an extension of the executive board (as is perhaps suggested by the one-tier model) but constitutes a separate body with a distinctive responsibility (corresponding more to the two-tier model). Although the nature of the constitutional basis differs for each perspective, they all seem to expect the supervisory board to monitor whether board decisions serve the interests according to which the corporation was constituted. For the partnership perspective, this constitutional basis involves the partners of the corporation, including all strategic stakeholders.1 For the institutional perspective, the corporation is constituted by the public interests for which it is licensed to operate, including its individual public purpose as well as the larger non-strategic interests of its stakeholders.2 Finally, the ecosystem perspective considers the legal corporation to be constituted by the factual embeddedness of its enterprise in its larger environment, requiring the supervisory board to monitor all relevant social and ecological aspects involved in its corporate ecosystem.3

All in all, this suggests a dual responsibility of the supervisory board for both (a) assisting the executive board in its attainment of durable success as well as (b) reviewing the impact of its decisions on the preservation of the constitutional basis of the corporation. The first responsibility positions the supervisory board as a close counsellor of the executive board, providing advice in relation to the best way for achieving durable success. The second responsibility requires a more distant and critical supervisory board, capable of reviewing whether board decisions maintain the commitment of its stakeholders, protect general public interests and preserve the resilience of its environment.4 This responsibility towards the constitutional basis of the corporation includes a critical self-assessment of the implications of board decisions for its environment, requiring conscientious reflection from the supervisory board.

In my view, such a dual responsibility fits well with the trend in Dutch corporate governance towards a professionalized and expert-based supervisory board in a one-and-a-half tier model. This convergence of the two-tier and one-tier model allows for both close cooperation with the executive board and a sufficient distance to be kept in order to critically review board decisions in relation to larger interests.5 By building on this trend, the supervisory board should be given the necessary capacities and composition to fulfil its responsibility for holding the board accountable for its impact on social and ecological interests. I will return to this in the following section. All in all, I articulate the following recommendation in relation to the responsibility of the supervisory board towards social and ecological interests: