4.5.1 Introduction

As described above, boards of companies in each country must develop, implement and monitor such varied elements as purpose, strategy, policy, risk management, succession, evaluation and communication. Since the composition of boards and the division of tasks have been dealt with in section 4.4, I shall now consider what roles are appropriate to each type of director and how these roles can best be promoted.

In this section (4.5) the role of the members of Dutch supervisory and management boards in the two-tier system and of executive and non-executive directors in a one-tier system will be discussed in relation to the following aspects: the evolution of the role of supervisory board members in a two-tier system over the last 30 years, culminating more or less in a one-and-ahalf-tier board (4.5.2); the legai context of the division of powers between shareholders and board members (4.5.3); the roles of the different board members in two-tier and one-tier systems (4.5.4); the role of the management board members and supervisory board members in strategy development (4.5.5); the difference between a two-tier and a one-tier board in relation to early and on-site information and access to junior management (4.5.6); the differences between supervisory board members and non-executive directors (4.5.7); the role of representing the company (4.5.8); the dual function of management board members: action and monitoring (4.5.9); independence in today's two-tier boards (4.5.10); the role of the chairman in the present and future (4.5.11); the role of the separate chairman and CEO in a two-tier and one-tier board in companies of varying size (4.5.12); evaluation (4.5.13); term of office, re-election, selection and dismissal (4.5.14); formal documentation of functions in twotier and one-tier boards (4.5.15); gelling the best out of directors (4.5.16); succession (4.5.17); enterprise risk management (4.5.18); corporate governance at banks (4.5.19); and, finally, a summary of the roles of directors (4.5.20). While discussing these matters, I shall also describe some of the differences between one-tier boards in the UK, US and the Netherlands and what elements of UK and US corporate governance could usefully be adopted by Dutch two-tier and one-tier boards.