The Importance of Board Independence (IVOR nr. 90) 2012/8.2.0:8.2.0 Introduction

The Importance of Board Independence (IVOR nr. 90) 2012/8.2.0

8.2.0 Introduction

Deze functie is alleen te gebruiken als je bent ingelogd.Deze functie is alleen te gebruiken als je bent ingelogd.Deze functie is alleen te gebruiken als je bent ingelogd.

This section describes the six issues regarding independence in the Netherlands. Table 8-1 gives a brief description of these issues for the Dutch legal framework. In the remainder of this section, these issues are elaborated upon. This chapter focuses solely on listed companies limited by shares (Naamloze Vennootschap, NV).

Table 8-1: Brief description of the six issues regarding independence for the Netherlands.

1. The board structures available to the company

The dual board structure is the standard board structure in the Netherlands. For companies that fall within the ambit of the structure regime, a dual board structure is mandatory. For other companies it was already possible to establish a unitary board structure. A new act makes it possible for all companies to establish a unitary board structure.

2. The appointment of supervisors

Normally, the appointment of supervisors is the task of the general meeting. Supervisors in companies that fall within the ambit of the structure regime are appointed by the general meeting on the nomination and proposal of the supervisory board itself or the NEDs themselves. However, the general meeting and the works council have an enhanced right of recommendation for one-third of the supervisory board.

3. The removal or suspension of supervisors

Normally, the removal or suspension of supervisors is a task of the general meeting. Supervisory directors in companies within the ambit of the structure regime may not be removed or suspended individually. The general meeting can adopt a motion of no confidence for the entire supervisory board with immediate dismissal. The Enterprises Division of the Court of Appeal in Amsterdam can remove a single supervisory director upon application by the entire supervisory board.

4. The independence criteria and their application

The independence criteria are listed in subsection 8.2.4. They focus on eight relationships and circumstances, which cover family relationships, employment, additional payments, business relationship, cross-directorships, share-ownership and temporary management tasks. At most one supervisory director may be non-independent.

5. Other parts of law or regulations that influence the independence of supervisors

Persons employed by the company or a dependent company or officers and persons employed by an employees’ organisation may not hold a position as supervisor in companies that fall within the ambit of the structure regime.In case of conflicts of interest in a transaction, the supervisor may not be involved in the decision on that particular transaction.The supervisory board should annually evaluate its own performance and that of its board committees and members. A statement about the evaluation should be made in the annual report. Companies should consider diversity in their outline profile of the supervisory board. Companies that fall within the ambit of the structure regime must have at least 30 per cent men and at least 30 per cent women on their (supervisory) board.

6. Enforcement of the requirements regarding independence

Companies are required to include a corporate governance chapter in their annual report, in which they mention whether they comply with the principles and best practices provided in DCGC or explain and motivate why they do not.

Deze functie is alleen te gebruiken als je bent ingelogd.