Do you have a private (bv) or public (nv) limited company, or do you want to start one? Then you may appoint supervisors. They can form part of the management board, a one-tier board. They can also form an independent supervisory board. Then we speak of a two-tier board. On this page, you can read everything you need to know about one-tier and two-tier boards as governance models.
On this page
What is a two-tier board?In the two-tier system (dualistic governance model), there is a separation between management and supervisors. The board is responsible for the day-to-day management of the company. A separate supervisory board supervises the management. Most companies in the Netherlands originally have a two-tier board.
What is a one-tier board?You can include a one-tier board in the articles of association. A one-tier board is a monistic governance model. The supervisors are part of the board. A company then has one board that consists of both the management and the supervisors. Within the one-tier board a distinction is made between executive directors and non-executive directors. Only a non-executive director may fulfil the task of chairperson of the board.
Why choose a one-tier board
- The expected advantage of a one-tier board is that board members receive information earlier and more detailed than supervisory board members within a two-tier board.
- The (direct) involvement of non-executive directors would also be greater in a one-tier board. They are also responsible for the actions and decisions of executive directors in the day-to-day business.
- Directors are close to the organisational policy. They can intervene directly in the course and strategy of the company.
- Non-executive directors are always natural persons. Executive directors can be natural or legal persons.