One-tier or two-tier board as a governance model

This information is provided by

Netherlands Chamber of Commerce, KVK

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.

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.

What do you need to arrange?

Your choice for a governance model is recorded in the articles of association. Do you want to start a new private (bv) or public (nv) limited company ? Then you have to go to the notary. They will include your choice for a one-tier or two-tier board in your articles of association. For an existing bv or nv you can have your articles of association amended by the notary.

What are the disadvantages of a one-tier board?

To the outside world, it appears as though there is no clear distinction between management and supervision with a one-tier board. In practice, this may lead to an interweaving of management and supervision, because the supervisory board is no longer outside the management board. If a director or supervisory director has a personal interest that conflicts with the interest of the company, they cannot participate in the decision-making.

The one-tier board on the Commercial Register extract

You do not see the term 'one-tier board' in the Commercial Register. The registration of this governance model is only apparent from the registered directors, who are classified as either being 'executive' (uitvoerend) or 'non-executive' (niet-uitvoerend). View an example extract (in Dutch) from the Commercial Register.

Representation at a one-tier board

The main rule is that the management board is jointly authorised to represent the company. Each director is also authorised to represent the company individually, including the non-executive directors. This individual power can be limited in the articles of association.

Questions relating to this article?

Please contact the Netherlands Chamber of Commerce, KVK

This information is provided by

Netherlands Chamber of Commerce, KVK