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 be part of the management board. In that case, you have a one-tier board. Or they can form an independent supervisory board. Then your company has 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 private limited and public limited companies in the Netherlands (bv and nv) have a two-tier board.
What is a one-tier board?If you have a one-tier board (monistic governance model), there is only one board that consists of both the management and the supervisors. The supervisors are part of the board. 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. You can include a one-tier board in the articles of association.
Why choose a one-tier board
- The advantage of a one-tier board may be 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 is also 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.