HomeChapter 9: Comparing Changing Board Attributes9.4 The Convergence of Board Models

9.4 The Convergence of Board Models

The third proposition (P.3) in this study suggests that a process of board model transformation can be observed through diminishing differences between the key attributes of one-tier and two-tier board models. This proposition directly builds on the two propositions related to the transformation of one-tier and two-tier boards in the US, the UK and the Netherlands (P.1 and P.2).

 

Table 9.3

The Comparison of Changing Board Model Attributes

 

US

UK

The Netherlands

 

Board model

One-tier

One-tier

Two-tier[44]

 

Board meetings:

Combined

Combined

Predominantly combined

Board size and composition

Board size:

-

Stable

Stable

Non-executives:

++

Stable

Stable

Executives:

--

Stable

Stable

Board leadership

CEO/chair-man split:

Modest support

Strong support

Determined by law

Lead directors:

Strong support

Modest support

Not applicable

The number of board committees

Audit:

 

++

++

+

Compensation:

++

 

++

 

+

 

Nomination:

++

 

++

 

+

 

Independent committee leadership:

 

++

 

++

 

No data available

 

 

Source: part II of this research.

++ = increases strongly, + = increases, - = decreases, -- = decreases strongly.

 

As stated in paragraph 9.3 of this chapter, proposition P.1 suggests that one-tier boards are becoming more independently composed and organized in the US and the UK. The second proposition (P.2) suggests that integrative board attributes are incorporated in two-tier board structures to facilitate the integration of decision management with decision control.

Developments in the composition and the structure of corporate boards in the US, the UK and the Netherlands suggest evidence for the third proposition of this study (P.3). Directors who operate with one-tier boards are increasingly modifying their governance structures to adapt to new corporate governance standards. Developments in the formal organization of two-tier boards in the Netherlands also indicate that supervisory directors apply design strategies that may integrate decision management with decision control. The observed transformation of board models implies that differences between the two major board models are diminishing (see also table 9.3). The implications of this process of board convergence are further explored in the next paragraph.


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Maassen, G.F. (2002). An International Comparison of Corporate Governance Models. A Study on the Formal Independence and Convergence of One-Tier and Two-Tier Corporate Boards of Directors in the United States of America, the United Kingdom and the Netherlands.

Maassen, G.F. (2002). An International Comparison of Corporate Governance Models. A Study on the Formal Independence and Convergence of One-Tier and Two-Tier Corporate Boards of Directors in the United States of America, the United Kingdom and the Netherlands. Amsterdam: Spencer Stuart Executive Search.