French

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11 March 2019

My parents were blessed with six sons. I am the fifth. I do occasionally suspect my parents of continuing until all hope of a daughter was crushed. Be this as it may, it was hectic at our home with those six boys. It already started at breakfast in the morning. At the time there were still heavy glass one-liter milk bottles. Every breakfast, at least five would be emptied. Four bottles disappeared in our insatiable stomachs and we would spill at least one full bottle over the breakfast table every morning. Gulp, gulp, gulp. I will never forget that sound. Or my mother’s exploding shriek from the bottom of her tormented soul, every morning without fail. It did not make a difference.

What also did not help was that my parents had the habit of speaking French with each other if they wanted to discuss something that we, children, were not supposed to hear. I remember well that I could already understand French (at least their French) perfectly when I was only five years old. As with everything else, it is a matter of motivation. Then you learn quickly. Had they simply discussed the tricky subject with each other in Dutch then we would probably not have noticed. We did not listen anyway.

“ What happens in the boardroom, stays in the boardroom’. This often leads to misunderstandings”

Openness is also a fascinating subject in the boardroom. Transparency, accountability and integrity are the three pillars of corporate governance. Although transparency is not always required or appropriate and not with everyone. It requires the necessary wisdom, experience and mutual understanding of the board and supervisory board to perform this balancing act properly. The windows of the boardroom are one-way screens. You need to be able to look out but nobody from the outside should be looking in. ‘What happens in the boardroom, stays in the boardroom’. This often leads to misunderstandings.

This certainly applies to supervisory directors. After all, they are appointed by the general meeting of stockholders. Most of the (individual) stockholders have their own agenda and objectives. These are not necessarily in line with the interests of the corporation. The latter is, however, the orientation point of the supervisory director. Hence, this may collide. Stockholders are not entitled to information about the deliberations in the boardroom. Nor are they entitled to minutes. They can certainly not give (individual) instructions. In brief, as a supervisory director you keep the deliberations and the exchange of documents in the meeting confidential. Hence, this also applies vis-à-vis the stockholder who appointed you. At the same time you do need to be open about the picture of the future, strategy, culture and the financial condition of the corporation. This openness must be given and structured consciously. The same applies to the openness between the management (board) and the supervisory board. They must always be honest to each other. As soon as this honesty disappears, the confidence disappears. This is inevitably the end of the relationship. This jeopardizes the corporation. That is why honesty and confidence are not just a moral but also a professional duty vis-à-vis the organization. But in this relationship it neither means that you should (be able to) say simply everything. What is more, in the relationship between the board and the supervisory board you should actually regularly include moments of consulting without each other. You can then speak and exchange ideas freely about matters that the other does not need to know (yet). You do share with each other afterwards what was discussed and what this means to the other. Openly. It does not include a word of French.

This blogpost is also available in Papiamentu. Download the PDF version. You can also download the English PDF version.

Do you have a question about corporate governance? Please email it to governance@ekvandoorne.com and perhaps your question will be discussed in the next blogpost.