Board meetings
In 2021, the average number of scheduled meetings was 8.5, compared with 7.1 in 2019. On average, boards met a total of 11.8 times in 2021. (Note: Ebusco went public in October, and therefore held only two meetings in 2021. This company is excluded from the analyses regarding meetings.)
Previously, AEX boards convened more often than their AMX counterparts; however, in 2021 no significant difference was found between the two (AEX 11.6 meetings; AMX 11.9). Although two-tier boards still met more often (11.9 meetings) than those with a one-tier system (11), the difference between the two board types was greater in 2019 (10.3 versus eight, respectively). Overall, companies identify issues related to Covid-19 as the trigger for the rise in the number of meetings. The supervisory board of ABN AMRO assembled most frequently last year, holding 27 meetings.
Committees
The average number of board committees is three; the most common being audit, remuneration and nomination, albeit the latter takes various nomenclatures. One company, Alfen, has no separate board committees. However, its by-laws mandate that separate committees will be formed if the supervisory board reaches more than four members (there are three currently). Heineken is the only board with five separate committees.
In 2012, two companies reported that they had a sustainability committee. Now, eight of the companies have a committee dedicated to ESG or sustainability. This shows companies are increasingly dedicating time to these topics. We expect the number of committees for sustainability, or ESG as a whole, will continue to rise in the coming years.
Committee leadership
When looking at the three most common committees, namely audit, nomination and remuneration, women now hold 34% of all committee leadership roles, compared to 30% in 2020. Women make up 43% of both remuneration chairs and audit chairs, rising from 39% and 38% respectively. Women’s share of nomination chairs also grew, although they still account for only 17% of the total, up from 12%. However, this is unsurprising as nomination committees are often headed by the chair of the board, most of whom are men. Three board chairs also lead the remuneration committee.
Our perspective
A recent article “It is high time to professionalize the nomination committee” argues that at as long as men make up the great majority of board chairs, it is not good practice for supervisory board chairs to simultaneously act as the chair of the nominations committee. A more diverse population of NomCo chairs would very likely go some way to increasing board and ExCo diversity.
Board evaluations
47 of the companies disclosed having conducted a board evaluation in 2021, and two companies did not conduct an evaluation in the period. One company did not disclose its board evaluation process in its annual report.
In 2021, most companies conducted an internal evaluation, and seven (14%) of the companies commissioned an externally facilitated board evaluation. This is low, given the fact that this proportion is usually around 30% (2019: 38%). A possible explanation could be that companies chose to do an internal evaluation in 2021, and paused externally facilitated evaluations until Covid restrictions are fully lifted.