The average number of directors on an SMI 20 board is 10.9, showing no
significant change from the 10.8 average recorded in our previous edition. The SMI
Mid average, on the other hand, has increased from 8.3 to 9.7. The change in
constituents might explain this substantial difference.
Ems-Chemie Holding operates the smallest board in our sample with four
members. Compagnie Financière Richemont continues to maintain the largest board
with 20 members, five of whom are executive directors (although the group HR director left the board in late 2020).
The roles of chair and chief executive
There are currently eight CEOs serving on SMI boards,
representing a steady increase in the past decade. However, a clear separation
between the role of CEO and chair remains, in line with the Swiss Code of Best
Practice for Corporate Governance. No boards record concurrent chair/CEO roles.
Executive chairs lead five boards. Temenos AG, Schindler
Holdings, and Partner Holdings have executive chairs who previously held CEO
positions in the same company and transitioned to the chair role.
At Dufry AG, the current executive chair was a partner at
Advent which owned the company prior to its IPO. The Lindt & Sprüngli chair has been in
the role for 28 years and was chair and CEO before becoming executive chair.
Vice-chair and senior independent director
Eighty per cent of boards in our sample have vice-chair
roles. Helvetia Holding is again the only company with two vice-chairs sharing
the job. However, a significant difference is apparent between the two indices when
looking at the senior independent director (SID) role. Here, 25% of SMI boards and
4% of SMI Mid boards have an SID.
Across both indices, 89.7% of all board members are deemed
independent, rising from 87.2% in our 2019 Index. The proportion of chairs who
are independent rose to 65.3%, up from the 61.7% recorded in the same edition.
Swiss boards continue to lead independence in the boardroom.
In Europe, only the Netherlands comes close, with 86.8% of board members deemed
independent. Germany and Italy record respectively 73% and 60% independent
board members; France has slightly more than half.
Length of service
The average tenure of all board members across the SMI is
6.7 years, slightly above the average of 6.4 recorded in our previous Board
Index. The average tenure of non-executives is 6.4 in the SMI 20 and 6.3 in the
A significant difference exists between the average tenure
of female non-executives (4.5 years) and their male counterparts (7.2 years),
reflecting the historical underrepresentation of women in the boardroom. The
Swiss target of 30% female representation on boards was approved around four
years ago, a period that coincides with the current average length of service
of female non-executive directors (NEDs).
In the SMI 20, the longest non-executive board tenure is
seen at the Swatch Group, where average tenure is 14.4 years. The lowest
average tenure, of two years, is recorded at Alcon, which was spun-off from
Novartis in 2019.
The average board chair tenure of the entire sample is 9.6
years, down from 10.9. The average tenure of chairs is 6.3 years, suggesting
that most chairs transition to the role after holding non-executive positions
on the board.
Age of directors
The average age of SMI non-executive directors (excluding chairs) is 60.5,
showing no significant change in the past six years.
Among SMI 20 companies, the youngest board sits at Partners Group Holding,
where the average age is 51.2. The Swatch Group has the oldest board, with an
average of 66.6. The youngest board in the SMI Mid is that of Barry Callebaut
with an average age of 55.2; the oldest, with an average of 64.7, is Temenos.
Average NED age, excluding chairs
Chairs in the SMI 20 have an average age of 65.7 years,
making them slightly older than their SMI Mid counterparts, whose average age is
63. The average age of chairs across the SMI is 64.1.
Tenure and age: chairs
||Partners Group (51.2)
Tenure and age: non-executives (excluding chair)
||The Swatch Group (14.5)
||The Swatch Group (66.6)
||Barry Callebaut (55.2)
The overall rate of board refreshment was 8% in 2021, half the
rate observed in our previous survey.
Female appointments peaked in 2018, the inauguration year of
targets for female representation, reaching 44% of total appointments. After two
years of falling rates of new female appointment, the trend seems to be moving
up again, reaching 37% (13) in this year’s survey.
In total, 36 new non-executive directors were appointed in
the 12 months before March 2021, more than half of them to SMI Mid boards.
New board appointments in the SMI (2016–2021)
The average age of newly appointed NEDs is 56 years old and 67.5%
of them are foreign nationals.
In addition to looking at new directors, we have analysed in
more detail first-time non-executive directors. In the past year, 25% of new NEDs
are first-time directors.
The average age of first-time directors at appointment is 52.6
years, younger than the 54.9 years previously recorded, and significantly lower
than the average age of new directors, which is 56.
Sixty per cent of directors sitting on a board for the first
time are non-Swiss. In terms of gender diversity of this first-time cohort, only
one is a woman. As in previous years, financial services sector experience is
the most common background of new NEDs.
A framework to help boards determine the readiness of a new director.
A guide for those considering a board directorship for the first time, expanded and updated.