Boyden's Board of Directors Series, Part 4

A Director's Eye from Europe

In the wake of the recent financial crisis and turbo-charged globalization, corporate governance has received an extraordinary amount of attention due to lapses at highly visible companies, as well as alleged systemic failures of governance underlying the global financial crisis.

The scale and scope of these issues has sensitized all stakeholders to the reputational, operational and financial risks, which follow from lapses in governance or effective management. Moreover, the global twenty-four hour news cycle and proliferation of sources in traditional, new and social media channels have ensured that awareness of these issues are raised with lightning speed.

However, these are only the most recent additions to underlying trends such as changes in business models and technology, growth opportunities in new and often unfamiliar markets, and the increasing complexity of globalization, all of which were already challenging boards’ ability to understand the strategic implications and provide relevant oversight. While less visible to the public and other stakeholders, these pressures on oversight models have been building for some time.

The variety of legal and cultural backdrops across European countries regarding corporate goals, stakeholder representation and board structure adds further to the apparent difficulty in devising governance processes which match local, legal and cultural expectations, yet draw on lessons learned globally.

Boyden spoke with 11 senior non-executive directors in France, Germany, Switzerland and the United Kingdom to gain an inside view through a director’s eye about the most important priorities across Europe within this changing environment of corporate governance.

While their perspectives represent the differences among their companies and countries, there are a number of areas on which their views converge, with emerging best practice enhanced by insight into the requirements of boards and individual directors. These encompass both external and internal factors, which necessitate an increasingly engaged and proactive board. Externally, adapting to emerging best practice, new codes and legislation; and internally, reshaping working models and relationships among non-executive directors and their management teams.

The participating directors who generously shared their perspectives are listed in the Appendix. We sincerely thank them for their time and contributions.

Dr. Gerhard Raisig
Chairman of Boyden World Corporation
Managing Partner, Boyden Germany    
Trina Gordon
President and CEO
Boyden World Corporation

John Ellis
Managing Partner    
Boyden United Kingdom
Karl Lange
Managing Partner
Boyden Germany

Armin Meier
Managing Director
Boyden Switzerland

Florence Soulé de Lafont
Boyden France

Table of Contents

I. Introduction: About Boyden’s Board of Directors Series

II. The Changing Landscape

III. The Changing Role and Character of the Non-Executive Director

IV. New Working Relationships

V. The Paradox of Need versus Supply

VI. European Governance Models in Practice

VII. Emerging Post Crisis Governance

I. Introduction: About Boyden’s Board of Directors Series

Boyden’s Board of Directors Series is a collection of papers that address the challenges of identifying and attracting new directors suitable for today’s business environment. These papers explore the critical need to improve corporate oversight and governance in a world of change – and how it can be accomplished.

Boards in Crisis focuses on the past, present and future of corporate boards. It explores the historical and contemporary reasons why shareholder interests have not received the attention they require. This is especially pertinent in the context of the recent global crisis, when the complexity of risk, and short-term compensation models in financial services, highlighted the need for fundamental changes in the practice of corporate oversight and governance.

Better Directors for Better Boards focuses on the role of the director, and the evolution from a ceremonial and social position to one that is functional and demanding. Getting boards on a new track requires developing the next generation of directors; this paper identifies an updated set of qualifications and recruiting methods for finding these next generation directors.

Why Ethics Is Not an Option explores the imperative for every director to understand and utilize ethical frameworks. An interview with John F. Levy, CEO of Board Advisory, explains why returning to ethical frameworks is essential to restoring shareholder trust. Levy details how the value of ethics programs to rebuild customer trust and company reputation far exceeds the cost of such initiatives.

A Director’s Eye from Europe looks at perspectives from four different systems of governance from France, Germany, Switzerland and the United Kingdom. Board members remain unique individuals with a range of views on the proper scope of governance. This paper explores how external and internal priorities can be met by an increasingly specialised team of non-executives and what the challenges are in terms of director profiles, board composition and remuneration.

II. The Changing Landscape

Corporate and systemic failures have led to high profile media coverage highlighting the significant reputational, operational and financial fallout resulting from boards not keeping up with complex risk and reward models. Access to information today, in traditional and social media combined with government and regulatory interests, raises the profile and impact of any lapses in board of directors’ decisions, and in some cases individual behaviour.

What was originally termed ‘the CNN-effect’ – the impact of instant, live and global reporting – on foreign policy decision-making a decade ago, has rippled out to affect decision-making throughout the corporate sector. A case in point was the Hewlett-Packard board’s rapid, proactive decision to force a resignation from its former CEO, Mark Hurd, following allegations of improper expense reporting and inappropriate conduct. HP’s board chose to act before alarms were raised by analyst and shareholder inquiries. In this more immediate and complex global environment, mistakes are magnified. “Corporate governance is much more in the news,” explains Betty Thayer, Non-Executive Director at Boyden UK and Founder and former CEO of “Every week the serious business newspapers and magazines have a feature on corporate governance. This escalation will only continue with new legislation and spectacular corporate failures.”
The high correlation between management missteps and corporate failures in recent financial crises has prompted regulatory scrutiny and pressure for stronger legislation. “The scope of corporate governance has continuously broadened and deepened, partly as a consequence of corporate scandals at the beginning of the 21st Century as well as the collapse of high-profile companies during the recent global financial crisis,” adds Carl L. von Boehm-Bezing, Member of Supervisory Board and Chairman of Audit Committee, RWE AG.

Industry efforts to self-regulate have not borne fruit, leaving the door open for regulatory involvement. “If the industry could live up to their own recommendations, written by their peers, it would need no legislation,” asserts Henning Boysen, Chairman of the Board at Kuoni, Switzerland. “The problem is that when you look at certain actions taken by parliament, the industry has not been able to implement, reason and agree on our own recommendations, and thereby opens itself up to legislation.”

Unintended Consequences of Regulation
In fact, some dangers in relying too heavily on legislation for reform go back to 1996. In that year R.A.W. Rhodes, a scholar at the University of Newcastle, states in his paper “The New Governance: Governing without Government” that the mere term “governance” is popular but imprecise. Rhodes argues, “Policy outcomes are not the product of actions by central government.” He further adds that no one entity “has all the knowledge or resources to make the policy work.”

Thus, governance and government play an important role, but coordinating all the actors involved in new regulation, the company, the board and the market, lead to new challenges. Each new piece of regulation brings with it unintended consequences.

As Dr. Markus Altwegg, former Chairman of the Board at Siegfried, Switzerland notes, “I am of the overall opinion that with the increase in regulation, there can be a tendency for people to lose sight of long-term, strategic concerns in a company.”

In Germany, some believe the dual board structure alleviates this. “Supervisory boards have gained considerably in importance: more responsibility, greater regulatory requirements and higher public expectations, representing an integral part of corporate and financial market supervision,” noted Carl L. von Boehm-Bezing, Member of Supervisory Board and Chairman of Audit Committee, RWE AG.

At the same time, the expected level of knowledge and competence among board members has risen. Pre-existing trends in business models and technology, growth opportunities in emerging markets and increasing globalization of supply chains all make understanding and overseeing the business more complex for non-executive directors.

At the same time, these same factors drive demand for greater oversight.

The result is an increasingly prominent focus on governance issues by the media and regulatory bodies and consequently, fundamental changes in what is required of non-executive directors.

III. The Changing Role and Character of the Non-Executive Director

It is clear from our participating directors that non-executive boards need to adopt a more strategic, operational and independent role in order to accommodate shareholder needs for deeper engagement and oversight. The role of the non-executive director will therefore need to become more specialized in nature, with experience more closely aligned to long-term goals and a greater time commitment.

Time and Skill Requirements
Board members need to view their role as a major commitment with significant accountability, rather than an honorary nomination. As Juhani Anttila, Managing Partner of ValCrea AG, Switzerland asserts, “Being a board member is no longer a prestige role given to someone in retirement. It is important that only people who have enough time, knowledge and intellectual curiosity take the job of board member.”

Time is an essential factor given the complexity of board roles and the increasing demands of shareholders and regulators. According to the European Commission’s 2011 Green Paper on the corporate governance framework in Europe, several EU Member States have sought to establish corporate governance principles that stipulate that non-executive directors should dedicate sufficient time to their duties.

The increased demands on board members can imply that non-executive directors spend as much as ten to twenty per cent of their total time on each board they serve. Yet, according to a 2011 survey1 by McKinsey & Company of nearly 1600 corporate directors, this may still not be enough. Directors note that they would ideally like to spend an additional ten days a year on board work, which would help alleviate some of the compliance and governance duties while adding value on strategy and risk areas.

In some countries such as the UK and Germany, regulators are recommending or limiting the number of board mandates that a non-executive may hold. For example, the UK Corporate Governance Code specifies that a “board should not agree to a full time Executive Director taking on more than one non-executive directorship in a FTSE 100 company nor the chairmanship of such a company.” In Germany, the number of supervisory board mandates in non-group listed companies or in supervisory bodies with similar requirements is limited to no more than three.

Board Diversity
It is now accepted that well-constructed boards require diverse backgrounds, including cultural and gender representation. With more male board members than female board members currently serving, efforts are underway to increase female board participation through regulatory mandates or industry initiatives such as the UK’s ‘30% Club’ plan. Led by chairmen from some of Britain’s largest companies, the group set an aspiration that by 2015 at least 30 per cent of each UK company board would consist of female non-executives.

“In Germany, the pool of potential female candidates is currently too small and there are not enough women on management boards, which lies at the heart of the composition problem among supervisory boards,” explains Mr. von Boehm-Bezing. “As a result, corporations have to recruit candidates from other professions in which there are highly qualified women.”

Furthermore, an implication of greater strategic and operational engagement is that boards will require representation of a range of skill sets specifically relevant to the business. These may include specific mixes of technological, industry and functional knowledge and increasingly, experience in certain geographic regions. Such experience, according to Lucy Marcus, a European Advisory Board Member of the firm Astia, helps organizations to “keep up, innovate and move into new issues,” such as social media communications, corporate social responsibility, sustainability and other areas that “will help future-proof the organization.”

As ValCrea AG’s Mr. Anttila summarizes, “The recent financial crisis was a test of corporate governance, and lack of diversity on boards was a major issue. Individuals with the same professional, cultural and personal backgrounds led to ‘group think.’ Greater diversity allows for a wider range of perspectives, encompassing people from different backgrounds who spark positive debate from what can initially be perceived as ‘stupid questions’.”

International diversity can also be important for global companies seeking knowledge of key regional markets to add value to operational and strategic discussions. “Nonetheless, such diversity can add to complexities for interaction within boards and management as cultural and language differences must be taken into account,” explains Florence Soulé de Lafont, a Partner with Boyden France.

Switzerland’s Dr. Altwegg considers international diversity important on a company-by-company basis. “International diversity is absolutely a specific issue for each company. If you think about a global company like Nestle, then I would definitely have someone from emerging markets on the board, although this may not be necessary for other companies.”

Yet, international representation is patchy. Mr. von Boehm-Bezing of Germany’s RWE AG adds, “The global scale of corporate business has not yet been reflected in a globalized representation in the composition of the boards.” While some companies are making a concerted effort to reach out to board members who live and actively work in high-growth markets such as Brazil and China, this evolution in board structure will take time.

In Germany for example, “Supervisory board members must actually become true sparring partners for the executive officers,” Mr. von Boehm-Bezing concludes.

Getting Board Composition Right
“As board functions become more complex there is a danger that composition policies become more administrative,” according to Dr. Chris Fay, Non Executive Chairman of Iofina, plc, and Chairman of Stena International Sarl. “The proverbial box ticking mentality is probably re-emerging and people are tending to make sure they satisfy the various requirements rather than concentrating on what’s best for the company. I think the administrative angle of boards is probably taking a turn for the worse.”

Moreover, if the board is to be aligned to a business’ evolving needs, there will be continuing need to change directors’ profiles in terms of skills. For instance, world class technology skills may be needed as a company moves toward new platform or operational experience will be critical when performance suffers. While these considerations would not lead to change en masse, the constant review and refresh process adds to what is already a difficult balancing act in recruiting and maintaining non-executive directors and supervisory board members that are appropriate to the business.

Evaluating the Non-Executives
Robert Marchbank, a former Member of the Supervisory Board of Wolseley plc, considers rotation of board members critical in bringing new thinking and vitality into the board process. “Directors need to be turned over every three years or so because the needs of the company and the needs and the dynamics of boards have to change and the life blood needs to be refreshed,” he asserts.

In fact, in a recent conversation with Boyden, Svein Rennemo, Chairman of Statoil ASA of Norway, stressed the importance of regular reviews of board effectiveness.2

“I strongly believe in a formal annual evaluation of the board – an evaluation of board processes, board competencies and individuals’ contributions on the board,” said Mr. Rennemo. “Benchmarking of the board compared to other companies, evaluation of the board by company management, and a separate assessment by outside experts is important for full evolvement.”

IV. New Working Relationships among Non-Executive Directors and with Management

The changing nature of the board, specifically the increased accountability and workload of non-executive directors, has led to significant changes in when, where and how non-executives’ oversight work is accomplished.

Following the most recent financial crisis, many boards are calling for more constructive board discussions. According to the McKinsey & Company survey, these include challenging the key assumptions behind management’s proposals and exploring different biases that board members might bring to the table.

Mr. von Boehm-Bezing compares today’s supervisory board work with board activities ten years ago. “The work has become not only more extensive in terms of expertise and technical knowledge but also more demanding, as seen, for example, in the higher meeting frequency and the work of the board committees.”

Work Style and Fit
As the nature of working relationships among board members becomes more collaborative, non-executive director candidates will need to be vetted more stringently for working style and “fit” with other non-executives as much as on their personal capabilities and credentials. This will help ensure an open, dynamic and critique-based dialogue within the board and management.

Boyden UK’s Betty Thayer considers intraboard relationships to be critical to board performance. “Looking at how individual board members contribute and how they operate as a team is essential to understanding effectiveness.”

Juhani Anttila adds that a degree of inter-personal “cultural” change is also needed in order for non-executive boards to have more open and collaborative relations with executive teams. It’s critical that directors are able to collaborate closely and build trust with the CEO and management to meet complex challenges and focus boardroom discussions on strategy and overall value creation.3

At the same time, as the role of the non-executive director evolves to become more strategic and operationally engaged, yet independent of management, a natural tension will arise. Management and their non-executive colleagues will face challenges in defining the rules of engagement and demarcation between company management and oversight.

Armin Meier, Managing Director of Boyden Switzerland states, “Cooperation between the non-executive board and executive management is key and needs attention”.

Indeed, there is a consensus among participants that the board selection process should increase the focus on:

  • Alignment of a candidate’s expertise relative to strategic goals;
  • The time commitment (and legislative restrictions) involved;
  • Diversity of perspective, as well as gender and geography; and
  • The personal characteristics that drive checks and balances in relation to management, which ultimately help board members better execute supervisory responsibilities and minimise liability.

V. The Paradox of Need versus Supply

Potential non-executive directors are plentiful, but the optimal fit may be harder to find. In theory, the desire for diverse skills, cultural backgrounds and experience should naturally broaden the potential non-executive director pool to a wider variety of candidates. However, in practice the need to balance technical, functional and operational skills together with geographic experience may narrow the search pool for each specific board opening. The UK’s Chris Fay makes that key distinction, noting, “There’s not a shortage of talent at all, as long as the appropriate market is really being tapped.”

Industry Experience is the Top Priority
Tapping the appropriate market is the key point, and this is where is there is some concern on the available talent pool. Pressure for board members to take a more active governance and strategic role is sharpening the focus on industry expertise and knowledge. However, once candidates from competitors are taken out of the pool, together with others unable or unwilling to make the time commitment, the ‘appropriate market’ needs to include candidates from a more diverse pool. As Boyden’s Armin Meier notes, “Finding someone with financial expertise is relatively easy, finding someone who understands your business without being conflicted is not”.

Markus Altwegg agrees. “If it is a niche business in a specific industry, that’s a demanding search. The difficulty is how to find someone who really understands our industry and yet is independent.”

In fact, of the various criteria for recruiting board candidates, active industry experience continues to be the number one factor in non-executive recruitment, providing meaningful strategic guidance in a tough, competitive climate. This experience can be hard to find in the right context and points to a need to better educate boards on industry dynamics and how their companies can contribute to value creation. In fact, in the 2011 McKinsey survey, only 21 per cent of directors surveyed claimed to have a complete understanding of their company’s current strategy.

Dr. Fay stresses, “The amount of time that directors spend on the periphery is just not enough to have a true understanding of how they can really contribute. Non-executives should have the skill set and industry experience in the first place to readily assess what their specific contribution needs to be.”

While industry knowledge is the number one criterion for a successful candidate, a range of technical, operational and international experience within the board is valuable in order to tackle different scenarios and avoid “group think.” Thus, the selection process must take into account how new candidates complement the experience and talent already in place.

Such experience ranges from technical to geographical. Boyden’s Mr. Meier considers information technology; legal, financial and geographical experience, as key components, while Mrs. Thayer points to the strategic importance of board directors from other geographies. “If you look at some of the UK boards, many of them may have their headquarters in the UK but the vast majority of operations are in other countries. Yet, boards are not as internationally diversified as they could be,” she asserts.

New Demands Bring Fresh Challenges
Attracting entrepreneurs is an important component that is getting lost in board recruitment today, particularly in big corporations. “One of the challenges for recruiters is convincing very successful entrepreneurial people to go on to corporate boards,” comments Mrs Thayer. “It is very frustrating for someone who’s used to running their own show to sit on a board where there is a dysfunctional or extremely political environment. Used correctly, I believe successful entrepreneurs should add an important perspective and significant value”.

Other challenges include assessing candidates’ psychology, decision-making style and behaviours.

Dr. Jürgen Lose, Chairman of the Supervisory Board of Dyckerhoff AG, believes that flexibility and the ability to interact with other board members and management, sometimes in demanding situations, are key elements in selecting non-executive directors. “The corporate governance system is placing increasing demands on directors. The challenge is to face these demands and consider new ways of assessment – beyond looking at candidates on paper – and trying to better understand their psychologies and potential future behaviour.”

Additionally, the focus on candidates who are still active in business is limiting, as each director is time constrained by other commitments. Boyden’s Mr. Meier has found that this makes it difficult to attract younger, suitable candidates who are willing to invest the time necessary to perform the job. “You want people who actually have something to say to the world in which we are living in. Finding such active executives to serve on a board with enough capacity is not easy”.

Available time and the regulatory environment can limit the number of boards on which any one non-executive can serve. Christian Strenger, Member of the German Government Commission on Corporate Governance and Director of DWS Investment GmbH notes, “In Germany going from management to the Supervisory Board generally requires a two year waiting period. This is too strict a rule that does not allow successful executives to contribute their experience to good supervisory work.”

Compensation and Responsibility
Finally, the opportunity cost to younger, highly-skilled, ‘niche’ candidates, combined with director liabilities, are driving up compensation for directors. A mismatch between compensation and liability is now a big recruitment challenge. As Carl L. von Boehm-Bezing says, “In light of the increasing qualifications required, demands on members’ time and higher liability risks, members of supervisory boards must be paid appropriately,” he explains.

While cross-border representation is important, local differences can also present a challenge. For example, in France, compensation for board members is usually not very high in comparison to the UK. Compensation is also an issue for smaller companies that want to attract independent board members but don’t have adequate resources to compensate them relative to larger corporations.

Siegfried Holding’s former Chairman Dr. Altwegg sees compensation concerns as a common trend driven by changes in corporate governance codes. “What I see is a conflict between compensation and responsibility, because with all the changes in corporate governance, more and more responsibility is shifted on the directors and sometimes pay scales are not appropriately balanced.”

VI. European Governance Models in Practice

The attention to corporate governance and oversight following the recent financial crisis has led to some harmonization of principles and practices across Europe. While national and cultural differences remain, fundamental changes in the non-executive director or supervisory role are evident across the region, despite the different board structures in Europe.

There are three main organisational models for boards in Europe. These board structures allow for representation of a broader set of stakeholders, including in Germany, for example, employees.4

The UK has a unitary structure, whereas Germany has a two-tiered structure and France a single or dual board system. In Switzerland non-executive directors form a totally separate group of people – the board, distinct from the executive group, which is called the executive management. With that, you have a complete separation – effectively a two-tiered structure, which many Swiss companies follow in practice – which the Swiss Code of Best Practice for Corporate Governance (SCBP) recommends, by asking for a majority of non-executive directors.

In France there is no legal requirement to recognize non-executive or independent directors within the board. Recognition of these independent directors exists in the German, Swiss and UK governance codes. France, Germany and Switzerland also set term limits for executive and non-executive directors. While term limits are not mandatory in the UK, they are suggested by the corporate governance code.

Analysis by Bettinelli and Chugh of legal requirements for boards in 10 European countries supports their conclusion that while there are clear differences in legal structures, there also appears to be a new culture among companies that goes above specific national features. In fact, the trends toward greater professionalism, engagement and strategic & operational oversight are pervasive throughout Europe. Over time, this may drive more convergence with regard to the practical processes and outcomes of governance.

Can Governance be Harmonised Across Europe?
While the traditional understanding of corporate governance is set out in the country-specific context, it is no longer defined solely through the roles and responsibilities of the board of directors or management board and supervisory board. In practice, convergence of the one and two-tier models is increasing.

More consistency in developing new corporate governance rules at the European and national levels may be a step forward in harmonizing pan-European corporate governance practices. A common European corporate governance model has been in place since 2001 but its application is not yet widespread. The European Commission’s 2011 Green Paper has been put forward to assess the effectiveness of the current corporate governance framework for European companies, in order to determine the course of action – rules- or principles-based – for improving governance and aligning it with international and market developments.

Some well-placed insiders believe that a common European Corporate Governance Code might be possible in the future. “Currently, however, such a European code cannot be expected because national rules and corporate cultures are simply too different,” observes RWE AG’s Mr. von Boehm-Bezing. “It is therefore important to strive for harmonisation in Europe wherever possible, in due consideration of the overall governance framework and to develop transparent corporate governance cultures in all countries.”

The current focus on ’professionalising’ the role of the non-executive director, increasing the effectiveness of the position and driving transparency across boards in Europe implies that the practical impact of national differences may become less significant over time. While national differences in structure and stakeholder representation affect recruitment criteria, this will not detract from an on-going, powerful trend towards more committed and rigorous boards.

VII. Evolving Post-Crisis Governance: The Road Ahead

Non-executive director views on the role of governance in the most recent financial crisis offer some clues into the road forward for post-crisis governance. Many senior directors we interviewed generally believe that governance was not at the heart of the financial crisis. Some characterize the crisis as possibly a crisis of foresight and leadership, but not of governance.

Armin Meier agrees. “It was not poor governance; it was poor management and poor foresight which caused the financial crisis and then also the consequences. I think more reporting or transparency would not have helped in that situation. But it could have helped if directors had been able to speak up, had been trusted to speak up and have their concerns duly deliberated when they were already seeing the problems.”

This view probably correctly distinguishes management from non-executive roles, placing the requirement for foresight and leadership in the practice of full-time management. Nonetheless, as oversight pressures on boards mounts, it is a moot point whether the general public, the media and shareholders would agree.

Risk Management and Governance
The dissenting view is that risk management and internal controls are part of governance, and therefore poor governance was indeed in part to blame for the financial crisis. Robert Marchbank asks, “Did governance contribute? Sure. Was it the sole cause? No. I look at corporate governance as kind of as ISO 9000.5 ISO 9000 says that you have to have a reliable process that you follow consistently. It doesn’t mean that it’s good. It just means that you do it consistently. Corporate governance can sometimes be a lot like that as well.”

Chris Fay has a similar view. “The tragedy is that the composition of boards isn’t broad enough or flexible enough to entertain what I would call the appropriate debate and discussion around the edges of the obvious.”

Germany’s Mr. von Boehm-Bezing agrees, saying, “Inadequate board composition contributed to the crisis. There were also too few independent and capable directors.”

Indeed, those adopting the view that governance was a major contributor might be inclined to attribute greater culpability to boards, and to advocate more board involvement in the future. As the Chairman of Switzerland’s Kuoni, Henning Boysen, a Danish national articulates, “The board should never allow itself to be in the hands of management – directors should play a balanced role and provide a balanced challenge to management.”

As boards, regulators and shareholders consider the evolving role of non-executive or supervisory members, certain changes are imminent. Corporate governance reporting requirements are increasing time requirements and administrative burdens on boards. In addition, regulators are encouraging greater diversity and asking board members to take a stronger responsibility in defining and managing companies’ risk profiles, according to John Ellis, Managing Partner of Boyden UK.

Betty Thayer observes that a critical concern among boards is that procedural issues of corporate governance are taking over the boardroom. “Boards are increasingly frustrated by not being able to address their main purpose - strategy. This is not industry specific. Nor is it country-specific. It is a brave chairman who takes on the news and operationally oriented agenda and substitutes a strategy-based one. Non-executives are increasingly having to devote more time than ever to their role to enable strategy to be adequately addressed. This includes strategy-specific away days, sometimes more than once a year.”

Boyden Switzerland’s Armin Meier summarizes the road ahead. “Sometimes I see corporate governance in conflict with corporate trust, with corporate governance in many cases attempting to replace this trust with control. Control is important, but it will never replace trust”. The challenge is putting in place sufficient legislative controls, while not legislating for every eventuality and obliterating personal judgment. Meier concludes, “We have to find the way back
to where we trust people to do the job they are being paid for, ensure they have solid work ethics and that they follow normal business rules.”

Corporate Governance Issues for the Future

  • Speed, and the need to take action on occasion prior to quarterly media and analyst scrutiny

  • An increase in the time commitment for non-executive directors

  • Practical and legal restrictions on director availability

  • The growing administrative/legislative/regulatory burden, such as the Combine Code, Corporate Bribery Act and Corporate Manslaughter Laws in the UK

  • The impact of high liability/low compensation ratios

  • The need for diversity of perspective, gender and geography

  • The distinction between the role of the ‘professional non-executive director’ and the need for candidates to be still active in business

  • A drive towards European and international governance approaches, against local legislative and cultural backdrops

Biographies of Directors Interviewed for this Edition

Dr. Markus Altwegg
Dr. Markus Altwegg is the former Non-Executive President of the Board of Directors at Siegfried Holding AG. Before Siegfried, he was responsible for the worldwide operations of the Vitamin & Fine Chemicals Division of the Roche Group from 1999 until his retirement in 2003. Since 1968, he held various positions within different departments at Roche and was appointed to the Executive Committee in 1986. He served on the Board of the Energiedienst Holding AG and Sal. Oppenheim AG. He is Chairman of the Basel Museum of Art Foundation, Committee Member of the Basel Museum of Ancient Art and the Ludwig Collection, Member of the Board of Unitectra, and a member of the Board of Unitectra (The Technology Transfer Organization of the Universities of Basel, Bern and Zurich). He is Chairman of the Nomination & Compensation Committee. Dr. Altwegg is a Economist and received an MBA in Economics in the year 1965 and PhD in Economics from the University of Basel in 1968.

Juhani Anttila
Mr. Juhani Anttila is the Managing Partner of ValCrea AG. His global experience as CEO and as Managing Director in international companies includes positions of Chief Executive Officer of Ascom Holding AG and Ascom Group, President and Chief Executive Officer of Swisslog Holding AG, Director of Nokia GmbH in Zurich and Managing Partner for CA Corporate Advisers in Zurich, Switzerland. He currently serves as the Chairman of the Board, Ascom Holding Ltd. and a board member at Actelion Ltd. and, ArgYou AG. Mr. Anttila has also held board positions at Nokia including as the Chairman of the Supervisory Board for Nokia (Deutschland) GmbH and a Member of the Executive Board of Nokia Consumer Electronics Division. Mr. Anttila holds a Master’s and Bachelor’s degree in Law at the University of Helsinki, Finland.

Henning Boysen
Henning Boysen has been a member of Kuoni’s Board of Directors since 2003. In 2006, the Board elected Mr. Boysen, a Dane, to be its chairman. After studying economics, Henning Boysen began his career as a management consultant at Booz, Allan & Hamilton. In 1975 he joined SAS Service Partner as a project manager before going on to the posts of Chief Financial Officer and then Executive Vice-President Catering. After stints as Chief Operating Officer (COO) of Saudia Catering and President of Aero-Chef A/S, he served as Chairman of the Board of Directors and CEO of Gate Gourmet International from 1996 to 2004, and as Deputy Chairman from 2004 to 2005. During this period as Chairman and CEO, Gate Gourmet grew from a medium sized European company to become a global player. Chairman of the Board of Directors of Global Refund Group, Nyon; Chairman of the Board of Directors of APODAN NORDIC AS, Copenhagen; Chairman of the Board of Trustees, Postgraduate Education, Copenhagen Business School; Member of the Board of Directors of Transcom Worldwide SA, Luxembourg; Member of the Advisory Board of the Ecole hôtelière de Lausanne (EHL), Lausanne.

Dr. Chris Fay
Dr. Chris Fay is currently the Non-Executive Chairman of Iofina plc and Stena International SARL and has previously held Non-Executive positions with Anglo-American plc, Expro International Group plc, BAA plc and Conister Financial Group. He was educated at the University of Leeds (BSc Civil Engineering, PhD) before moving into industry with the Royal Dutch/Shell Group. Dr Fay subsequently spent much of his career with the Shell Group cumulating in his appointment as Chairman and Chief Executive of Shell UK Ltd, a position he held from 1993 to 1999. He is a Fellow of the Royal Academy of Engineering, the Royal Society of Edinburgh and the Institute of Petroleum. Institute of Civil Engineers. Dr. Fay received a CBE in the Queen’s Birthday Honours in 1999.

Dr. Jürgen Lose
Dr. Jüergen Lose has been Chairman of the Supervisory Board of Dyckerhoff AG since June 1998. He has served as the President of the Bundesverband der Deutschen Zementindustrie, Bundesverband Baustoffe, Steine und Erden and Cembureau. He served as member of the Management Board of Dyckerhoff AG since 1977. Dr. Lose also serves as the Deputy Chairman of the Advisory Board at BHF-Bank Aktiengesellschaft (also known as BHF Bank AG) where he started his working career. He is the Chairman of the Supervisory Board of AGIV Aktiengesellschaft, BauDatenbank and has served as the Director of Buzzi Unicem S.p.A. since 2002. Dr. Lose studied law in Hamburg and Munich, Germany, before gaining his doctorate.

Robert Marchbank
Mr. Robert Marchbank, a former Member of the Supervisory Board of Wolseley plc, served as the Chief Executive Officer of European Operations at Wolseley until 2010. Mr. Marchbank previously served as Managing Director of Wolseley UK, Ltd. He joined Wolseley US subsidiary Ferguson Enterprises Inc., in 1982. Mr. Marchbank also served as Director of Strategic Planning at Wolseley Group since 2001 and served as its Director of Information and Processes. He served as an Executive Director of Wolseley plc from 2005 to 2010. Mr. Marchbank received a BA in Government from The College of William and Mary and attended the Executive Education programs at University of North Carolina at Chapel, Duke University and the International Institute for Management Development.

Armin Meier
Mr. Armin Meier currently serves as the Managing Director of Boyden Switzerland. Prior to this role, he held several management positions in information technology as well as in travel and transportation. He was the Chief Commercial Officer of Travelport, a global distribution system for the travel business located in London; Group CEO of Kuoni Travel Holding Ltd, the largest global upmarket tour operator, publicly traded on the Zurich stock exchange; member of the Executive Committee of Migros, the leading retail company in Switzerland, with responsibility for logistics and IT; CEO and President of Atraxis, the independent and globally active IT company of the Swissair Group. In addition, Armin Meier has experience as member of non-executive boards, including Kuoni Reisen Holding AG. Originally trained as a teacher he studied Information Technology at the University of Applied Sciences in Berne and he holds a bachelor’s degree in engineering from the Bern Institute of Technology and an Executive MBA degree from the University of St. Gallen.

Hélène Ploix
Ms. Hélène Ploix is currently Chairman and CEO at Pechel Industries. Previously, she was Deputy Chief Executive Officer of Caisse des Dépôts et Consignations. Previously, Ms. Ploix had been a Director of Boots Company PLC since 2000. She was the Chairman of BIMP where she created the first LBO fund in France and Director of CEP from 1978 to1982. Ms. Ploix had held several positions in the public sector including Adviser to the Prime Minister on economic and financial affairs as well as Executive Director of both the International Monetary Fund and the World Bank. She served as a President and Chairman of A.F.I.C (Association Française des Investisseurs en Capital) and the French Venture Capital Association from 2001 to 2002. She is also a Non-Executive Director of BNP Paribas. She has been a Director of Lafarge SA since 1999. Ms. Ploix has been a Member of the Supervisory Board of Publicis Groupe SA since 1998 and serves as a Director and Chairperson of Pechel Services SAS. She is a Director of Ferring; Director and Vice-Chairperson of HRF6 SA, and CAE International SA. Ms. Ploix is the Ad hoc Member of the Investment Committee for the United Nations Personnel Pension Fund. She began her career as a Management Consultant at McKinsey & Co. Ms. Ploix is a graduate of Institut d’Etudes Politiques (IEP), Paris, and has degrees in Law and English Literature. She has an M.A.P.A degree from Berkley and an M.B.A. from INSEAD.

Christian Strenger
Mr. Christian Strenger is Member of the Supervisory Boards of DWS Investment GmbH, Evonik Industries AG, Fraport AG and TUI AG. He is also Chairman of the Germany Funds, New York. Mr. Strenger is a Member of the German Government Commission on Corporate Governance and Deputy Chairman of the Private Sector Advisory Group of the World Bank/IFC’s Global Corporate Governance Forum. Mr. Strenger holds an MBA from the University of Cologne.

Betty Thayer
Ms. Betty Thayer is a globally recognized expert on the non-executive position and transition coaching of senior executives and currently serves as Board Non-Executive Director at Boyden UK. Prior to this position, she was the Founder, Department Chair and Chief Executive Officer of Exec-Appointments LTD. She previously served 20 years in management consulting with Ernst & Young London. Mrs. Thayer is the Chairman of Tristart Ltd, a Non-Executive of Genius Consultancy and also sits on the Board of the Appointments Commission as a Non-Executive Director. She is as a visiting lecturer at the Cranfield School of Management and serves as a member of the Advisory Board of the University of Bath School of Management. Mrs. Thayer holds a BA in Accounting and Business as well as an MBA in Corporate Finance from Vanderbilt University.

Carl L. von Boehm-Bezing
Mr. Carl-Ludwig von Boehm-Bezing is a Member of the Supervisory Board and Chairman of Audit Committee, RWE AG. Previously he served as Managing Director of Deutsche Bank AG,. Mr. von Boehm-Bezing served as a Member of the Board of Management of Deutsche Bank AG. He served as the Chairman and Member of Board of Supervisory Board of AKA Ausfuhrkredit GMBH. He has been a Member of the Supervisory Board of RWE AG since 1997 and serves as Member of Supervisory Board of Ruetgers AG. He served as a Director of Fiat S.p.A. from 1999 to 2002. He served as a Director of Deutsche Bank from 1990 to 2001. He served as a Member of the Supervisory Board of ThyssenKrupp AG, until January 21, 2005. He served as a Member of the Supervisory Board of Steigenberger Hotels AG. He served as a Member of Advisory Board of Deutsche Bank AG. Mr. Von Boehm-Bezing received a Ph.D. in Law in Germany.


“Comparative Analysis of European Board of Directors”. Bettinelli C. Chugh L. 2008, in. Fuxman, L., Delener, N., Lu V., Rivera-Solis, L.E. (Ed.), International Review of Business Research Papers, Vol.5 N0. 2 March 2009 Pp. 62-75

Corporate Governance Code of Listed Corporations, France, December 2008,
“Enhancing Stakeholder Diversity in the Board Room,” ‘The Erfurt meetings’ series, No 1, March 2008, European Citizens’ Seminars e.V. (Erfurt, Germany) publishers.

“Legal Developments for Directors and Officers in Switzerland,” Matter, R, Pellanda, K, Bar & Karrer AG, Zurich, Switzerland, as excerpted in Executive Risks, A Boardroom Guide, 2010/2011, Willis.

“The Changing Role of the Non-Executive Board Director in Today’s World,” TEDxNewSt event talk by Lucy Marcus, October 2010.

“Governance since the economic crisis: McKinsey Global Survey results” McKinsey Quarterly, July 2011.

“The EU Corporate Governance Framework,” Green Paper by the European Commission, April 2011

The German Corporate Governance Code, May 2010,

“The New Governance: Governing without Government”
, R. A. W. Rhodes in Political Studies (1996) Volume: 44, Issue: 4, Publisher: Wiley Online Library, Pp. 652-667

The Swiss Code of Best Practice for Corporate Governance, April 2002,

The UK Corporate Governance Code, June 2010

“Women on Boards”, Report by Lord Davies of Abersoch, February 2011

About Boyden

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Special thanks are due to Dan Margolis, Nadia Rehman, John Watts and Jonty Yamisha with the Strategic Communications Practice of FTI Consulting ( and for their perspective and support.

Boyden Papers on Leadership is a series of publications on innovative thinking and best practices for corporate leadership today. These papers provide a foundation for discussion with multiple views of leadership that include sector-specific and global perspectives. For further information, please contact Gray Hollett, Chief Marketing Officer at Boyden:

This is part four of Boyden's four-part Board of Directors series. You may access part one by clicking here. You may access part two by clicking here. You may access part three by clicking here.


  1. McKinsey&Company conducted the survey in April 2011 of 1597 corporate directors globally of which 330 represented publicly owned companies, 334 represented firms that were owned by private equity firms, 545 represented family-owned business and the remainder were from other private and government-owned companies.
  2. Boyden Board Series Q & A interview with Svein Rennemo.
  3. McKinsey & Company Quarterly 2010
  4. For a country by country analysis covering Spain, Italy, France, Germany, Austria, Portugal, Greece, Ireland, The Netherlands and the UK, see Bettinelli and Chugh (2008
  5. The ISO 9000 family of standards represents an international consensus on good quality management practices. It consists of standards and guidelines relating to quality management systems and related supporting standards.