MPs place limits on corporate board jobs

Thursday 10 December 2009

MPs are to place a limit on the number of supervisory board jobs executives are allowed to have in an effort to break up the 'old boys network', the Financieele Dagblad reports.

The changes will limit 'professional' supervisory board members to five functions, with chairmanship posts counting as two. At the same time, CEOs and executive board members will be limited to two supervisory board jobs at companies or foundations, MPs agreed.

Socialist party MP Ewout Irrgang, who drew up the amendment, says the move is important to guarantee the quality of supervisory boards and prevent conflicts of interest.

Golden handshakes

MPs also voted in favour of an amendment which breaks the formal working contract between executive board members and companies. This means top level staff will no longer be considered employees and entitled to statutory golden handshakes if they lose their jobs.

Under the Tabaksblat corporate governance code of conduct, executives may get a maximum one year's salary if they are dismissed. Under employment law they are usually entitled to more.

Employers organisation VNO-NCW said the change in executive contracts will mean extra work for companies. And the limit on supervisory board positions interferes with companies' rights to choose their own staff.

© DutchNews.nl

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