Corporate governance

The Rhineland model

The Rhineland model is characteristic of (among others) the Dutch system. In addition to the company and its shareholders, this model also focuses on other stakeholders, such as employees, customers, suppliers, and society. The executive board and the supervisory board are separate, forming what is known as a two-tier board. In countries such as the United States, the Anglo-Saxon model dominates, with a greater focus on profit and shareholders. Here, executives and supervisors sit together on a board of directors, known as a one-tier board. 

The Origins of the Dutch Corporate Governance Code

In the wake of the Enron accounting scandal, the Netherlands experienced its own major accounting scandal. The supermarket group Ahold had been manipulating its financial figures. Unlike Enron, Ahold would survive, but one thing was clear: even the stakeholder model was not immune to large-scale malpractice. Consequently, then-Minister of Finance Hans Hoogervorst established a Dutch corporate governance commission in March 2003, led by Morris Tabakblat. The renowned top executive (and later supervisory board member) succeeded in getting the business community’s leadership to agree on self-regulation through a code of conduct for companies and their directors. The so-called Corporate Governance Code, published in December 2003, contains over 100 recommendations for good governance.

The Corporate Governance Code Monitoring Committee

Companies committed to applying the corporate governance code or explaining why they deviated from it on certain points. In 2004, the corporate governance code—known among directors as the Tabaksblat Code—was enshrined in law. The Corporate Governance Code Monitoring Committee was also established. Since then, it has overseen compliance with the code. Under Tabaksblat’s successors, Jean Frijns and Jaap van Manen, the code was revised. Frijns broadened support for the code by, among other things, involving investors in the code. Under Van Manen, who introduced the revised Corporate Governance Code in 2018, the concept of “corporate culture” became a key focus. In 2018, Pauline van der Meer Mohr was appointed chair of the Corporate Governance Code Monitoring Committee. Under her chairmanship, the Committee further developed topics such as long-term value creation, stakeholder dialogue, the role of shareholders, and diversity. In 2025, a new Committee was established, led by Rob van Wingerden. That Committee’s first major achievement was to incorporate the Statement on Risk Management (VOR) into the Code.

Key themes in the Dutch Corporate Governance Code

From day one, there was much debate about recommendations regarding compensation and compensation policy: might transparency have a driving effect on executive pay? Many companies now have a compensation committee that reviews compensation policy, and compensation is being scrutinized more critically at shareholder meetings. Long-term value creation was also a key theme. This must be the primary objective when formulating long-term strategy. Furthermore, directors are expected to articulate a vision regarding the level of their own compensation and how it aligns with long-term value creation. Corporate culture is also considered increasingly important. For example, the board and supervisory board members are expected to promote openness and accountability. In short: good governance without accounting scandals.