Supervisory boards are in the focus of media and public attention before the AGM season. Is this (once again) an attention bubble – or a harbinger of fundamental change?

Aufmerksamkeitsblase

HELAU, dear readers of GermanBoardNews,

the business media are devoting increasing attention to the topic of “Corporate Governance”. Three weeks ago, for example, SPIEGEL wrote under the heading “Loss of control” about “the supervisory boards of DAX corporations”. In the spotlight were (once again) the gentlemen Achleitner, Wenning, Kaeser, Hagemann Snabe and Zetsche.

In its current issue, the Manager Magazine highlights two governance topics at once: Dietmar Palan writes in the cover story about “men in the money rain” (“New rules are supposed to stop the increase in remuneration in the boardrooms – in fact, the sums will continue to grow”), and Philipp Alvares de Souza Soares ponders: “Sinn-Salabim. CO2, plastic waste, inequality – the economy is under constant fire. It takes a “purpose” to appease the critics”. To this end, he appeals to supervisory and management boards, saying that “concrete changes in the business model” are necessary.

Scene-connoisseurs should not be particularly surprised by the theme economy, as the AGM season is slowly picking up speed. But I ask myself: Is it (once again) much ado about nothing? Does the mountain circle and give birth to a little mouse? Is anyone beyond the corporate governance community still listening?

The “Tone from the Top” must be right

Anyone who hastily affirms these questions and senses a temporary phenomenon is making things too easy. For me it is clear: the current media attention is a side effect of a fundamental change. Top decision-makers can no longer ignore the topics of “sustainability” and “purpose”. They must take stakeholders seriously, communicate sincerely with them and credibly convey that the “tone from the top” fits the corporate culture and purpose.

Those who fail to do so risk the future of their company. And it is also a fact that the Supervisory Board has a very special responsibility in this respect – after all, it is this body that defines the guidelines for entrepreneurial action and decides on the composition of the Management Board, an increasingly important personnel responsibility.

Decision makers need orientation, not paternalism

I am convinced that every person who bears responsibility needs orientation and guidelines by which to measure their actions. And it is always better for companies to define guidelines and principles themselves than to leave this to third parties, such as politicians and investors.

So why not draw up such guidelines in dialogue with all stakeholders? I mean, nothing. There is much more of an imperative to act here.

The Association of Supervisory Boards in Germany (VARD) has drawn up both professional principles for supervisory boards and principles guidelines for a corporate code of conduct, which we will present for discussion at the 16th German Supervisory Board Congress as part of a workshop on #FutureGoodGovernance. All top decision-makers, supervisory boards and management boards are cordially invited to participate in this dialogue.

If we do not define guidelines, someone else will do it for us; and then it is too late for complaining and whining.

 

On that note, Helau and Alaaf!
Your
Peter Stretching

 

Additions, remarks, objections? I look forward to your feedback

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