Cabal in Oldenburg: What’s going on at governance role model Cewe?

Dear readers of GermanBoardNews,

one headline in particular has surprised me in recent days: “Cewe CEO Friege must go – against the will of the Supervisory Board,” was the headline in the Handelsblatt newspaper. Against the will of the Supervisory Board? The lawyer in me was particularly reluctant, and on top of that: I had previously counted the photo service provider from Oldenburg as one of the few corporate governance role models in Germany.

Why? The special foundation structure seemed to promote long-term entrepreneurial thinking. This was supported above all by an astonishingly positive development: Cewe achieved an early and determined digital transformation.

In addition, those in charge were more vehement than most other companies about employee participation – an instrument that is tailor-made for bridging gaps between labor and capital and change. We acknowledged all this in GermanBoardNews, partly because we were convinced by the people involved.

CEO Friege in Governance Talk

I met the now apparently disgraced CEO Christian Friege in 2020 at a meeting of the Association of Supervisory Boards in Germany (VARD). Shortly afterwards, he presented his thoughts on corporate governance, leadership and corporate culture in the GermanBoardNews section “Governance Talk”.

His messages convinced me and others, such as this: “Leadership is no longer a decision-making privilege, but a service to the modern organization.”

I know Friege’s Supervisory Board Chairman Otto Korte even better: in 2018, he was one of the speakers at the 14th German Supervisory Board Day (#DART14), and in 2020, he moved into VARD’s Presidium. At the time, I was VARD Board Chair (by the way: VARD celebrates its tenth anniversary on March 29 – congratulations to all Presidium and Board members).

Not all that glitters was governance gold

So what happened at Cewe? Why could such things happen despite two champions of good governance? The Handelsblatt report suggests that at Cewe, it is the foundation’s Board of Trustees, not the Supervisory Board, that decides on appointments to the Executive Board. The Board of Trustees is chaired by Friege’s predecessor, Rolf Hollander, and the majority of its members voted against Friege.

According to Handelsblatt, both the Supervisory Board around Otto Korte and the heirs of founder Otto Neumüller (share: 27.1 percent) were behind Friege. This shows that not all that shone at Cewe was governance gold. A complex division of responsibilities between the Board of Trustees and the Supervisory Board and an ex-CEO deciding on his successor: this is the stuff of conflict.

What’s more, the incident impressively underscores the fact that, regardless of the governance structure, it’s people who ultimately make the decisions. And if they are not committed to a common personal governance, then decisions are difficult to predict. So you can see here on a small scale (S-Dax) what we also see again and again on a large scale: We need clear rules for personnel governance.


Yours, Peter H. Dehnen (Editor)