1.1.1 Long-term value creation strategy
The management board should develop a view on long-term value creation by the company and its affiliated enterprise and should formulate a strategy in line with this. Depending on market dynamics, it may be necessary to make short-term adjustments to the strategy.
When developing the strategy, attention should in any event be paid to the following:
- the strategy’s implementation and feasibility;
- the business model applied by the company and the market in which the company and its affiliated enterprise operate;
- opportunities and risks for the company;
- the company’s operational and financial goals and their impact on its future position in relevant markets;
- the interests of the stakeholders; and
- any other aspects relevant to the company and its affiliated enterprise, such as the environment, social and employee-related matters, the chain within which the enterprise operates, respect for human rights, and fighting corruption and bribery.
1.1.2 Involvement of the supervisory board
The management board should engage the supervisory board early on in formulating the strategy for realizing long-term value creation. The management board renders account to the supervisory board of the strategy and the explanatory notes to that strategy.
1.1.3 Role of the supervisory board
The supervisory board should supervise the manner in which the management board implements the long-term value creation strategy. The supervisory board should regularly discuss the strategy, the implementation of the strategy and the principal risks associated with it. In the report drawn up by the supervisory board, an account is given of its involvement in the establishment of the strategy, and the way in which it monitors its implementation.
1.1.4 Accountability of the management board
In the management report, the management board should give a more detailed explanation of its view on long-term value creation and the strategy for its realization, as well as describing which contributions were made to long-term value creation in the past financial year. The management board should report on both the short-term and long-term developments.
You can read the complete New Dutch Corporate Governance Code here: http://www.commissiecorporategovernance.nl/download/?id=3367
Background
The Purpose of the Corporation Project participated in the consultation process by hosting a roundtable on corporate governance at Nyenrode Business University. Irene Heemskerk, member of the Dutch Monitoring Committee Secretariat, presented the draft Corporate Governance Code and solicited comments and reflections from roundtable participants.
The results of the discussion were shared with the Committee following the roundtable, along with suggestions for amendment to the text: http://www.purposeofcorporation.org/summary-dutch-roundtable_1.pdf
