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Source: 12manage.com
Characteristics One-tier boards (also "unitary model") Two-tier boards (also: dual model")
Organization One-layered board structure Two-layered board structure
Composition There is only one single Board of Directors, composed out of both executive directors as well as non-executive directors. In the classic form, the executive directors used to form the majority; nowadays increasingly the majority is formed by non-executive directors. - The Supervisory Board consists fully our of non-executive (supervisory) directors.

- The Board of Directors (Management Board) consists fully out of executive, managing directors.
Committees There are (compulsory supervisory) committees, such as an Audit Committee and a Compensation Committee, and sometimes also a Nominating Committee and a Governance Committee, who are typically composed out of a majority of non-executive directors.

The CEO and other executive directors may be members or even chairman of the various committees. Recently, the focus on the independence of committee members has increased.

 Supervisory committees were mostly not compulsory, but increasingly we see an increase of the (influence of) committees in the two-tier model.
CEO and Chairman position In the classic model, the CEO and Chairman role can be held by one and the same person (CEO duality). Increasingly, the CEO is no longer chairman of the Board of Directors, but an independent, non-executive director. No CEO-duality, although the CEO can be a regular member of the Supervisory Board.
Executive Directors Appointed by the general meeting (of shareholders), based on a nomination by the Nominating Committee or by the Board as a whole or by the general meeting.

Some jurisdictions also permit the board of directors to appoint directors, either to fill a vacancy which arises on resignation or death, or as an addition to the existing directors.

 Appointed by the general meeting (of shareholders), based on a nomination by the Nominating Committee, the Supervisory Board or by the general meeting.
Non-executive (Supervisory) Directors Appointed by the general meeting, based on a nomination by the Nominating Committee or by the Board as a whole or by the general meeting.

Some jurisdictions also permit the board of directors to appoint directors, either to fill a vacancy which arises on resignation or death, or as an addition to the existing directors.

 Appointed by the general meeting, based on a nomination by the Nominating Committee, the Supervisory Board or by the general meeting.

Sometimes a part of the Supervisory Directors can be appointed by third parties, such as the public government, a bank or the employees.

Invest in yourself with a Premium membership of 12manage and save on management books, education and consultancy.

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