Absent a statutory basis for board observers, parties have significant freedom in determining the role and position of board observers on boards of Dutch companies. Dutch doctrine on board observers has not (yet) seen significant development and consequently limited guidance is available. In our experience, parties tend to take inspiration from the more developed US or UK precedent when installing a board observer in Dutch companies. For illustrative purposes, we set out several use cases regarding board observers and share our considerations when opting to use board observers in the governance of a Dutch company.
We expect to see a further increase in the use of board observers in the Netherlands, especially by private equity and venture capital investors. The more well-established these board observers become, the more likely this is to impact Dutch corporate governance standards. This may help develop a more established market practice and doctrine on the role and composition of board observers for Dutch companies.
Want to learn more? A trend report in which we share our thoughts on how this development may impact Dutch corporate governance standards, is freely available below.
Should you have any further questions on how this development may impact Dutch corporate governance standards or do you feel that the described trend could be applicable to your specific situation, please do not hesitate to contact our corporate governance and litigation experts for tailor-made advice.
Please download the report below.