An SE can freely choose between a monistic or dualistic board structure. This also applies to countries where national company forms such a choice does not (yet) exist. Overall, the picture reveals a clear prevalence of SEs governed by a dualistic board structure. However, one has to take into consideration the uneven distribution of SEs throughout Europe: 4 out of 5 SEs are registered in Germany and the Czech Republic, in which national public limited companies must have a two-tier system of corporate governance.

In Europe, two different corporate governance systems can be found: (1) the monistic system with a single administrative board (board of directors) directing the company’s business and (2) the dualistic system with, on the one hand, a management board responsible for the day-to-day business and, on the other hand, a supervisory board monitoring the management board. So far, the choice of board system largely depended on the legal provisions in the different countries. Only in some member states did companies already have the choice of selecting under certain circumstances between the monistic and dualistic models (for example, in France, Finland, Hungary and Italy). In contrast, an SE can freely choose between a monistic or dualistic board structure. This also applies to countries where national company forms such a choice does not (yet) exist.

Overall, the picture reveals a clear prevalence of SEs governed by a dualistic board structure. Of the 1426 SEs, 76 per cent have a supervisory board and a management board, compared to only 17 per cent with a monistic board structure. For 7 per cent of the SEs the board structure is unknown.

However, one has to take into consideration the uneven distribution of SEs throughout Europe: 4 out of 5 SEs are registered in Germany and the Czech Republic, in which national public limited companies must have a two-tier system of corporate governance. The table below provides a breakdown of the 10 countries hosting most SEs with regard to the corporate governance system.

The table below shows SE board structure in the ‘TOP-10’ SE countries:

The analysis points to a clear path dependency with regard to the corporate governance system. In eight of the ten countries the majority of SEs have opted for the ‘traditional’ national board system. This is especially the case for the Czech Republic where 98 per cent of SEs have stayed with the well-known two-tier system. In the Netherlands, however, almost two-thirds of SEs have a monistic system, hitherto unknown to the Dutch corporate governance system. The share of monistic SEs is even higher in Austria: only 5 of the 20 Austrian SEs have opted for the traditional separation into a management and a supervisory board, whereas 15 SEs considered an administrative board more suitable for them. Also in Germany, a remarkable 92 of the 226 SEs have chosen a monistic instead of a dualistic board system.

Although in the majority of cases the free choice of the board system was obviously not the driver of the SE project, a significant number of companies have made use of this new flexibility created by the SE legislation, foremost in Austria, the Netherlands and Germany. Whether the choice of the board was the key motive for the setting-up of the SE cannot be concluded from the data. However, many companies have explicitly mentioned this motive in their (public) documents. In the meantime, some 25 SEs have decided to change their corporate governance subsequent to SE registration.

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