A NETHERLANDS ANTILLES COMPANY: ANGLO-SAXON AND/OR CONTINENTAL?
Shareholder primacy versus stakeholder approach
The Anglo-Saxon model (USA, UK) can be characterized as follows:
– the corporation is a continuation of the shareholders; shareholders primacy; and
– the main aim of the corporation is to maximize profits.
The continental model (continental Europe, Netherlands Antilles, Aruba and Japan) on the contrary:
– the corporation is a combination of different interest parties all having an own aim and interest, among which the employees, creditors, shareholders and also the protection of the environment being amongst others the interest of the society; and
– the object of the corporation is more continuity of the corporation and the interest of the afore mentioned interested parties.
The difference between management and shareholders creates in both models information and agency problems and requires sometimes independent and qualified supervision. In the Anglo-Saxon system, with its ‘one-tier boards’, this is the task of the non-executive directors. In the continental ‘two-tier board’ system with both managing and supervisory directors this belongs to the task of the supervisory directors. Improvement of the supervision is the central issue in the corporate governance discussions. It should be noted that as from 1 March 2004, the board of a Netherlands Antilles NV or BV can be organized as one-tier board or as two-tier board.
Karel Frielink
Attorney (Lawyer) / Partner
