Switzerland has a president

Board President

The President assumes the organizational leadership role in the Board of Directors and ensures smooth cooperation between the Board of Directors and management.

Definition and background

Terms used synonymously:
Chairman of the Board of Directors, Chairman, Chairman

The role of the chairman of the board of directors is only mentioned a few times in the Code of Obligations: The board of directors appoints its chairman (OR 712) if this task is not assigned to the general assembly in the articles of association. He has the casting vote in the BoD, signs the minutes (OR 713) and the annual report (OR 958). In addition, the president is mentioned in connection with the right of board members to inspect files and call a board meeting (OR 715). In principle, the Swiss Code of Best Practice confirms the practical organizational leadership role of the President on the Board of Directors.

Function of the VR President

Primus inter pares with additional functions

The function of the President, like that of the Secretary, is practically only confirmed in its existence by the text of the law. The concrete role of the President as the organizational leader of the Board of Directors has emerged in practice (see sample document job description). In this function he is usually supported by the secretary of the board of directors.

choice

The president must be a member of the board of directors, is in fact determined (and removed) by the board of directors and must be entered in the commercial register. The commercial registers of certain cantons also require the entry of a vice-president. Since the Minder Initiative (valid from the 2014 AGM), the president of listed companies has to be elected annually by the general assembly.

tasks

In accordance with the Swiss Code of Best Practice, the President takes over the management of the Board of Directors (processes, advice, decision-making) and ensures that there is sufficient information exchange between management and the Board of Directors. The following tasks specifically assigned to the Chairman of the Board of Directors can be found in the organizational regulations:
  • Formal management of the Board of Directors
  • Organization and management of board meetings
  • Ensure flow of information with GL and other bodies
  • Representation of the company and the board of directors to the outside world
  • Signing the VR and GV protocols
  • Convening and chairing the general meetings
  • Signing the board of directors and general meeting minutes, regulations, HR entries
  • Sign employment contracts GL
  • Control implementation of board and general meeting resolutions
  • Organization of self-evaluation VR
  • Organization of training and further education VR
  • Granting of authorization to sign
  • Exercising the casting vote in the Board of Directors
  • Decisions to hold extraordinary meetings and requests for information from the Board of Directors

Chairman in the USA

Since the USA and UK as well as Switzerland use the 1-tier system, the functions of the president and chairman are generally comparable. Although the discussion about the personal union of Chairman and CEO continues in the USA, the strong 'President and CEO' is the norm in many companies.

market

There is little publicly available market information about the role of the BoD chairman other than age distribution or compensation in the case of listed companies. Effective tasks and working methods have rarely been systematically examined.

Typology of the board presidents of listed companies

The average age of the board presidents (100 largest Swiss companies) is 61 years - which is roughly the European average. The high proportion of academics is striking. This is likely to be a lot lower for unlisted companies.
Source: Data CH: Schillingreport 2014, EU: Heidrick, CG Report 2014

Discussion and sticking points around the topic

  • With the special position of the BoD President, the question of the liability of the individual BoD members towards the BoD as a whole also arises.
  • Especially with full-time board presidents in larger companies, there is a potential for conflict without a clear division of competencies from management and CEO.
  • A strong personality and an imminent knowledge advantage of the president harbor the danger of too great a concentration of power vis-à-vis other members of the board of directors and management.

Further literature and links

The most comprehensive Swiss book on the subject (Wunderer, 1995) is a bit older. A brief introduction is given by Müller (2008). Krneta (2005, 472ff.), Müller (2007, pp. 68ff.) And Böckli (2009, §13-324ff.) Are more detailed. There is a little more literature from North America (Cadbury 2002 and Lechem, 2002). See also the job description for President under sample documents.

The Chairman of the Board of Directors
Comprehensive dissertation on the role of the VR President. Legal status, tasks, role, competencies. With market survey on practical use, expectations, priorities, role in crisis phases. Not up to date anymore, but still valid for the most part.
Corporate Governance and Chairmanship
The corporate governance guru from UK. Very good overview of the chairman's functions and problems. The book that is still missing for Switzerland. E-book version
The Chairman of the Board of Directors
Comprehensive, but somewhat generally theoretically legal
The role of the board president and board secretary
One-sided outline by the lawyer without further references.
Source: Board of Directors - New Corporate Governance
La rôle du président du conseil
Source: Swiss journal for business law
The role of the chairman of the board of directors
Brief overview of the tasks and role of the VR President. Unfortunately out of date, but still a good introduction.
Source: Board of Directors as an executive board
About the role of chairman. Role, ethics, qualifications, risks, assessment etc .. Written for North America, but a lot is also relevant to us.
Job description of the Chairman of the Board of Directors
Sample document for job description of the Chairman of the Board of Directors. Description of the tasks and competencies of a board president