Supervisory Board Qualification of German Banks: Legal Standards and Survey Evidence
Sachkunde in Kontrollorganen deutscher Banken: Rechtliche Anforderungen und Befunde einer Befragung
Improving the regulation of banks has been at the centre of economic policy actions since the outbreak of the global financial crisis. One of the many and conceptually very different measures proposed is to improve the corporate governance of banks by setting qualification standards for banks’ non-executive directors. To explore the rationale of such a regulation implemented in Germany, we conducted a detailed survey among supervisory board members of German banks covering their educational background, professional status and experience, as well as non-occupation related activities. We document that general education among supervisory board members is high, but very few board members can rely on a professional background in banking and finance. This is especially true for chairpersons. A higher share of professionals among board members primarily reflects the presence of employee representatives. The majority of board members reports leadership experience, chairpersons more often than ordinary members. Some of these findings strongly depend on the bank’s legal form, its size and business model, suggesting that both market forces and institutional characteristics of banking markets are important determinants of the qualification level of non-executive directors.
Körner, T., O. Müller, S. Paul and C. Schmidt (2016), Supervisory Board Qualification of German Banks: Legal Standards and Survey Evidence: Sachkunde in Kontrollorganen deutscher Banken: Rechtliche Anforderungen und Befunde einer Befragung. Credit and Capital Markets – Kredit und Kapital, 49, 2, 299-342
DOI: 10.3790/ccm.49.2.299