The primary responsibility of both, the supervisory board and the non-executive directors, is to supervise and advise the board of directors. In this capacity, they may be held jointly and severally liable, for instance, in case the board of directors fails to draw up the company’s financial statements in a timely and accurate manner. Non-executive directors can also be held liable as directors.
Furthermore, they have to approve major decisions, such as entering into transactions worth more than 1/4 of the sum of the company’s issued share capital and reserves, making amendments to the articles of association or issuing new shares. These powers are similar and complementary to the powers of the general meeting. However, the general meeting’s right to appoint and discharge directors is transferred to the supervisory board or the non-executive directors. The general meeting, in turn, is granted the right to discharge the entire supervisory board or all the non-executive directors.
Non-executive directors can be charged with more responsibilities than the members of the supervisory board. An individual non-executive director can, for example, due to his special expertise, be charged with the implementation of the company’s new sustainability program. Although it is possible to charge one or more non-executive directors with more tasks, they cannot be relieved from their supervisory responsibilities.