34. Corporate Governance Working Breakfast

At the 34th Corporate Governance Working Breakfast (CGWB), Dr. Daniel Weiß, lawyer and partner at Hengeler Mueller, spoke about the challenges and responsibilities of the supervisory board in crisis situations and provided valuable insights into best practices. The CGWB is a series of events regularly hosted by Professor Dr. Julia Redenius-Hövermann, Professor of Civil and Corporate Law at Frankfurt School, and Sabrina Biedenbach, Board Office Biedenbach.

Responsibility of the Supervisory Board and Stakeholder and Risk Mapping

Daniel Weiß began by presenting various crisis scenarios and emphasized that crises can occur at any time and unexpectedly—regardless of industry or company size. In such cases, the supervisory board plays a crucial role, particularly in monitoring and supporting the executive board. It must ensure that the executive board remains capable of functioning and managing the crisis. While fact-finding is primarily the responsibility of the executive board, the supervisory board may initiate its own investigation if there are indications of breaches of duty, in order to assess potential liability claims.

A well-founded stakeholder and risk mapping forms the basis for effective crisis management. Dr. Weiß highlighted that numerous stakeholders may be affected, increasing the risk of litigation—especially in the United States. Therefore, transparent communication and a well-thought-out strategy help to build trust among those affected and to find joint solutions.

Acute Crisis Management and Best Practices for Handling Aftermath

In acute crisis management, the focus is on averting danger and mitigating damage, while taking legal and economic aspects into account. It is crucial to prevent future incidents and avoid mistakes in the early stages. The supervisory board plays a central role here in monitoring, coaching, and, if necessary, intervening. Time-critical measures include securing data and evidence, as well as ensuring well-planned communication. At the same time, a crisis offers an opportunity to sustainably improve the company’s risk-opportunity profile.

Finally, Dr. Weiß outlined best practices for dealing with crisis incidents in retrospect. As part of its supervisory duty, the supervisory board must also assess the plausibility of internal investigations conducted by the executive board. Dr. Weiß recommended ensuring proper clarification of suspected cases, strong governance, legally compliant and appropriate communication, and effective interaction with authorities. Incorporating findings into follow-up processes and conducting a root cause analysis are also essential. If there is suspicion of breaches of duty by the executive board or serious risks to the company, an independent investigation by the supervisory board may be required. However, such investigations are often legally, economically, and organizationally complex.

A more detailed report on this Corporate Governance Working Breakfast can be found here.

Information on previous Corporate Governance Working Breakfasts can be found here.