Non Executive Director Agreement Template for Switzerland
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What is a Non Executive Director Agreement?
The Non Executive Director Agreement is a crucial document used when appointing independent directors to Swiss company boards, ensuring compliance with Swiss corporate law and governance requirements. This agreement is essential for establishing clear parameters of the non-executive role, including independence criteria, fiduciary duties, and compliance obligations under the Swiss Code of Obligations. It's particularly important for companies seeking to strengthen their corporate governance through independent oversight, whether they are private enterprises or listed companies subject to additional regulatory requirements. The document typically incorporates specific Swiss legal requirements regarding director liability, confidentiality obligations, and corporate responsibility, while also addressing practical aspects such as meeting attendance, committee participation, and remuneration structures.
About the Non Executive Director Agreement
A Non Executive Director Agreement is a formal contract that governs the appointment and responsibilities of independent directors on Swiss company boards. This document ensures compliance with Swiss corporate governance standards and establishes clear boundaries for the non-executive role under the Swiss Code of Obligations.
When do you need this document?
You need this agreement when appointing independent directors to strengthen your company's governance structure. It's essential for companies preparing for public listing, seeking investment from institutional investors, or establishing subsidiary boards with independent oversight. The document becomes particularly important when your company operates in regulated sectors requiring enhanced governance standards, or when stakeholders demand independent board representation. Swiss law encourages independent director appointments for transparency and accountability, making this agreement a cornerstone of modern corporate governance.
Key legal considerations
The agreement must clearly define the director's independence criteria to avoid conflicts of interest and ensure objective decision-making. Director liability provisions are crucial, as Swiss law holds board members personally liable for breaches of fiduciary duty under Articles 707-726a of the Swiss Code of Obligations. The document should specify indemnification arrangements and insurance coverage to protect directors from personal liability. Confidentiality clauses must comply with the Swiss Federal Act on Data Protection and address insider trading restrictions. Time commitment expectations should be realistic and enforceable, while remuneration terms must align with Swiss corporate law requirements and shareholder approval processes.
Legal requirements in Switzerland
Under Swiss law, all director appointments must comply with the Swiss Code of Obligations, which defines statutory duties including loyalty, care, and business judgment obligations. Listed companies must additionally follow the Swiss Financial Market Infrastructures Act requirements for board composition and disclosure. The agreement must specify compliance with Swiss criminal law provisions regarding business secrets and insider information handling. Directors must observe the Swiss Federal Act on Data Protection when accessing confidential company information. For financial sector companies, additional qualifications and responsibilities under the Swiss Financial Market Supervision Act apply. The agreement should incorporate these regulatory requirements while establishing clear procedures for board meetings, committee participation, and decision-making processes that meet Swiss corporate governance standards.
GOVERNING LAW
Applicable law
This Non Executive Director Agreement is drafted to comply with Switzerland law. Key legislation includes:
Swiss Federal Act on Financial Market Infrastructures (FMIA): Regulates corporate governance requirements for listed companies and disclosure obligations for board members
Swiss Financial Market Supervision Act (FINMASA): Relevant for companies in the financial sector, setting requirements for director qualifications and responsibilities
Swiss Federal Act on Data Protection (FADP): Governs handling of personal data and confidentiality obligations that directors must observe
Swiss Criminal Code: Contains provisions on criminal liability for board members, particularly regarding business secrets and insider trading
Swiss Code of Best Practice for Corporate Governance (SCBP): Though not binding law, provides important guidelines for director independence and board composition
SIX Swiss Exchange Listing Rules: Applicable if the company is listed, containing specific requirements for board members and disclosure obligations
Federal Act on the Implementation of International Sanctions: Relevant for ensuring compliance with international sanctions and director screening requirements
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