Now, however surprising this may sound, this question has not really been studied so far. So, what we decided to do in order to get a handle on this question is to carry out a survey. We surveyed the FT 500, i.e. the 500 largest European corporations listed on the Stock Exchange in terms of market capitalisation. The results that we can report today are preliminary results - and I insist that they are preliminary, because they are based only on a relatively small sample. So far, we have received responses from only 101 corporations, i.e. 20% of the FT 500. Mind you, those 101 corporations account for 30% of the capitalisation of the FT 500, which also means that the companies in our sample are slightly bigger than the average FT 500 company.

First, the main result we obtained from our sample is that, on average, about 23% of executive board members are non-domestic. In other words, about 75% of executive board members are nationals of the country in which their firm is incorporated.

The proportion of domestic and non-domestic non-executives is roughly the same as for executives. Only 23% of them are non-domestic. Altogether, therefore, 75% of all executive and non-executive board members in our sample of FT-500 firms are nationals of the country in which their firm is incorporated.

There are very important differences across countries. We show here the proportion of non-domestic (i.e. international) executives in the countries where firms are incorporated. What we find, perhaps with no surprise, is that this proportion of international executives is larger in the smaller countries. But there are very big differences across countries, both across the small countries and across the big countries. In Switzerland and in the NL, 40% - 50% of the executives within our sample are non-domestic. But some of the small countries have rather small proportions of non-nationals.

Among the big countries, the UK is slightly above average - about 25% of non-domestic executives; France comes very close to the UK; but Germany and Italy are extremely low. Less than 10% of the executive board members for the German (Italian) firms in our sample are non-German (Italian).

We carried out the same exercise for non-executive board members, and again we find that companies in the NL and Switzerland are those that are the most internationally-minded. Among the large the large countries, the UK is again the most internationally-minded, while German and Italian have almost no foreign non-executive board members.

We see, therefore, that there are three clusters of countries in Europe. One cluster comprises of NL and Switzerland, the proportion of non-domestic executive and non-executive board members is rather large, about 40% for both cases. Another comprises of Germany and Italy, which both display a very strong domestic bias: there are very few non-Germans or non-Italians within their executive and non-executive boards. The other countries lie in-between these two extreme clusters.

We also examined the situation for the heads of the executive (CEO) and non-executive (chairman) board. Here we found that 15% of the CEOs are non-domestic. In other words, 85 of the CEOs in our sample are nationals of the country in which their company is incorporated. And we find that only about 10 of the companies in our sample have a Chairman of the Board who is not a national of the country where the firm is incorporated.

Again, if you look across countries, we see that there are strong differences. The small countries (in this case, Sweden and Switzerland) stand out as far as the CEOs are concerned. Among the large countries, the UK stands out clearly. One-fourth of the CEOs of the British companies in our sample are non-British. By contrast, not a single German or Italian company in our sample was headed by a non-German or non-Italian national. France, rather surprisingly, is rather more in the British category than in the Italian or German category.

Even among the small countries there are important differences.

One interesting example is the case of the NL. You recall that NL is one of the countries with the highest share of non-domestic executives: - about 40% of executives in the Dutch companies in our sample are non-Dutch. This is a very high proportion. But if you look at the CEOs of all these companies, you can see that all of them are Dutch. So, the person at the top is Dutch, but that person is surrounded by a fair degree of non-Dutch executives. You see differences in other countries. The situations are different in Switzerland and in Finland.

If you look at the Chairman of the Board, you can also observe big differences across countries. The small countries have more non-domestic chairmen of the board than the large ones. The UK stands out again among the large countries. We see that 20% of the UK companies in our sample have a chairman of the board who is not from the UK. By contrast not a single German or Italian company has a non-domestic chairman of the board. Among the small countries, the NL is an interesting case. None of the Dutch companies in our sample is headed by a non-Dutch chairman.

By definition, all the companies in our sample of 101 FT-500 firms are large. There are, however, significant size differences among these companies. The smallest company in our sample has a market capitalisation of about $2 billion, while the largest has a market capitalisation of around $160 billion.

We examined whether the degree of internationalisation of executive and non-executive boards is positively correlated with the size of firms. As you can see from the red lines in the two charts, there is, indeed, such a positive correlation, but it is not very strong. There are lots of companies, both small and fairly large ones, which have no non-domestic executives on their boards.

On the other hand, it is true that if you look at the largest firms in our sample, all of them have some non-domestic board members. degree of internationalisation.

Now, let me conclude.

The main conclusion of this presentation is that is a very large discrepancy between the internationalisation of firms in terms of their activities and in terms of their executive and non-executive boards. Unfortunately, our data only gives a picture for the year 2001. We cannot tell whether boards have become more international or not over the years.

In the next phase of our work, we plan to analyse whether there is a relationship between the degree of internationalisation of companies and their performance. It would be interesting to see whether companies that have more nationally diverse boards of executives or non-executives display better performance in terms of return on capital.

We hope to see you in a few months to discuss our new findings.

Thank you.