Report of the Supervisory Board

It was a turbulent year – for passengers, for employees, for the Executive Board (EB) and certainly for the Supervisory Board (SB). As stewards of the organisation, we also want to close each year with an NS that is a little bit better. We faced several challenging issues in 2024.

Operational performance

In 2024, NS was able to tentatively reap the first fruits of changes initiated in late 2023. Much has been done to improve track performance, but NS still has some way to go. From an internal perspective, it is possible to say that NS is now doing better in several areas, but from a passenger perspective, there is further room for improvement. The Supervisory Board was kept informed of measures to return operational performance to a higher level. Improvements have been made, particularly in operations. For instance, considerable efforts were made to improve availability of rolling stock to reduce the number of trains withdrawn from the train service at the same time. This had a direct positive impact on seat availability for passengers. The process of introducing the new Intercity trains also went more smoothly. The Supervisory Board set up an operational committee in late 2023, with the aim of being more involved in operational matters. This committee met for the first time in 2024. This enables the Supervisory Board to strengthen its role as challenger and sparring partner of the Executive Board. A lot of time and thought has gone into how we can work ‘smarter’ to improve the passenger experience. And how to achieve the KPIs agreed in the concession.

On the topic of operational performance, infrastructure dependency was discussed at length. ProRail carried out a great many high-impact maintenance works again in 2024. Although everyone agrees that these works are necessary for the future, they have a substantial negative impact on the NS customer experience. They also place high demands on NS in terms of preparatory work. A case in point are the works at Amersfoort, a major hub station from which passengers fan out in various directions. The works lasted for six weeks, with NS offering passengers an alternative in the form of a replacement bus service for part of the journey. The Board has seen that NS pulled out all the stops in this situation to properly inform passengers and minimise inconvenience. The Supervisory Board is concerned by the amount of trackwork planned for 2025. This – like unplanned disruptions, of which there were many in 2024 – has a major impact on passengers and their travel experience. Not only is the number of works increasing, but work done at night is shifting to the day and work during holiday periods to year-round. This will mean considerable inconvenience for passengers.

NS faced many temporary speed limits in 2024. On several routes, trains were not able to travel at the normally permitted speed for safety reasons. Understandable, but a bitter pill to swallow. This made it a lot harder to achieve punctuality targets and the minimum value on the HSL proved infeasible. Extensive discussions were held with the Executive Board on these issues and all KPIs. The Supervisory Board challenged, questioned and encouraged. 

Financial situation

The Supervisory Board is disappointed with NS's financial situation, to say the least. This is a challenge that requires constant attention and has therefore been a subject of regular discussion. Passenger numbers fell short of forecasts, which is understandable. The COVID-19 pandemic caused a break with past trends and still makes it difficult to estimate the impact on passenger numbers in the short and somewhat longer term. It is clear that the average capacity utilisation rate is too low for the costs involved. The commuter peak is on Tuesdays and Thursdays, the morning and evening rush hours are fairly busy and the number of weekend passengers has risen again. At various times, there is room on the train for more passengers. The Supervisory Board sees the capacity utilisation rate as one of the most important control instruments. Rate differentiation as proposed in 2023 could bring about significant changes in this area, but is politically and socially sensitive. We therefore failed to communicate our proposal sufficiently clearly.

Another factor that also complicates our financial situation is ever-increasing costs. NS’s costs rose partly due to investments in new trains, which have a long lead time, with associated employee training costs. The costs of these investments far outweigh the benefits. The current Collective Labour Agreement that took effect on 1 January 2024 also entails additional costs. On top of this, energy costs have increased and student public transport revenue is set to fall sharply in the coming year. NS wants and needs to be able to fend for itself and ensure its own sustainability, even if it falls short of expectations. The Supervisory Board believes the company owes it to society to always critically examine whether things can be done more effectively or efficiently. The Supervisory Board discussed ways to make savings and reduce costs with the Executive Board. The Supervisory Board supported the Executive Board in its discussions with the Ministry of Infrastructure and Water Management to keep train tickets affordable. In 2024, NS agreed with the State Secretary that the adjustment for inflation would be divided over the past few years. This means that the government will pay one third, NS one third, which presents an additional challenge for us, and passengers will pay one third through an average 6.18% increase in the price of train tickets. Part of this is regular inflation. The political challenge is to find a long-term solution to this problem, as has happened with other public transport. 

Strategy

Although today’s operational and financial problems are demanding, we must not forget the challenges of tomorrow. And that means difficult decisions: what to do, what not to do. The Supervisory Board believes it is essential to ensure that the company can enter the next phase. Several discussions took place with the Executive Board on strategy, both short-term and long-term. The question that frequently arose was what does the company need to ensure its survival for the next ten years. How can we make sure we are still relevant then? The Supervisory Board provided support in honing the strategy, as well as offering different perspectives. The Supervisory Board is satisfied that the Executive Board was able to bring the foreign operations of subsidiary Abellio to a tidy and successful conclusion. This also marked the end of NS's internationalisation strategy. The trains now running to Belgium are covered by the main rail network concession. The remaining international trains, which NS operates via open access, play an important role in offering passengers a sustainable travel alternative up to a distance of 700 kilometres.

Another repeat topic of discussion with the Executive Board has been strategic workforce planning for staffing and, in particular, insight into staff departures. The Supervisory Board sees the tight labour market as a huge challenge and foresees a need to work differently and smarter. Embracing IT as an opportunity is part of the solution: IT changes how work is carried out but not employment opportunities. It is important that employees are properly informed about and involved in the changes. With this in mind, the Supervisory Board created the Executive Board portfolio ‘People & IT’. 

Social safety is a recurring theme on the agenda. The Supervisory Board sees a link between the aggression faced by staff and absenteeism, which, although reduced, is still on the high side. It saddens us that there are employees stuck at home who are generally eager to work, but are now unable to due to one or more aggressive incidents. The Supervisory Board agrees with the Executive Board that NS cannot face social safety issues alone, but must do so with the support of government.

The strategic scheduling of rolling stock was also discussed with the Executive Board, as well as the choices to be made in relation to the substantial investment in new trains.

The Supervisory Board notes that NS stations remain attractive places for passengers. Major renovations are taking place at some stations, causing inconvenience to passengers, however this work is necessary to ensure high service levels in the future.

Concession

A great deal of time and effort was invested in the new concession last year. Rightly so, in the Supervisory Board’s opinion. Acquiring this concession in 2023 was challenging. The contract setting out the preconditions was drawn up in 2024. The organisation has also made preparations for the start of the new concession. These include major changes to the 2025 timetable, with more than 1,500 extra trains per week, and twice as many travel options to Belgium. However, open access for existing international links that are now no longer covered by the main rail network concession also required attention. The Supervisory Board appreciates the energy and dedication put into all the preparations: an important investment in the future of travel in the Netherlands.

Review and a word of thanks

When the Supervisory Board looks back at the past concession period, 2019 stands out as a particularly positive year. The years that followed were dominated by the pandemic and the subsequent recovery. The Supervisory Board is grateful to the Executive Board for all the work that has been done and appreciates how the two boards have supported each other in the face of difficult challenges, each with their own responsibilities. The Supervisory Board deliberately chose to keep the number of Executive Board members at five, given the challenges facing NS. The appointment of Liesbeth Kaashoek as of 15 June 2024 with the People & IT portfolio, the reappointment of Eelco van Asch, and the appointment on 1 April 2025 of Daan Schut as Commercial and Network Director bring the Executive Board back to full strength. The Supervisory Board is pleased with the open and transparent relationship with, and support from, the shareholder and notes that a good relationship is being built with the Ministry of Infrastructure and Water Management. An open and constructive relationship has also been established between the employee representation bodies and the Executive Board through the Central Works Council committee. The Board greatly appreciates the efforts of all NS employees for passengers and would like to thank them for their dedication. Whether they work on the trains, at the stations, in the workshops or in the offices: together, they keep the Netherlands moving.

'NS employees live NS'

'I know how hard NS has worked to do things better than in 2023; I can see the improvement. That’s a real positive in the NS report, but from the passenger's perspective there is obviously still a way to go. Some things lie within NS's control, but others do not, such as the temporary speed limits due to the state of the infrastructure and work on the tracks. That makes things complicated. Of course, I too am a passenger and am occasionally frustrated by delays. And if it’s not me experiencing it, I am held to account by those around me. Then my daughter calls and says “Dad, it's happening again”. Or my circle of friends chime in with the most valuable lessons. Although I say it with a smile, many people are not aware of the complexities of the background causes. Of course, when things go well, which fortunately happens quite often, it goes without saying I never hear anything. The heart of NS, of course, lies in its operations. And I know: NS employees live NS. They do their very best, even when things are tough. We have discovered that NS is great at putting out fires, but we must make sure that we do not get so caught up in everyday problems that we forget about the future. As a supervising body, we also support NS in this: we want to fundamentally move the company forward together with the Executive Board. It has been a hectic year, just like in the world around us, and I think that will continue for a while into 2025. But we are working to make things a little bit better for passengers all the time.'

Herman Dijkhuizen
Chair of the Supervisory Board

Corporate governance

Changes in the Supervisory and Executive Boards

Supervisory Board

Last year, Marike van Lier Lels said farewell to NS at the end of her second term of appointment. We thank her for her commitment to the company. Herman Dijkhuizen was reappointed for a second four-year term. Janet Stuijt was reappointed for a third two-year term. The reason for this reappointment is to ensure continuity and quality within the Supervisory Board and also in the oversight of the ongoing succession processes. Klaas Dijkhoff and Giny Boer took office in 2024. As a result, the NS Supervisory Board now has seven members. The Supervisory Board as a whole is independent within the meaning of the Dutch Corporate Governance Code. The Supervisory Board broadly subscribes to best practice stipulations 2.1.7 to 2.1.9 in the 2022 Code. The chair of the Supervisory Board meets the criteria of independence and is not a former Executive Board member of NS. In accordance with the criteria of best practice 2.1.7 and 2.1.8, each Supervisory Board member is required to be able to operate independently and critically. All of the Supervisory Board members are independent within the meaning of best practice provision 2.1.8. 

Executive Board

After serving for more than seven years as Finance Director and a brief interim term as CEO, Bert Groenewegen handed over his role as Executive Board member and Finance Director on 1 March 2024. The Supervisory Board is extremely grateful to Bert for the way he has fulfilled his duties, his tremendous commitment and his contributions to the company. We were pleased to welcome Angelique Magielse as Bert Groenewegen’s successor and are happy with this internal transfer. Angelique continued to serve as Managing Director of Abellio until 1 March 2024.

The Supervisory Board also thanks Tjalling Smit, Commercial & Development Director on the Executive Board, who said farewell to NS last year after seven years. His successor, Daan Schut, will start on 1 April 2025 and will also become a member of the Executive Board. Liesbeth Kaashoek, People and IT Director, was appointed as Anneke de Vries' successor with effect from 15 June 2024 and joined the Executive Board. 

Performance of the Supervisory Board

Once every three years, the Supervisory Board commissions an external agency to examine its performance. A self-assessment took place in 2024. The results show that the members of the Supervisory Board are diverse and complement each other. It is to some degree a new team that is making positive progress towards utilising the power of the collective to better effect. Following the self-assessment, the Supervisory Board is spending more time on jointly preparing for Supervisory Board meetings. 

Performance of the Executive Board and collaboration with the Supervisory Board

The Executive Board’s performance has been satisfactory and it performs its duties well in a complex playing field. The relationship between the Supervisory Board and the Executive Board is professional and good. The Supervisory Board is informed in a timely and adequate manner and involved in decision-making where necessary. The meetings also cover concrete dilemmas. The Supervisory Board has confidence in the Executive Board and professional relations between the two boards are good. Both the Supervisory Board and the Executive Board keep to their roles in the performance of their tasks.

Supervisory Board meetings

In total, the Supervisory Board met eleven times last year. Virtually all of these meetings were attended by all Supervisory Board Members, with an average attendance rate of 83%. The Supervisory Board has three permanent committees: the Risk and Audit Committee (RAC), the combined Remuneration and Appointments Committee (Renomco) and the Operational Committee (Opco). The committee attendance rate for 2024 was high. The Opco had an attendance rate of 100%. In the case of the Renomco and RAC, 1 Supervisory Board member (who is a member of both committees) missed the February meeting. 

Risk and Audit Committee

The Risk and Audit Committee (RAC) consists of three Supervisory Board members and is chaired by Ron Teerlink. The committee met five times. The Chair and CEO, the members of the Executive Board for Finance and Risk & Compliance, the Audit Director and the external auditor also attended these meetings. Depending on the agenda, other individuals – such as the directors of Legal Affairs and Sustainable Enterprise – were also invited. In 2024, the RAC held discussions about the 2023 financial statements and annual report, compliance with the corporate governance code, the 2024 six-monthly figures, the 2025 budget, risk management and risk appetite, the group plan for 2024-2028, plans and reports of the Internal Audit department, reports prepared by the external auditor, the settlement of Abellio, an update on IT and cybersecurity issues and the status of the CSRD. The RAC also discussed the performance of the external audit function.
Key points from the external auditor’s management letter and the eye opener report include internal control, the incorporation of the discontinued foreign operations (Abellio UK and Germany), IT and cyber security and the CSRD. The main topics from the auditor’s end-of-year report that were discussed related to NS’s results, solvency, financing and continuity, and the impairment of the main rail network as a result of the new concession that was agreed. Over the course of the year, the Chair of the Supervisory Board and the Chair of the RAC held several consultations separately with the external auditor and the shareholder.

Remuneration and Appointments Committee (combined)

The combined Remuneration and Appointments Committee is made up of four members of the Supervisory Board and is chaired by Janet Stuijt. The committee met four times in 2024. The CEO and People and IT Director also attended the meetings of this committee. The topics discussed include talent and leadership development, succession planning, remuneration for the Executive Board and the remuneration policy. The committee also considered the remuneration report, target letters, the appraisal process, the rate of absences due to sickness and succession processes.

Operational Committee 

The Operational Committee consists of three Supervisory Board members, with Pamela Boumeester chairing the committee. This committee met three times in 2024. The CEO and the Director of Operations attended the committee meetings. Topics discussed by this committee in 2024 were operational performance, portfolio reset, deployment and service models and ERTMS.

Shareholder and contracting authority

The Supervisory Board has a sound relationship with the Ministry of Finance as NS shareholder and is in regular contact. This takes place through regular consultations such as the annual meeting and the spring and autumn consultations, as well as ad hoc meetings. In 2024, for instance, we discussed the new concession, infrastructure problems and changes in the composition of the Executive Board and Supervisory Board, among other things. There is increasing contact between the Supervisory Board and the Ministry of Infrastructure and Water Management as NS's contracting authority.

Employee participation

The Supervisory Board had frequent contact with the Central Works Council in 2024, including through the standing SB-COR Committee, which in principle meets four times a year. Themes discussed included the new concession and open access, operational performance, the challenges in relation to the capacity of staff on trains and deployment models, safety and the succession of Tjalling Smit and Anneke de Vries. The appointments of new Supervisory Board members Klaas Dijkhoff and Giny Boer were also discussed, and the reappointments of Herman Dijkhuizen and Janet Stuijt were discussed with both the Executive Committee of the Central Works Council and the standing Supervisory Board-Central Works Council Committee. The Supervisory Board also had two ‘Section 24 Works Council Act meetings’ with the Central Works Council and the Executive Board. The Supervisory Board appreciates the atmosphere of constructive cooperation and the confidential relationship between the Central Works Council and the Supervisory Board.

Relationship with the external auditor

The external auditor attended most meetings of the Risk and Audit Committee. The external auditor did not attend the September meeting due to the narrower agenda. The external auditor also attended the meetings of the full Supervisory Board at which the financial statements and six-monthly figures are discussed. In addition, the RAC consults with the external auditor without the Executive Board being present. As in previous years, the RAC evaluated the external auditor’s performance and issued feedback to the Supervisory Board.

About this report

The financial statements for 2024, as prepared by the Executive Board, were discussed by the Supervisory Board in the presence of the external auditor. The financial statements are accompanied by the Executive Board’s report. We propose that the General Meeting adopt the 2024 financial statements. We also invite our shareholder to discharge the Executive Board and the Supervisory Board from their liabilities.

The Supervisory Board would like to give special thanks to all employees, the employee participation bodies and the Executive Board of NS. Despite the multitude of operational and staff-related challenges, all staff served with full commitment throughout the year. 2025 will once again require a great deal of resilience on the part of our people, but passengers will always be able to count on NS.

Utrecht, 4 March 2025