Conflicts of interest can be seen as a fact of life at the board level. And if Board Members are not careful, conflict of interest can distort decision-making and undermine the credibility of boards, organizations, or entire economic systems.
When an individual serves on too many boards and, as a result, cannot adequately perform their duties and effectively serve the organization, it becomes a conflict of interest, referred to as "overboarding".
How to prevent overboarding
✅ Decline when necessary
✅ Establish formal policies
✅ Prioritize & allocate time
✅ Ensure compliance & transparency
✅ Strengthen multi-board director rules
✅ Disclose potential conflicts of interest
✅ Implement a thorough director selection process
✅ Brush up on legal or regulatory requirements related to conflicts of interest
However, when you have the time to dedicate to several boards, there can be many benefits to overboarding:
- Spotting trends
- Broader experience and expertise
- Enhanced networks and collaboration
- Sharing effective governance practices
- Applying industry and economic knowledge
- Being able to contribute a broader perspective to board discussions
Ultimately, serving on multiple boards can be beneficial if managed responsibly and ethically. One must be diligent about potential conflicts and ensure that the decisions prioritize the best interests of each organization they serve.
Discover our tailored compliance training for board members and be prepared to properly manage conflicts of interest.
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