Board members are trusted with a great deal of confidential information by their companies in the course of their duties as fiduciary directors. Some of this information falls into the category of material non-public data, which is subject to the laws and corporate policies. Other information, particularly in the context for-profit companies are highly sensitive and private. Some of the information discussed in boardroom discussions is both sensitive and important that creates a trust issue when it’s time protect the information from leaks.
Leaks can be devastating to companies and their employees. They can not only impact the financial performance of the business but also the image of the directors. The nature of the leak (and the circumstances that led to it) they could expose directors to criminal or civil liability.
It is best to ensure that all signees understand what information is confidential and agree to adhere to these conditions. This involves identifying the specific information to be protected and clearly defining the limitations on the disclosure of this information, for example, that it can only be shared with other directors, or the company’s sponsor.
It is also essential to give a comprehensive and thorough Confidentiality policy to all directors, or their sponsors if they are constituency directors, before they are appointed. This will ensure that they are aware of their obligations and help to create a culture that values the compliance with and confidentiality of information as one of the most fundamental aspects of a director’s duties and duties.
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