Board members have access to an enormous amount of confidential information because they perform their fiduciary responsibility. The information they receive is usually personal and business-related. This information may include confidential boardroom discussions and strategic initiatives, potential acquisitions, legal and competitive threats, and the deliberations by other board members. In contrast to confidential employee information, the disclosure of this type of information to others is not prohibited by law, but it can violate the director’s fiduciary obligation and result in substantial legal liability for both directors and the company.
The board should formally adopt an official confidentiality policy that covers all the confidential information that it receives and discuss. The policy should be included in the members’ handbook. The board should require all members acknowledge the policy and agree to its terms. The board should make clear boards confidential documents that the policy will continue to apply even after the director’s term is over and that when a director is found in violation of the policy, he or she will not be eligible to sit on the board again.
The board should limit the number of physical copies and utilize a portal for the board that is equipped with enterprise-grade security to share sensitive documents. This will keep the information from being accessible by unauthorised persons and can be easily lost or stolen. The platform should permit users to create printing and downloading rights. It should also provide watermarks that have the date and time stamp. And it should provide reports on who has downloaded, opened or printed the documents.