In the course of fulfilling their fiduciary duties as her response directors Board members are entrusted with a lot of confidential information about their companies. Some of this information falls into the category of important non-public information, whose disclosure is governed by laws and corporate policies. Other information, especially in the context of for-profit businesses are extremely sensitive and private. The fact that some of the information discussed in boardroom deliberations is both sensitive and significant creates a particular trust issue in the context of keeping that information safe from leaks.

Leaks are devastating for an organization and its staff. They are not just able to affect the financial performance of the company as well as the reputation of the directors themselves. Depending on the nature and circumstances of the leak, directors may be liable for criminal or civil liability.

It is best to ensure that all signers understand the information that must be kept confidential and agree to abide by these terms. This means identifying the specific information to be protected, and clearly defining any restrictions on disclosure of that information, such as that it is only divulged to other directors or the company’s sponsor.

Additionally, it is important to include a thorough and comprehensive Confidentiality Policy which is provided to all directors (and their sponsors in the case of constituency directors) prior to their beginning their service. This will assist them in understanding their responsibilities as directors and create an environment that values confidentiality as a fundamental aspect of director responsibilities.