Directors' Roles & Responsibilities

Multiple directorships must necessarily impact proper corporate governance, firm monitoring and performance. Too many directorships must necessarily lower directorial effectiveness as directors are constrained by personal time availability and effectiveness on each board they serve.



Sitting in too many boardrooms upsets the corporate governance policing work and oversight duties. If the director receives a compensation, does the “busyness” of the director affect board performance? Will the busy director be more acquiesce and capitulate to the wishes of dominant chairmen or chief executives? What are the characteristics of directors who are valuable in the market for board seats? How do the capital markets perceive the appointment of well-connected but inevitably busy directors? Do all appointed directors serve stockholders’ interests and carry with them the burden of corporate governance oversight and independence? All these considerations are fine balancing acts and there is no magical optimal number for any director to undertake. It is really how the directors exercise discretion, independence and personal commitment to each board that really matters. At the end, it is when the directors are called to rise to the occasion at exceptional times that their true colors are shown – whether the directors can discharge their duties with professional care and due diligence and to defend their independent decisions.



In any way, directors should not have their hands in too many pies as multiple directorships are thought to have an inverse relationship to director quality.