Interlocking directorate

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Interlocking directorate

Describes cross-memberships of directors on each other's company Board of Directors.

Interlocking Directorates

A situation or state in which one person is a member of the board of directors in more than one publicly-traded company. This creates the possibility of a conflict of interest; indeed, interlocking directorates are illegal when two companies are competitors.
References in periodicals archive ?
The impact of demographics (e.g., female directors and directors' age) and cognitive diversity (e.g., interlocking directorships and level of education) are correlated with board tasks and board structural diversity (e.g., board size, board independence and board of directors' meeting).
The corporate power elite in South Africa: interlocking directorships among large enterprises.
In this article, we have mapped one vector of corporate influence based in interlocking directorships. There are other vectors no less important (e.g., lobbying, funding relations, media messaging); thus our analysis offers one vantage point on the architecture of stage 2 denialism.
"My decision to...end interlocking directorships at Citigroup is part of our continuing effort to assure that our corporate governance reflects best practices," Weill said at the time.
The corporate-governance reforms reviewed earlier altered several practices that actually produce the corporate network, and in view of the importance the reforms placed upon outside directors as custodians of shareholder value, we must distinguish between two kinds of interlocking directorships that arise out of board practices.
* Potential conflicts of interest: Minimize the number of active investment bankers, legal counsel, commercial bankers, consultants, and interlocking directorships.
Here more about interlocking directorships could probably have been said if a little more formal network analysis were applied.
Going back even that far, Hawaii's corporate boards were dominated by an elite few - a quorum of interlocking directorships that made decisions for all the state's largest businesses.
It is noted that the key features of these relationships are the form of the relationship itself and the content which it embodies[5]: networks can involve transaction relations; the communication of messages; elements held in common (so-called "boundary" relations) such as interlocking directorships; one-off jobs ("instrumental relations"); expressions of sentiments towards each other; authority to issue commands based on superior power in a relationship; and kinship or descent relations.
In this section, the authors deal with a variety of aspects very competently--Mats Larsson on the banking difficulties of the 1920s; Kristina Bjorkegren on the banks' public image; Hans Sjogren on the distribution of bank loans; and Jan Ottosson on networks and interlocking directorships between finance and industry.
The significance of each of these structures is tested with a sample of the forty largest industrial firms and twenty largest financial firms in Japan across networks of equity ownership, interlocking directorships, and banking borrowing.
Additional criteria for qualifying as an independent director, including restrictions on interlocking directorships, further limit the availability of CEOs and others in the business community for board appointments.