As general counsel and assistant corporate secretary at Mechanics Bank in Northern California, I always considered my financial institution’s method for delivering its board books to our corporate directors in advance of their board meetings was fraught with peril and legal risk. The fact is that it was no different than what many corporations — banking and otherwise — do when distributing board materials in advance of their meetings.
Because our board of directors meets monthly, aside from June and August, the legal risks were multiplied as compared with corporations whose boards meet quarterly. I wasn’t a math major, but understood the equation: 10 meetings means 10 sets of board books to be delivered to 13 directors, or 130 opportunities for materials to get lost in transit, intercepted or forwarded to inappropriate recipients. That’s not even counting the meetings held by the board’s six committees, which include audit and compensation committees, among others.
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