Discussion: should Board meetings be recorded. If you have been following the business news in any of the Fairfax publications, you couldn’t have failed to notice that collapsed Australian satellite company, Newsat, has been in the news quite a bit recently (see this link to The Age’s website for example). A couple of the latest articles also contain leaked videos of boardroom meetings. Which started imac legal thinking: is recording board meetings a good idea or not?
On the one hand, as a champion of good compliance and governance principles, recording Board meetings (either audio or video) has a certain appeal. After all, if a company has nothing to hide why would they be concerned about having their Board meetings taped? Recordings would be prima facie evidence of what was discussed and what transpired at Board meetings. He said, she said would be a thing of the past. And it could be argued that the mere knowledge that a meeting is being recorded would be a catalyst for all Board members to bring their ‘A’ game to the table. Surely that would result in conscientious consideration of issues, focused debate and discussion. In other words, a cultural fillip, right?
But on the other hand, there are a number of risks and potential unintended consequences. First out of the blocks, there is the risk of recordings falling into the wrong hands. Valuable and secret information is discussed at Board meetings. Industrial espionage is not unheard of and disgruntled employees, directors or other insiders are in every office block. There is also the risk that Boards would end up a reality TV version of themselves – directors with points to prove could well play up to the cameras. Knowing that meetings are recorded however could have the unintended consequence of discouraging open, honest, robust discussion, especially around sensitive issues. And perhaps even worse, it could result in important conversations taking place ‘off-piste’ instead of in the Boardroom where they belong. Undoubtedly, it would only be a matter of time where such recordings would be the subject of legal discovery in disputes, taking a company’s eye off the ball fighting rear-guard actions instead of focusing on the corporate objectives. And of course, it could be argued that the onus on directors is already great enough; they don’t need another albatross around the neck.
To our mind, the risks and pitfalls clearly outweigh any potential benefits of recording Board meetings. Succinct, accurate minute-taking should suffice. But what about you? Would you ever seriously consider overt recording of Board meetings as a governance tool? We’d love to hear your thoughts.
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