DSC Questions Answered

[Russ16]

I really don't understand the need for a board to require signed Non-Disclosure Agreements so long as it is understood that what happens in executive session stays in executive session. Having read the Board meeting minutes of DSC for the last couple of years, I rarely see them in executive session.

More importantly, if a director is doing his or her required fiduciary duties of care, obedience, and loyalty as required by Texas law, a NDA would be superfluous.

The duty of care is fairly obvious. You manage and make policy in such a manner as a prudent person would do.

However, obedience and loyalty might take some explanation. Obedience means "a duty of obedience to the terms of the corporation’s governing documents." This means the charter of DSC takes precedence over the bylaws and other governing documents. The Restated Certificate of Formation does mention hunting and conservation almost equally. That said, conservation is the stated primary purpose for DSC in the bylaws.

The duty of loyalty means you put the organization's interest over your own. This is why conflicts of interest must be disclosed.

In the non-profit and trade assoc world the board is often privy to financial information of donors or member companies. The NDA of partially to give those entities confidence.