Maximum number of board appointments

Good practice: Reasonable limits on maximum number of board appointments are important to ensure that directors have sufficient time to carry out their duties.

In terms of improving the quality of boards, imposing hard constraints on the number of board memberships an individual can hold is a difficult issue, but it is growing in importance when identifying suitable candidates. Board members should have sufficient time and resources to devote themselves to their duty, which implies a natural limit to the number of directorships they can reasonably hold. However, excessive limits will reduce the capacity for a professional board membership to develop and may unnecessarily limit access to talent, particularly in smaller jurisdictions. Whether or not this is expressed formally differs between jurisdictions. For example in Austria, a maximum number of appointments is 10, whereas in Estonia the number of appointments to a board is usually less than four (an individual assessment of the extent of workload is, however, involved). In Greece only one remunerated directorship is allowed at any given time.

The number of board nominations per individual is linked organically with the size of SOE boards discussed in Chapter 6. Particularly large SOE boards (which are not recommended, for reasons discussed below) imply less time commitment from each director. Where such are common, the limitations on number of board appointments are usually less strict.

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