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Silence is Golden: Why Confidentiality is Key for Private Club Boards

Posted by Joe Abely & Dave Duval on 7/21/23 1:31 PM

club board confidentiality

In our work with private club boards, we have met many officers who are concerned about maintaining the confidentiality of boardroom discussions. Their harrowing tales about the messes that ensue when those efforts fail are the inspiration for this post.

Confidentiality is an important part of a club director’s fiduciary duty. According to an article published on, the primary duties associated with a director’s fiduciary responsibilities are Duty of Care, Duty of Loyalty, Duty of Obedience, Duty of Confidentiality, Duty of Prudence and Duty to Disclose.

The article goes on to define the duty of confidentiality specifically as the requirement that board members keep certain types of information confidential and that they not use anything seen or heard in the scope of their position for personal gain.

From a practical perspective, confidentiality simply means that what’s discussed in the boardroom must remain confidential unless or until the board determines that it will be disclosed to the membership. Examples of situations where confidentiality is especially important include:

  • Protracted deliberations or processes. Developing strategic plans, undertaking significant capital expenditures, increasing capital dues or implementing an assessment are matters that are often considered over long periods of time. Leaks during the process can lead members to reach their own conclusions prematurely and risk the spread of misinformation. In these cases, the board’s ability to effectively manage the process may be compromised. An unintended consequence may be a loss of trust in the board by members.

  • Sensitive subjects. The leaking of deliberations concerning personnel situations or discipline of an employee or member can lead to the spread of misinformation, damage to the reputation of an individual or the club and divisions within the membership as people “take sides” without knowing all the facts. In addition to the potential for personal embarrassment, these situations may also present legal exposures.

Board education is one of the most important steps a club can take to make sure directors understand the importance of maintaining confidentiality.

  • During the nomination process for new directors, make sure that potential nominees are educated on their fiduciary responsibilities, including the duty of confidentiality.

  • Once new directors are elected, the importance of confidentiality should be conveyed clearly and emphatically during the onboarding process.

  • The obligations of board members (including confidentiality) should be thoroughly documented, preferably in a Board Policy Manual.

  • We encourage clubs to conduct annual board education sessions for both new and returning directors. In addition to covering a director’s fiduciary duty, we recommend such sessions also cover topics such as the board’s objectives for the coming year, the club’s finances including benchmarking data, strategic, facilities and/or golf course plans, roles and responsibilities of the board, committees and management and membership data in the form of KPI ratios.

  • At the end of each board meeting, the Board chair should review and remind the board of the confidential information covered in the meeting.

Regular communication with the members will also go a long way toward minimizing the impact of any leaks of confidential information that might occur. We recommend developing a communication plan and being particularly diligent about its implementation whenever the board is deliberating significant matters that will impact the membership. Provide clear verbal and written communication of items that are important to your members, such as the status of strategic and facilities master plans, progress of major capital projects, operating performance to date, financial expectations for the year and results of membership surveys.

To learn more, contact Joe Abely at or call 781-953-9333. Dave Duval can be reached at or 617-519-6281.

Topics: Board Education, Articles, Club Governance

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