Interlocking directorate

Network diagram showing interlocks between various U.S. corporations/institutions, and four major media/telecom corporations (circled in red).
Network diagram showing interlocks of the board members of American International Group (AIG), from 2004 with other U.S. corporations.
Network diagram showing interlocks between various U.S. corporations and institutions and the Council on Foreign Relations, in 2004

Two or more corporations have interlocking directorates when they share members of their boards of directors or each shares directors with a third firm. A person that sits on multiple boards is known as a multiple director.[1] Two firms have a direct interlock if a director or executive of one firm is also a director of the other, and an indirect interlock if a director of each sits on the board of a third firm.[2]

This practice, although widespread and lawful, raises questions about the quality and independence of board decisions. In the United States, antitrust law prohibits interlocking directorates within the same industry over collusion concerns, though legal observers have noted that this has long been unenforced.[3][4] In 2022, the Department of Justice signaled it would enforce laws on anti-competitive interlocking directorates, leading to the resignation of seven directors at five companies in October 2022.[4]

  1. ^ Scott, 1997: p. 7
  2. ^ Salinger, 2005: p. 438
  3. ^ Cite error: The named reference :0 was invoked but never defined (see the help page).
  4. ^ a b Cite error: The named reference :1 was invoked but never defined (see the help page).