The Gatekeeper Economy Series

The Launch Dock explores entrepreneurship, economic systems, and community development. In this series, The Gatekeeper Economy, we examine how business culture, power, and policy shape who truly benefits from growth.

The Trust Problem No One Wants to Name

People know when something feels off.

They may not know every bylaw.
They may not know every policy.
They may not have access to every private conversation.

But people can tell when the same names keep showing up.

The same people on the nonprofit board.
The same people on the economic development council.
The same people connected to real estate.
The same people publicly talking about what is “best for the community” while privately benefiting from the decisions being made.

And once people begin to see that pattern, trust starts to collapse.

Not because communities expect perfection.

But because they expect honesty.

Research from the OECD’s 2024 Trust Survey found that 44% of respondents across surveyed OECD countries reported low or no trust in their national government, outweighing those reporting high or moderately high trust. The same report found that trust was much higher when people believed they had a real say in public decisions (OECD, 2025).

That matters locally too.

Because when people feel shut out of decision-making, they stop believing the process is for them.

Conflict of Interest Does Not Have to Be Illegal to Be Destructive

That is the part people often miss.

A conflict of interest is not only a legal issue.

It is also an ethical one.

Sometimes a deal can be technically allowed and still feel deeply dishonest.

Sometimes a person can disclose a relationship and still hold too much influence over the process.

Sometimes a board can follow procedure and still produce an outcome that makes the public lose faith in the system.

That matters because public trust is not built on technical compliance alone.

It is built on whether people believe decisions are being made fairly.

Independent Sector’s governance guidance specifically warns organizations to account for both real and perceived conflicts of interest, because the appearance of self-interest can be enough to damage credibility (Independent Sector, n.d.-a).

In other words, people do not only lose trust when rules are broken.

They lose trust when the rules are written too narrowly to address what everyone can plainly see.

When Overlap Becomes a System

On paper, overlapping leadership can sound efficient.

A person may say they serve on multiple boards because they care about the community.

Maybe they do.

But overlapping power becomes dangerous when it creates a system where:

• the same people shape the narrative
• the same people control access
• the same people approve projects
• the same people influence who gets funding
• the same people benefit financially, politically, or socially

At that point, it stops looking like leadership.

It starts looking like a closed loop.

And closed loops do not build strong local economies.

They build insider economies.

Federal antitrust authorities have long warned that certain overlapping board relationships can undermine fair competition. The FTC has specifically described “interlocking directorates” as a threat when the same individuals hold board positions that reduce independence and fair competition (Federal Trade Commission, 2017). The U.S. Department of Justice has continued to signal concern about overlapping governance arrangements that distort competition and public trust (U.S. Department of Justice, 2025).

Not every overlapping role is illegal.

But the broader principle is obvious:

When too few people hold too much overlapping power, fairness becomes harder to believe.

Why Boards Become So Out of Touch

One of the biggest problems with insular boards is not just conflict.

It is disconnection.

When boards are made up mostly of executives, developers, attorneys, investors, and the same civic names rotating through every organization, they often become detached from the everyday realities of the people most affected by their decisions.

People trying to pay rent.
People trying to start a first business.
People working hourly jobs.
People raising children.
People navigating stagnant wages, rising costs, and limited access.

If more everyday people served on boards, businesses and institutions might be far less out of touch with the communities they claim to serve.

Communities do not need more polished insiders repeating the same talking points.

They need people who actually understand what it costs to live, work, raise children, start small, recover from setbacks, and survive bad decisions made at the top.

That kind of representation does not weaken governance.

It strengthens it.

The Real Problem: Access to the Room

Many people never serve on boards not because they are unqualified, but because they are never invited into the process.

Open seats are often filled informally.

Relationships matter more than transparency.

Selection happens quietly.

The same people recommend the same people.

That is how power reproduces itself.

Not always through dramatic corruption.

Often through routine exclusion.

If communities want decisions to reflect the public, then access to leadership cannot operate like a private club.

It needs:

• public notice of open seats
• clear application processes
• published qualifications
• transparent selection criteria

Otherwise, people are told they have a voice while the real power stays concentrated in the same hands.

Facts & Statistics

• In the OECD’s 2024 Trust Survey, 44% of respondents reported low or no trust in national government, compared with 39% reporting high or moderately high trust (OECD, 2025).

• Among respondents who believed they had a say in government actions, 69% reported high or moderately high trust, compared with 22% among those who felt they had no say (OECD, 2025).

• Independent Sector recommends annual conflict-of-interest disclosure for directors, officers, and key employees and explicitly includes both real and perceived conflicts (Independent Sector, n.d.-a).

• Independent Sector’s governance principles emphasize accountability, transparency, ethics, and clear oversight as core standards for organizations serving the public good (Independent Sector, n.d.-b).

• The FTC has warned that interlocking board relationships can undermine competition and fair decision-making (Federal Trade Commission, 2017).

These numbers and standards point to a simple truth:

Trust grows when people believe systems are open, fair, and accountable.

It collapses when communities see the same people benefiting again and again.

Real-World Solution: Build Systems That Deserve Trust

If a community wants ethical growth, it cannot rely on personal assurances and vague promises.

It needs systems that make fairness visible.

1. Require Strong Conflict-of-Interest Disclosures

Not just for obvious financial interests, but also for family ties, business partnerships, close professional relationships, and overlapping board roles.

2. Normalize Recusal

If someone stands to benefit directly or indirectly, they should step away from the decision.

3. Set Term Limits

Board service should not become permanent ownership of community influence. Term limits help prevent power from hardening into entitlement.

4. Reserve Seats for Everyday Community Members

Boards should include teachers, hourly workers, young adults, small business owners, parents, renters, first-generation entrepreneurs, and people from the neighborhoods most affected by local decisions.

5. Make the Application Process Public

Communities should know when seats open, how to apply, and how decisions are made.

6. Use Plain-Language Disclosures

People should not need a law degree to understand a conflict of interest. If someone owns nearby property, has a family connection, or may profit from a vendor arrangement, the public should be told clearly.

7. Limit Overlapping Board Service

One person should not sit on every influential board in the same local ecosystem. Too much overlap turns community governance into insider management.

8. Expand Public Questioning

Before major appointments or major deals, the public should have the chance to ask who benefits, what relationships were disclosed, and what alternatives were considered.

These are not anti-business ideas.

They are pro-trust ideas.

And trust is one of the most important forms of capital any community has.

Call to Action

Every community should be asking:

Who is making the decision?
Who benefits from the decision?
Who keeps getting access to the room?
What kind of leadership culture are we allowing to represent our community?

And if you are a business owner, board member, or community leader, ask yourself something harder:

Would people still trust this process if every relationship tied to it were made public?

Because trust is not destroyed only by corruption.

Sometimes it is destroyed by secrecy, overlap, gatekeeping, and the quiet expectation that nobody will question the pattern.

If we want businesses and institutions that are less out of touch, then more everyday people need a real seat at the table.

Closing Reflection

Communities do not need perfect leaders.

They need honest systems.

They need transparent processes.

They need leadership structures that are strong enough to survive public scrutiny.

Because once people believe growth is just a private opportunity for the already-connected, every promise about community benefit starts to sound hollow.

And when trust goes, everything else follows.

A healthy economy is not just built on money.

It is built on credibility.

And credibility cannot survive a system where the same people keep approving the deal, shaping the story, and benefiting from the outcome.

In solidarity,
Lyndsay LaBrier
Merchant Ship Collective | The Launch Dock

References

Federal Trade Commission. (2017). Have a plan to comply with the bar on horizontal interlocks.

Independent Sector. (n.d.-a). Conflict of interest policy.

Independent Sector. (n.d.-b). Principles for good governance and ethical practice.

Organisation for Economic Co-operation and Development. (2025). Exploring new frontiers in citizen participation in the policy cycle.

U.S. Department of Justice. (2025). Statement of interest regarding interlocking directorates and competition law.