With gas prices rising and everyone getting busier, more and more board members want to participate in board meetings by telephone. The advantage: more people participate. The disadvantage: there's a lot lost in human interaction for both the board member and the board-as-a-whole when the meetings aren't face-to-face. Consider this policy: a member can attend by phone only twice per year, and new board members can attend by phone only after they've been to at least three meetings in person.
And some boards don't permit participation by phone at all. If you do decide to have some people phoning in to meetings, don't just use the speakerphone option on a regular phone. Invest in a dedicated speaker phone with "duplex" features so that sound can travel both directions simultaneously and everyone can actually hear.
What are the laws on board meetings by conference call?
Such matters are regulated by states (not the federal government) so organizations need to talk with their state attorney general. The most recent compilation of state laws is from 1999 (yes, we know how old that is!), but at least it gives you a sense of the variances among states: http://www.muridae.com/nporegulation/documents/teleconf_definitions.html
Eric Mercer's links take you to the section in each state's code that describes the rules (remember, the law of the nonprofit's home state applies, not the law where a board member lives). For example, a California excerpt reads: "Participation in a meeting through use of conference telephone constitutes presence in person at that meeting as long as all members participating in the meeting are able to hear one another." The meeting minutes should show, at the start of the meeting, that all persons attending confirmed they could hear everyone else.
See also: Can Nonprofit Boards Vote by Email?