The kinds of higher-level job-holders who might be sitting on other boards would likely have employment agreements that are negotiated to specifically carve out those exceptions.
Usually it's mutually agreed upon when there's a conflict. For example Disney CEO Bob Iger was on Apple's board up until Apple announced they were creating a streaming service. Disney was planning a streaming service that would compete with Apple TV+. Iger announced his resignation from Apple's board on September 10.
