Because a policy does not state you can't does not infer that you can. The SM is the designated observer and that is all that you have to say. Stand on your principles and your role as CC and don't hide behind the alledged lack of rules. A Scout is brave! Bravery means standing up for your convictions.
Before participating in an EBOR a prospective board members should have experience with lower level BORs where their performance can be evaluated and if needed improved. An after BOR discussion with the CC and more experienced board members is the forum for this to occur. You apparently have a very experienced board and I don't understand why an inexperienced CM would not defer to that experience.
Why does this CM need to observe when he/she already sat on a board?
My gut feeling is that you have a problem CM and this isn't the first problem. One of the responsibilities of the CC to coach other committee members. Adult participation is a priviledge not a right and at some point in time it may become apparent that the priviledge is being abused. When that situation arises remember that a Scout is Brave. That may come down to asking a CM to step down.
