An interesting question. We haven't thought about such conflict of interest.
Firstly we've updated the idea to make it more flexible than only placing students at the mentor's place of work. Alumni can also just offer advice on this or help connect students with their desirable placement hosts. Secondly, it's a mutual choice, so students have a say as well. They can turn down the offer if they don't think it suits.
You have made a good point about alumni's time commitment. It's our concern too. We mainly have 2 solutions for that. 1) As for event, it's largely organised by students and supported by alumni. We're also thinking to call for a committee to run the scheme. There will be representative from each stakeholder, students, alumni and staff. In this way, it's more organised and efficient. 2) There are different ways alumni can contribute/mentor, depends on their own situation. So the expectation can be managed.
Your second concern re competitiveness. I believe we're in an age of empowerment. By empowering others, like alumni support students, alumni will be empowered in turn. For example, by supporting students doing research relevant to their company, alumni will have the chance to practice and demonstrate leadership and management skills which is not often the case for young professionals. Also, they gain new knowledge by being involved in student's research which will become their competitive edge too. But of course, more incentives need to be defined.
Networking. I don't think it's realistic to pair each student with a mentor while maintain the good quality of the relationship. E-mentoring might help, but we need to be careful. Also one mentor to a few students might work. But still we prioritise quality to quantity.