Meetings
‘Conflicts of Interest’ is a standing item on all board and committee agendas; the chairperson will remind trustees at the start of each meeting that any interests must be declared. There is a duty of care to identify any known or perceived conflicts of interest at the beginning of each meeting.
A record of any professional or personal interest that may make it difficult for a director to fulfil their duties impartially, or may create an appearance of impropriety, with any item on the agenda for that day’s meeting is to be noted in the minutes of the meeting. Specifically:
- If a director is in any way, directly or indirectly, interested in a proposed transaction or arrangement with the organisation, they must declare the nature and extent of that interest to the other trustees
- If a declaration of interest proves to be or becomes inaccurate or incomplete, a further declaration must be made
- Any required declaration of interest must be made before the organisation enters into the transaction or arrangement
- A declaration is not required in relation to an interest of which the director is not aware or where the director is not aware of the transaction or arrangement in question. For this purpose a director is treated as being aware of matters of which they ought reasonably to be aware.
If a director states a conflict of interest they will normally be requested to leave the meeting while the relevant agenda item is discussed.
Register
Members of the Board and the Senior Team should declare all interests, which are relevant and material. Specifically, if the individual, or a close family member (parent/child/partner) or business partner holds:
- A paid or unpaid senior role (board level appointment, including non-executive and President, Patron etc, trustee, director, or senior team, or financial, contracting or other authority), or a financial or business interest in a charity, public body or commercial entity, including consultancies:
- Which provide goods or services to us, or one of our subsidiaries, or contract for our services.
- Which may seek to do business with us.
- Which operate in a field related to our work, or which may reasonably be perceived as a competitor.
- With whom we have a partnership, or other working relationship.
- An elected position in a public or other body, or a senior or public facing role in a political party, or other politically active organisation.
- Any other role or participation in an activity that might reasonably be perceived by stakeholders, as a potential conflict of interest.
trustees may retain existing or other roles, and for those whose livelihood involves professional involvement, continue with it provided it is transparent and not inconsistent with the organisation’s role, aims or objectives.
Following appointment, trustees will seek advice from the chairperson (and in the case of the chairperson from such expert as may be agreed) before taking on any new role(s) in which there might be a real or perceived conflict of interest.
Where a director’s circumstances involve or might appear to involve a material conflict of interest in her or his role, they will declare these in the register and, where appropriate, withdraw from related business and discussions.
All personal or business interests which may, or may be perceived to influence a director’s judgement should be declared.
Potential Conflicts of Interest
A charity may pay and offer other material benefits, to one or more of its trustees to provide services to the charity, where the trustee board reasonably believes it to be in the charity’s best interests to do so. The services in question must be ones which the charity trustee provides in addition to carrying out normal trustee duties. Any such proposal would be treated on a case for case basis and would only be approved subject to compliance with the Articles of Association and Charity Commission guidance.
Where an individual is not part of the decision making process, there is no direct conflict of interest. However, where he/she has a relationship with the organisation, or individual trustee/director, the perception could arise that the trustees haven’t acted in the organisation’s best interests, because of this.
Managing Conflicts of Interest
To manage these issues, the Board will ask themselves the following questions:
- Is this the best use we might make of our limited resources?
- If so, might anyone else be able to provide this service?
- If there are others, in terms of cost, quality, availability etc, who would be the best provider?
For a major or complex contract/agreement, an investment appraisal or similar may be needed to enable the Board to make the best decision for the organisations.
Recording Decisions
Conflicts of interest will be recorded in the minutes, together with the key points and decision(s) made, in sufficient detail to enable a reader to understand the issue and the basis on which the decision was made.