ABOUT CONFLICTS OF INTEREST
You have a legal duty to act in your charity’s best interests when making decisions as a trustee. If there’s a decision to be made where a trustee has a personal or other interest, this is a conflict of interest and you won’t be able to comply with your duty unless you follow certain steps.
For example, if you’re a trustee, you would have a conflict of interest if the charity is thinking of making a decision that would mean:
- you could benefit financially or otherwise from your charity, either directly or indirectly through someone you’re connected to
- your duty to your charity competes with a duty or loyalty you have to another organisation or person
Conflicts of interest are common in charities – having a conflict of interest doesn’t mean you’ve done something wrong. But you need to act to prevent them from interfering with your ability to make a decision only in the best interests of the charity.
Follow a 3 step approach (identify, prevent, record) so that you are able to comply with your duty and avoid:
- making decisions that could be overturned
- risking your charity’s reputation
- having to repay your charity if you make unauthorised payments to trustees
Legal requirement: you MUST declare a conflict of interest immediately you are aware of any possibility that your personal or wider interests could influence your decision-making.
More details can be found here