Conflict of Interest

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