Numerous blogs, articles and books have been written about conflicts of interest. Numerous workshops, seminars and webinars have also been presented on the subject. Yet, hardly a week goes by without the media identifying where an individual or individual’s handling of a conflict of interest, whether actual or perceived, ended up harming an organization.
It is essential that a non-profit/not-for-profit adopt and implement policies to ensure that all conflicts of interest (real or perceived) within the board are appropriately addressed with signed disclosures before a problem arises. Along with the conflict of interest statement, there should also be a completed and signed statement of disclosure that addresses specific potential conflicts of interest.
The common sense reasons for this are as follows:
- Conflicts of interest can be potential, perceived or material and need to be addressed.
- Not all conflicts of interest are illegal or unethical, but often are unavoidable.
- How the board handles a conflict of interest reflects on the organization.
- Only board members who do not have a conflict of interest should vote when the situation arises.
- Those with a conflict should recuse themselves for discussions and voting on the matter.
- A written signed conflict of interest statement serves as a guide to addressing situations where a conflict of interest can arise.
How does your organization handle a conflict of interest?
Contact me if you would like a sample copy of a conflict of interest statement and/or a statement of disclosure at email@example.com.