# Conflict of Interest Policy: [Organisation name]

> A written conflict of interest policy for a nonprofit or charity
> board, its committees, officers and senior staff: what counts as a
> conflict, who it covers, the annual disclosure, the declare, decide,
> recuse and record procedure, compensation decisions and breaches. The
> structure follows the elements the US IRS describes for Form 990
> Part VI lines 12a to 12c (2025 instructions) and the sample policy in
> Appendix A of the Instructions for Form 1023 (Rev. 12/2024), with
> notes for the four-step approach of the Charity Commission for
> England and Wales. The example organisation, Brackenfold Reading
> Trust, is fictional. Replace every `[bracketed]` value and every row
> marked *Example*. This is a documentation format, not legal advice:
> check your governing document, the current official texts and a
> qualified adviser in your jurisdiction.

<!--
Guidance: How to use this template
- Read your governing document (articles, bylaws, constitution, trust
  deed) first. Where it already has conflict rules, this policy must
  match them or the governing document wins.
- The policy has four working parts: definitions (section 3), the
  annual disclosure (section 5 and Annex A), the meeting procedure
  (section 6) and the record (section 7). A policy without an annual
  disclosure and minutes that show recusal is hard to evidence.
- Use the jurisdiction notes in section 11 to check what your regulator
  expects. Keep the register of interests as a separate living file;
  link it in section 5.
- Common pitfall: treating a declared interest as "managed". Declaring
  is step one; the board must still decide whether a conflict exists,
  and the conflicted person must leave the discussion and the vote.
-->

## Document control

<!-- Guidance: The board adopts this policy by resolution. Record the minute reference so the adoption itself is evidenced. -->

| Field | Value |
|---|---|
| Document ID | [GOV-POL-COI] |
| Organisation | [Legal name, registration or EIN number] |
| Version | [1.0] |
| Status | [Draft / Adopted / Under review] |
| Owner | [@board-secretary] |
| Approved by | [Board of directors / Board of trustees] |
| Adoption minute | [Minute reference, YYYY-MM-DD] |
| Last updated | YYYY-MM-DD |
| Next review | YYYY-MM-DD (at least every [two] years) |
| Classification | [Public] |

### Approvals

| Role | Name | Date |
|---|---|---|
| Chair of the board | [Name] | YYYY-MM-DD |
| Secretary | [Name] | YYYY-MM-DD |

### Revision history

| Version | Date | Author | Change |
|---|---|---|---|
| 1.0 | YYYY-MM-DD | [@author] | Policy adopted |
| 1.1 *(Example)* | YYYY-MM-DD | [@board-secretary] | Added loyalty conflicts and the gift threshold in section 3 |

## 1. Purpose

<!-- Guidance: State why the organisation has the policy in plain words. Mention both protecting the organisation's decisions and protecting individuals from unfair suspicion. -->

This policy protects [Organisation name] when it considers a
transaction, arrangement or decision that might benefit the private
interest of a board member, officer, committee member or senior
employee, or a person or organisation connected to them. It makes sure
that decisions are taken only in the organisation's best interests,
that interests are disclosed openly, and that the record shows how each
conflict was handled. It supplements, and does not replace, the law
that applies to the organisation and its governing document.

## 2. Who the policy covers

<!-- Guidance: List every class of person covered. The IRS asks (line 12c) which persons are covered; the Charity Commission expects every trustee to follow the policy. Include committee members who are not board members. -->

| Class | Covered | Annual disclosure |
|---|---|---|
| Board members (directors or trustees) | Yes | Yes |
| Officers (chair, treasurer, secretary) | Yes | Yes |
| Members of committees with delegated board powers | Yes | Yes |
| Chief executive and [senior staff with budget authority] | Yes | Yes |
| [Advisory panel members] | [Yes for sections 3, 4 and 6 only] | [No] |
| *Example:* Brackenfold finance and audit committee co-opted member | Yes | Yes |

A **connected person** includes a covered person's spouse or partner,
children, parents, siblings and their spouses or partners, any business
in which the covered person or a family member holds [more than 5%
*Example*] of the shares or is a director, partner or employee, and any
other organisation they serve as a board member or officer.

## 3. What counts as a conflict

<!-- Guidance: Define both types. The IRS line 12a definition centres on financial benefit; the Charity Commission also names loyalty conflicts. Give local examples so people recognise them. -->

A **financial interest** exists when a covered person or connected
person, directly or indirectly, has an ownership or investment interest
in, a compensation arrangement with, or is negotiating either with, an
entity or individual with which the organisation has or is negotiating
a transaction. Gifts and favours above [USD 100 *Example*] a year
from such a party count as compensation for this policy.

A **loyalty conflict** exists when a covered person's duty to another
body or person (an employer, another charity, the body that appointed
them, a friend or relative) could compete with their duty to this
organisation, even with no money involved.

A financial interest is not automatically a conflict of interest. The
disinterested board members decide whether a conflict exists (section
6, step 3).

| ID | Situation | Type |
|---|---|---|
| COI-T01 *(Example)* | Trustee's printing firm quotes for the annual report | Financial |
| COI-T02 *(Example)* | Chief executive's brother applies for a paid post | Financial |
| COI-T03 *(Example)* | Trustee is also a trustee of a charity applying to Brackenfold for a grant | Loyalty |
| COI-T04 *(Example)* | Trustee is employed by the local authority that funds Brackenfold | Loyalty |
| COI-T05 *(Example)* | Board sets the chief executive's salary | Financial (for the chief executive) |

## 4. Duties of covered persons

<!-- Guidance: Keep duties short and specific. The point is early disclosure, before any discussion starts. -->

Each covered person must:

1. Disclose any actual or possible conflict as soon as they become
   aware of it, and before the matter is discussed.
2. Give the board or committee all material facts it needs to decide.
3. Not try to influence the decision, formally or informally.
4. Keep their entry in the register of interests up to date within
   [30 *Example*] days of a change.
5. Ask the chair or secretary when unsure, rather than deciding alone
   that an interest is irrelevant.

## 5. Annual disclosure and register of interests

<!-- Guidance: The IRS asks (line 12b) whether officers, directors, trustees and key employees must disclose or update their interests at least annually. Name the month, who collects the forms and where the register lives. -->

Each covered person completes the declaration in Annex A on appointment
and every [January *Example*], and confirms that they have read this
policy. The secretary keeps the register of interests at [location or
system], reports any missing declaration to the chair within [30]
days, and presents the updated register to the board at the [first
meeting of the year]. A covered person who has not returned a
declaration does not vote until they do.

| Register field | Content |
|---|---|
| Person and role | Name, board or staff role, start date |
| Interest | Business, investment, employment, board seat or family link |
| Related party | The entity or person the interest relates to |
| Relevance | Transactions or decisions where it may matter |
| Date declared and last confirmed | YYYY-MM-DD |

## 6. Procedure at meetings

<!-- Guidance: This is the core of the policy. Line 12c asks at what level conflicts are decided and reviewed, and what restrictions apply. Make every step visible in the minutes. -->

1. **Standing item.** Every board and committee agenda opens with
   "Declarations of interest".
2. **Declare.** The interested person states the interest and the
   material facts.
3. **Decide whether a conflict exists.** The interested person leaves
   the room (or the virtual meeting) while the remaining members
   discuss and vote on whether a conflict exists.
4. **Consider removing it.** Where possible, avoid the conflict: for
   example, ask a different supplier to quote, or let the interested
   person step back from the related role.
5. **Manage it.** If a conflict exists, the interested person may give
   a short factual presentation if invited, then leaves for the
   discussion and the vote. The chair may appoint a disinterested
   person or committee to look at alternatives. The disinterested
   members decide, by majority, whether the transaction is in the
   organisation's best interests, fair and reasonable, and whether a
   better arrangement is reasonably available without a conflict.
6. **Quorum.** The interested person does not count towards the quorum
   for that item. If the quorum fails, [defer the item / refer it to
   the chair's committee / seek regulator consent where required].
7. **Record.** The minutes follow section 7.

```mermaid
flowchart TD
    A["Interest declared at the start of the item"] --> B{"Disinterested members: is it a conflict?"}
    B -- No --> C["Person stays, minute the decision"]
    B -- Yes --> D{"Can the conflict be removed?"}
    D -- Yes --> E["Remove it, then proceed"]
    D -- No --> F["Person leaves discussion and vote"]
    F --> G{"Quorum still met?"}
    G -- Yes --> H["Disinterested members decide: best interests, fair and reasonable"]
    G -- No --> I["Defer or escalate, seek consent if required"]
    C --> J["Record in minutes and register"]
    E --> J
    H --> J
    I --> J
```

## 7. Records

<!-- Guidance: Form 990 line 8 asks whether meetings are documented contemporaneously, which the IRS defines as by the later of the next meeting or 60 days after it. Name what the minutes must show for each conflict. -->

For each declared interest the minutes record: the person, the nature
of the interest, whether the board found a conflict, who was present
for the discussion and the vote, the alternatives considered, the
decision and the vote count, and the steps taken to manage the
conflict. Minutes are approved by the later of the next meeting or
[60] days after the meeting. The secretary updates the conflicts log:

| ID | Date | Person | Interest | Conflict? | Action | Decision | Minute ref |
|---|---|---|---|---|---|---|---|
| [COI-NNN] | YYYY-MM-DD | [Role] | [Interest] | [Yes / No] | [Left room / Removed / None] | [Decision] | [Ref] |
| COI-007 *(Example)* | YYYY-MM-DD | Trustee B | Owns 30% of Fennick Print Ltd (fictional) | Yes | Left for discussion and vote, two other quotes obtained | Contract to another supplier, 5 for, 0 against | BRT-2026-04 m.6 |

## 8. Compensation decisions

<!-- Guidance: Pay decisions for the chief executive and any related person are where conflicts most often reach regulators. Form 990 line 15 asks about review by persons without a conflict, comparability data and contemporaneous documentation. -->

- No covered person votes on their own pay, benefits or expenses, or on
  those of a connected person.
- A member who receives pay or other payments subject to approval by
  the person whose pay is under review does not vote on that pay.
- The [remuneration committee / board] uses comparability data for
  similar roles and records the data and the decision at the time.
- Payment of any board member for serving as a board member happens
  only where the governing document and the law allow it.

## 9. Breaches

<!-- Guidance: Give a fair process: tell the person the basis for concern, hear them, then decide. Name possible outcomes and whether a transaction can be revisited. -->

If the board has reasonable cause to believe that a covered person has
failed to disclose an actual or possible conflict, the chair informs
the person of the basis for that belief and gives them a chance to
explain. After hearing the response and any further enquiry, the board
decides whether a breach occurred and what corrective action to take:
for example, a formal note, removal from a committee, a request to
step down, or a review of the affected transaction. Serious matters are
reported to the regulator where the law requires.

## 10. Annual statements and periodic review

<!-- Guidance: The IRS sample policy has annual statements and periodic reviews; most charity regulators expect the board to check the policy works. Name what is checked and by whom. -->

Each year the [governance committee] checks that every declaration was
returned, that every conflict in the log was minuted, and that
transactions with connected parties were at fair value and approved
under section 6. It reports to the board, which reviews this policy at
least every [two] years. Outside advisers may help with reviews; the
board keeps responsibility.

## 11. Jurisdiction notes

<!-- Guidance: Name only what applies to you. These rows are dated pointers, not a summary of the law; read the current text. -->

| Jurisdiction | Pointer (checked 2026-10-30) | What to check |
|---|---|---|
| United States, federal | IRS Instructions for Form 990 (2025), Part VI lines 12a to 12c and 15 (https://www.irs.gov/instructions/i990); sample policy, Instructions for Form 1023 (Rev. 12/2024) Appendix A (https://www.irs.gov/instructions/i1023) | Written policy, annual disclosure, how conflicts are monitored and at what level decided |
| United States, state | State nonprofit corporation law and attorney general guidance | Interested director transaction rules and approval votes |
| England and Wales | Charity Commission, "Managing conflicts of interest in a charity" (published 2020-11-02, https://www.gov.uk/guidance/managing-conflicts-of-interest-in-a-charity) | Four steps: declare, consider removing, manage, record; when Commission authority is needed |
| European Union member states | National foundation and association law (no single EU rule) | Local registry and supervisory authority guidance |

## Annex A. Annual declaration form

<!-- Guidance: Keep the form to one page. Ask for facts, not judgements: the board decides what is a conflict. -->

| Question | Answer |
|---|---|
| Name and role | [Name, role] |
| Employment and paid roles held in the last 12 months | [List] |
| Board or officer roles in other organisations | [List] |
| Businesses in which you or a connected person hold more than [5%] or are a director or partner | [List] |
| Any transaction with [Organisation name] by you or a connected person in the last 12 months | [Describe or "None"] |
| Gifts or hospitality above [USD 100] from suppliers, grantees or applicants | [Describe or "None"] |
| Any other interest a reasonable person might see as relevant | [Describe or "None"] |

I confirm that I have read and understood the Conflict of Interest
Policy, that the information above is complete and accurate, and that I
will update it within [30] days of any change.

Signed: [Name] Date: YYYY-MM-DD

## 12. Related templates

<!-- Guidance: Link the documents that apply this policy in practice. -->

- [Board minutes](./board-minutes.md) for the declarations of interest item and recusal record
- [Board governance calendar](./board-governance-calendar.md) to schedule the annual declarations and policy review
- [Gift acceptance policy](./gift-acceptance-policy.md) for gifts from connected persons
- [Conflicts of interest policy and register](../compliance/conflicts-of-interest-register.md) for investment firms under MiFID II and SEC rules
- [Whistleblowing policy](../compliance/whistleblowing-policy.md) for reporting undeclared conflicts

## Glossary

- **Covered person:** anyone listed in section 2.
- **Connected person:** a family member, business or organisation linked to a covered person (section 2).
- **Disinterested member:** a board or committee member with no financial interest or loyalty conflict in the matter.
- **Recusal:** leaving the discussion and the vote on a matter.
- **Register of interests:** the living list of declared interests (section 5).

## Standard and licence note

Based on the US IRS Instructions for Form 990 (2025), Part VI lines 8,
12a to 12c and 15, and the structure of the sample conflict of interest
policy in Appendix A of the Instructions for Form 1023 (Rev. 12/2024),
which says it prescribes no specific requirements; with notes from the
Charity Commission for England and Wales guidance "Managing conflicts
of interest in a charity" (2020, Open Government Licence v3.0). The
text, thresholds and fictional Brackenfold examples are original. Check
the current official texts, your governing document and a qualified
adviser before adoption. Template licence: MIT.