Conflict of Interest Examples and Samples
What are some conflict of interest examples?
- The organization’s chief executive is a spouse or close relative of the board member.
- The board candidate is also the chief executive of an organization with a similar mission and program structure.
- The board candidate is expected to participate in fundraising but is affiliated with an organization that is competing for the same funding.
- A board member performs professional services for the organization.
- A board member proposes a relative or friend be considered for a staff position.
- A board member’s spouse receives a contract to provide a service without soliciting other bids despite their organization’s policy requiring competitive bidding on large purchases.
- A staff member starts dating a board member.
- A development director for one organization chairs the development committee for another in the same community and field.
Sample Conflict of Interest Policy
Employees and board members have an obligation to conduct business within guidelines that prohibit actual or potential conflicts of interest. This policy establishes only the framework within which XYZ wishes its business to operate. The purpose of these guidelines is to provide general direction so that board members and employees can seek further clarification on issues related to the subject of acceptable standards of operation.
An actual or potential conflict of interest occurs when a board member or an employee is in a position to influence a decision that may result in personal gain or gain for a relative as a result of XYZ’s business dealings. For the purpose of this policy, a relative is any person who is related by blood or marriage, or whose relationship with the board member or employee is similar to that of persons who are related by blood or marriage.
No presumption of a conflict is created by the mere existence of a relationship with outside firms. However, if a board member or an employee has any influence on any material business transactions, it is imperative that he or she discloses to an officer of the organization as soon as possible the existence of any actual or potential conflict of interest so that safeguards can be established to protect all parties.
Personal gain may result not only in cases where a board member, an employee, or a relative has a significant ownership in a firm with which XYZ does business, but also when a board member, an employee, or a relative receives any kickback, bribe, substantial gift, or special consideration as a result of any transaction or business dealings involving XYZ.
Additional Resources on conflict of interest policy
A conflict of interest policy that follows a traditional legal format is recommended by the Internal Revenue Service (IRS). BoardSource offers nine additional conflict of interest policy samples, disclosure forms, and questionnaires in the ePolicy Sampler on Ethics and Accountability. In the sampler, you will find:
- A conflict of interest disclosure statement
- A conflict of interest disclosure questionnaire
- A conflict of interest policy that acknowledges a duality of interest
- A conflict of interest policy that begins with a set of “whereas” clauses
- A conflict of interest policy specifically for foundation boards
- A conflict of interest policy specifically for community foundations with a disclosure form for trustees