Conflict of Interest Policy for Nonprofit - Form Pro · AU-law

CONFLICT OF INTEREST POLICY

________ (ACN ________) (ABN ________) ("Organisation")

Registered with the Australian Charities and Not-for-profits Commission (ACNC)

Approved by the Board on: ________
Last updated: ________
Next review due: ________

(1) APPLICATION

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(b) This Policy operates in conjunction with, and is subject to, the Organisation's Constitution, the Corporations Act 2001 (Cth) (to the extent applicable), the Australian Charities and Not-for-profits Commission Act 2012 (Cth), the ACNC Governance Standards, and any applicable State or Territory associations incorporation legislation.

(2) INTRODUCTION

(a) The Organisation is committed to observing the highest standards of ethical and good governance conduct in its operations and expects its Staff to do the same. The Organisation has adopted this Conflict of Interest Policy (the "Policy") to ensure that it remains committed to and acts consistently with its charitable purpose and the public benefit it is established to serve.

(b) The Organisation expects all Staff to conduct themselves ethically and with integrity in the course of their engagement with the Organisation.

(c) This Policy is designed to help all Staff of ________ to identify, disclose and manage potential conflicts of interest.

(d) This Policy provides information about how to identify potential conflicts of interest, how to manage them, and how and when to disclose them. Handling potential conflicts of interest in accordance with this Policy will help Staff to protect their integrity and that of the Organisation.

(e) Please take the time to read and review this Policy thoroughly. If you have any questions, please contact your manager, supervisor or the person identified in clause (12).

(f) Compliance with this Policy is a condition of your engagement with the Organisation. Failure to comply may result in disciplinary action and, where applicable, may constitute a breach of duties owed under law.

(3) PURPOSE

(a) The purpose of this Policy is to help Staff to appropriately identify, manage, disclose and deal with any conflicts of interest they may encounter, whether perceived, potential or actual. Doing so protects the integrity of both the Staff member and the Organisation and manages risk.

(b) It is important that all Staff understand their obligation to disclose, manage and deal with any conflicts of interest they may encounter, and their obligation to comply with this Policy.

(c) If a conflict of interest exists, it creates the risk that a Staff member will make a decision or act in a way that is not in the best interests of the Organisation. Conflicts of interest must therefore be carefully managed.

(4) DUTIES OWED TO THE ORGANISATION

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(b) Where the Organisation is registered under the Corporations Act 2001 (Cth), directors and officers also owe duties under sections 180 to 184 of that Act, including the duties of care and diligence, good faith, and the proper use of position and information.

(c) All Staff owe the Organisation a duty of loyalty. This requires Staff to avoid using their position with the Organisation for personal advantage or gain. Staff must avoid any action, including voting where applicable, where the Staff member's personal interest (including any financial interest) could conflict with the interests of the Organisation.

(5) WHAT IS A CONFLICT OF INTEREST?

(a) A Staff member encounters a conflict of interest when their personal interests conflict with their obligation to act in the best interests of the Organisation. These "personal interests" may include the Staff member's own interests as well as the interests of their spouse, partner, relatives, friends, business associates or other connected persons.

(b) A conflict of interest may also arise where a Staff member has obligations to another organisation that conflict with their obligations to the Organisation, for example where the Staff member holds a position with another charity or entity that deals with the Organisation.

(c) A conflict of interest may be actual, potential or perceived, and may relate to financial or non-financial matters.

(d) An "actual" conflict means a conflict of interest that presently exists.

(e) A "potential" conflict means that the conflict may not exist yet, but a conflict is likely to arise if the Staff member continues the relevant course of conduct.

(f) A "perceived" conflict means that a conflict may not actually exist, but it could reasonably appear to a third party that a conflict exists. Perceived conflicts should be avoided as they are likely to undermine the integrity of the Staff member and the Organisation.

(6) EXAMPLES

(a) The examples below are intended to help Staff understand what a conflict of interest might look like. They are not an exhaustive list, and Staff may encounter conflicts in circumstances different from those listed.

(b) General examples of conflicts of interest include where:

(I) the Staff member, or a relative, friend or associate of the Staff member, has a current or potential financial interest that would impact the Staff member's ability to perform their duties impartially;

(II) the Staff member is, or has the potential to be, involved with a business that transacts with the Organisation;

(III) the Staff member uses the Organisation's confidential information for personal profit;

(IV) the Staff member accepts significant gifts, benefits or monetary compensation from third parties dealing with the Organisation, such as partners, suppliers or vendors; or

(V) the Staff member otherwise stands to benefit personally as a result of their relationship with the Organisation in a capacity other than as a Staff member.

(c) Specific examples of conflicts of interest that may arise in this Organisation include:

________

(7) OUR APPROACH

(a) We recognise that Staff have lives, obligations and interests outside of their engagement with us.

(b) We recognise that conflicts of interest are common and are not, in themselves, a problem provided they are handled openly, honestly and effectively.

(c) Nevertheless, any conflict of interest, whether actual, potential or perceived, and whether financial or non-financial, creates a risk that a Staff member might act in a way that is not in the best interests of the Organisation.

(d) We will handle any matters related to this Policy sensitively and confidentially.

(8) WHAT WE EXPECT OF STAFF

We require Staff to:

(a) comply with all applicable laws, rules and regulations;

(b) comply with this Policy and the Organisation's Constitution;

(c) avoid conflicts of interest;

(d) avoid the appearance of any conflict of interest;

(e) notify us of any actual, potential or perceived conflict of interest at the earliest opportunity;

(f) carefully and continually monitor and manage any conflicts of interest that arise, in open consultation with us;

(g) manage any conflicts of interest as directed by us;

(h) promptly respond to any breaches of this Policy;

(i) promptly report any breaches of this Policy to us;

(j) take a proactive and precautionary approach. If unsure whether something is a conflict of interest, treat it as though it is one;

(k) conduct themselves in a manner that does not compromise our reputation;

(l) act in our best interests during the course of their engagement with us;

(m) not hold any financial interest that conflicts with our interests, except where properly disclosed and managed under this Policy;

(n) not be involved with any business or organisation that conflicts with or competes with the Organisation without proper disclosure; and

(o) not use or share our confidential information except for the purpose of performing their duties for us, and in accordance with the Privacy Act 1988 (Cth) where personal information is involved.

(9) GOVERNANCE RESPONSIBILITIES

The Board has the following responsibilities regarding conflicts of interest:

(a) actively monitoring compliance with this Policy;

(b) establishing and maintaining systems for identifying, managing, disclosing and dealing with conflicts of interest;

(c) reviewing this Policy at least once every ________ and the Organisation's procedures to ensure that this Policy remains current, effective and appropriate for the Organisation's circumstances.

(10) ACNC GOVERNANCE STANDARDS

(a) The Organisation takes its obligations under the ACNC Governance Standards (set out in the Australian Charities and Not-for-profits Commission Regulations 2022 (Cth)) very seriously, in particular Governance Standard 5 (duties of Responsible Persons).

(b) Staff must ensure that they are aware of their obligations under the ACNC Governance Standards and that they disclose any conflicts of interest as required.

(11) REGISTER OF INTERESTS

(a) The Organisation must maintain a register of interests.

(b) The register of interests will be managed by: ________.

(c) The register of interests must record information related to a conflict of interest, including at a minimum:

(I) all material facts;

(II) the name(s) of any Staff affected by the conflict of interest;

(III) details about the nature of the conflict of interest;

(IV) details about the extent of the conflict of interest;

(V) details about any measures undertaken to manage the conflict of interest; and

(VI) any other relevant details.

(d) The register of interests will be maintained and any personal information contained in it handled in accordance with the Privacy Act 1988 (Cth) and the Organisation's privacy policy.

(12) DISCLOSURE OF CONFLICTS

(a) When a conflict of interest is identified, whether actual, potential or perceived, it must be recorded in the Organisation's register of interests and declared in writing as soon as possible to: ________.

(b) Staff are not permitted to unilaterally assess or determine the outcome of their own conflicts of interest.

(c) When disclosing a conflict of interest, Staff must provide the following details:

(I) all material facts;

(II) any potential or existing financial interest;

(III) any potential or existing competing interest, even if not financial; and

(IV) any self-dealing or potential self-dealing.

(d) Where any Staff member becomes aware of a potential conflict of interest involving another party, that Staff member must immediately report it to: ________.

(e) Where all members of the Board share a conflict of interest, disclosure must occur in accordance with ACNC Governance Standard 5 and, where applicable, the Organisation's Constitution, and the matter may be referred to the members of the Organisation.

(13) CONFIDENTIALITY AND PRIVACY

(a) The Organisation handles any matters related to this Policy sensitively and confidentially, and collects, uses, stores and discloses personal information in accordance with the Privacy Act 1988 (Cth) and the Australian Privacy Principles.

(b) The Organisation will use the following procedures to protect the confidentiality of any disclosed conflicts of interest:

________

(14) RECUSAL

(a) Where a Staff member has a material conflict of interest, they may be required to recuse themselves from any meetings, debates, votes or other actions in relation to the relevant matter.

(15) CONFLICT PROCEDURES

(a) Staff shall disclose conflicts of interest to the board of directors or other relevant committee (the "Board") as soon as practicable after becoming aware of the conflict, as described above.

(b) Staff shall complete an annual disclosure form describing any ongoing interest that may create a conflict.

(c) After the Board receives any conflict disclosure from a Staff member, the Board (excluding any Staff member(s) involved in the conflict):

(I) may request follow-up discussions or additional information;

(II) will consider whether a conflict exists;

(III) will determine whether the conflicted Staff member(s) will be permitted to participate in any debate or discussion regarding the matter;

(IV) will determine whether the conflicted Staff member(s) will be permitted to vote on the matter;

(V) will determine whether the conflicted Staff member(s) will be permitted to be present during any debate, discussion or vote regarding the matter; and

(VI) may consider whether the conflicted Staff member needs to resign from their position (which may be necessary in the case of serious conflicts).

(d) The Board may consider any factor it wishes in determining whether a conflict exists and what steps to take, including but not limited to:

(I) whether the conflict is likely to actually affect or impair the relevant Staff member's ability to act impartially in the best interests of the Organisation;

(II) whether the conflict needs to be avoided or whether it can be managed and documented;

(III) how the conflict could affect the Organisation's reputation, and whether it could create an appearance of improper conduct (even if no actual conflict exists);

(IV) what other options exist to avoid the conflict;

(V) the scale of any financial interest the Staff member may have in relation to the transaction;

(VI) the extent of the Staff member's involvement with any other entity transacting with the Organisation;

(VII) the degree to which the Staff member could personally benefit from the transaction or relationship; and

(VIII) the Organisation's charitable purpose, objects, resources and goals.

(e) For the Board to approve any action in relation to a conflict of interest, the action must be supported by a vote of at least a majority of the Board members entitled to vote (excluding any Staff member(s) involved in the conflict), and a quorum (disregarding the conflicted member(s)) must be present, subject to the Organisation's Constitution.

(16) DOCUMENTATION OF CONFLICTS

(a) The Board must ensure that any conflict of interest, and any decision made in relation to that conflict of interest, is properly documented.

(b) The minutes of any meeting of the Board at which a conflict of interest is considered must record the following:

(I) the name(s) of the Staff member(s) who disclosed or were otherwise found to have a conflict of interest;

(II) the nature and extent of the conflict of interest;

(III) whether the conflicted Staff member(s) were present during any debate, discussion or vote on the matter, and whether they participated in or were recused from such debate, discussion or vote;

(IV) any action taken to manage the conflict of interest, and the reasons for that action; and

(V) the outcome of any vote taken in relation to the matter, including the number of votes for and against.

(17) ABSTENTION FROM VOTES ON REMUNERATION

No Board member who is, or may be, remunerated or otherwise materially benefited for their services to the Organisation may vote on, or be present during the determination of, their own remuneration or benefit. Any remuneration of Responsible Persons must be consistent with the Organisation's Constitution and not-for-profit character.

(18) POLICY VIOLATIONS

(a) If a Staff member fails to disclose any potential or actual conflict, the Board shall first request an explanation from the Staff member. The Board may then determine appropriate action, including disciplinary action if required.

(b) Behaviour that breaches this Policy is unacceptable at the Organisation.

(c) If a Staff member breaches this Policy, the following disciplinary procedures may apply, subject to any applicable obligations under the Fair Work Act 2009 (Cth) and principles of procedural fairness:

(I) a formal warning;

(II) a requirement to attend integrity-related training;

(III) a requirement to attend counselling;

(IV) demotion;

(V) a missed opportunity for promotion;

(VI) suspension;

(VII) termination of engagement; and/or

(VIII) removal from a position as a Responsible Person in accordance with the Constitution.

(d) These disciplinary procedures will apply equally and fairly to any Staff member who breaches this Policy, regardless of that Staff member's position or seniority at the Organisation.

(19) HOW TO DISCLOSE CONFLICTS OF INTEREST

If you need to disclose a possible conflict of interest, you may do so in the following manner:

________

(20) IF YOU NEED MORE INFORMATION OR ASSISTANCE

Staff may contact a supervisor, manager or the following officer for a confidential discussion regarding any matters related to conflicts of interest: ________.

(21) GOVERNING LAW

This Policy is governed by the laws of ________ and the applicable laws of the Commonwealth of Australia. This Policy does not form part of any contract of employment and the Organisation may vary it at any time.

(22) ACKNOWLEDGEMENT

By signing below, the Staff member acknowledges having read and understood this Policy, and agrees to comply with it:

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Staff Member Signature

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Staff Member Name

________
Position

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Date