Charity Trustee Conflicts of Interest Policy

A trustee conflicts of interest policy sets out how your charity spots, declares and deals with situations where a trustee's personal or other interests could influence, or appear to influence, a decision made for the charity. It turns a sensitive judgement call into a clear, repeatable procedure that every trustee follows.

The Charity Commission regulates charities in England and Wales, and trustees are responsible for their charity's governance and for compliance with charity law. Handling conflicts properly is part of acting in the charity's best interests, and it is a recurring theme in the Commission's guidance and in the Charity Governance Code, a sector standard rather than a legal rule.

The headline point is simple. A conflict of interest is not a failing in itself, and most trustees will hit one sooner or later. What matters is that the conflict is identified, declared and managed openly, and that you can show what happened afterwards.

This guide follows the approach in the Charity Commission's conflicts of interest guidance for charity trustees (CC29): identify, declare, manage or remove the conflict from the relevant decision, and record it, supported by a register of interests as good practice.

What counts as a conflict of interest

A conflict of interest arises when a trustee's duty to act only in the charity's best interests could be affected by another interest or loyalty they hold. That competing interest might bring the trustee a financial benefit, or it might be a personal connection, such as a relative who would gain from a decision.

Conflicts also include conflicts of loyalty, where a trustee sits on the board because of a connection to another organisation or group. The trustee may gain nothing personally, but their loyalty could still pull against the charity's interests when a decision touches that other body.

The CC29 approach, step by step

1. Identify conflicts early

Trustees should look ahead and recognise where a conflict could arise, both when joining the board and as each agenda is set. Asking about interests at the start of every meeting helps surface anything new before a decision is taken.

2. Declare the interest

Any trustee with an actual or potential conflict must declare it openly, ideally before the relevant item is discussed. The declaration should be specific enough for the rest of the board to understand the nature and extent of the interest.

3. Manage or remove the conflict from the decision

The board then decides how to handle the conflict so the decision is made only in the charity's interests. Where the conflict is significant, this usually means removing the conflicted trustee from the relevant decision, so they take no part in the discussion or the vote, and may be asked to leave the room.

Your governing document may set out particular rules, so the policy should be read alongside it. The aim throughout is that an outside observer could see the decision was taken cleanly.

4. Record what happened

The minutes should record the conflict, the declaration, who left the discussion or vote, and the decision reached. A clear record protects the charity if the decision is later questioned and demonstrates good governance to the Commission and to funders.

The register of interests

A register of interests is a standing record of the relevant interests and connections each trustee holds, such as other trusteeships, employments, business interests and close family ties to people who deal with the charity. Keeping one is good practice and makes conflicts easier to spot in advance.

The register should be reviewed regularly, normally at least once a year, and updated whenever a trustee's circumstances change. It works alongside the meeting-by-meeting declarations rather than replacing them.

Quick reference

Element	What it covers
Identify	Spot actual or potential conflicts ahead of each decision and on joining the board
Declare	Trustee states the interest openly, before the relevant item where possible
Manage or remove	Decide how to handle it; remove the conflicted trustee from the decision where needed
Record	Minute the declaration, who withdrew, and the decision reached
Register of interests	Standing list of trustees' interests, reviewed regularly (good practice)

What trustees must do

• Adopt a written conflicts of interest policy that follows the CC29 approach and fits your governing document.
• Maintain a register of interests and review it at least once a year.
• Ask about conflicts as a standing item at the start of every trustee meeting.
• Declare any actual or potential conflict openly and before the relevant item is discussed.
• Remove conflicted trustees from the relevant decision where the conflict is significant.
• Record the declaration, the withdrawal and the decision in the minutes.

Common mistakes

• Treating a declared conflict as the end of the matter, without then managing how the decision is taken.
• Letting a conflicted trustee stay in the room and influence the discussion, even after declaring.
• Keeping no register of interests, so conflicts are only spotted once a decision is already on the table.
• Failing to minute who withdrew, leaving no evidence that the decision was made cleanly.
• Confusing conflicts of loyalty with conflicts of personal benefit, and ignoring the former.
• Reimbursing or paying trustees without checking the governing document and the rules on trustee payments.

How Policy Pros can help

We write bespoke charity policies and procedures that reflect the Charity Commission's expectations and read like your charity, not a template. A conflicts of interest policy is one piece of a wider governance framework, and it works best alongside the controls that protect your funds and your decisions.

For the financial side, see our guide to a charity internal financial controls policy, which covers segregation of duties, dual authorisation and the safeguards set out in the Commission's internal financial controls guidance (CC8). For the rules on reimbursing or paying board members, our charity trustee expenses policy guide explains what is allowed.

For the full picture of the policies the Commission expects and how they link to your annual return, start with our charity policies and annual return guide. You can also browse the Commission's own collection of CC guidance publications and the Charity Governance Code.