The purpose of this policy is to protect the interests of Handcrafted and its stakeholders. In the regular course of our organisation, trustees and members of staff of Handcrafted may have the opportunity to advance their own personal interests with or against the Charity’s interests. Acting in such a manner is unacceptable and any party who acts outside Handcrafted’s best interest may be subject to disciplinary action

This policy will be reviewed as required and at least annually by the group or individual responsible for review and authorised by the Trustees as below:

Group or individual responsible for review	Trustees
Last review and approval	14/09/2023

Definition

A conflict of interest is any situation in which a trustee’s or member of staff’s personal interests or loyalties could, or could be seen to, prevent the trustee or member of staff from making a decision only in the best interests of the charity.

Conflicts occur where an individual stands to gain directly or indirectly, or where an individual is engaged with an organisation that has aims incompatible with those of the Charity.

Trustees

Conflicts of interest, and even the perception of competing interests, impaired judgement or undue influence, can damage a charity’s reputation, or public trust and confidence in charities generally.

These harmful effects can be prevented where individual trustees can identify the potential for conflicts of interest, and the trustee body can act to prevent them from affecting their decision making.

All trustees have a legal duty to act only in the best interests of their charity.

Conflicts of interest

Conflicts of interest will usually arise where either:

there is a potential financial or other measurable benefit directly to an individual, or indirectly through a connected person
a trustee’s duty to the charity may compete with a duty or loyalty they owe to another organisation or person

In practice, this means that trustees cannot receive any benefit from the Charity in return for the service they provide to the Charity, unless they have the express legal authority to do so.

The Charity Commission identifies examples that any of the following may amount to a potential conflict of interest.

Benefits to trustees are where the trustees decide to:

sell, loan or lease charity assets to a charity trustee
acquire, borrow or lease assets from a trustee for the charity
pay a trustee for carrying out their trustee role
pay a trustee for carrying out a separate paid post within the charity, even if that trustee has recently resigned as a trustee
pay a trustee for carrying out a separate paid post as a director or member of staff of the charity’s subsidiary trading company
pay a trustee, or a person or company closely connected to a trustee, for providing a service to the charity
employ a trustee’s spouse or another close relative at the charity (or at the charity’s subsidiary trading company)
make a grant to a service user trustee, or a service user who is a close relative of a trustee
allow a service user trustee to influence service provision to their exclusive advantage

Conflicts of loyalty

These conflicts of interest arise because, although the affected trustee does not stand to gain any benefit, the trustee’s decision making at the charity could be influenced by his or her other interests.

For example, a trustee’s loyalty to the charity could conflict with his or her loyalty to

the body that appointed them to the charity
the membership or section of the charity that appointed them to trusteeship
another organisation, such as their employer
another charity of which they are a trustee
a member of their family
another connected person or organisation

The test is always that there is a conflict of interest if the trustee’s other interest could, or could be seen to, interfere with the trustee’s ability to decide the issue only in the best interests of the charity.

Identifying and Declaring conflicts of interest from affecting decision making

Although declaring conflicts of interest is primarily the responsibility of the affected trustee, the trustee body should ensure that they have strong systems in place so that individual trustees have a clear understanding of the circumstances in which they may find themselves in a position of conflict of interest and understand their personal duty to declare them.

Register of Interests of trustees

All trustees should complete a Register of Interests of trustees on an annual basis and be alert to any other possible conflicts of interest and advise the Chair as soon as they arise.

Conflicts of interest are to be a standard agenda item at the beginning of each Board and committee meeting to allow the opportunity for declaration of any actual or potential interest in any of the items on that agenda.

A trustee should declare any interest which he or she has in an item to be discussed, at the earliest possible opportunity and certainly before any discussion of the item itself.

If a trustee is uncertain whether or not he or she is conflicted, he or she should err on the side of openness, declaring the issue and discussing it with the other trustees.

If a trustee is aware of an undeclared conflict of interest affecting another trustee, they should notify the other trustees or the Chair.

Any trustee who has a financial interest in a matter under discussion, should declare the nature of their interest and withdraw from the room, unless they have a dispensation to speak.

If a trustee has any other interest which does not create a real danger of bias, but which might reasonably cause others to think it could influence their decision, they should declare the nature of the interest, but may remain in the room, participate in the discussion, and vote if they wish.

If in doubt about the application of these rules, the Chair should be consulted.

Recording a conflict of interest

Handcrafted Trustees will document any conflicts of interest and how they have dealt with them in the minutes of their meetings.

The written record of the decision will show:

the nature of the conflict
which trustee or trustees were affected
whether any conflicts of interest were declared in advance
an outline of the discussion
whether anyone withdrew from the discussion
how the trustees took the decision in the best interests of the charity

Recording decisions in this way helps trustees to show that they have acted properly and complied with their duties.

Staff and Volunteers

Occurrences

Members of staff need to be mindful of potential conflicts of interest. These can occur if people use their position with Handcrafted Projects to:

further their own financial interests e.g. by taking on private work with a client
benefit a third party with whom they are associated e.g. recommend a tradesperson to whom they are related
discriminate against a service user due to their allegiances or political or religious views
refer people to agencies with whom they have a connection e.g. to a particular charity with whom you have an involvement
unfairly benefit a service user to whom they are related e.g. by applying a reduced charge for a service

OR

are employed or engaged by an organisation in competition with Handcrafted
are involved with groups whose values are in conflict with those of Handcrafted

This list is not intended to be exclusive but is indicative of the kind of issues that can arise.

Support Workers are expressly forbidden to privately undertake any additional paid work on behalf of a client of that service. Doing so will result in disciplinary action and possible dismissal.

Reporting and Resolving Conflicts of Interests

As a member of staff or volunteer, if you have an interest that potentially could be in conflict with your position with Handcrafted Projects, you should bring it to the attention of your line manager who will pass it onto the Operations Manager for consideration. Senior Project Managers with a potential conflict of interest should consult with the Managing Director and, in similar circumstances, the Managing Director should consult with the Chair of Trustees.

Most conflicts of interest can be successfully managed if they are known and out in the open. If you have interests outside your role with Handcrafted Projects, providing you are transparent, it should not prevent you from continuing in your role.

Where it is deemed that you have acted in your own interests, to the potential detriment of others or the Charity, disciplinary action will be taken.

Recording a Conflict of Interest

A written record of reported conflicts of interest will be maintained in a register, covering details of the conflict and how the management team dealt with them. This should include:

the nature of the conflict
the person(s) affected
how the management took the decision in the best interests of the charity