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Difference between revisions of "Non-Profit Directors (Societies Act FAQs)"
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Non-Profit Directors (Societies Act FAQs) (view source)
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===What is a conflict of interest?=== | ===What is a conflict of interest?=== | ||
A conflict of interest is a situation in which an individual or organization is involved in multiple interests that may be incompatible, where acting upon one interest could compromise another. A conflict of interest includes not only a material interest but the perception of an interest. In the legal context, this term is used to describe a situation in which a person has a duty to act in the best interests of an organization or party, yet they may have personal interests that conflict with that duty. For example, a board director voting on an increase in salary for a family member who works for the non-profit. The ''Societies Act'' requires non-profits to keep records of any conflicts of interest. | A conflict of interest is a situation in which an individual or organization is involved in multiple interests that may be incompatible, where acting upon one interest could compromise another. A conflict of interest includes not only a material interest but the perception of an interest. In the legal context, this term is used to describe a situation in which a person has a duty to act in the best interests of an organization or party, yet they may have personal interests that conflict with that duty. For example, a board director voting on an increase in salary for a family member who works for the non-profit. The ''Societies Act'' requires non-profits to keep records of any conflicts of interest. | ||
===What should a director do if they have a conflict of interest?=== | |||
S. 56 of the ''Societies Act'' provides guidance to non-profits on how to address conflicts of interest. A director with a conflict of interest ''must'': | |||
*Immediately disclose they have a conflict of interest and the nature and extent of the conflict; | |||
**If outside a meeting, disclosure must be in writing (e.g. email) to all other directors. | |||
**If during a meeting, disclosure must be recorded in the minutes. | |||
*Not vote on the matter; | |||
*Leave the meeting while the matter is discussed except when they are required to be present to provide information; and, | |||
*Leave the meeting while the rest of the board votes on the matter. | |||
==Directors Employed by the Non-profit Society== | ==Directors Employed by the Non-profit Society== | ||
