Trustee Conflict of Interest Policy/Proposal November 2012

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Historical
This page is kept as an archival reference.
If you want to raise a point about it, please start a discussion thread on the community forum.

This policy has been drafted after having considered the Charity Commission guidance.


Background

Individual board members have personal responsibilities, as directors and trustees, to ensure that the decisions they take are in the interests of the charity as a whole rather than their personal interest. Where there is a situation where there is a potential conflict of interest or potential conflict of loyalties, board members are expected to follow appropriate procedures on disclosure, voting and decision making.

The Articles of Association sets out the over-arching rules on conflicts of interest in clauses M5.5-7. A requirement in those articles cannot be overridden by anything in these Rules. They provide that:

No board member may:

  • Buy from
  • Sell to
  • Be employed by, or
  • Receive financial benefit from the chapter unless:
    • The amount is reasonable
    • The transaction is of a type allowed under clause M5.5
    • A majority of board members does not receive a benefit

The restriction also applies to close family members and, in respect of remuneration, to companies which employ the board member.

Likely situations

A conflict of loyalties may occur even where a board member does not have a personal financial interest in a third party, but has a historical connection or loyalty to them. This includes loyalty derived from being a volunteer committee member.

The following are examples of where board members may face a conflict of interest:

  • Claiming and authorising reimbursement of expenses
  • Purchasing goods and services from a connected organization, such as hiring a room from your university
  • Partnership agreements for initiatives with a connected organization, such as providing a Workplace Learning seminar at your place of work
  • Agreements with the Wikimedia Foundation or other chapters where a board member has previously served on one of their committees, including the English Wikipedia MedCom and ArbCom, unless they have been representing Wikimedia UK on the committee.

Activities as an ordinary Wikimedia project editor, including trusted editors like Administrators, are not normally considered to create a conflict of interest, though local project definitions of conflict of interest apply and may require their own related declarations of interest with respect to a board member's role in the charity.

Disclosure

Given the likelihood of conflicts arising with regard to agreements with the Wikimedia Foundation, trustees are required to list on the public Declarations of Interest all positions held or formerly held with the Foundation or on Foundation projects and to conclude whether a potential conflict exists. After each board election, members will be required to declare that they have registered all such positions. Trustees are encouraged to declare agreements and positions held with other Wikimedia organizations.

Where we are discussing a relationship with a third party, any board member's prior relationship which may create a potential conflict of interest must be discussed with the Company Secretary or the full board before any decision is made. Where a decision is being made by an initiative leader, the board member is expected to raise the issue with them, and they must discuss the matter with the Company Secretary or the full board. The Secretary must note the matter in the confidential register of interests or the public Declarations of Interest as appropriate.

The board must consider the privacy rights of individual board members when discussing conflicts of interest. Appropriate use must be made of in camera board meetings and private discussions with board officers.

When considering whether to authorise a conflict of interest, the Board must take due regard to the Charity Commission guidance "A Guide To Conflicts of Interest For Charity Trustees"

If, after discussion, it is concluded that a board member has a conflict of interest in a proposed transaction, the decision must be considered by the Board. The conflicted member must excuse themselves from any vote on the transaction and will not be counted as part of the quorum. They may take part in an initial discussion, but the final decision must be made by the remaining unconflicted board members following a final in camera discussion. If a transaction is approved, the Board must ensure that appropriate controls are in place.

Expenses

We seek to have a board that reflects the diversity of Wikimedia project users and recognise that not all potential board members are able to pay for their own out of pocket expenses. We will therefore normally reimburse expenses that are properly incurred for the benefit of the chapter. Advance payment of expenses will be considered where cost may be an obstacle to any board member carrying out their duties.

Expenses will only be reimbursed if they are approved in principle prior to the expense, are reasonable, are on the proper form and supported by receipts as appropriate and are properly authorised. Board members are expected to keep the expenses they incur to the lowest reasonable level.

Travel by private motor vehicle or bicycle will be reimbursed at the standard HMRC rates. Travel by train or aeroplane will be reimbursed for standard class only.

Expense claims must be accurate. Submitting a false or misleading claim, even if not paid, may damage public confidence in the chapter and will be considered a serious disciplinary matter.

Authorisers must only pay claims where they have been properly completed.

When considering whether to submit or authorise an expense payment, due regard must be paid to the Charity Commission guidance "CC11 - Trustee expenses and payments"

Benefits

Board members may not accept non-trivial gifts in connection with Wikimedia UK activities.

If, for example, a partner organization offers to pay for a lunch to discuss joint activities then this may be acceptable, but a judgement should always be made as to whether the gift is appropriate. Where it could be perceived as impairing the ability of the board member to make independent decisions, at the time or in the future, in the interests of the chapter, then the gift must be declined.

Board members will not be eligible to receive any prizes in connection with chapter initiatives.

Disciplinary actions

When board members nominate themselves as candidates for election, they are informed of their duties as trustees, including their duty to avoid conflicts of interest.

If a Board member does not comply with these Rules with no reasonable excuse, the Board will consider disciplinary action against the board member. Board members will normally be required to pay back any amounts which have been improperly received.

In extreme cases, disciplinary matters may include removal of membership and hence directorship under Article 4.

Category:Constitution Category:Board