Conflict of Interest Policy for Charities (Free Template)
Every charity should have a written conflict of interest policy, even though it is not a strict legal requirement for every charity type. Conflicts can be financial, such as a trustee's company winning a contract, or non-financial, such as a relative using services, and both must be declared. Charity Commission guidance expects trustees to declare an interest, leave the room for that discussion, and record it in the minutes; a trustee cannot normally vote on a matter where they have a personal interest.
What counts as a conflict (real charity examples)
The first time I drafted a conflict of interest policy for my own charity, I got the scope wrong: I wrote it as if conflicts were only about money. Most small charities make the same mistake. A conflict of interest actually arises whenever a trustee’s personal interests, or those of someone connected to them, could influence or appear to influence a decision they’re making as a trustee — which covers financial conflicts, such as awarding a contract to a trustee’s business, and non-financial ones, such as a trustee’s close relative applying for a grant or a staff role. This guide, part of our charity compliance handbook, gives you the policy, the register and the meeting script to manage both kinds properly.
- Financial example: a trustee who is also a director of a catering company being considered for the charity’s event contract.
- Employment example: a trustee’s spouse applying for a paid role at the charity.
- Beneficiary example: a trustee’s family member being one of several applicants for a hardship grant the charity administers.
- Loyalty conflict example: a trustee who also sits on the board of a partner organisation negotiating a joint funding agreement between the two.
None of these situations are automatically wrong, what matters is whether they’re declared, managed and recorded properly, per the Charity Commission’s guidance in Managing a conflict of interest in your charity.
The Charity Commission’s expectations
The Charity Commission expects trustees to identify conflicts before a meeting where possible, declare them at the start of the relevant agenda item, withdraw from the discussion and any vote unless the governing document allows otherwise, and have this recorded in the minutes. Trustees are also expected to take reasonable steps to identify conflicts they might not immediately think of, not just wait to be asked.
Where a conflict is significant and the governing document doesn’t provide a clear route to manage it, trustees may need to seek Charity Commission authority before proceeding, particularly for conflicts involving trustee payment or benefit. The Charity Commission’s guidance sets out three main steps for managing any conflict of interest: identify it, prevent it from affecting the decision, and record how it was handled.
Free template (annotated)
Below is a working conflict of interest policy structure you can adapt directly. I prepared it myself — it’s a tightened version of the policy I keep for my own charity, reshaped after reading what Charity Commission case reports actually criticise. Copy the headings into your own document, or take the downloadable conflicts of interest policy template with guidance notes attached to each clause.
1. Purpose. This policy sets out how [Charity Name] identifies, declares and manages conflicts of interest affecting trustees, staff and volunteers involved in decision-making.
2. Definition. A conflict of interest is any situation where a trustee’s duty to the charity competes with a separate personal interest, financial or otherwise, of the trustee or someone connected to them.
3. Declaration. Trustees must declare any known conflict as early as possible, and in any case at the start of the relevant agenda item, before discussion begins.
4. Register. All trustees must complete and annually update an entry in the charity’s declarations register (template below), covering both standing and situational interests.
5. Managing a declared conflict. The conflicted trustee must withdraw from the discussion and vote unless the chair and remaining trustees agree their presence is needed to answer factual questions only.
6. Recording. The minutes must record that a conflict was declared, who declared it, and what steps were taken (e.g. left the room, did not vote).
7. Review. This policy and the declarations register will be reviewed at least annually by the board.
Annotation: clause 5 is where most charities go wrong in practice, either by letting the conflicted trustee stay for “just this bit” of a discussion, or by not recording clearly enough that they left. Be explicit in the minutes rather than assuming it’s obvious — clause 5 is the one I’d read aloud at the meeting where you adopt the policy.
The declarations register
A declarations register is a standing document, reviewed and signed off at least annually, that lists every trustee’s known interests, financial and non-financial, that could reasonably create a conflict in future decisions. It sits alongside, not instead of, the requirement to declare situational conflicts as they arise at specific meetings.
| Trustee name | Interest declared | Nature (financial/non-financial) | Date declared | Reviewed |
|---|---|---|---|---|
| [Name] | Director of [Company], a supplier | Financial | [Date] | [Date] |
| [Name] | Spouse works for a partner organisation | Non-financial | [Date] | [Date] |
Ask every trustee to complete this at induction — it’s on our trustee onboarding checklist for exactly that reason — and refresh it annually, or immediately if their circumstances change. At my own charity the annual refresh lives on a recurring calendar entry, because a register that depends on someone remembering it isn’t a control. Auditors and independent examiners will typically ask to see this register, so keep it current rather than reconstructing it at year-end. See CharityIQ’s financial controls (CC8) guide for how this fits into wider financial governance.
From experience: What I check first when a possible conflict of interest comes up at my own charity isn’t whether money is involved, it’s whether it’s been declared before the discussion starts — an undeclared conflict is the pattern Charity Commission case reports keep coming back to, not the conflict itself. The declarations register earns its keep more than the policy document does: it’s what an examiner actually asks to see, and it shows a pattern building before it becomes a problem. I’d still rather trustees know a one-page policy by heart than have a ten-page one nobody’s reopened since it was approved.
Handling a conflict in a meeting (script)
The simplest way to handle a live conflict is a short, scripted exchange at the start of the relevant agenda item, so nothing depends on memory or good intentions in the moment. Chairs should build this into the standard agenda and minutes template rather than relying on trustees to raise it unprompted.
Chair: “Before we discuss item 6, does anyone have an interest to declare?”
Trustee: “Yes, I’m a director of [Company], which is one of the suppliers being considered.”
Chair: “Thank you. [Name] will now leave the discussion and any vote on this item. This is noted in the minutes. [Name], we’ll call you back in once we’ve concluded.”
This exchange, verbatim or close to it, is exactly what should appear paraphrased in your minutes: who declared, what the interest was, and what happened next.
Common failures that reach the regulator
The Charity Commission’s published inquiry and case reports repeatedly cite undeclared conflicts of interest, trustees benefiting from charity contracts without proper authority, and poor record-keeping of how conflicts were managed, as recurring governance failures. I read a stack of these reports while researching CharityIQ’s compliance material, and what struck me is how rarely they describe one-off dramatic breaches — it’s usually a pattern of informal, undocumented decision-making that escalates over time.
- No written policy at all, leaving trustees to rely on informal judgement about what counts as a conflict.
- Declared but not managed: a trustee declares an interest but stays in the room and votes anyway.
- Undeclared connected-party payments, such as a contract awarded to a trustee’s family business without Commission authority where required.
- No register, or a stale one that hasn’t been updated in years, undermining trustees’ ability to spot patterns.
Read the Charity Commission’s own guidance directly at gov.uk for the full legal detail behind these expectations, particularly around trustee benefit requiring prior authority.
What to do next
If your charity doesn’t have a written policy, adopt one at your next board meeting using the template above, and set up a declarations register the same day. If you already have one, check when it was last reviewed and whether every current trustee has completed an entry.
- Adopt or update your conflict of interest policy at board level.
- Circulate the declarations register to every trustee for completion.
- Add “declarations of interest” as a standing item on every meeting agenda.
- Review the register and policy annually, and after any trustee changes.
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Frequently asked questions
It isn't a strict statutory requirement for every charity type, but the Charity Commission strongly expects one, and most governing documents effectively require it through provisions on trustee benefit. In practice, every charity should have a written policy and a declarations register.
Common examples include a trustee's business supplying the charity, a trustee's relative applying for a grant or job, or a trustee sitting on the board of a partner organisation the charity is negotiating with. Both financial and non-financial interests count.
Generally no. Once a conflict is declared, the trustee should withdraw from the discussion and any vote on that item, unless the governing document specifically allows otherwise or the remaining trustees agree they're needed to answer factual questions only.
In two places: a standing declarations register listing each trustee's known interests, reviewed annually, and the minutes of any meeting where a specific conflict was declared and managed. Both should be kept for as long as your charity retains governance records.
No. Having a conflict is normal and not itself a problem; failing to declare and manage it properly is what creates risk. Many well-governed charities have trustees with genuine connections to suppliers, partners or beneficiary groups, handled transparently.
Yes, particularly staff involved in procurement, recruitment or grant-making decisions. A good policy extends the same declaration and management principles to senior staff, not only the board.