How does a Board best deal with Conflict of Interest concerns?
The simple answer (and there is never an actual "simple answer") is that a Board best deals with concerns over conflicts by having a specific Conflict of Interest Policy and by adhering strictly to it. The need for this is highlighted in the November 2011 Sport Canada publication titled "Pursuing Effective Governance in Canada's National Sport Community" where at page 11 the following is set out:
Establish a Conflict of Interest Policy
A conflict of interest policy should be in place and declarations of interest updated at least once a year and declared in relation to agenda items at each Board meeting. This is a simple tool but essential in this era of perceived conflicts of interest.
This suggests that not only is it important to have a policy but there needs to be annual "declarations of Interest" and declarations for each Board meeting. The latter two are the easiest to manage. I recommend that each Board member, at the time of the first Director's meeting after each Annual General Meeting, sign a conflict declaration wherein they set out any matters that they are aware of at the time that might give rise to the perception of a conflict. To be clear this is not just about actual cases of conflict but perceived conflicts as well, So, for example if you did work on a part time basis (such as teaching courses or leading camps) that would need to be declared. Similarly having a family member on a team in your organization may, in certain circumstances, give rise to a conflict.
Next is to have as a standing agenda item (probably right after "Approval of Agenda") a heading for "Declarations of Conflict". This provides an opportunity for a Board member to say in advance of a specific topic being discussed that he or she has a conflict with that item. It would then be appropriate to allow that member to absent themselves from any discussion of that specific topic. For example, if an item on an agenda was "Team Selection for Provincial Championships" and one of the Directors had a family member in the pool for selection then when the Board meeting was at the "Declarations of Conflict" line of the Agenda that member should declare a conflict as a result of the family member's potential for selection. The meeting could then carry on with the Board member then excusing him or herself from the meeting when the discussion reached the Team Selection item.
The broader issues of conflict of interest is addressed by having a specific policy that spells out what sorts of things are (and perhaps are not) conflicts and under what circumstances (if any) a conflict may be "acceptable". In that regard it is important to note that while the existence of a conflict may disqualify a Board member from discussions (and, of course, voting) on the issue with which there is a conflict it generally does not disqualify them from more than that. To that end it is useful to have a comprehensive policy not just so that the Board members may be sure to follow it but also to serve as a tool that guides and educates the general membership.
So the "answer" to this question is to have and clear policy that is looked at regularly and to couple that policy with active steps by the Board at each meeting to deal with potential conflicts as they relate to the ongoing business of the organization up front and in public.
Peter Lawless, MA, LLB
President, Coaches of Canada
Every sport organisation should have a Board approved Conflict of Interest policy that is well communicated and understood by all volunteers and staff. The policy should outline what constitutes a conflict of interest and how conflicts of interest are to be managed within the organisation. It is good practice to have volunteers and staff sign conflict of interest statements annually and to have a standard agenda item of all meetings (Board, Committees, staff) where conflicts of interest are declared.
Joan Duncan
JDI Consulting
The best thing is to be aware. Conflict of interest is a serious problem in the governance of sport organizations, because the sport community is relatively small. Sport people are also 'do-ers', passionate people who like to be involved and it is not uncommon for a typical sport volunteer to be involved in many different organizations at the same time. This is what creates the problem. When a person is a director on a board, he or she has an important legal duty to put the interests of that organization first, ahead of any other interests. Often, people who are board of directors of more than one organization, may find that their loyalties are divided. For example, a president of a swim club who is also on the board of a provincial body while also being the chair of a national committee, may find that they cannot fufill their duty of loyalty all the time. To address this issue, sport organizations need to understand and be aware of the potential for conflict, they need to have a clear policy that governs situations of conflict of interest (and a willingness to enforce such a policy), and they need to be open and transparent in how they report and manage the conflict. Some organizations avoid the problem entirely by requiring, as a matter of policy or bylaws, that directors cannot have competing interests in other organizations.
Rachel Corbett
Centre for Sport & Law
Every Board needs to ensure that it has clear Conflict of Interest regulations, and that these regulations are reviewed for consistency and "fit" on a regular basis. Primarily, Boards should:
- Ensure that Conflict of Interest policies are formalised and implemented at the Board and Committee level annually - this includes the "signing" of a statement by Board members indicating their knowledge of and commitment to the policy
- Ensure that a Conflict of Interest policy does differentiate between "direct" and "indirect" conflict potential, and outlines a process in which a Board member can function when confronted with a conflict
- Ensure that the President/Chair and senior staff person are particularly well versed in the policy and the implementation process (including professional development opportunities if needed)
- Ensure that the policy is applied consistently throughout the association, including at the staff operational level where appropriate.
- Ensure that, in circumstances that require such, the association's appeal policy is well equipped to deal with situations that may arise from the implementation of the Conflict of Interest policy.
Ian Moss
Canadian Olympic Committee