Do you have a Conflict of Interest Policy’s? If not, it’s time. A comprehensive policy will protect your organization, and its leaders if it is current and up to date with the organization’s needs.
The IRS says all organizations should have a comprehensive conflict-of-interest policy that follows a traditional legal format. This is recommend in Part V, Section 5 of IRS Form 1023. The code asks questions to determine if the organization has procedures on handling conflicts and makes recommendations on creating a conflict-of-interest policy if one does not exist.
The full sample is here, but the overview can be seen below.
Article I: Purpose
Article II: Definitions
- Interested Person
- Financial Interest
Article III: Procedures
- Duty To Disclose
- Determining Whether a Conflict of Interest Exists
- Procedures for Addressing the Conflict of Interest
- Violations of the Conflicts-of-Interest Policy
Article IV: Records of Proceedings
Article V: Compensation
Article VI: Annual Statements
Article VII: Periodic Reviews
Article VIII: Use of Outside Experts
Take-away: At your next Board meeting, make it a point to update or adopt a comprehensive conflict-of-interest policy.