What sort of situation can give rise to a conflict of interest for a board member?
There are many scenarios where the interests of a particular board member may run counter to the best interests of the nonprofit, or where it will be difficult for a board member to make an objective decision. Q. One of our board members has proposed that he provide his accounting services to the nonprofit for a reduced rate. How should we handle this? A. This is an example of how helpful it is to have a written conflict of interest policy for board members. Board members need to be sensitive to their obligations to disclose conflicts and to their legal duty of loyalty to enter into transactions and make decisions in the best interest of the nonprofit. In situations of conflict, the “interested party” — in this case the board member — must inform the rest of the board what financial gain, if any, he (or his immediate family members) will realize from providing services to the nonprofit. Then, the rest of the board must make an informed, independent judgment as to whether it is in the
