Conflicts of Interest at Foundations: Avoiding the Bad and Managing the Good

BoardSource | A partnership of the Forum of Regional Associations of Grantmakers and the Council of Michigan Foundations

Even the most comprehensive conflict-of-interest policy cannot cover every conceivable situation where there might be the appearance of a conflict. Accordingly, conflict-of-interest policies should encourage board members and foundation managers to follow the process outlined above any time there might be the appearance or perception of conflict, even if it is not directly covered by the policy. Conflicts of interest must be handled carefully to ensure good, objectivedecisions; to preserve the reputation of the foundation, its board, and its managers; and to protect against liability. To do this, 1) answer the questions posed at the start of this paper, 2) enact and follow a conflict-of-interest policy, and 3) make sure the foundation’s board and managers understand how to recognize and handle a conflict when one occurs.