Conflicts of Interest and Bias

Also worth reviewing URPC’s own document on Code of Conduct.

Councillors appointed to an outside body will have a personal interest in that body and will need to consider their position when they sit on cabinet, a council committee or other decision-making body which is considering a matter which relates to the outside body.

A personal interest will always need to be declared and the Councillor will need to consider whether or not they also have a prejudicial interest arising from that membership.

Having prejudicial interest rules apply, regardless of whether or not the Councillor was appointed onto the outside body by the council. The rules simplify what were quite complex rules about overriding duties to a company or as a trustee that were applicable under the previous code of conduct.

What may happen in relation to that item of business depends on whether that Councillor has a “prejudicial interest” under the code of conduct and the meeting rules.

A Councillor has a prejudicial interest in an item of business arising from their membership of an outside body they must still leave the Chamber, but only after they have attended the meeting for the purpose of making representations, answering questions or giving evidence relating to the business, provided that the public are also allowed to attend the meeting for the same purpose.

Conflict of Interest
A term used to describe the situation in which a public official or fiduciary who, contrary to the obligation and absolute duty to act for the benefit of the public or a designated individual, exploits the relationship for personal benefit, typically pecuniary.

In certain relationships, individuals or the general public place their trust and confidence in someone to act in their best interests. When an individual has the responsibility to represent another person—whether as administrator, attorney, executor, government official, or trustee—a clash between professional obligations and personal interests arises if the individual tries to perform that duty while at the same time trying to achieve personal gain. The appearance of a conflict of interest is present if there is a potential for the personal interests of an individual to clash with fiduciary duties, such as when a client has his or her attorney commence an action against a company in which the attorney is the majority stockholder.

Incompatibility of professional duties and personal interests has led Congress and many state legislatures to enact statutes defining conduct that constitutes a conflict of interest and specifying the sanctions for violations. A member of a profession who has been involved in a conflict of interest might be subject to disciplinary proceedings before the body that granted permission to practice that profession.

Conflict of Interest
Noun. a situation in which a person has a duty to more than one person or organization, but cannot do justice to the actual or potentially adverse interests of both parties. This includes when an individual’s personal interests or concerns are inconsistent with the best for a customer, or when a public official’s personal interests are contrary to his/her loyalty to public business. An attorney, an accountant, a business adviser or realtor cannot represent two parties in a dispute and must avoid even the appearance of conflict. He/she may not join with a client in business without making full disclosure of his/her potential conflicts, he/she must avoid commingling funds with the client, and never, never take a position adverse to the customer.