A conflict of interest arises when the interests of a member of the management committee/board are in conflict with the interests of the organisation they are helping to govern. This can be direct, in relation to the interests of the individual, or indirect, in relation to the interests of a close relative or business partner.
If an organisation is a company limited by guarantee. (i.e. incorporated) it may choose to have a Company Secretary.
A company limited by guarantee is an incorporated organisation. This means that it has gone through the registration process that converts a new or existing business into a corporate body, making it a legal entity in its own right.
With a company that is limited by guarantee, the financial liability of members, including the Management Committee is usually limited to a nominal amount, should the company face financial difficulties (although it does not protect against fraud, negligence, etc).
This has a number of implications which you should be aware of:
1. Duties of Company Directors
Since October 2007, there are now statutory duties of company directors, under the Companies Act 2006. All Management Committee members need to be aware of their duties to:
An article to running a charitable company, including updated guidance on the requirements of company law by NICVA.
Click here for more information.
A guide for charities considering incorporation. Produced by NICVA.
Click here for more information or to download.
A community interest company (CIC) is a limited liability company created with the specific aim of providing benefit to a community. It is a relatively new legal structure, designed to meet the needs of social enterprises and ‘not-for-profit' projects, which combine the pursuit of a social purpose with commercial activities.
A community interest company shares many of the features of a limited company, in that it is incorporated and the financial liability of its Directors is limited to a nominal amount.
An overview document explaining the legal features of Community Interest Companies, produced by the CIC Regulator.