New guidance on conflicts of interests for academy trusts issued by The Chartered Governance Institute

London, 3 July 2020 – The Chartered Governance Institute has today published guidance on ‘Managing conflicts of interests (including related party transaction) in academy trusts’.

Louise Thomson, Head of Policy (Not for Profit) at the Institute says:

“We have seen a number of academies get into difficulties in recent years over conflicts of interest or related party transactions, an area of governance that causes confusion and misunderstanding in many charities, academies included. Charitable status places a duty on those leading the academy trust to act in the best interests of the trust’s charitable objects and avoid conflicts of interests. It is important that trustees are aware of this and able to recognise what constitutes a conflict or related party transaction, hence the reason for the guidance.

“Avoiding all conflicts of interests and loyalty will not be possible or even preferable, so it is essential all academy trusts have robust and effective measures in place to manage real and perceived conflicts. If trustees and senior staff members can identify, avoid and manage conflicts of interest, this will allow them to demonstrate that public funds have been used appropriately, thereby protecting the reputations of the academy trust, its trustees and its senior managers.”

The guidance, which includes a specimen conflict of interests policy, covers the following areas:

  • Definitions of what constitutes a conflict of interest and related party transaction
  • Regulatory and ethical reasons why conflicts of interest and related party transactions should be managed
  • Legal duties of charity trustees and company directors
  • Prevention, identification, management and recording of conflicts of interest
  • Decision making, reporting and recording of related party transactions
  • How conflicts of interest and related party transactions relate to senior staff
  • Whistleblowing
  • Developing a policy
  • Questions for trustees.

Appendices relating to legal definitions of ‘related’ or ‘connected’ persons and the ESFA online procedure for related party transactions are also included.

The guidance is free to download at www.icsa.org.uk/academytrustsconflicts 

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For further information, please contact Maria Brookes, Media Relations Manager:

mbrookes@icsa.org.uk  
+44 (0)20 7612 7072
+44 (0)7890 649 143


Notes to Editors:

  1. The Chartered Governance Institute is the qualifying and membership body for governance with over 125 years’ experience of educating and supporting governance professionals. With a Royal Charter purpose of leading ‘effective and efficient governance and administration of commerce, industry and public affairs’, we provide professional development, guidance and thought leadership, and work with regulators and policy makers to champion high standards. Website: www.icsa.org.uk
  2. The Chartered Governance Institute has a wealth of resources for the academy governance sector, which can be accessed at www.icsa.org.uk/knowledge/academies

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