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Directors – Dealing with Conflicts of Interest #1

The reality is that with the world being so small, and networks being so important, most directors are going to face situations where there may be a conflict of interests.


What could entail such situations?

– Where a director stands to gain personally from information from the company or opportunities which they come into by virtue of their office.
– Where directors are personally and directly involved in transactions involving the company.
– Where directors hold positions or own properties/ interests that may result in conflicting duties with their directorship.


In such situations, come clean. Discuss the matter with your Board.

Whether the circumstances lead to an actual or potential conflict of interest, the first order of business would be to make a declaration of the conflict. There may be no escaping such situations but the minute you are aware of the (potential) conflict and seek to sweep it under the rug, is the minute that you become liable for failure to disclose.

The Company’s Act and your own company’s Constitution should provide ample guidance on whether disclosure should be made.

If you are still in doubt, consult a lawyer. Pronto.


Please note that this article does not constitute express or implied legal advice, whether in whole or in part. If you require legal advice, please contact us at: or


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