Conflict of interest

Conflict of interest: a situation in which a person is in a position to derive personal benefit from actions or decisions made in their official capacity. The term is often used in the context of directors’ fiduciary duties owed to the company and its shareholders. A director must put the interests of the company and its shareholders over the director’s own personal interests in making decisions for the company and evaluating opportunities. If there is a potential conflict of interest, the director must disclose it and allow for the board of directors to determine how to proceed.