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Commissioners corner: Conflicts between duties and dual responsibilities

Friday 12 July 2019

By Dr. Nikola Stepanov - Queensland Integrity Commissioner

My office and I have been on the road again during the past few months along with the Independent Assessor, Ms Kathleen Florian, presenting integrity workshops. This has provided us with the opportunity to meet you all face to face and hear first hand about your experiences and the issues you face. I look forward to meeting more of you in the near future.

An emerging issue I have seen is that of Council owned corporations or entities and potential conflicts between duties arising for councillors appointed to these entities (as Board Directors). This dual role situation can give rise to complex conflict of interest issues.

An example of this is where a councillor is nominated by Council as a representative on a corporate board or entity. Due to this position, the councillor will be subject to a range of legal duties under corporations law including to act in the best interests of the company.

In addition to these duties, the councillor will also need to be conscious of their responsiblities to the local government, including that they must serve the overall public interest of the whole local government area.

This situation can give rise to conflicts of interests between the councillor’s responsibilities and duties to each position and in some limited situations, a councillor may be at risk of breaching one or both of their dual responsiblities.

It is crucial that Councils ensure that the duties of councillors appointed to Council Boards or entities, align with their duties as a councillor, including the duty to act in the public interest, in order to limit the potential for conflicts.

In addition, where a councillor receives remuneration for their position on a Board or entity, it is important to remember that they may have a material personal interest under the current legislation which will need to be disclosed.

It is also important that councillors in these positions remain vigilant, recognise the potential for material personal interests or conflicts to arise, seek advice early if there is any uncertainty, and put in place mechanisms to avoid or to sufficiently manage, conflict.

My office has recently developed a framework and meeting aid for multi-member decision-making bodies, including Boards and entities, to assist in identifying and managing conflicts. These materials are available on my website: https://www.integrity.qld.gov.au/publications/education-resources.aspx

I appreciate the challenges faced by councillors in this time of change.

It is my hope that these materials will be helpful to those with dual responsiblities, as well as others designated persons in my jurisdiction.

Remember, having a personal interest is not a bad thing. If we deal with our interests in a transparent and honest way, our communities maintain confidence in Council, councillors and the local government as a whole.

If you want to seek my advice, email me at: integrity.commissioner@integrity.qld.gov.au

Local Government Association of Queensland
LG House, 25 Evelyn Street, Newstead Qld 4006


 

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