The Committee considered a report that introduced a standalone Conflict of Interest Policy that had been developed in response to the recently introduced Failure to Prevent Fraud offence under which the Council might be held criminally liable if it failed to prevent fraud that had been committed by employees or associated persons. The Draft Conflict of Interest Policy was attached to the report at Appendix 1.

The report explained that under the Failure to Prevent Fraud offence, that had been introduced in September 2025, the Council might be held criminally liable if it failed to prevent fraud that had been committed by employees or associated persons, unless it could demonstrate that reasonable and proportionate fraud prevention procedures were in place. This included having clear governance frameworks, effective monitoring and documented controls to mitigate the risk of prosecution and reputational damage. A key area of concern had been the management of employee conflicts of interest.  Currently, staff Declarations of Interest were not renewed annually. This created a risk that new business interests, secondary employment, or personal relationships might go undisclosed, leaving the Council exposed to allegations of bias or impropriety. Without regular updates it would become difficult to evidence compliance with statutory requirements and to defend decisions if challenged. To address this a standalone Conflict of Interest Policy, that built on current expectations in the Code of Conduct, had been created to reflect the Council’s obligations under the Failure to Prevent Fraud offence. Declaration of Interest submissions would be mandatory on an annual basis for all staff, regardless of whether circumstances had changed or not. Staff would also be required to update their declaration immediately if a new interest arose. This would enable the Council to demonstrate proactive compliance with the new legislation, strengthen transparency and reduce the Council’s exposure to fraud, corruption and procurement risks. It would also create a clear audit trail evidencing that the Council had taken reasonable steps to prevent conflicts and misconduct, thereby protection both staff and the organisation.

Finally, the report stated that process changes would be made upon approval of the Policy by Personnel Committee and a communications campaign was under development to ensure its implementation.

Resolved:    That the creation of a standalone Conflict of Interest Policy that built on the current provision in the Code of Conduct, to reflect recent legislative changes, be noted.