BUSINESS AND PECUNIARY INTERESTS EXPLAINED
When visiting schools auditors are often asked the difference between business and pecuniary interests and exactly who should be making what declarations.
A business interest is the involvement of an individual or their family members in any trade or professions, along with any direct interest they may have in any company providing goods or services to the school. For example, if a Governor runs their own building company or provides training courses for teaching staff. When making a decision about what or what not to declare, the individual should consider how they may be challenged about their decision not to disclose information.
All members of the Governing Body, the Headteacher and any staff who influence financial decisions, are expected to declare any business interests that they or any family member may have. A register of the business interests should be made available in the school and there should be an annual review of this register. In addition, where a Governor or no member of staff has no business interests, they should complete a form saying ‘No interests to declare’. New Governors or members of staff, influencing financial decisions, should be asked to complete a form on joining the relevant Governing Body or school.
It is a common misconception that pecuniary interests are the same as business interests; however, pecuniary interests are a wider term. Pecuniary interests include personal financial interests, such as involvement in a trust fund or investment, as well as potential interests, for example, where a member of staff’s husband is applying for a vacancy in the school or where a teacher Governor is involved in the decision over the promotion of a colleague, and where they may be a potential candidate for the post made available.
Because of the nature of these interests, they cannot only be declared annually. All members of the Governing Body and all members of staff should be made aware at Governor and staff meetings of the need to declare these interests, as they arise. Declarations should be made in writing to the Headteacher or the Chair of Governors of the relevant board and these should be filed in a register of pecuniary interests.
Register of Business Interests
As you will appreciate, the Governing Body must ensure that Governors and staff are not involved in activities that might conflict with their role within the school. It is especially important to demonstrate that individuals do not benefit personally from the decisions made by the Governors, unless such decisions are made openly and legitimately.
The Governing Body is not concerned with any hobbies from which no income is made, or even minor commercial interest that you might have. However, governors must declare any interest they have, or plans they, their spouse partner or a close family member might have, and that are related to or might be construes as being related to the school and its budget.