A declaration of interest in board minutes is a formal record that a director has disclosed a personal, financial, or other interest in a matter being considered by the board. Its purpose is to show that the company has identified a potential conflict of interest and has dealt with it properly as part of good corporate governance. A precedent board minutes clause typically refers to a declaration made by written notice or by general notice to the other directors in accordance with the Companies Act 2006 .

What should be included in the board minutes

Board minutes should usually record:

• the name of the director making the declaration
• the nature of the interest being declared
• the transaction, contract, or arrangement to which the interest relates
• whether the declaration was made by specific notice or general notice
• the date of the declaration
• whether the director remained in the meeting, abstained from voting, or left the room, depending on the company’s articles or constitution
• any board decision on how the conflict would be managed

Typical wording to enter in the minutes

A short entry in board minutes might say:

• “The Chair noted that [name of director] declared an interest in the proposed contract with [company/supplier], on the basis that [brief description of interest].”
• “The declaration was noted by the board and recorded in the minutes.”
• “In accordance with the company’s articles, [name] took no part in the discussion or vote on this matter.”

Common scenarios where a declaration may be needed

Typical examples include:

1. Director contracting with the company
   For example, the director is personally selling goods, services, or property to the company .
2. Interest through another business
   For example, the director owns or controls a separate business that is entering into a contract with the company .
3. Family connection
   For example, the company is proposing to hire the director’s spouse, child, sibling, or another connected person, or to buy from or sell to them .
4. Competing business interest
   For example, the director is involved in another business that may benefit from an opportunity the company is considering .
5. General ongoing interest
   A director may give a general notice that they are connected with a particular company and should be treated as interested in future contracts involving that company .

Example board minute paragraph

“[Name of director] declared an interest in the proposed agreement with [name of counterparty], by reason of being [a director/shareholder/partner/spouse of a shareholder] in that entity. The board noted the declaration. In accordance with the company’s articles, [name] did not vote on the matter and left the meeting for the duration of the discussion.”