Review article
https://doi.org/10.31141/zrpfs.2018.55.128.353
Conflict of Interest of sport company administrative members
Ratko Brnabić
; Pravni fakultet Sveučilišta u Splitu, Split, Hrvatska
Abstract
The conflict of interest of the members of the board of sports public limited companies exists with a member of the board who is not neutral in relation to the subject of the decision and may influence the decision-making process based on interests that differ from the interests of the company. The Law on the Prevention of Conflict of Interest defines a conflict of interest as a situation in which a private interest of an official may affect his impartiality in performing public duties.
The conflict of interest should be viewed objectively, so the subjective impression of a member of the board whether there is a conflict of interest is not relevant. When the required preconditions are met, the board member is obliged to notify the other members of the board and the supervisory board of the conflict of interest.
Further, there is no real conflict of interest in the case when only putative conflict of interest exists. Conflict of interest always involves an element of uncertainty because there is simply no room for a presumption that a member of the board of directors will make a decision contrary to the interests of the company. In the first place, this means that there must be a concrete conflict of interest which is not of minor importance. Therefore, on the other hand, the board is not obliged to notify the supervisory board about the existence of conflict of interest which is of lesser importance or when it comes to an abstract conflict of interest.
There is no duty to notify if the supervisory board and the management already know or need to know about the existence of conflicts of interest.
No special level of difficulty (severity) of conflict of interest is required. This threshold of seriousness should not be too high, as this would lead to a situation in which the task of the board members to detect conflicts of interest would only exist in the extreme cases. Some indications of what would fall into conflict of interest can be found in other regulations, for example in the Law on General Administrative Procedure.
Keywords
public limited company; the board; conflict of interests; ban on competition; corporate governance code
Hrčak ID:
199094
URI
Publication date:
19.4.2018.
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