Record transaction and people
Keep the documents and decision for this step in order.
Take the next step only after legal and factual review.
Foundation board
Conflict of interest on a private foundation board: recusal and approval
A conflict of interest on a private foundation board requires clear recusal, approval and decision records.
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Your matter is handled by a team combining corporate law, asset succession, real estate law and dispute resolution. We review the foundation declaration, board resolutions, information rights and liability issues and set out clear next steps. Mag. Bernhard Brandauer is responsible for the legal advice, supported by further specialised lawyers of the firm where the matter requires it.
11 August 2026, Mag. Bernhard Brandauer, Rechtsanwalt
A conflict of interest on a private foundation board does not automatically make a decision impossible. It does require a precise review: who is affected, what transaction is involved, which body is competent and what approval follows from statute or deed?
The affected person cannot resolve the issue with a formula in the minutes. Recusal, access to information, resolution and closing must align.
This article focuses on the process for a concrete conflict and separates the board issue from general beneficiary and remuneration questions.
Describe the conflict precisely
Describe the conflict precisely
A conflict may arise from personal involvement, family proximity, a personal claim or a related company. The label is less important than the concrete overlap between board duty and personal interest.
The board should record the transaction, benefit, people involved and alternatives. This makes it possible to review whether recusal and approval were handled correctly.
Recusal and access to information
Recusal and access to information
Recusal does not necessarily exclude the affected person from all information. Scope and timing must match the purpose of the review and the decision.
Minutes should record who participated in discussion and vote, which documents were considered and whether the affected person could present relevant facts before recusal.
Section 17(5) PSG and approval
Section 17(5) PSG and approval
For transactions between the foundation and a board member or related person, section 17(5) PSG requires particular attention. The statutory test, approving body and form cannot be inferred from a general internal policy.
Approval does not replace economic review. The transaction must still fit the foundation purpose and must not favour one interest without a defensible reason.
Resolution, closing and record
Resolution, closing and record
A conflicted transaction needs one complete file: facts, deed, value, alternatives, recusal, approval, resolution and implementation. Missing records are difficult to recreate after payment.
Follow-up includes payments, performance, later changes and complaints. Repeated transactions should not be covered by a generic blanket formula.
Conflict matrix
Recusal and approval serve different functions
The steps complement but do not replace each other.
| Review field | Function | Record |
|---|---|---|
| Recusal | Remove personal interest from vote | minutes |
| Approval | Statutory or deed-based control | approval resolution |
| Reasons | Show purpose and alternatives | decision file |
Important: The specific deed and complete facts are decisive. A general template cannot replace a resolution or deed review.
Review sequence
From the basis to a reliable implementation
A fixed sequence prevents implementation from overtaking an open legal question.
- 01Step 101Step 1
- 02Step 202Step 2
Clarify conflict and recusal
Keep the documents and decision for this step in order.
Take the next step only after legal and factual review.
- 03Step 303Step 3
Determine approval route
Keep the documents and decision for this step in order.
Take the next step only after legal and factual review.
- 04Step 404Step 4
Record the resolution
Keep the documents and decision for this step in order.
Take the next step only after legal and factual review.
- 05Step 505Step 5
Monitor implementation
Keep the documents and decision for this step in order.
Take the next step only after legal and factual review.
Initial assessment
Conflict of interest on a private foundation board: recusal and approval
Two answers show whether the file is ready for the next step.
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Is the legal basis for this step fully documented?
All paths at a glance
Overview of all answers.
Implementation can be prepared on a documented basis.
Reconcile the resolution, documents, authority and implementation once more.
Complete the basis before implementation.
Secure the current deed, relevant resolutions and complete facts.
Frequently asked questions
Conflict of interest on a private foundation board: recusal and approval
Must a board member leave every conflict discussion? +
It depends on the transaction and required participation. Recusal, information and voting must be organised under the applicable rule.
Is recusal enough without approval? +
No, where statute or deed requires additional approval. Recusal and approval serve different functions.
What belongs in the minutes? +
The facts, people, documents, participation, recusal, vote, approval and reasons should be traceable.
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Related topics and next reviews
Topics
private foundationfoundation deedfoundation boardbeneficiaryPSGresolutionrecords
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