Mark is a Director of a cleaning company, Shine On Pty Ltd. His brother, Jordan, owns Clean Up Pty Ltd, a company that manufactures chemical products used for cleaning. Jordan’s company is struggling financially due to the pandemic and is not able to sell its products. Jordan offers $50,000.00 to Mark if Shine On Pty Ltd enters an agreement with Clean Up Pty Ltd.

The contract with the current supplier will end soon and Shine On Pty Ltd is considering whether they should continue the contract or find a new supplier. Knowing this opportunity, Mark enters a new supply agreement with Clean Up Pty Ltd although he is aware that the chemical products manufactured by Clean Up Pty Ltd have lower quality than the products currently used by Shine On Pty Ltd. Chloe, another director of Shine On Pty Ltd discovers the situation and threatens to take legal action against Mark.

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Use the IRAC method to advise Mark whether he has breached his director’s duty to avoid conflict of interest.


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