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Standards of Official Conduct for Deans, Separately Reporting Directors, and Executive Managers

Handbook

This is the handbook for the Standards of Official Conduct for Deans, Separately Reporting Directors, and Executive Managers (the “Policy”).The text in boldface is the text of the Policy, which was adopted by the Board of Trustees on June 18, 2004.The other text explains how the Policy is to be interpreted and implemented.

Section I

PRINCIPLES

Administrators at Michigan State University are expected to abide by the highest ethical standards in discharging their responsibilities for the University, to act in the best interests of the University, to accord the University their primary professional loyalty, and to arrange their other obligations, financial interests, and activities in a manner consistent with these commitments to the University.These Standards of Official Conduct for Deans, Separately Reporting Directors, and Executive Managers (“the Policy”) are adopted to implement these principles.
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This is a fairly strong statement of the employee’s duty of loyalty to his/her employer, which is appropriate because of the responsibilities those who manage the University bear to maintain public trust in the University and to protect its reputation.

Section II

SCOPE

This Policy applies to all individuals who hold positions as deans, separately reporting directors, or executive managers, including the President.In this Policy, these individuals are referred to as “Administrators.”
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1.The President, like the members of the Board of Trustees and unlike other University employees, is a “state officer” under Section 3 of Michigan’s Conflict of Interest statute, MCL 15.301 et seq, and is, therefore, subject to that law.The Policy also applies to the President.

2.The Policy applies to deans, separately reporting directors, and executive managers, including individuals holding those positions on an interim or acting basis, and also to faculty members on special assignment to the Provost’s Office and to offices of other Vice Presidents.

3.Administrators who are faculty members will be subject to this Policy and also to the Faculty Conflict of Interest Policy, when it is adopted, with respect to their research, teaching, and service/outreach responsibilities (i.e., their faculty roles).

Section III

CONFLICTS OF INTEREST

A “conflict of interest” exists when an Administrator’s financial interests or other opportunities for personal benefit may compromise, or reasonably appear to compromise, the independence of judgment with which the Administrator performs his/her responsibilities at the University.

Administrators should be sensitive to potential conflicts of interest.Though Administrators may seek to avoid conflicts of interest, circumstances may arise in which it proves impractical for an Administrator to do so.In those situations, the Administrator must promptly identify and disclose the conflict of interest and comply with the plan for its management or elimination.
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1.Failing to regulate conflicts of interest can undermine public confidence in the University and adversely affect its reputation and ability to achieve its goals.The main purpose of Section III of the Policy is to increase Administrators’ awareness that their private interests may conflict with those of the University and to ensure that, when they do, such situations are disclosed, properly reviewed, managed, and resolved.

2.            Determining whether a conflict of interest exists requires the application of subjective and objective standards.If an Administrator believes, or is concerned, that his/her financial or other private interests will compromise his/her judgment in performing his/her responsibilities at the University, the Administrator should treat the situation as one involving a conflict of interest and make appropriate disclosure.

But even if the Administrator is confident that he/she can separate his/her financial or other private interests from the exercise of his/her judgment, if a reasonable person would question whether the Administrator’s actions or decisions at the University are affected or determined by considerations of personal gain, the Administrator should treat the situation as one involving a conflict of interest and make appropriate disclosure.An Administrator would generally meet this disclosure obligation by identifying any situation where the Administrator’s performance of his/her responsibilities at the University could affect or be affected by a significant financial interest held by the Administrator or a by member of the Administrator’s immediate family, or a significant financial interest held by a relative of the Administrator if the Administrator knows, or reasonably should know, that the relative has the significant financial interest.The terms “significant financial interest”, “member of the Administrator’s immediate family”, and “relative” are all defined in the attached Glossary.

3.An Administrator’s duty to disclose a conflict of interest is described in more detail in Section VI(B) of the Policy.

4.The President is responsible for establishing plans for the management or elimination of other Administrators’ conflicts of interest.See Section VII(A)(1) of the Policy.

Section IV

RULES

In addition to their obligations with respect to conflicts of interest, Administrators shall abide by the following rules.

A.                 Confidential Information.Administrators shall exercise care regarding confidential and proprietary information acquired in the course of their employment at the University.Administrators shall not use or disclose such information for personal gain or benefit.
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1.Definitions and examples of “confidential information” and “proprietary information” are included in the attached Glossary.

2.The main purpose of Section IV(A) is to prevent Administrators from disclosing confidential or proprietary information to persons outside the University in return for a benefit to the Administrator or a relative of the Administrator.“Relative” is defined in the attached Glossary.Section IV(A) is not intended to discourage Administrators from cooperating with the Freedom of Information Office in responding to Freedom of Information Act requests or from complying with court orders, subpoenas, or other legal mandates for the release of information.Nor is Section IV(A) intended to discourage Administrators from sharing information with other University employees who have a legitimate interest in the information, i.e., who need it to perform their duties at the University, or with individuals outside the University when the purpose of sharing the information with those individuals is to benefit the University, e.g., by acquiring information the University needs in return.

B.Outside Influence.No Administrator shall solicit any gift for personal gain or benefit.No Administrator shall accept any unsolicited gift from anyone outside the University, if the gift would tend to influence improperly the manner in which the Administrator performs his/her duties at the University.
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1. “Gift” is defined in the attached Glossary.

2.(a)Section IV(B) does not prevent an Administrator from soliciting any gift on the University’s behalf or on behalf of any organization that exists to benefit the University, e.g., the Michigan State University Foundation and the Green & White PAC (assuming compliance with federal and State laws that prohibit the use of University property and resources for this purpose without full reimbursement by the Green & White PAC), or any organization closely affiliated with the University, e.g., the Michigan State University College of Law and MSU Safe Place.“Property and resources” is defined in the attached Glossary.

(b)Section IV(B) does not prevent an Administrator from soliciting a gift on behalf of another organization in a fund-raising campaign approved by the University, e.g., the annual Capital Area Campaign for the United Way.

3.Section IV(B) prohibits an Administrator from soliciting any gift for himself/herself or for any of his/her relatives from any individual or entity that does business, or, to the best of the Administrator’s knowledge, intends to do business, with the University. “Entity” is defined in the attached Glossary.

4.Section IV(B) prohibits an Administrator from accepting:

(a)an unsolicited gift of money (or of the equivalent of money, e.g., a gift certificate), in any amount, from any individual or entity that does business, or, to the best of the Administrator’s knowledge, intends to do business, with the University; or

(b) any other unsolicited gift from any individual or entity that does business, or, to the best of the Administrator’s knowledge, intends to do business, with the University, if, in the Administrator’s judgment, the gift would tend to influence improperly the manner in which the Administrator performs his/her duties at the University;or

(c) any other unsolicited gift from any individual or entity that does business, or, to the best of the Administrator’s knowledge, intends to do business, with the University if a reasonable person would find that the gift would tend to influence improperly the manner in which the Administrator performs his/her duties at the University.

An Administrator should exercise great caution in accepting any unsolicited gift with a value of over two hundred fifty dollars ($250), especially if the Administrator has accepted any other gift from the same individual or entity within the prior 12 months.But see (5), (6), and (7) below.

Gifts of consumables (e.g., tins/baskets of fruit, candy, cookies, nuts, cheese) should generally be shared with others in the Administrator’s office or unit.

5.(a) Section IV(B) does not prohibit an Administrator from accepting meals and entertainment (i) provided without charge to all those at meetings the Administrator attends as part of his/her University duties; or (ii) from anyone outside the University if the meals and entertainment are obtained in the course of the Administrator’s institutional advancement, fund-raising, or development activities on behalf of the University.

(b)Section IV (B) does not prohibit an Administrator from attending, in connection with his/her University duties, a reception (e.g., a Christmas party or a reception at a conference) that is sponsored by an individual or entity that does business or intends to do business with the University and at which food and entertainment typical to business receptions are provided without charge.

6.            Occasionally, an Administrator will be called upon to exchange gifts or to receive a gift as part of his/her University responsibilities, particularly when traveling abroad or receiving visitors from abroad.Many such gifts will be of minimal value, but some will not.It is important that Administrators be respectful of the practices of other cultures in such situations.An Administrator who receives a gift of property worth more than two hundred fifty dollars ($250) in such situations, or otherwise in the course of his/her University duties when it would be discourteous or awkward for him/her to reject or return the gift, does not violate Section IV(B) if he/she promptly:

(a)buys it from the University for its fair market value; or

(b)submits it to a University unit (e.g., WKAR, Surplus) which accepts it for sale in one of the periodic sales or auctions of merchandise conducted by that unit; or

(c)otherwise sees that it is used for a University purpose or to benefit the University, rather than for the Administrator’s personal benefit.

7.            Section IV(B) does not prevent an Administrator from receiving gifts from relatives of the Administrator, even if the relative does, or intends to do, business with the University, provided that the Administrator complies with the rest of the Policy, especially Sections V and VI.“Relative” is defined in the attached Glossary.

C.Use of Authority, University Resources.

1.No Administrator shall use University property or resources, or his/her authority or title at the University, to obtain or provide others with a private benefit which is inconsistent with the University’s interests, nor shall any Administrator personally profit, or cause others to profit, by trading on his/her University position or authority.

2.Administrators shall not represent their personal opinions as those of the University.
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1.            “Property and resources” is defined in the attached Glossary.

2. Private use of University property and resources is not prohibited by Section IV(C)(1) if (a) it is part of the Administrator’s remuneration; or (b) the private use would not adversely affect the availability of the property and resources for University activities, and (i) the University is reimbursed for the private use by the Administrator at fair market value for the benefit received by the Administrator, or (ii) the private use is a de minimis, incidental use which imposes no, or little, additional cost or expense on the University.

3.The prohibition against trading on University position or authority in Section IV(C)(1) prevents an Administrator from giving, or stating/implying that he/she will give, any individual or entity an advantage of any kind in doing business with the University in return for a personal benefit to the Administrator or a relative of the Administrator.“Relative” and “entity” are defined in the attached Glossary. For a similar concept, see the Faculty Rights and Responsibilities policy: “Faculty members have the responsibility not to abuse their standing within the University for personal or private gain.”

4.In applying Section IV(C)(2), note the following text from the Faculty Rights and Responsibilities policy: “When the situation warrants, faculty members acting or speaking as citizens have a responsibility to make clear that these actions or utterances are entirely their own and not those of the University or any component of the University.”Administrators have the same responsibility.

D.Conflicting or Incompatible Service.No Administrator shall render paid or voluntary services on behalf of any individual or entity, whether public or private, for-profit or not-for-profit, other than the University, when those services: (1) would be incompatible or in conflict with the discharge of that Administrator’s duties at the University; or (2) would require that Administrator to disclose, to the University’s detriment, confidential or proprietary information acquired in the course of his/her employment at the University.
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Regarding Section IV(D), the University recognizes that its Administrators have interests and activities outside the University and that both the University and the community benefit greatly from their involvement in these interests and activities.Therefore:

1. Section IV(D) does not apply if the Administrator has been assigned by the University to render services to or for an individual or entity or if the University recognizes the Administrator as the University’s representative on the entity.“Entity” is defined in the attached Glossary.

2.Absent special circumstances, the following are not prohibited by Section IV(D):

(a)    service by the Administrator to or for entities (i) which exist to benefit the University, e.g., the Michigan State University Foundation and the Green & White PAC (assuming compliance with federal and State laws that prohibit the use of University property and resources for this purpose without full reimbursement by the Green & White PAC); or (ii) which are closely associated with the University, e.g., Michigan State University College of Law; the University Club of Michigan State University; Mid-Michigan MRI, Inc.; University Rehabilitation Alliance, Inc.; Radiation Oncology Alliance; and Great Lakes Cancer Institute; or

(b)service by the Administrator to or for any professional association of which the Administrator or the University is a member; or

(c)participation by the Administrator in advisory or peer review processes for government agencies, accreditation agencies, other educational institutions, or foundations; or

(d)service by the Administrator as an editor, an editorial board member, or a reviewer for a professional journal.

This is not an exclusive list.“Property and resources” is defined in the attached Glossary.

3.Many potential conflict situations involving board membership on other entities can be satisfactorily resolved by the traditional devices of disclosure and nonparticipation: the Administrator discloses the potential conflict to the University and to the entity when accepting the board membership and does not participate in the consideration of, or vote on, any matter involving a potential conflict between the entity and the University.Management of occasional conflicts through the use of these devices is particularly appropriate when the University, in general, benefits from the Administrator’s service on the other entity’s board.

4.Some situations require special care.These include:

(a)          when the services the Administrator will undertake on behalf of the other entity include institutional advancement, fund raising, or development, particularly if the institutional advancement, fund-raising, or development activities will involve contact with individuals or entities with whom the Administrator also has contact in fulfilling his/her University duties; or

(b) if the Administrator’s title at the University will receive special emphasis or visibility (more than what is normal or necessary for purposes of identification) in connection with the services the Administrator is performing for the other entity; or

(c)if the Administrator may be perceived as the University’s representative or spokesperson on the entity, but is not performing that function on behalf of the University.

In these situations and any others in which the Administrator is concerned that her/his services to another individual or entity might conflict with the standards included in Section IV(D), the Administrator should consult with the Administrator to whom she/he reports prior to undertaking the service.

5.Administrators who render paid services to any individual or entity other than the University must also comply with applicable University policies relating to outside work for pay/conflict of commitment.

6.Definitions and examples of “confidential information” and “proprietary information” are included in the attached Glossary.

E.           Competition with University.No Administrator shall knowingly compete with the University for any property, asset, or opportunity needed by the University.

F.Diversion of Opportunities.No Administrator shall divert an opportunity which may be of interest to the University to another individual or entity for the Administrator’s personal gain or benefit or for the gain or benefit of any relative of the Administrator unless the University has been informed of the opportunity on a timely basis and has declined to act on it.

Sections IV(E) and (F) address different aspects of the same principle.For example, an Administrator should not purchase—Section IV(E), or profit by advising others of an opportunity to purchase—Section IV(F), real property abutting the University, unless the Administrator has verified that the University has no interest in purchasing that property at that time.The same would be true of other unique investment opportunities (e.g., purchasing stock in a start-up that licenses intellectual property from the University) which the Administrator wishes to pursue.Sections IV(E) and IV(F) apply only to prospective purchases of property and assets, and to other investment opportunities, in which the Administrator knows, or reasonably should know, the University might be interested and which the University could not easily replicate.For example, an Administrator’s purchase of marketable securities should not affect the University’s ability to purchase securities in the same entity, even if the Administrator knows the University is planning to make a similar investment.But, an Administrator cannot try to acquire the last available shares in an IPO if he/she knows the University is seeking these shares and others are not available on the same terms obtained by the Administrator.

“Entity” and “relative” are defined in the attached Glossary.
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Section V

CONTRACTS WITH THE UNIVERSITY

A.Prohibitions.An Administrator shall not directly or indirectly solicit, take any part in approving, take any part in negotiating, renegotiating, or amending, or in any other way represent any party to, any contract between the University and

1. the Administrator; or
2.a relative of the Administrator; or
3.any corporation, partnership, unincorporated association, trust, or estate in which the Administrator has a significant financial interest; or
4.any corporation, partnership, unincorporated association, trust, or estate in which the Administrator knows or reasonably should know that a relative of the Administrator has a significant financial interest.
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1.Administrators in direct contact with suppliers or potential suppliers to the University, or who have direct or indirect control or influence over purchasing decisions or contracts, or who otherwise have official involvement in the purchasing or contracting process, should exercise special care to comply with Section V of the Policy.

2.The prohibitions in Section V(A) are procedural.Section V(A) does not prohibit any individual or entity listed in Section V(A) from entering into a contract with the University, as long as the Administrator keeps his/her distance from the transaction, as mandated by Section V(A), and other applicable legal and Policy requirements are met.See Section V(B) of the Policy, for example.

3.Section V(A) is not intended to prevent an Administrator from representing himself/herself in negotiating the terms of his/her employment at, or separation from, the University, including any employment contract or separation agreement between the Administrator and the University.Nor is Section V(A) or any other provision of the Policy intended to limit any Administrator’s ability to represent the University in any way in connection with any contract for or relating to employee benefits at the University, or to manage or administer employee benefit plans atthe University, solely because the Administrator or a relative of the Administrator will or could benefit from that contract or plan as a University employee.

4.“Relative”, “entity”, and “significant financial interest” are defined in the attached Glossary.

B.Board Approval.Administrators shall take all steps necessary to assist the University to comply with the State law requiring Board approval of contracts between the University and the Administrator or between the University and entities in which the Administrator has a financial interest specified by the State law.

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1.Under the Michigan statute entitled “Contracts of Public Servants with Public Entities,”MCL 15.321 et seq., a contract between the University and any of the following requires Board of Trustees approval:

(a)an Administrator; or
(b)         any firm, meaning, in this case, a partnership or unincorporated association, of which the Administrator is a partner, member, or employee; or(
c)any private corporation of which the Administrator is (i) a director, officer, or employee; or (ii) a stockholder owning more than one percent (1%) of the total outstanding stock of any class if the stock is not listed on a stock exchange or stock with a total market value in excess of $25,000 if the stock is listed on a stock exchange; or
(d)any trust of which the Administrator is a beneficiary or trustee.

In obtaining the Board’s approval, the pecuniary interest of the Administrator in the contract is publicly disclosed to the Board of Trustees. The disclosure is made a matter of record in the Board’s official proceedings.

After this notice has been given to the Board, the Board votes whether to approve the terms of the contract at a subsequent formal session of the Board.A vote of at least two-thirds (2/3) of the full membership of the Board is required to approve the contract.The following are made part of the official record of the Board meeting at which the vote is taken:the name of each party to the contract; the nature of the employee’s pecuniary interest in the contract; the duration of the contract; the financial consideration between the parties to the contract; a description of any use of University facilities or services pursuant to the contract; and a description of any work to be performed by University employees assigned to fulfill the University’s obligations under the contract.

2.When Board of Trustees approval of a contract may be required by State law, the relevant Administrator should contact the Office of the General Counsel to receive guidance and, if necessary, assistance in preparing the materials to present to the Board to obtain its approval.Because of the Board’s meeting schedule, obtaining the requisite approval from the Board will generally take at least 60 days.

3.Unless otherwise required by University policy or applicable law, Board approval is not sought if the relevant contract:

(a) is between the University and any entity to which the University has assigned the Administrator to act as a board member, or otherwise to render services; or

(b)         is an employment or separation agreement between the University and the Administrator.

“Entity” is defined in the attached Glossary.

4.The University does not generally construe a gift or grant as a contract for purposes of compliance with this State law.

Section VI

REPORTING

A.Disclosure of Significant Financial Interests.Each year a questionnaire shall be distributed to each Administrator asking the Administrator to provide information about organizations that do business, or intend to do business, with the University and in which the Administrator or members of the Administrator’s immediate family have afinancial interest prescribed in the questionnaire.Each Administrator shall provide the requested information.
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1. Since each Administrator is responsible to disclose conflicts of interest in which he/she becomes involved (see Sections III and VI(B)(1) of the Policy), a major purpose of the circulation of the annual questionnaire pursuant to Section VI(A) is to give each Administrator an opportunity to consider potential conflicts of interest and how best to avoid them.

2.The Internal Audit Department will compile and collect the questionnaire.

3.A definition and explanation of the phrase “member of the Administrator’s immediate family” is included in the attached Glossary.

4.The questionnaire is distributed once each year, at the beginning of the academic year.An Administrator whose financial interests change during the succeeding year has no obligation to update the information provided in response to the questionnaire.New or increased financial interests may trigger immediate obligations for the Administrator under other Sections of the Policy, however.See, for example, Sections III, V(A), V(B), and VI(B) of the Policy.

5.To the extent permitted by law, the University shall seek to preserve the confidentiality of private financial and other private information disclosed by an Administrator in response to the annual questionnaire or in connection with the review, management, and resolution of conflicts of interest involving that Administrator.See Section VI(B) of the Policy.

Nonetheless, it is possible that the University may be compelled to release some or all of the information disclosed by the Administrator if that information is included in records which are sought pursuant to Michigan’s Freedom of Information Act.The University may also have to release the information in response to a subpoena or a court order, or as part of the discovery process in a litigation.

B.Disclosing Conflicts of Interest.

1.Disclosure of conflicts of interest is the responsibility of the Administrator who becomes involved in activities that may be in conflict.The Administrator shall make disclosure to the Administrator to whom he/she reports as soon as he/she becomes aware of the situation that gives rise to the conflict of interest, except that the President shall make such disclosure to the Chairperson of the Board of Trustees.An Administrator who has questions about a possible conflict of interest, or about compliance with other parts of this Policy, should direct them to the same individual.

2.In considering possible conflicts of interest, Administrators should err on the side of disclosure.It is the role of the University, not the Administrator, to decide whether the disclosed interest constitutes a conflict of interest and, if it does, how best to address it.­­­­­­­­­­­­­­­­­________________________________________________________

1.Regarding Section VI(B)(1), Vice Presidents and other Administrators who report directly to the President should disclose conflicts of interest to the President. Deans and other academic Administrators should make disclosure to the Provost.Other Administrators should make disclosure to the Vice Presidents to whom they report.If any Administrator feels that it would be inappropriate to disclose a conflict of interest to the Administrator to whom he or she reports because that individual shares the conflict or has another conflict, the Administrator may seek advice on how to proceed from the General Counsel or from the Associate Provost and Associate Vice President for Academic Human Resources.

2.Administrators (other than the President) who receive conflict of interest disclosures or questions about conflicts of interest should advise the President of such disclosures and questions before responding to them.

3.(a)If an Administrator is concerned that he/she might have a conflict of interest, he/she should bring it to the attention of the Administrator to whom he/she reports.

(b)Even if Administrators are confident that their financial and other private interests will not impair the independence of judgment with which they perform their duties at the University, they are urged to make disclosure when they are concerned that others might question the propriety of their behavior or the motivation for their conduct.

4.Although the judgment about what to report as a potential conflict of interest lies first and foremost with the Administrator, the University is ultimately responsible for deciding whether a conflict of interest exists in a given situation, and, if it does, how it should be managed and resolved.Administrators are reminded that the existence of a conflict of interest must be measured by objective, as well as subjective, standards.See (2) under Section III above.

5.When disclosing a conflict of interest, the Administrator must provide sufficient information about the conflict to ensure that its nature and scope are understood.

C.Complaints.The University shall establish a process for receiving reports, including anonymous reports, of undisclosed conflicts of interest and other violations of this Policy by Administrators.

The University is in the process of establishing a toll-free 24 hour voice message hotline for fraud and financial misconduct, including violations of the Policy.The Internal Audit Department will monitor the hotline. ________________________________________________

Section VII

IMPLEMENTATION

A. Authority.The President shall be responsible for implementing this Policy for all other Administrators, and thus has authority with respect to such Administrators to:

1.determine whether a conflict of interest exists and, if it does, establish a plan for its management or elimination;

2.designate appropriate individuals to investigate alleged violations of this Policy and report back to him/her;

3.decide whether an Administrator has violated this Policy;

4. institute disciplinary action for any such violation; and

5. delegate any of these tasks to the Provost or the Vice President for Finance and

Operations on a case-by-case basis.

The Chairperson of the Board shall review any issues relating to the implementation of this Policy with respect to the President and report to the Board about the results of such review.

1.Regarding Section VII(A)(1), the President may employ a variety of techniques for the management or elimination of an Administrator’s conflicts of interest.While disclosure is often sufficient to resolve conflicts of interest involving faculty, it is less likely to be the sole means of resolving an Administrator’s conflict.Other techniques for addressing an Administrator’s conflict of interest might include monitoring of the conflict situation by another Administrator; disqualifying the Administrator from participating in all or part of the situation that gives rise to the conflict; instructing the Administrator to divest the financial interest, or to sever the relationship, that gives rise to the conflict; or instructing the Administrator not to undertake the activity that gives rise to the conflict.

2.Regarding Section VII(A)(2), individuals designated by the President to conduct or participate in an investigation of a reported conflict of interest may include representatives of the Internal Audit Department, of the Office of the General Counsel, or of other University offices, or outside professionals, depending on the circumstances.Members of the University community are expected to cooperate in such investigations.

3.Regarding Sections VII(A)(3) and VII(A)(4), if the President determines that an Administrator violated the Policy, the President will take such steps as are necessary and appropriate to respond to and remedy the situation.The President may also take appropriate disciplinary action.See Section VIII of the Policy.

B.Handbook.A handbook explaining and interpreting this Policy shall be prepared and made available to Administrators.

This Section of the Policy is self-explanatory.This is the handbook to which the Policy refers.

C.Annual Certification.Each Administrator will affirm annually that he/she has complied with this Policy during the previous year and will comply with this Policy during the next year.

1.Since each Administrator is responsible under Section VI(B)(1) of the Policy to disclose conflicts of interest in which he/she becomes involved, the main purpose of the annual affirmation is to remind each Administrator of the Policy and his/her obligations under it, and to give each Administrator an opportunity to consider his/her financial and other personal interests and how they might trigger conflicts.In other words, it provides an occasion for an annual self-examination on a set of issues which is the subject of public concern and scrutiny.

2.The annual certification will be collected by the Internal Audit Department as part of the annual questionnaire.See Section VI(A) above.

D.Annual Report.The President shall make an annual report to the Finance and Audit Committee of the Board of Trustees on the implementation of this Policy during the previous year.

The Finance and Audit Committee receives this report in connection with its oversight of the University’s financial processes and internal controls.

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Section VIII

SANCTIONS

Administrators who violate this Policy are subject to disciplinary action, up to and including discharge.
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No University policies prescribe procedures which must be followed before deans, directors, or executive managers may be discharged from these positions.A serious and intentional or reckless violation of the Policy by an Administrator who is also a tenured faculty member could form the basis for that Administrator’s dismissal for cause from the University, but only after the University complies with the Dismissal of Tenured Faculty for Cause policy.

PLEASE NOTE:The Standards of Official Conduct for Deans, Separately Reporting Directors, and Executive Managers do not change, supersede, or substitute for other University policies governing conduct of Administrators.For example, an Administrator should be familiar with the Conflict of Interest in Employment policy if any of his/her relatives are employed by the University.“Relative” is defined in the attached Glossary.

GLOSSARY

“Confidential information” means information/records whose public disclosure is restricted by law, contract, University policy, professional code, or practice within the applicable discipline or profession.Examples of information/records that are typically or often confidential include patient records; most student records and personally identifiable information about students; medical information about employees; social security numbers; human subject research records; certain financial information provided to the University in connection with a potential investment by the University; and letters of reference for appointment, reappointment, promotion, and tenure recommendations for faculty.

“Entity” means any corporation; limited liability company; partnership; limited partnership; joint venture; sole proprietorship; firm; franchise; association; organization; holding company; joint stock company; foundation; receivership; business, real estate, or other trust; estate; or other legal entity, however organized, private or public, for-profit or not-for-profit, but excluding the University or any entity controlled by or affiliated with the University.

“Gift” includes any good, property, service, loan, or other thing of value for which the Administrator pays less than its fair market value, as well as any good, property, service, loan, or other thing of value which the Administrator receives free of charge.“Gift” includes the promise to make or provide a “gift” in the future.

“Member of the Administrator’s immediate family” means the Administrator’s spouse or domestic partner, minor children, and any relative who resides with the Administrator or who is the Administrator’s dependent for tax purposes.This definition is limited to those relatives about whose significant financial interests an Administrator can reasonably be expected to know.

“Property and resources” include facilities, supplies and material, equipment, personnel, and intellectual property.

“Proprietary information” means information or data with potential commercial value, whose value would be lost or reduced by disclosure or by disclosure in advance of the time prescribed for its authorized public release, or whose disclosure would otherwise adversely affect the University financially.Examples of proprietary information include non-patentable technical information or know-how that enhances the value of a patented invention or that has independent commercial value, or information about the University’s intention to buy, sell, or lease property whose disclosure would increase the cost of that property for the University or decrease what the University realizes from that property.

“Relative” is a connection between the Administrator and another person by blood, marriage, adoption, domestic partnership, or cohabitation, or an intimate relationship in which objectivity might be impaired.This definition is based upon, and essentially conforms to, the definition of “relative” in the University’s Conflict of Interest in Employment policy.

“Significant Financial Interest” means:

(a)anything of monetary value, including, without being limited to, payments relating to services (e.g., salary, commissions, consulting fees, or honoraria), equity interests (e.g., stock, stock options, or other ownership interests), beneficial interests (e.g., as a beneficiary of a trust or estate), indebtedness (e.g., loans, mortgages), and intellectual property rights (e.g., patents, copyrights, and royalties from such rights), EXCEPT:

(i)      salary, royalties, or other remuneration from the University or paid for or on behalf of the University (including remuneration from a University-approved practice plan); or

(ii)income from seminars, lectures, or other educational activities sponsored by public or not-for-profit entities; or

(iii) income from service on advisory committees or review panels for public or not-for-profit entities; or

(iv)        any financial interest of any amount arising solely by means of investment in a mutual, pension, or other institutional investment fund over whose management and investments neither the individual in question nor a member of his/her immediate family exercises control (e.g., TIAA-CREF); or

(v)          an equity interest that, when aggregated for the individual in question and the members of his/her immediate family and any entity that one or more of them owns or controls, is worth less than $10,000 (as determined through reference to market prices or any other reasonable measure of fair market value) and also does not constitute more than a five percent (5%) ownership or voting interest in any single publicly traded entity or more than a one percent (1%) ownership or voting interest in any single non-publicly traded entity; or

(vi)              salary, royalty, and other payments of any kind from a single entity that, when aggregated for the individual in question and the members of his/her immediate family and any entity that one or more of them owns or controls, did not exceed $10,000 during the last 12 months and are not anticipated to exceed $10,000 during the next 12 months; or

(vii)             indebtedness of any kind to or from a single entity that, when aggregated for the individual in question and the members of his/her immediate family and any entity that one or more of them owns or controls, does not exceed $10,000; or

(viii)           a mortgage on a residence, or a car loan, or credit card debt, or a student or college loan, in any amount, from a bank, credit union, or other commercial lender; or

 

(b)         service as an officer, director, trustee, partner, or in any fiduciary or managerial role, or on a governing or advisory board, for:

(i) any for-profit entity,whether or not remuneration is received for such service; or

(ii)any not-for-profit entity, if remuneration in any amount is received for such service (remuneration does not include reimbursement for expenses or indemnification or insurance for that service); or

(c)service as a trustee, executor, or personal representative for any trust or estate.

The definition of “significant financial interest” is based in large part on the definition of that term in the University’s “Guidelines for Potential Conflicts of Interest Pertaining to Applications for NSF and PHS Research Support” and on the State law referenced in Section V(B) of the Policy and described in Section V(B)(1) of this handbook.

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