Conflict of Interest Policy
POLICY 1.21 CONFLICTS OF INTEREST
Article I - Purpose
The purpose of the conflict of interest policy is to protect Tri-County Humane Society’s interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer, director, employee or volunteer of the Corporation or might result in a possible excess benefit transaction. This policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and charitable organizations.
Article II - Definitions
Interested Person: Any Director, principal officer, employee, volunteer or member of a committee with Board delegated powers, who has a direct or indirect financial interest, as defined below, is an interested person.
Financial Interest: A person has a financial interest if the person has, directly or indirectly, through business, investment, or family:
a. An ownership or investment interest in any entity with which Tri-County Humane Society has a transaction or arrangement,
b. A compensation arrangement with Tri-County Humane Society or with any entity or individual with which Tri-County Humane Society is negotiating a transaction or arrangement.
c. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which Tri-County Humane Society is negotiating a transaction or arrangement.
Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial.
A financial interest is not necessarily a conflict of interest. Under Article III, Section 2, of this Policy a person who has a financial interest will have a conflict of interest only if the appropriate governing Board or Committee decides that a conflict of interest exists.
Article III - Procedures
Duty to Disclose: In connection with any actual or possible conflict of interest, an interested person must disclose the existence of the financial interest and be given the opportunity to disclose all material facts to the Directors, Officers and members of Committees with Board delegated powers considering the proposed transaction or arrangement.
Determining Whether a Conflict of Interest Exists: After disclosure of the financial interest and all material facts, and after any discussion with the interested person, the interested person shall leave the Board or Committee meeting while the determination of a conflict of interest is discussed and voted upon. The remaining Board or Committee members shall decide if a conflict of interest exists.
Procedures for Addressing the Conflict of Interest: Once a conflict of interest has been determined to exist
a. An interested person may make a presentation at the Board or Committee meeting, but after the presentation, the interested person shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest.
b. The chairperson of the Board or Committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
c. After exercising due diligence, the Board or Committee shall determine whether Tri-County Humane Society can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest.
d. If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the governing Board or Committee shall determine by a majority vote of the disinterested Directors whether the transaction or arrangement is in Tri-County Humane Society’s best interest, for its own benefit, and whether it is fair and reasonable. In conformity with the above determination it shall make its decision as to whether to enter into the transaction or decline to do so.
Violations of the Conflicts of Interest Policy:
If the Board or Committee has reasonable cause to believe a person covered by this Policy has failed to disclose actual or possible conflicts of interest, it shall inform the person of the basis for such belief and afford the person an opportunity to explain the alleged failure to disclose.
If, after hearing the person’s response and after making further investigation as warranted by the circumstances, the Board or Committee determines the person has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.
Article IV -Records of Proceedings
The minutes of Board and all Committees with Board delegated powers shall contain:
a. The names of the persons who disclosed or otherwise were found to have a financial interest in connection with an actual or possible conflict of interest, the nature of the financial interest, any action taken to determine whether a conflict of interest was present, and the Board’s or Committee’s decision as to whether a conflict of interest in fact existed.
b. The names of the persons who were present for discussions relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings.
Article V - Compensation
a. A Director of the Board who receives compensation, directly or indirectly, from Tri-County Humane Society for services is precluded from voting on matters pertaining to that person’s compensation.
b. A voting person of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from Tri-County Humane Society for services is precluded from voting on matters pertaining to that person’s compensation.
c. No Director of the Board or a voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from Tri-County Humane Society, either individually or collectively, is prohibited from providing information to any committee regarding compensation.
Article VI: Annual Statements
Each director, principal officer, and member of a committee with board-delegated powers annually shall sign an acknowledgement and disclosure form that:
a. Affirms that such person has received and reviewed a copy of the conflict of interest policy and agreed to comply with its terms;
b. Requires that such person disclose any Financial Interest in or Fiduciary Responsibility towards any entity such person believes may enter into a proposed transaction with Tri County Humane Society in the upcoming year.
(Approved 11/22/94) (Effective 11/22/94) (Approved 7/22/03) (Approved 5/26/09) (Approved 2/28/17) (Amended and approved 03/28/2017) (Approved 11/28/2017)
