Conflict of Interest Policy

Purpose:

The Conflict of Interest policy is to protect the District’s interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of one of its officers, directors or other members of the District leadership. This policy is intended to supplement, but not replace any applicable state and federal laws or RI and TRF policies governing conflicts of interest.

Conflict of Interest Defined:

For purposes of this policy, a potential conflict of interest is defined as:

1. the actual use of one’s position or association with the District to create personal or private gain, or to provide unwarranted preferential treatment to a third party, outside organization or vendor;
2. conduct that causes or results in the loss of one’s impartiality or independence, such that the operations, best interests or reputation of the District are adversely impacted; or
3. conduct that can cause the District to be legally (or otherwise) vulnerable to criticism, embarrassment, or litigation.

Covered Individual:

All Directors, Committee Chairs, and District Rotary Foundation Committee members, District Grant and International Service Subcommittee members, employees, and any other individuals that exert control over the allocation of the District resources are “covered individuals”.

Responsibilities:

All covered individuals agree to commit their best efforts to the implementation of the objectives of the District and to conduct consistent with the fiduciary responsibilities that he or she bears. Accordingly, all covered individuals agree to avoid those actions or situations that create an actual conflict of interest or the appearance of a conflict of interest.

All decisions by covered individuals on behalf of the District will be made solely on the basis of a desire to advance the best interests of the District and not for personal, professional, or third-party gain. The integrity of the District must be protected at all times. Because covered individuals may be involved in the affairs of other institutions, businesses and organizations, certain relationships and affiliations may raise questions about actual or perceived conflicts of interest. Accordingly, the District requires each covered individual to: (a) be familiar with the terms of this policy; (b) annually disclose to the District on the “Annual Conflicts of Interest Form” any possible personal, familial or business relationships that reasonably might give rise to a conflict involving the District; and (c) acknowledge by his or her signature that he or she is in accordance with the letter and spirit of this policy.

The following definitions are provided to assist covered individuals as to whether a relationship should be listed on the annual disclosure form:

• Business Relationship: One in which a covered individual or a member of his or her family, as defined below, serves as an officer, director, employer, partner, or board member, trustee or controlling stockholder of an organization that does substantial business with the District.
• Family Member: A spouse, parent, sibling, child, or any other relative if the latter resides in the same household as the covered individual.
• Substantial Benefit: When a covered individual, or a member of the covered individual’s family, (a) is the actual or beneficial owner of more than five percent (5%) of the voting stock or controlling interest of an organization that does substantial business with the District; or (b) has other direct or indirect dealings with such an organization from which the covered individual, or a member of their family, benefits directly, indirectly or potentially from cash or property receipts totaling $10,000 or more annually.

Determining Whether a Conflict of Interest Exists:

After disclosure of the conflict of interest and all material facts, and after any discussion with the covered individual, he/she shall leave the governing 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:

1. If the governing board or committee has determined that a conflict of interest exists, the chairperson of the governing board or committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
2. After exercising due diligence, the governing board or committee shall determine whether the District 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.
3. 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 the District’s best interest, for its own benefit.

Persons with Conflict of Interest:

Covered individuals who have been found to have a conflict of interest shall refrain from participating in consideration of proposed transactions unless the District Governor requests information or interpretation for special reasons.

Educational Training about Conflict of Interest Policy:

District needs to provide education to individuals in 6270 leadership roles of what potentials of conflict there are and what impact perception has and the need for transparency. Governance committee would be responsible body for the education on the Conflict of Interest policy. Potential conflicts:

World Affairs Seminar of 6270
Central States Rotary Youth Exchange
Western Great Lakes Multi-District Conference Council
Mid-West President Elect Training Seminar
6270 District Grants with awarding of DDF to clubs
6270 Global Grants Committee
6270 Scholarship Committee
Others to be added as deemed necessary

Recusal:

Individuals need to recuse themselves from voting when a potential of conflict exists. This primarily will be with fiscal matters and decision making. Other conflicts may be identified in the future. Meeting minutes or notes need to reflect that those individuals recused themselves from voting.

Distribution and Collection of Forms:

The distribution of the ‘Annual Conflict of Interest Disclosure Form’ be done by the District Administrative Assistant starting May 1st. The completed and signed Annual Conflict of Interest Disclosure Form must be returned to the District Administrative Assistant or District Secretary, prior to July 1, of the new Rotary year. The Administrative Assistant must do required follow-up to secure forms, they can request others to assistin the collection process. The Conflict of Interest forms will be reviewed by the District GovernanceCommittee to identify potential conflicts.

Forms are to be placed on file by year.

Enforcement of Policy:

On identification of any potential conflict of interest, the District Governance Committee and District Governor shall both be notified. Keeping the District Governor apprised of their work, the governancecommittee shall promptly review the potential conflict, and make a recommendation to the board of directors for action steps to resolve the conflict.