Policy: All Circles shall follow the following procedure to process conflicts of interest in the event that a staff member has a financial interest in a transaction or arrangement that is being proposed:

(a) Identifying a Staff Member’s "financial interest:"

A staff member has a financial interest and is considered an "interested person" if the staff member has, directly or indirectly, through business, investment, or family:

(1) an ownership or investment interest in any entity with which the corporation has a transaction or arrangement,

(2) a compensation arrangement with the corporation or with any entity or individual with which the corporation has a transaction or arrangement, or

(3) a potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the corporation is negotiating a transaction or arrangement.

(b) Duty to Disclose

In connection with any actual or possible conflict of interest, a staff member who is an interested person must disclose the existence of the financial interest and be given the opportunity to disclose all material facts to the staff who are considering the proposed transaction or arrangement.

(c) 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 staff member with the potential conflict of interest shall leave the meeting while the remaining staff discuss the matter and determine whether a conflict of interest exists.

(d) Procedures for Addressing the Conflict of Interest

An interested person may make a presentation at the meeting, but after the presentation, they shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest. In order to prevent excess private benefit, staff shall, when feasible, take time to do additional research to determine whether the organization 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. If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the disinterested staff may adopt a proposal - using the usual proposal process - to enter into the transaction. However, unlike with the usual proposal process, any staff member may object to the proposal if he or she believes that the transaction or arrangement is not in the organization’s best interest, or is not fair and reasonable.

(e) Documenting the Conflict of Interest

The meeting notes shall include the name of the staff person who disclosed or otherwise was 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 staffs' decision as to whether a conflict of interest in fact existed. The notes shall also include the names of the persons who were present for discussions and votes 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. The staff may choose to keep particularly sensitive notes in a location separate from where meeting notes are normally kept, in order to allow for candid comments, and to insulate the interested staff person from knowledge of the conversation.

(f) Notifying the Board

If the staff team decides to enter into the transaction or arrangement, they should notify the Board Secretary (or Governance Owl) of the decision and provide her with access to notes on the decision.

(IR)