I. Conflict of Interest – Trustees

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I. Conflict of Interest – Trustees

  1. Scope. This policy applies to all members of the University System of New Hampshire Board of Trustees. The term University System of New Hampshire (“USNH”) includes the USNH Chancellor’s Office, Granite State College, Keene State College, Plymouth State University, the University of New Hampshire, including the University of New Hampshire School of Law.
  2. Fiduciary Responsibilities.
    1. Trustees of USNH serve the public trust and are required to fulfill their responsibilities with care and loyalty. All decisions and actions of the board are to be made for the sole purpose of advancing the best interests of the institution and the public good. The integrity of USNH must be protected at all times, and the fiduciary relationship of trustees of USNH must be respected in both actuality and appearance.
    2. A conflict of interest exists when a trustee's direct or indirect personal interests are inconsistent with or interfere in any way with the best interests of USNH.
    3. Through this policy, the Board of Trustees intends to implement the highest possible ethical standards and to establish that it will not tolerate conflicts of interest. The Board, through its Governance Committee, will administer this policy strictly, with complete transparency, and in accordance with the following principles:
      1. In general, it is the policy of USNH that it will not engage in business or financial relationships with trustees.
      2. No business or financial relationship between USNH and any trustee, or a member of his or her immediate family, or any entity with which a trustee or a member of his or her immediate family is affiliated, will be permitted unless it has been thoroughly reviewed and considered by the Governance Committee and has been found to be of clear benefit to the University.
      3. No trustee, or a member of his or her immediate family, may knowingly invest directly in any business, investment fund, limited partnership, separate account, commingled account, mutual fund, or other vehicle ("Investment Vehicle") in which USNH has a material financial interest. Except with the prior approval of the Governance Committee, USNH will not knowingly invest directly in an Investment Vehicle in which a trustee or officer, or a member of his or her immediate family, has a material financial interest. For purposes of this provision, "material financial interest" means a role as general or managing partner, management-level employee, owner or sponsor of the investment firm, or an ownership interest of greater than 5% in the Investment Vehicle.
      4. Any offer of full-time USNH employment to a member of the immediate family of a trustee is subject to the prior review and approvals of the Chancellor and the Chairman of the Governance Committee.
      5. Any trustee who serves at USNH's request as a director or trustee of another organization shall turn over to USNH any compensation received from such other organization for such service.
  3. Procedures. As outlined below, effective implementation of this policy requires, first, the full disclosure of individual interests that might conflict with the best interests of USNH (see, 3.1, below). Second, the interested trustee must refrain from participating in USNH decision making with respect to any transaction or relationship in which he or she is interested (see, 3.2, below). Finally, an independent determination must be made that the transaction or relationship meets the applicable standard and should be entered into or continued (see, 3.3, below).
    1. Disclosure. All trustees are required to disclose on the Conflict of Interest Disclosure Form: (1) any business or financial relationship they or members of their immediate families have or propose to have with USNH, either directly or through another entity in which they have a significant interest, and (2) any other organizations as to which they serve as a director, officer, or employee, except where such service is only nominal with no material compensation or decision-making authority. The disclosure form is to be filed annually; an amended form must be filed promptly in the event of a material change in circumstances. Disclosure forms will be reviewed by the Director of Internal Audit and the General Counsel for compliance. The General Counsel shall provide the Chancellor, Chairman of the Board, and Chairman of the Governance Committee a summary of all reported disclosures. Unless already included on the most recent annual disclosure form, a trustee shall provide advance written disclosure of any proposed business or financial relationship covered by this policy to the Chancellor, Chairman of the Board, and the Chairman of the Governance Committee.
      1. The following guidelines are provided to help trustees determine whether a relationship should be disclosed:
        •   A business or financial relationship includes the sale or acquisition of goods, property, or services; the commitment of resources to a common venture; or, in the case of a member of one’s immediate family, an employment relationship. It does not include attending USNH as a student.
        •   A member of one's immediate family means (1) a spouse; (2) a child, grandchild, parent, grandparent, sibling, uncle, aunt, nephew, or niece, or the spouse of any such person; (3) a person having a step-relationship described in (2) above; (4) a parent-in-law or a brother- or sister-in-law; or (5) any other person who resides in the same household as the trustee, officer, or employee.
        •   A significant interest in another entity includes service as a trustee, director, partner, or management-level employee; the actual or beneficial ownership of more than 5% of the entity; or a compensation arrangement that is dependent upon a business or financial relationship with USNH.
      2. The foregoing guidelines are not intended to be exclusive; other relationships or interests that might conflict with the best interests of USNH should also be disclosed. If a trustee is uncertain whether to disclose a particular business or financial relationship, the Chairman of the Governance Committee or the USNH General Counsel should be consulted.
    2. Restraint on Participation. Trustees who have disclosed a potential conflict of interest shall refrain from participating in USNH's consideration of any proposed business or financial relationship in which he or she is interested, except to respond to questions or to provide further information. If a transaction or relationship requires a vote, the interested party should not be present at the time of the vote.
    3. Approval of Business or Financial Relationship. The Governance Committee will determine whether a business or financial relationship involving a trustee or officer should be entered into or continued. In the case of any such relationship involving a trustee, such a determination shall be set forth in a written report of the Governance Committee signed by the Chairman and a majority of the Committee, and provided to the Board of Trustees.
This page last updated Friday, November 9, 2012. For information on the adoption and effective dates of policies please see explanation on the OLPM Main Menu.