Article I – Purpose

The International OCD Foundation (IOCDF), as a nonprofit, tax-exempt organization depends on charitable contributions from the public. Maintenance of its tax-exempt status is important both for its continued financial stability and for the receipt of contributions and public support. Therefore, the Internal Revenue Service (IRS) as well as state corporate and tax officials, view the operations of the IOCDF as a public trust which is subject to scrutiny by and accountability to such governmental authorities as well as to members of the public. The purpose of this conflict of interest policy is to protect IOCDF’s interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest(s) of an Officer, Director, or Key Management Employee, including Family Members, of the organization. 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

  1. IOCDF Officer /Director. An Officer or Director on the IOCDF Board of Directors.
  2. Key Management Employee. Any employee who has the ability to influence an action or decision of the IOCDF.
  3. Material Conflict of Interest. A Material Conflict of Interest exists if a reasonable disinterested person would conclude that the IOCDF Officer’s, Director’s, or Key Management Employee’s outside business, community, or personal relationships, interests, or actions create a potential, perceived or actual conflict between the person’s private interests and his or her fiduciary duty to the IOCDF or otherwise would call into question the impartiality of the Officer, Director, or Key Management Employee.
  4. Business Relationship. A Business Relationship exists if the IOCDF Officer, Director, or key management employee is an officer, director, employee, partner or member of, or serves as counsel or renders other professional services to, or directly or indirectly has an ownership or investment interest in, or any compensation or other financial arrangement with, a corporation, partnership or other business entity or organization supplying goods or services to or otherwise conducting business with the IOCDF.
  5. Community Relationship. A Community Relationship exists if an IOCDF Officer, Director, or Key Management Employee is an officer, director, trustee, employee, consultant or advisor to, or has any compensation or other financial arrangement with a non-profit or other agency or organization which is principally engaged in charitable, educational, community or other non-business activities.
  6. Family Member. A Family Member is a legal relative two the second degree, by blood, marriage, adoption, or court-ordered custody of an IOCDF Officer, Director, or Key Management Employee.

Article III – Policy

  1. Fiduciary Duty. IOCDF Officers, Directors, and Key Management Employees have a fiduciary duty to the IOCDF which carries with it a broad and unbending duty of loyalty and fidelity. They have the responsibility of administering the affairs of the IOCDF honestly and prudently, and of exercising their best care, skill, and judgment for the sole benefit of the IOCDF. They shall exercise the utmost good faith in all transactions involved in their duties, and they shall not use their positions with the IOCDF or knowledge learned from the IOCDF for their personal benefit, pecuniary or otherwise. The interests of the organization must have the first priority in all decisions and actions.
  2. Duty to Disclose. IOCDF Officers, Directors, and Key Management Employees have a continuing duty to disclose to the Executive Director (if the conflict involves the Executive Director he or she shall make the disclosure to the Board President) any potential, perceived or actual conflict of interest prior to participating in or making any decisions involving such conflict. IOCDF Officers, Directors, and Key Management Employees shall complete and sign the IOCDF Annual Conflict of Interest Statement in May of each year and deliver to the Executive Director.
  3. Alternative/Recusal. IOCDF Officers, Directors, and Key Management Employees found to have a material conflict of interest shall be recused from participating in or making decisions involving the conflict if no alternative arrangements can be made to eliminate the conflict.
  4. Failure to Disclose. A failure to disclose by an IOCDF Officer, Director, or the Executive Director shall subject that person to action as deemed appropriate by the full Board. A failure to disclose by an employee, other than the Executive Director, shall subject that person to action as deemed appropriate by the Executive Director.

Article IV – Conflicts of Interest

    1. The areas of conflicting interest listed below, and the relations between parties in those areas which may give rise to conflict, are not exhaustive. Conceivably, conflicts might arise in other areas or through other relations. Interested Persons must be vigilant to try to recognize such areas. Common conflicts of interest arise when:
      1. An IOCDF Officer, Director, or Key Management Employee or Family Member
        has a Business Relationship with any business entity with which the IOCDF or any of its Affiliates is negotiating or considering approval, termination or modification of, any transaction or relationship involving the provision of goods or services or any lease, purchase, investment, financing or other transaction;
      2. An IOCDF Officer, Director, or Key Management Employee or Family Member
        has a Community Relationship with any Non Profit Entity with which the Foundation or any of its Affiliates is considering any decision to make, or to reduce, augment or condition any grant;
      3. The Foundation or any of its Affiliates makes, or is considering any decision with respect to, a grant or award, including a scholarship or civic award, to an individual or for the benefit of an individual who is related to or who is a business associate of any an IOCDF Officer, Director, or Key Management Employee or Family Member or who is an employee of any business entity in which an IOCDF Officer, Director, or Key Management Employee or Family Member has a “material” ownership or investment interest; or
      4. An IOCDF Officer, Director, or Key Management Employee or Family Member
        solicits or accepts any payment, gift or other thing of value that is given with the attempt to influence or given with the expectation of favoritism or other preferential treatment with respect to any action of the IOCDF or any of its Affiliates.

 

Article V – Procedures

  1. Disclosure. In connection with any potential, perceived, or actual conflict of interest, the Officer, Director, or Key Management Employee must disclose the existence of the conflict to the Executive Director, who shall then notify the Governance Committee. The Executive Director shall make any such disclosure to the President. Disclosures shall be made on the attached Annual Disclosure Statement or otherwise participating in decision making relative to a transaction that would give rise to the conflict.
  2. Determining Whether a Material Conflict of Interest Exists. The person making the disclosure shall be given the opportunity to disclose all material facts to the Governance
    Committee. After disclosure of the financial interest and all material facts, and after any discussion with the person making the disclosure, he/she shall leave the Governance Committee meeting. The Governance Committee shall then discuss and determine by vote whether a material conflict of interest exists or if further investigation is required. If further investigation is required, the President shall appoint a disinterested Director to conduct the investigation. If the Governance Committee finds that a material conflict of interest exists, it shall address the conflict in accordance with paragraph C, below. If the Governance Committee finds that no material conflict of interest exists, it shall report its findings to the full Board. Unless the full Board decides to overturn the Governance Committee’s findings, the matter will be deemed closed.
  3. Procedures for Addressing the Material Conflict of Interest
    1. The Governance Committee shall determine whether a recusal from any decisions involving any transactions with the relationships or interests giving rise to the conflict or whether further steps are also required such as determine whether the IOCDF 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. In the case of a Family Member relationship, the conflict shall be resolved in accordance with subparagraph C.3, below.
    2. If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the Governance Committee or full Board shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in the IOCDF’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 arrangement.
    3. The Governance Committee shall then report to the full Board its findings and recommendation(s), upon which the full Board shall vote whether to accept the Governance Committee’s findings and recommendation(s) or pursue an alternative course of action, including obtaining further information.
    4. Transactions with immediate or extended Family Members may be undertaken only if all of the following are observed:
      1. A material transaction is fully disclosed in the audited financial statements of the organization;
      2. The related Officer, Director, or Key Management Employee is excluded from the discussion and approval of such transaction;
      3. A competitive bid or comparable valuation exists; and
      4. The full Board finds by majority vote that that the transaction is in the best interest of the IOCDF.

Article VI – Failure to Disclose

  1. If the Governance Committee has reasonable cause to believe an Officer, Director, or Management Employee has failed to disclose actual or potential conflicts of interest, the President shall inform that person of the basis for such belief and afford the person an opportunity to explain the alleged failure to disclose.
  2. If, after hearing the person’s response and after making further investigation as warranted by the circumstances, the Governance Committee shall make a recommendation as to the appropriate corrective action to the full Board and the full Board shall vote upon the matter.

Approved by Board Vote May 6, 2017.
INTERNATIONAL OCD FOUNDATION