Grand Traverse Regional Land Conservancy
Policy Title: Conflict of Interest Policy for Board Members, Staff Members, and Other Insiders (Adopted February 22, 2018, Amended April 23, 2020)
I. PURPOSE & APPLICABILITY
The Purpose of the Conflict of Interest Policy is to protect Grand Traverse Regional Land Conservancy’s interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of a Conservancy Insider 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.
The Conservancy’s effectiveness is dependent upon public confidence in our organization and its work. We must maintain our reputation for honesty, objectivity, and fairness. Therefore, each Conservancy Insider must avoid Conflicts of Interest and act impartially in his or her work for the Conservancy.
This document describes conditions that might constitute real or perceived Conflicts of Interest and identifies the procedures the Conservancy will follow to identify, disclose, and manage and/or avoid these conflicts. The policy applies to all Insiders as defined below.
II. DEFINITIONS
A. For purposes of this policy, the words and phrases enumerated below shall have the meanings set forth herein.
1. Conflict of Interest.
a) An Insider (as defined herein), including a Board or staff member, has a Conflict of Interest when a transaction or other matter involving the Conservancy affects or reasonably appears to affect in a material way the personal or financial interest of that person.
b) A Board or Staff member also has a Conflict of Interest when his or her: (a) relationship to or transaction(s) with any other person, including another Insider, compromises or reasonably appears to compromise his or her objectivity, independence or integrity while participating in the Conservancy’s work; or (b) participation in community affairs compromises or reasonably appears to compromise (i) his or her undivided loyalty to the Conservancy and its mission, or (ii) the Conservancy’s longstanding practice of remaining neutral in partisan affairs, issues, and contests.
2. Financial Interest. A financial interest is a direct or indirect business, investment, or family (1) ownership or investment interest in any entity with which the Conservancy has a transaction or arrangement; (2) A compensation arrangement with the Conservancy or which any entity or individual with which the Conservancy 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 Conservancy is negotiating a transaction or arrangement.
Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial.
3. Insider. An Insider is any: (1) Board member; (2) staff member; (3) non-Board committee member; (4) person who has the ability to influence the Conservancy’s decisions; (5) volunteer who has a significant level of involvement that provides him or her access to inside information not available to the general public; (6) Substantial Contributor (as defined herein) to the organization; or (7) person who has access to information regarding the Conservancy’s plans or operations that is not available to the general public; or (8) Related Party (as defined herein) to any of the people in this section
4. Personal Interest. A Personal Interest is a non-financial interest of any Insider: (1) relating to his or her job or profession; (2) relating to his or her role with a competing organization or entity; (3) implicating a competing fiduciary duty; or (4) implicating a Personal Interest of a Related Party.
5. Related Party. A Related Party is any one of a person’s: spouse, parents, grandparents, great-grandparents, brothers and sisters, spouses of brother and sisters, children, grandchildren, great-grandchildren, and spouses of children, grandchildren, and great-grandchildren.
6. Staff Member. A Staff Member is any full-time, part-time, seasonal, paid or unpaid employee, intern, or extern of the Conservancy. Staff Member does not include volunteers.
7. Substantial Contributors. A Substantial Contributor is any individual, corporation, or foundation that makes a gift or pledge of $100,000 or more at any one time or cumulatively within a five-year period prior to the occurrence of the Conflict of Interest either in cash, appreciated securities, other assets or in land, easement or bargain sale value.
8. Material Financial Interest. A Material Financial Interest is any financial interest in a transaction, direct or indirect, other than one that is so minor that no one would reasonably believe that the interest could affect or influence the judgment or decisions of the person or persons involved.
III. GENERAL PROVISIONS
Each Board and Staff member shall:
A. Annually read this policy and sign an appropriate document acknowledging she or he has received a copy of the policy, has read and understands the policy, and affirms his or her compliance therewith;
B. Take all reasonable steps to avoid creating a Conflict of Interest;
C. Apprise the Board Chair or Executive Director, as appropriate, if he or she leans that another Insider has an actual or possible Conflict of Interest; and
D. Comply with all applicable federal and state laws regarding Conflicts of Interest.
IV. PROCEDURES
In addressing and resolving a Conflict of Interest, the Conservancy should undertake all appropriate measures to ensure, as much as possible, that any transaction entered into with an Insider is equivalent to one with outside, unrelated parties. For all types of transactions, information about comparable transactions and any other information helpful in evaluating the propriety of the transaction should be considered. For any transactions involving land (e.g., sale/bargain-sale or donation of property or a conservation easement), this means at minimum obtaining an independent appraisal or consulting with an independent appraiser concerning the value of the interest in land at issue.
A. If a Board member has an actual or possible Conflict of Interest, the conflicted Board member shall:
1. Disclose the Conflict at the earliest practicable opportunity by either written notice or oral notice at a Board meeting to the Board Chair or Vice-Chair;
2. Abstain from attending, participating in, or otherwise influencing any Board discussions, and from voting on any Board decision, relating to the Conflict notice, except to answer any questions posed by the Board Chair or Vice-Chair regarding the facts giving rise to the Conflict;
3. Abstain from attending, participating in, or otherwise influencing any Board discussions, and from voting on any Board decision, relating to the transaction or other matter giving rise to the Conflict of Interest, unless the Board determines that there is no such Conflict;
4. Similarly, disclose the Conflict of Interest to the Board Committee Chair, and abstain from participating in any way in any Board Committee discussions or decision, including any related vote, when the Conflict arises concerning a transaction or other matter before a Board committee;
5. Resign from the Board, if requested to do so by the Board, until the matter giving rise to the Conflict of Interest or circumstances has been resolved. The Board in its discretion may invite the resigned Director to rejoin the Board.
B. Upon receipt of notice that a Board member has an actual or possible Conflict of Interest:
1. The Board Chair or Vice-Chair shall provide notice of the Conflict to the remaining Board members a reasonable time before the next Board meeting or as soon as reasonably practicable when the Conflict has been disclosed orally at a Board meeting;
2. The Board shall determine whether a more advantageous transaction or agreement that would not create a Conflict of Interest is possible, and, if not, what appropriate measures shall be put in place to screen the conflicted individual as the transaction proceeds;
3. The Board shall address the Conflict, consider the relevant facts and policies, and take whatever additional action it deems appropriate with respect thereto before discussing and voting on the transaction or other matter giving rise to the Conflict;
4. The Board shall make a well-documented record in the minutes of its handling and resolution of the Conflict; and
5. The Board Committee Chair and Board Committee shall similarly address, take action on, and memorialize their handling and resolution of any Conflict notice that the Board committee Chair receives concerning a transaction or other matter before the Board Committee.
C. If a Staff member has an actual or possible Conflict of Interest, the conflicted staff member shall:
1. Disclose the Conflict of Interest at the earliest practicable opportunity by written notice to the Executive Director; and
2. Abstain from attending, participating in, or otherwise influencing any related staff, Board, or Board Committee discussions or decision (except to answer any questions posed by the Executive Director regarding the facts giving rise to the Conflict), including any related vote, unless and until the Executive Director determines that there is no such Conflict.
D. Upon receipt of notice that a Staff member has an actual or possible Conflict of Interest:
1. The Executive Director shall address the Conflict of Interest in a manner consistent with the concerns reflected herein and make a well-documented record in the Conservancy’s files regarding his or her handling and resolution of the Conflict;
2. The Executive Director shall disclose the Conflict to the relevant employees or Board Members, as appropriate and without giving personal details giving rise to the Conflict unless absolutely necessary; and
3. The Staff member must abstain from attending meetings, influencing discussions and decisions, will be removed from the email list on the project and will be appropriately screened from the project.
E. If an Insider other than a Board or Staff member has an actual or possible Conflict of Interest, the Board Chair or Board Committee Chair addressing the transaction or other matter giving rise to the Conflict shall:
1. Provide prompt notice to all other members of the Board or Board Committee (as applicable), of the Conflict of Interest;
2. Prevent the conflicted Insider from attending any meeting addressing the matter (except to answer any questions posed by the relevant Chair regarding the facts giving rise to the Conflict) or otherwise influencing any related Conservancy discussions or decision, including any related vote; and
3. Make a well-documented record in the Board’s or Committee’s minutes of its handling and resolution of the Conflict.
F. As to a transaction in which a Related Party has an actual or possible Conflict of Interest, the Board Chair or Board Committee Chair addressing the transaction or other matter giving rise to the Conflict shall:
1. Provide prompt notice to all other members of the Board or Board Committee (as applicable), of the Conflict of Interest.
2. The individual connected to the Related Party with the actual or possible Conflict of Interest shall abstain from attending, participating in, or otherwise influencing any Board or Board Committee discussions, and from voting on any Board or Board Committee decision (if applicable), relating to the Conflict notice, except to answer any questions posed by the Board Chair or Vice-Chair regarding the facts giving rise to the Conflict;
3. The individual connected to the Related Party with the actual or possible Conflict of Interest shall abstain from attending, participating in, or otherwise influencing any Board or Board Committee discussions, and from voting on any Board or Board Committee decision (if applicable), relating to the transaction or other matter giving rise to the Conflict of Interest, unless the Board or Board Committee determines that there is no such Conflict; and
4. The Board or Board Committee shall determine whether a more advantageous transaction or agreement that would not create Conflict is possible, and, if not, what appropriate measures shall be put in place to screen the conflicted individual as the transaction proceeds;
5. The Board or Board Committee shall address the Conflict, consider the relevant facts and policies, and take whatever additional action it deems appropriate with respect thereto before discussing and voting on the transaction or other matter giving rise to the Conflict; and
6. The Board or Board Committee shall make a well-documented record in the minutes of its handling and resolution of the Conflict.
G. As to a transaction in which an Insider, including a Substantial Contributor, has a Material Financial Interest, the Board may approve the transaction only if it determines and makes specific findings that:
1.The Conservancy is entering into the transaction for its own benefit.
2.The transaction is fair and reasonable as to the Conservancy.
3.Prior to consummating the transaction or any part of it, the Board has authorized or approved the transaction in good faith by a vote of the majority of the members in office without counting the vote of any interested Board member and with knowledge of the material facts concerning the Transaction and the Board member’s interest in the transaction.
4.Prior to authorizing or approving the transaction, the Board considers and in good faith determines after reasonable investigation under the circumstances, that the Conservancy could not have obtained a more advantageous arrangement with reasonable effort under the circumstances.
H. In any case in which an actual or potential Conflict of Interest is disclosed, in developing a response to such Conflict, every reasonable effort will be made to avoid the Conflict. In cases where it is not possible to completely avoid an actual or potential Conflict, reasonable efforts will be made to mitigate the effects of the Conflict. At a minimum, the recommended course of action shall ask the individual involved in the Conflict to disclose the situation fully to the relevant parties and recuse and absent him or herself from any involvement in decisions pertaining to the Conflict. Before the Conflict is disclosed and while the request for approval of a proposed course of action is pending or being considered, the individual involved in the Conflict shall refrain from participating in the questionable activity.
I. For a donation of land or interest in land with any Insider, the Conservancy and Insider shall comply with the requirements and standards of the Conservancy’s Land Policy.
V. VIOLATIONS
A. If the Board, Board committee, or Executive Director has reasonable cause to believe a Board member, Staff member, or other Insider has failed to disclose actual or possible Conflicts of Interest, the person shall be informed of the basis for such belief and offered an opportunity explain the alleged failure to disclose.
B. After hearing the Board member, Staff member, or other Insider’s response and after making further investigation as warranted by the circumstances, the Board, Board Committee, or Executive Director (as applicable) shall take appropriate disciplinary and corrective action if it is determined the person has failed to disclose an actual or possible Conflict of Interest.
VI. COMPENSATION
A. A voting Board member who receives compensation, directly or indirectly, from the Conservancy for services is precluded from voting on matters pertaining to that Board member’s compensation.
B. A voting Board committee member whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Conservancy for services is precluded from voting on matters pertaining to that Board member’s compensation.
C. No voting Board member or voting Board committee member whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Conservancy, either individually or collectively, is prohibited from providing information to any committee regarding compensation.
VII. PERIODIC REVIEWS
To ensure the Conservancy operates in a manner consistent with charitable purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted.
A. The periodic reviews shall, at a minimum, include the following subjects:
1. Whether compensation arrangements and benefits are reasonable, based on competent survey information, and the result of arm’s length bargaining.
2. Whether partnerships, joint ventures, and arrangement with management organizations (if any) conform to the Conservancy’s written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes, and do not result in inurement, impermissible private benefit, or in an excess benefit transaction.
B. When conducting periodic reviews, the Conservancy may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the Board of its responsibility for ensuring such reviews are conducted.
My signature below indicates my voluntary and free acknowledgment of
and agreement to comply with the above provisions.