CONFLICTS OF INTEREST POLICY
Anyone making decisions on behalf of Salem-Ota Club, Inc. should always act based on the best interests of the organization, and no individual associated with Salem-Ota Club, Inc should use his or her position for personal benefit, for the benefit of friends or relatives, or to further any outside interests or personal agenda. This standard applies to all transactions and decisions, whether or not covered by the detailed policies and procedures below.
An interested person may be a director, officer, member of a committee or staff member of Salem-Ota Club, Inc. (Note that while no staff member positions currently exist, this conflict of interest policy encompasses future possibilities of such situations. Additionally no compensation currently exists nor is contemplated, however again this conflict of interest policy encompasses future possibilities of such situations.)
A potential conflict of interest exists whenever the professional or financial interest of an interested person is opposed to that of the organization, or when such an interest or any conflicting fiduciary duty might influence the interested person’s actions and judgment on behalf of Salem-Ota Club, Inc. A potential conflict also exists when there is an appearance that an interested person’s actions may be influenced by a competing interest or duty.
A conflict of interest exists whenever an interested person’s competing interest or fiduciary duty is substantial enough that the interested person cannot reasonably be expected to exercise independent judgment and take action in the best interest of the corporation.
Conflicts of interest most frequently arise in (but are in no way limited to) the context of:
• decisions about an interested person’s compensation (as a contractor or employee);
• decisions about transactions with entities in which an interested person holds an ownership interest;
• decisions about transactions with an entity by which an interested person is employed.
Conflicts (or the appearance of conflicts) may also arise when the corporation is contemplating a transaction with a close relative or domestic partner of an interested person, or any entity in which such a related person has an ownership interest or which employs such a person.
Conflicts of interest should not be considered to arise when the potential benefit to the interested person is tenuous or remote, such as an interested person with investments in a mutual fund which holds a small amount of stock in a particular company. The fact that an interested person is also a director, officer, member or volunteer of a not-for-profit organization that obtains or seeks funds from institutions or individuals from which Salem-Ota Club, Inc. also obtains or seeks funds shall not by itself be deemed to be a conflict of interest.
Whenever a director, officer, or committee member becomes aware of a potential conflict of interest, whether financial or otherwise, s/he shall make the situation known to the board or committee (as the case might be) and provide all facts material to understanding the nature and scope of the conflict, including whether the interested person believes his or her ability to make an independent decision based solely on the best interest of the corporation has been compromised. If the interested person involved does not make this disclosure, another director or committee member with knowledge of the potential conflict should draw it to the body’s attention.
The interested person with the potential conflict must retire from the meeting and not participate in final discussion and voting on the existence of the conflict. If a conflict is found to exist, the interested person may be invited to provide any relevant information that could be of use to the board in making its decision, but shall again retire and not participate in the final discussion and voting regarding the transaction. The board or committee’s decision shall be based on consideration of whether the transaction:
a) is in the organization’s best interest and for its own benefit;
b) is fair and reasonable to the organization; and
c) is the most advantageous transaction or arrangement the organization can obtain with reasonable efforts under the circumstances.
Whenever a staff member becomes aware of a potential conflict of interest in an area where s/he exercises any discretion in carrying out her/his duties for Salem-Ota Club, Inc, s/he shall promptly disclose the potential conflict to the President. If the President sees a potential conflict, s/he shall disclose it to the board or an executive committee. The person or body to whom disclosure is made shall determine whether there is a conflict that requires recusal of the interested person. When a conflict is found to exist, the interested person shall provide the person or body to whom disclosure is made with all information s/he has relevant to any decision to be made in which s/he has an interest, and the final decision shall be made by that person or body.
In setting compensation of directors, officers, or any individual who may exercise substantial influence over the organization, the board shall ensure that no individual who receives a substantial portion of his or her income directly or indirectly from Salem-Ota Club, Inc participates in such decisions. The basis of the compensation decision shall be documented and based on a determination that the amount paid is not more than reasonable in view of services rendered.
ANNUAL DISTRIBUTION, ACKNOWLEDGMENT AND DISCLOSURE
This conflict of interest policy shall be distributed annually to all directors, officers, members of committees, and staff. All covered individuals shall sign an annual acknowledgment that they have received a copy of this policy, understand it, and agree to abide by its terms.
This Policy adopted by Vote: __January 2009