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Conflict of Interest Policy

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Article I. Purpose

The purpose of this conflict of interest policy is to protect the Texas State University Research Foundation’s (Foundation) interest when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer or director of the Foundation 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.

Article II. Definitions

Interested Person

Any director, officer, or member of a committee with Board of Directors delegated powers, who has a direct or indirect financial interest, as defined below, is an interested person.

Financial Interest

A person has a financial interest if the person has, directly or indirectly, thorough business, investment or family:

  1. An ownership or investment interest in any entity with which the Foundation has a transaction or arrangement,
  2. A compensation arrangement with the Foundation or with an entity or individual with which the Foundation 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 Foundation is negotiation a transaction or arrangement.

Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial.

A financial interest is not necessarily a conflict of interest. Under Article III, Section 2, a person who has a financial interest may have a conflict of interest only if the Board of Directors decides that a conflict of interest exists.

Article III. Procedures

  1. Duty to Disclose

    In connection with any actual or possible conflict of interest an interested person must disclose the existence of the financial interest and be given the opportunityto disclose all materal facts to the directors and members of committees with Board of Directors delegated powers considering the proposed transaction or arrangement.

  2. 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, he or she shall leave the Board of Directors or committee meeting while the determination of a conflict of interest is discussed and voted upon. The remaining board or committee members shall decide if a conflict of interest exists.

  3. Procedures for Addressing the Conflict of Interest
    1. An interested person may make a presentation at the Board of Directors or committee meeting but after the presentation, he or she shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest.
    2. The Chair of the Board of Directors of committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.