PCB CONFLICTS OF INTEREST POLICY

 

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I. PURPOSE AND APPLICABILITY OF POLICY

The purpose of this policy is to protect the interest of the Pennsylvania Council of the Blind (PCB) when it is contemplating entering into a transaction or arrangement that might benefit the private interest of a member of the Board of Directors, or employees of PCB. This policy is intended to supplement, but not replace any applicable state laws governing conflicts of interest applicable to nonprofit and charitable corporations.  The individuals who are subject to this policy include those serving as officers, members of the PCB Board, and employees of PCB.

II. DEFINITIONS

Interested Person:

A member of the PCB Board or employee who has a direct or indirect Financial Interest, as defined below, is an interested person.

B. Financial Interest:

A person has a Financial Interest if the person has, directly or indirectly, through business, investment, or his or her immediate family:

  1. An ownership or investment interest in any entity with which the Organization has a transaction or arrangement;
  1. A compensation arrangement with the Organization (other than for services as an employee) or with any entity or individual with which the Organization has a transaction or arrangement;
  1. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Organization is negotiating a transaction or arrangement.

C. Compensation:

Compensation includes direct and indirect remuneration as well as gifts or favors that are substantial in nature. A Financial Interest is not necessarily a conflict of interest. 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.

III. STANDARD OF CARE IN DISCHARGE OF DUTIES

It is the responsibility of each Board member and employee of the Organization to discharge his or her duties in good faith, in a manner the person reasonably believes to be in the best interest of the Organization, and with the care an ordinarily prudent person in a like position would exercise under similar circumstances.

IV. CONFLICTS PROCEDURES

A. Duty to Disclose

In connection with any actual or possible conflict of interest, an Interested Person must disclose the existence of his or her Financial Interest and be given the opportunity to disclose all material facts relating to his or her Financial Interest to the PCB Board considering the proposed transaction or arrangement.

B. 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, the Interested Person must leave the board meeting while the Financial Interest is discussed and voted upon. The remaining board members shall decide if a conflict of interest exists.

C. Procedures for Addressing the Conflict of Interest:

  1. An Interested Person may make a presentation at the board meeting regarding the proposed transaction or arrangement, but after such presentation, the Interested Person shall leave the meeting during the discussion of, and the vote on, the proposed transaction or arrangement that could result in the conflict of interest.
  1. The presiding officer of the board shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
  1. After exercising due diligence, the board shall determine whether the Organization can obtain a more advantageous transaction or arrangement with reasonable efforts from a person or entity that would not give rise to a conflict of interest.
  1. If a more advantageous transaction or arrangement is not reasonably attainable under the circumstances that would not give rise to a conflict of interest, the board shall determine by a majority vote of the disinterested directors whether the transaction or arrangement is in PCB’s best interest and for its own benefit and whether the transaction is fair and reasonable to the Organization and shall make its decision as to whether to enter into the transaction or arrangement in conformity with such determination.

V. VIOLATIONS

A. Procedure

If the board has reasonable cause to believe that a person subject to this policy has failed to disclose actual or possible conflicts of interest or failed to discharge his or her duties in accordance with Article III, it shall inform the person of the basis for such belief and afford the person an opportunity to explain the alleged failure.

B. Action

If, after hearing the response of the person and making such further investigation as may be warranted in the circumstances, the board determines that the person has, in fact, failed to discharge his or her duties in accordance with this policy or to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.

VI. RECORDS OF PROCEEDINGS

The minutes of the board meeting shall contain:

  1. The names of the persons who disclosed or otherwise were found to have a Financial Interest in connection with an actual or possible conflict of interest, the nature of the Financial Interest, any action taken to determine whether a conflict of interest was present and the board’s decision as to whether a conflict of interest in fact existed.
  1. The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussions, including any alternatives to the proposed transaction or arrangement and a record of any votes taken in connection therewith.

VII. COMPENSATION

A member of the board of directors who receives compensation, directly or indirectly, from PCB for services rendered in conjunction with a transaction or other business arrangement is precluded from voting on matters pertaining to that member’s compensation.

VIII. ANNUAL STATEMENT

Each member of the Board of Directors and employee of PCB shall complete and sign a Conflict-of-Interest Policy Annual Statement within ninety (90) days after his or her initial election or appointment and annually thereafter. The current form is attached hereto as Exhibit A.  All signed statements shall be filed with the Executive Director who shall review such statements within thirty (30) days of receipt and notify the PCB president of any potential conflicts of interest disclosed therein.  All signed statements shall remain on file in the PCB office.

IX. PERIODIC REVIEWS

To ensure that PCB operates in a manner consistent with its charitable purposes and that it does not engage in activities that could jeopardize its status as an organization exempt from federal income tax, periodic reviews shall be conducted and their findings reported to the Board of Directors. The periodic reviews shall, at a minimum, include the following subjects:

  1. Whether compensation arrangements and benefits are reasonable and are the result of arm’s length bargaining.
  1. Whether partnership and joint venture arrangements and arrangements with management service organizations conform to written policies, are properly recorded, reflect reasonable payments for goods and services, further charitable purposes and do not result in inurement or impermissible private benefit or in an excess benefit transaction.

X. USE OF OUTSIDE ADVISORS

In conducting the periodic reviews provided for in Article IX, the Organization may, but need not, use outside advisors. If outside advisors are used, their use shall not relieve the Board of its responsibility for ensuring that periodic reviews are conducted.

Exhibit A: PCB CONFLICTS OF INTEREST POLICY ANNUAL STATEMENT

 

The undersigned, being a member of the Board of Directors or an employee of the Pennsylvania Council of the Blind, hereby acknowledges the following:

  1. I have received a copy of the PCB Policy Regarding Conflicts of Interest and Discharge of Duties (the “Policy”).
  1. I have read and understand this Policy.
  1. I agree to comply with the Policy.
  1. I understand that the Policy applies to all members of the Board and employees of PCB.
  1. I understand that PCB is a charitable organization and that in order to maintain its federal tax exemption, it must engage primarily in activities which accomplish one or more of its tax-exempt purposes.
  1. The following information concerning conflicts and potential conflicts is true, correct and complete to the best of my knowledge:
  1. I serve or represent the Pennsylvania Council of the Blind in the following capacity or capacities:
  1. I am a member of the Board or an employee, or I have a material financial or beneficial interest in the following organizations which may have a conflict of interest with the Pennsylvania Council of the Blind:
  1. I am not involved in any activity or transaction, nor am I a party to a contract involving interests which could be found to be adverse to the Pennsylvania Council of the Blind except for the following:
  1. I am not pursuing any business opportunities which might adversely affect the Pennsylvania Council of the Blind, except for the following:
  1. I bring to your attention the following potential conflicts of interest in addition to those, if any, disclosed in B, C and D above: (If none, insert “None.”)

Dated:

Print or Typed Name:

Signature:

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