Castle Rock Historical Society

CONFLICT OF INTEREST POLICY

Policy

This conflict of interest policy is designed to ensure that voting members of the governing board,  officers, and employees of the Castle Rock Historical Society identify situations that present  possible conflicts of interest and to provide appropriate procedures if a possible conflict of interest arises.  It is also intended to ensure that decisions are not influenced by any private profit or other personal benefit to the individuals affiliated with the Castle Rock Historical Society (“CRHS”) that participate in such decisions.  

Definitions

  1. A “conflict of interest” arises when a person in a position of authority over an organization,  such as a voting member of the governing board, officer, or employee may benefit financially from a decision he or she could make in such capacity, including indirect benefits such as to  family members or businesses with which the person is closely associated.  
  2. Classes of individuals covered by this conflict of interest policy:
  1. An “interested person” is any current or former officer, director, member of a  committee with governing board delegated powers, key employee, and five key highest compensated employees or disqualified persons.
  2. An “officer” is a person elected or appointed to manage the organization’s daily operations, such as president, vice president, secretary, or treasurer.  The officers of  an organization are determined by reference to its bylaws, resolutions of its governing body, or as otherwise designated consistent with state law.  The top management official and top financial official are treated as officers.
  3. A “key employee” is an employee of CRHS (other than an  officer, director, or trustee) who meets any of the following tests:
  1. Responsibility Test.  The employee has responsibilities, powers or influence over the organization that is similar to those of officers, directors, or trustees; manages a segment of activity of the organization that represents 10% or more of the activities assets, income, or expenses of the organization; or has or shares authority to control or determine 10% or more of the organization’s capital expenditures, operating budget, or compensation for employees.
  2. Top 5 Test.  Is one of the 5 employees with the highest reportable compensation from the organization and related organizations for the calendar year ending with or within the organization’s tax year.
  1. Related Parties:
  1. A “family member” or “family relationship” includes only his or her brother and sisters (whether whole of half blood or step), spouse or domestic partner, ancestors, and lineal descendants.
  2. A “35% controlled entity” is an entity that is constructively owned, directly or indirectly, by a given person, such as the organization’s current or former officers, directors, trustees, or key employees, or the family members thereof, in which a listed persons has a controlling interest, or owns more than 35% of the total combined voting power, profits interest, or beneficial interest,
  3. A “Business Relationship” is defined as:
  1. One person is employed by the other or by an organization with which the other is associated as a trustee, director, officer, key employee, or greater-than-35% owner.
  2. One person is transacting business with the other (other than in the ordinary course of business on the same terms as are generally offered to the public), directly or indirectly, in contracts of sale, lease, license loan, performance of services, or other transaction involving transfers of cash or property valued in excess of $10,000 in the aggregate during CRHS’s tax year.  Indirect transactions are transactions with an organization with which the one person is associated as a trustee, director, officer, key employee, or greater-than-35% owner.
  1. A “proposed transaction or arrangement” is intended to include, but not limited to  initiating, making the principal recommendation for, or approving a purchase or contract;  recommending or selecting a vendor or contractor; drafting or negotiating the terms of such a  transaction; or authorizing or making payments from CRHS property, and the provision of services or space by the CRHS.

Procedures  

  1. Duty to Disclose
    In connection with any actual or possible conflict of interest, an interested person should disclose the existence of the  interest and be given the opportunity to disclose all material facts to the  CEO, directors, officers, key employees or members of committees with governing board delegated powers considering the proposed transaction or arrangement.  
  2. Determining Whether a Conflict of Interest Exists  
    After disclosure of the interest and all material facts, and after any discussion with the interested person, he or she shall leave the meeting while the determination of a conflict of interest is discussed and voted upon. The remaining directors, officers, key employees or committee members shall decide if a conflict of interest exists.  
  3. Procedures for Addressing the Conflict of Interest  
    An interested person may make a presentation at the governing board, committee meeting, or staff meeting.  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. Any CRHS business transaction, which involves a potential conflict of interest with a voting member of the governing board, officer, or employee, shall have terms that are at least as fair and reasonable to the CRHS as those that would otherwise be available to the CRHS if it were dealing with an unrelated party.
  4. Violations of the Conflicts of Interest Policy
  1. If the governing board or committee has reasonable cause to believe a member has failed to disclose actual or possible conflicts of interest, it should inform the member of the basis for such belief and afford the member an opportunity to explain the alleged failure to disclose.  
  2. If, after hearing the member's response and after making further investigation as warranted by the circumstances, the governing board or committee determines the member has failed to disclose an actual or possible conflict of interest, it should take appropriate disciplinary and corrective action.  

Compliance

  1. Each voting member of the governing board, officer, and employee will be required to complete a conflict of interest statement.
  2. A record on any report of possible conflict and of any adjustments made to avoid possible conflicts of interest shall be kept by the President & CEO, or board chair.  
  3. The minutes of the governing board and all committees with board delegated powers should contain:  The names of persons who disclosed or otherwise were found to have an interest in connection with an actual or possible conflict of interest, the nature of the interest, any action taken to determine whether a conflict of interest was present, and the governing board's or committee's decision as to whether a conflict of interest existed.  
  4. This conflict of interest policy statement shall be made available to each voting member of the governing board, officer, and employee.  They will be asked to sign the following Statement of Understanding concerning reporting of potential conflicts of interest.

Statement of Understanding

I have read and understand the Castle Rock Historical Society’s policy on conflict of interest and agree to abide by its terms.  

Potential Conflict of Interest Disclosure:

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Signed: ________________________________________________

Date:  ________________________________________________

(Ratified by the Castle Rock Historical Society’s Board of Directors October, 2012)