Conflict of Interest Policy 4:35 Updated On 8/7/09

History In 1989 the National Institute of Health (NIH), Alcohol, Drug Abuse, and Mental Health Administration (ADAMHA) issued the first Conflict of Interest requirements. National Science Foundation (NSF) and Public Health Service (PHS) implemented conflict of interest policies in 1994.

Federal Requirements Federal Agencies wished to ensure researcher objectivity. Required disclosure to the university and required the university to review any conflicts. Federal Agencies wished to ensure researcher objectivity. They did not want researchers to be influenced by their outside investments or financial interests. This required disclosure to the university where the researcher worked, and required the university to review any conflicts.

Example – NSF Disclosure Requirements. Each investigator must disclose all significant financial interests. We will discuss what the definition of “significant financial interest” is for the Board of Regents.

What Constitutes “Significant Financial Interest” Includes interests of the investigator’s spouse and dependent children (e.g. Children living at home.) Ownership in entities whose financial interests would reasonably appear to be affected by such activities. Must be more than $10,000 in value; or Must own more than 5% of entity. Step through bullets. - “We will go over some examples later in this presentation.”

SDBOR Adopted Parallel Policy Professional employees must yearly disclose only: If research or other decisions in matters in which the employee or immediate family member has a significant financial interest, and; Which “…may reasonably be thought to influence, either directly or indirectly institutional business…” Source: BOR Policy 4:35 The South Dakota Board of Regents Adopted a Parallel Policy in 1997. The policy states that: Go through bullets here. The form that has been developed will assist you and the Institution in documenting possible conflicts.

What Constitutes Financial Interest? Outside employments, occupations, or; Endeavors for profit, including investments or ownership interests held by employee or spouse or dependent family members; Must be more than $10,000 in value; or Must own more than 5% of entity. Source: BOR Policy 4:35 You may now be asking, “What constitutes financial interest?” Go through Bullets.

What Happens to Information? If no conflict is found, the form will be sent to the employee’s personnel file. If possible conflict is found, the information will be sent to a dean or supervisor to evaluate conflict. If a conflict is found, another employee will make the required decisions; the employee will be allowed to participate but another employee will lead the decision making process; or another solution will be sought. What happens to the form that is filled out?

Only Requires Disclosure of Conflict – Not Details of Finances Example 1: John Smith’s family founded a restaurant which caters events. John Smith has a $150,000 investment in the restaurant. John is a member of a committee which selects caterers. Report – “I own an investment in excess of $10,000 in ACME Restaurant.” Solution – John does not participate in any discussions concerning catering, and abstains from any votes selecting caterers. Remember – this form only requires you to disclose the conflict. It does not require you to give details on Finances! Let’s go through an example:

Additional Examples Example 2: Jane Smith’s family founded a restaurant which caters events, including many in connection with the university. Jane Smith has a $150,000 investment in the restaurant. Jane Smith is a faculty member and makes no decisions concerning catering. Report – Mrs. Smith needs to report nothing. Solution – No solution needed.

Additional Examples Example 3: John Smith’s 16 year old son, who lives at home and works at a local restaurant which caters events. John is the executive assistant to the President and must coordinate events surrounding an upcoming Board of Regents meeting. Report – John may conclude that his son’s part – time job could not “reasonably” be construed to be affected his decisions. To be safe, John reports, “My son works part-time at ACME Restaurant.” Solution – The President reviews the report and concludes that it would not be reasonable to believe John Smith’s decisions would affect the part-time job at ACME.

Additional Examples Example 4: Jane Smith sits on an advisory board for ACME labs. ACME compensates her, and utilizes her scientific expertise in making business decisions. ACME approaches SDSU and contracts for research/or product testing. Report: “I am a paid board member and consult for ACME Labs.” Possible Solutions: Assign staff other than Dr. Smith to perform and evaluate tests. Dr. Smith could assist that faculty member, but the lead investigator will not be Dr. Smith. Allow Dr. Smith to perform the tests and evaluations, but other disinterested faculty review her decisions and conclusions. Dr. Smith could resign her consulting and business relationships with ACME.

Additional Examples Example 5: Jane Smith works for two or three clients as a consultant. She is paid, and employs a graduate assistant to assist her in providing services to her clients. Jane chairs the GTA’s dissertation committee, and therefore has input on the GTA’s academic performance. Report – “I employ GTA Jones in my consulting practice.” Possible Solutions: Dr. Smith could be removed from the dissertation committee. Assign staff other than Dr. Smith to chair the dissertation committee, however, Dr. Smith could serve on the committee. Dr. Smith could discontinue employing the GTA.

Summary Do you, your spouse, or family member(s) living with you, work for an outside employer? Do you, your spouse, or family member(s) living with you have investments worth more than $10,000; or where your family controls 5% of an entity? Do you make decisions at SDSU which may either directly, or indirectly affect the outside employer or the investment? If “yes,” identify the outside job, or the investment and the decisions affecting those areas.

Questions?