The University Senate
of Michigan Technological University
PROPOSAL 2-03
Definitions
Conflict of
Interest: Actual, possible or perceived Conflicts of
Interest and/or conflicts of commitment, including time, as discussed in General Principles 1.1.
Committee: MTU Conflict of
Interest Committee
Coordinator: MTU Conflict of
Interest Coordinator
Member: A member of the MTU
community.
MTU: Michigan
Technological University
MTU Community:
All faculty, staff, students, and
administrators of MTU.
MTU
Resources: Includes all facilities such as office
space and equipment, as well as information technology (including web site
servers and telecommunications), personnel and stationery.
Policy: The MTU Conflict of
Interest policy for which these procedures were developed to implement (Board
of Control Policy 3.13).
Procedures: These Conflict of
Interest procedures.
Proposal: A proposal for
externally funded or sponsored research, education and training activity, or other external
collaborations.
Relative: A member of the MTU
community's spouse, child (by blood, adoption or marriage), parent, or person with whom the member has a close
personal relationship.
Supervisor: Department chair,
dean, director; in some cases a researcher, staff, faculty member or administrator other than a chair, dean or
director.
Preamble
MTU is a
complex, dynamic
university of which we are proud -- a university with important goals and
remarkable achievements. For the purpose of these Conflict of Interest
procedures, this dynamism has two consequences. First, though these procedures
strive to be comprehensive, these procedures cannot address every possible
situation and do not obviate the need
of members to understand and follow other MTU policies and procedures. Second,
as the market and our collective expertise develop, new conflict of interest
challenges will arise. In applying these procedures, the President
and Board of Control relinquish none of their constitutional or statutory
authority. Finally, members should be reminded that the Board of
Control cannot change or override federal, state or local laws; as such,
members must continue to abide by these laws notwithstanding anything that may
appear in these procedures.
1 General
Principles
1.1 Conflict of Interest in the university context is a very
difficult subject, for it touches on many different, but related, topics, including proprietary rights and use of
MTU resources. Conflicts can be divided into
two basic categories. The first covers what many people traditionally associate
with the term Conflict of Interest -- opportunities for inappropriate personal
gain during the pursuit of official duties. The gains might be financial, but
may include other forms of benefit such as power or political advantage. The
second category covers conflict of commitment -- the choices individuals make
about their professional priorities, especially the allocation of their time to
the different institutions and organizations they serve as professionals.
Members may encounter conflicts of commitment when outside professional
activities take priority over other MTU-related responsibilities.
1.2 An
important function of these procedures is to (i) describe appropriate
commercial relationships beyond normal MTU business between supervisors,
faculty, and other researchers and their staff subordinates, students and other
parties, and (ii) identify when those relationships generate potential or actual Conflict of
Interest and should be disclosed, mitigated (if possible), discouraged, or
disallowed. These procedures identify
five categories of activity that may generate Conflicts of Interest: (i)
activities which are usually exempt, (ii) outside professional service
activities, (iii) activities or external relationships with minimal financial
interests, including supervision of relatives, and the use of university
resources, (iv) complex external relationships, including business activities
and entrepreneurial projects.
1.3 Most situations that pose Conflicts of Interest involve
contacts or relationships between individual members and external entities that
compromise, or appear to compromise, the judgment, activities or perceived
loyalty of those individuals. Perception is an especially important but
slippery realm, for it is not guided strictly by "the intentions" and
perception can be as damaging to the individual and MTU as are clear-cut, open
conflicts. Therefore, it is incumbent upon the member to disclose sufficient
information so that any perception of a Conflict of Interest can be addressed
and satisfactorily resolved. MTU thus will consider how Conflict of Interest
appears to an outside third party when applying these procedures.
1.4 These procedures primarily address conflicts emerging from
professional activities. MTU does not seek to regulate private decisions that
are protected by statute. However, nothing in these procedures should be
construed as allowing any member of the MTU community to avoid other
obligations under state and federal law. For example, patent and copyright laws
must be followed (see Board of Control Policy 18, especially section 1, on
Patent and Other Proprietary Rights).
1.4.1 There is a State of Michigan Statute on conflict of
interest, MCL 15.301, et seq. (the "Statute") that requires that MTU
members disclose any pecuniary interest in a contract with MTU to the Board of
Control, which will make the disclosure a matter of record in its official
proceedings. Any member contemplating a contract with MTU must disclose this to
the Coordinator, who will make a determination regarding the conflict with
respect to the provisions of the Statute, and if required by the Statute, will
report the conflict to the Board of Control.
1.5 MTU's Conflict of Interest policies and procedures
rest upon the following:
1.5.1 Upon becoming a member, every individual makes a commitment
to MTU. Those who accept full-time appointments or employment at MTU must
accord MTU their primary professional loyalty. These procedures require,
therefore, that every member arrange their personal interests and activities so
as not to conflict with their commitment to MTU. This avoidance of Conflict of
Interest requires that individuals shall not realize improper gain, financial
or otherwise, from either (i) the inappropriate use of MTU property, funds,
equipment, prestige, or other resources; or (ii) from the exercise of outside
professional opportunities that conflict with the conduct of their MTU duties.
1.5.2 These procedures do not require members to avoid
involvement in outside public or private activities. To the contrary, such
involvement is often wholly consistent with MTU's mission to educate its
students and serve the public interest.
1.6 It is vital to the successful performance of MTU's mission
that members be as
free as possible from Conflicts of
Interest. No member may undertake any activity that constitutes an actual or
perceived Conflict of Interest, except as may be expressly approved and/or
permitted pursuant to these procedures. It is each member's responsibility, therefore,
to contact the Conflict of Interest Coordinator (Coordinator) if he or she
encounters a Conflict of Interest not contemplated by these procedures or if
there is uncertainty about the existence of a conflict.
1.7 In the event that any member makes any disclosure to any
MTU official pursuant to these procedures with respect to an ongoing project or
relationship, such member must submit complete and accurate follow-up
disclosure, in the same form as previously submitted, to such MTU party if
change of circumstances has rendered any previously submitted Disclosure Form
materially inaccurate or incomplete.
1.8 In the event that the Conflict of Interest
Coordinator or Committee proposes remedies or mechanisms for ameliorating,
mitigating, or eliminating a member’s Conflict of Interest, these shall be
reported to the member’s supervisor.
1.9 The MTU Board of Control is governed by
separate Michigan statutes with respect to Conflict of Interest (MCL15.301 and
MCL 15.341). As a courtesy, the Board
may disclose Conflicts of Interests to the Coordinator.
2 Category I: Outside Activities
Exempt from Conflict of Interest
Participation
in Category I traditional professional activities do not typically create
Conflicts of Interest or commitment (but see section 6.2), and as such do not
normally have to be fully disclosed to the Coordinator. Category I activities
include, but are not limited to:
If a member
has reason to believe that an ordinarily benign Category I activity may create
a Conflict of Interest, they must fully disclose this potential Conflict of
Interest to the Coordinator prior to participation in the proposed activity.
The Coordinator will promptly determine whether the proposed activity would
constitute a Conflict of Interest, and in consultation with the member, settle
upon an appropriate course of action.
3 Category II:
Outside Professional Service Activities Which Create Conflicts of Interest
3.1
Definitions
3.1.1 Activities that may
generate Category II Conflicts of
Interest include:
3.1.2 Activities that do not generate Category II Conflicts of Interest include:
3.2 Category
II Guidelines
3.2.1 Members should not allow their outside service activities
to interfere with their primary responsibilities to MTU.
3.2.2 The time and attention devoted to rendering an outside
professional service must not have priority over routine MTU obligations,
unless the member has been appropriately released from those obligations.
3.2.3 By way of guidance, members may not engage in Category II
activities in excess of an average of one day per week, up to a maximum of 38 days during the
regular academic year. Faculty and
professional
staff may, upon approval of their supervisors, be extended the
limited privilege of flexible scheduling of some working hours so that some
Category II activities in excess of this level are performed during normal
working hours during the period required to accomplish the service or activity.
3.3 Disclosure and Review
3.3.1 Each Member must promptly and fully
disclose in writing to their immediate supervisor when such member engages in
any Category II activities, whether or not it will result in a conflict of
interest.
3.3.2 If an immediate supervisor determines that a Category II
activity creates a Conflict of Interest or is otherwise detrimental to the
college's, school's, department's, or individual's primary duties, he or she
may require that the member submit to special oversight or management
procedures or to cease such activity. Members may appeal their supervisor's
decision to MTU's Conflict of Interest Coordinator.
4 Category
III: External Relationships and Activities With Minimal Financial Interests
4.0 Background
Certain
aspects of the efforts of members to serve their professions or the wider
community may create opportunities for members to benefit monetarily from those
efforts, over and above their regular salary or compensation. These
opportunities include professional consulting; adoption of self-authored
textbooks or other course materials; royalties from patents; sponsored
research, education and training proposals; routine testing; and the ownership
and operation of small businesses not directly related to the member’s MTU
responsibilities. MTU encourages these activities in the belief that such
contacts and the activities benefit MTU, its faculty members and students, and
the wider community. But Conflicts of Interest and particularly conflicts of
commitment are inherent in these activities. When compensation is small, the
primary conflict is likely to be a conflict of commitment, as a member diverts
his or her time from regular responsibilities from MTU to an outside
professional activity. The first step in mitigating such a conflict is prior
disclosure of the activity to the member's immediate supervisor. In some cases,
additional required actions are described in the guidelines below.
In addition,
two activities that are deemed Category III activities are use of university
facilities and supervision of relatives.
4.1 Consulting
Category III
activities include providing consulting services by a member on more than a
one-time basis where such services are related to the member's area of
professional expertise. Professional activities or outside employment of any
type undertaken by faculty on nine-month appointments during the summer term,
however, are not considered Category III activities.
4.1.1 Category III Consulting Guidelines
4.1.1.1 Faculty members on nine-month appointments may provide
consulting services during
that nine-month period only when the individual's primary duties in the classroom,
research, and other academic areas continue to be performed at a high standard.
(Also see section 4.1.3).
4.1.1.2 Faculty members, research staff or administrators on
twelve-month appointments may pursue consulting on a limited basis only,
because of the demands placed on their time by MTU. (Also see section 4.1.3).
4.1.1.3 Any Category III consulting that overlaps with or takes
place in the context of Proposals
(see section 4.4) will be reviewed by the Coordinator to determine if the
activity should be considered Category IV and follow the procedures thereto
(see section 5).
4.1.1.4 A full-time member may not engage in
Category III activities in excess of the equivalent of one day per week during
the regular academic year, up to a maximum of 38 days. Should the member be required to be
absent from work or to miss meeting regularly scheduled classes in order to
engage in the Category III activity, the member’s supervisor must approve the
absence in advance.
4.1.1.5 Members may not divert work from MTU that would normally be funded through
sponsored research or other proposals into their own
Category III consulting activity for the purpose of avoiding payment of MTU
overhead or to reduce third party costs.
4.1.1.6 Members may not compete with professional or instructional services
offered by MTU.
4.1.1.7 Members may not accept consulting contracts that could be
perceived as conveying competitive advantage to third parties due to the
member's employment at MTU.
4.1.1.8 Members must not accept consulting contracts that expose
the individual or MTU to actual or apparent conflicts arising from multiple
concurrent financial, advisory, or occupational programs.
4.1.1.9 Faculty and staff members with financial relationships
outside of MTU who can apply for sponsored funding should not allow such pursuits to interfere with
their pursuit of sponsored funding for MTU. In situations where MTU and the outside
entity can apply for the same funding, MTU has first priority in making
application and the member may not cause the outside entity to compete with MTU
funding applications. Members must first discuss such ideas or proposals with
their supervisors in such situations. The investigator must recognize that he
or she owes appropriate time and effort to MTU's search for sponsored projects.
4.1.2
Disclosure and Review
4.1.2.1 Before engaging in Category III consulting activities,
members must fully disclose proposed activity in writing to their immediate
supervisors. Supervisors may require that the member submit to special
oversight or management procedures or to cease such activities, if they
determine that such activities constitute a Conflict of Interest or are
otherwise detrimental to the college's school's, department's, or individual's
primary duties, especially if consulting places excessive or disproportionate
demands (e.g., see section 4.1.2.3) on the time, energy, or intellectual effort
of the individual involved. Members may appeal their supervisor's decision to
the Coordinator.
4.1.2.2 Supervisors may permit faculty members or researchers to
adopt a limited flexible work schedule so that some consulting services may be
performed during what would otherwise be normal working hours during the period
required to accomplish the service or activity.
4.2 Adoption
of Self-authored Textbooks and Other Course Materials
4.2.1
Definitions
4.2.1.1 "Textbooks" are books sold to
students that are (i) published by commercial or university presses, or (ii)
assembled and/or published within MTU or through local duplication services.
4.2.1.2 "Course Materials" are non-book
instructional materials sold to students that are (i) published by commercial
or university presses; or (ii) material assembled and/or published within MTU
or through local duplication services.
4.2.2
Guidelines
4.2.2.1 Faculty may not sell instructional
materials directly to students.
4.2.2.2 All textbooks and course materials adopted
for a class must represent, in the instructor's professional opinion, the most
appropriate choice for that class and the students within it.
4.2.2.3 Members must select books and course
materials according to the merit and appropriateness of these items, not for
personal financial gain.
4.2.3 Disclosure and Review
4.2.3.1 Faculty who receive royalties from the
sale of textbooks or course materials must disclose the use of such works to
their chair or dean for approval.
4.2.3.2 If the chair's or dean's review determines
that a member's use of member-authored textbooks
or course materials constitutes a Conflict of Interest or is otherwise
detrimental to the college, school, department, or MTU, the chairperson may
require the member to submit to special oversight or management procedures or
to cease the use of such textbooks or course materials. Members may appeal the
chairperson's decision to the Coordinator.
4.3 Royalties
from Patents
4.3.1 Guidelines
4.3.1.1 Members may work on or assign students,
postdoctoral fellows, or other trainees to research projects in which that
member or a relative is entitled to receive royalties or licensing fees from
patents or patent applications, but has no other financial interests in that
project, provided that the roles are made clear in writing to their immediate
supervisor and the Coordinator.
4.3.1.2
Per the terms of each employee’s and graduate student's Patent, Research and
Other Proprietary Rights Agreement, and MTU’s Board of Control Policy (Chapter
18), developments made while individuals are employed by MTU must be assigned
to MTU. Use of technologies that are covered under this agreement and
related policies can only be conducted under appropriate license or other
agreements. Individuals interested in beginning entrepreneurial
activities based on developments that have occurred during their course of
employment should consult the Office of Intellectual Property and Technology
Commercialization to determine if a license is necessary and to begin
discussing licensing conditions.
4.3.2 Disclosure and Review
Members who are entitled to receive
royalties (or licensing fees) in connection with projects and continue to
conduct research related to the subject for which they are receiving royalties
must fully disclose in writing the existence of these royalty payments to their
immediate supervisor and
the Coordinator before continuing their research or assigning others to the
project. To avoid doubt, this disclosure must include the nature and
circumstances of the assistance provided by and compensation provided to
students, postdoctoral fellows, or other trainees to such projects. The Coordinator may require the member to
submit to special oversight or management procedures or to cease such
activities altogether, and will inform the member’s supervisor of such
procedures. Members may appeal the imposition of any such remedy or mechanisms
to the Committee.
4.4. Proposals (Sponsored Research, Education/Training,
and other Proposals)
4.4.1 Category III Proposal Guidelines
4.4.1.1 Members that submit proposals and who
conduct ongoing research and collaborations at MTU funded by outside third
parties must avoid if possible, and disclose if unavoidable, all Conflicts of
Interest including, without limitation: (1) the existence of financial connections
between the project staff, including the investigators, and research sponsor or
client; and (2) financial involvement by investigators and/or other members of
the research team with an outside business
enterprise in the same or a related research area through consulting or other
business activities.
4.4.2 Disclosure and Review
4.4.2.1
If no Category
III (or IV or V) Conflict of Interest exists for a given proposal, the
principal or cooperating investigator indicates on the MTU transmittal form
that the proposal does not present a conflict of interest, and by signing the
transmittal form, certifies that the investigator(s) have read these procedures
and are in compliance with them.
4.4.2.2
If a Category
III (or IV or V) Conflict of Interest exists for a proposal,
each investigator must submit to the Coordinator a completed Conflict of
Interest Cover Sheet and Disclosure Form ("Disclosure Forms") at the
time of submission of each such proposal. If there are multiple investigators,
Disclosure Forms must be
submitted by each investigator.
4.4.2.3 Distinct
Disclosure Forms must be submitted to the Coordinator for each separate
proposal, including proposals to continue ongoing currently sponsored research.
The Coordinator will keep this information as confidential as possible.
4.4.2.4 The
Coordinator will review the submitted Disclosure Forms for Conflict of
Interest. If the Coordinator identifies a real, potential, or perceived
Conflict of Interest, the Coordinator will work with the investigator(s) to
propose remedies or mechanisms for ameliorating, mitigating, or eliminating the
Conflict of Interest, or will disapprove the proposed activity. These remedies
or mechanisms need not be finalized before submission of the proposal, but must
be finalized to the satisfaction of the Coordinator before funds may be
expended by any investigator. Members may appeal the imposition of any such
remedy or mechanisms to the Committee.
4.4.2.5 After the review the
Coordinator will attach a signed internal review form to each contract or grant
proposal, indicating the satisfactory
resolution of any Conflicts of Interest. The satisfactory signed internal
review form must be in the proposal file in order for MTU to release funds to
the principal investigator. Normally
this review, including these forms, is not transmitted to funding agencies. If
funding agencies request copies of these forms, the Coordinator will confer
with Research and Sponsored Programs and the PI before releasing any
information.
4.4.2.6 In
the event that the Coordinator is off campus and unable to review external
research and project proposals for potential Conflicts of Interest, other
designated MTU representatives will be authorized to conduct the Conflict of
Interest review and to sign the internal review form. Cover Sheets and
Disclosure Forms so reviewed by designated MTU representatives, and the
internal review form, must then be transmitted to the Coordinator for
subsequent verification.
4.4.2.7 If
a new Conflict of Interest arises after receipt of a research award, or if the
Conflict of Interest situation changes after receipt of a research award, the
investigator(s) must submit to the Coordinator updated Disclosure Forms. The Coordinator will review the submitted
Disclosure Forms for Conflict of Interest.
If the Coordinator identifies a real, potential, or perceived Conflict
of Interest, the Coordinator will work with the investigator(s) to propose
remedies or mechanisms for ameliorating, mitigating, or eliminating the
Conflict of Interest, or will disapprove the proposed activity. These remedies or mechanisms must be
finalized to the satisfaction of the Coordinator before additional funds may be
expended by any investigator. Members
may appeal the imposition of any such remedy or mechanisms to the Committee
4.5
Testing
4.5.1 Definitions
4.5.1.1
Testing is defined as the performance of a standard test that provides the
sponsor with results and does not involve an analysis of those results
4.5.2
Disclosure and Review
4.5.2.1
Members engaged in testing must submit Disclosure Forms to the Coordinator on
an annual basis with respect to such testing if a Conflict of Interest
exists.
4.5.2.2
After reviewing the Disclosure Forms, the Coordinator may require the member to
submit to special oversight or management procedures or to cease such testing
altogether. Members may appeal the
decision of the Coordinator to the Committee.
4.6 Small Businesses Not Directly Related to the Member’s MTU
Responsibilities
4.6.1
Definitions
4.6.1.1 Category III activities include owning and operating a small
business outside of MTU in an area not directly related to the member’s MTU
responsibilities or areas of expertise. The ownership or operation of a small
business during the summer term by faculty, staff or administrators on
nine-month appointments, however, is not considered a Category III activity.
4.6.2 Guidelines
4.6.2.1 Faculty members, staff or administrators on nine-month
appointments may own or operate small businesses during that nine-month period. Nonetheless, this
business should not interfere with the individual's primary MTU duties. (Also see section 4.6.3).
4.6.2.2 Faculty members, staff or administrators on twelve-month
appointments may own or operate a small business on a limited basis only,
because of the demands placed on their time by MTU. (Also see section 4.6.3).
4.6.2.3
Should the member be required to be absent from work or to miss meeting
regularly scheduled classes in order to engage in the Category III activity,
the member’s supervisor must approve the absence in advance.
4.6.2.4
Members may not divert work from MTU that would normally be funded through sponsored research into
their own Category III small
business for the purpose of avoiding payment of MTU overhead or to reduce third
party costs.
4.6.2.5
Members may not compete with professional or instructional services offered by
MTU.
4.6.2.6
Members may not accept business contracts that could be perceived as conveying
competitive advantage to third parties due to the member's employment at MTU.
4.6.2.7
Members must not accept business contracts that expose the individual or MTU to
actual or apparent conflicts arising from multiple concurrent financial,
advisory, or occupational programs.
4.6.2.8 Faculty and staff members with financial relationships
outside of MTU who can apply for sponsored funding should not allow their small
business to interfere with their pursuit of sponsored funding for MTU. In
situations where MTU and the outside entity can apply for the same funding, MTU
has first priority in making application and the member may not cause the
outside entity to compete with MTU funding applications. Members must first
discuss such ideas or proposals with their supervisors in such situations. The
investigator must recognize that he or she owes appropriate time and effort to
MTU's search for sponsored projects.
4.6.3
Disclosure and Review
4.6.3.1 It
is in the best interest of members to disclose the proposed activity in writing
to their immediate supervisors or to the Coordinator before engaging in Category III business ownership or
operation. Supervisors or
the Coordinator may require that the member submit to special oversight or
management procedures or to cease such activities, if they determine that such
activities constitute a Conflict of Interest or are otherwise detrimental to
the college's school's, department's, or individual's primary duties,
especially if the business places excessive or disproportionate demands (e.g.,
see section 4.1.2.3) on the time, energy, or intellectual effort of the
individual involved. Members may appeal their supervisor's decision to the
Coordinator, or
the Coordinator’s decision to the Committee.
4.7 Use
of University Resources
4.7.1 Definition
4.7.1.1 Category III activities include the use of MTU resources in connection with any work
undertaken by members for outside activities.
4.7.2 Category III Use Guidelines
4.7.2.1
Correspondence and reports related to outside activities must not be written on
MTU stationery, nor shall such correspondence or reports identify the member as
representing MTU.
4.7.2.2
Members
should abide by MTU policies, such as the MTU Computer Use Policy and
University Web Policy, that govern use of MTU resources.
4.7.2.3 Members engaged in outside activities
involving more than minimal use of MTU equipment or resources as determined by
the supervisor, department chair or dean, must make special arrangements to
schedule the use of those resources. Members must reimburse MTU for any MTU
resources, including small-scale office or laboratory equipment, used during
the provision of work for outside entities for which they receive direct
compensation. If actual costs cannot be determined or a use fee negotiated, the
cost of using MTU facilities will be deemed to be fifteen percent (15%) of any
gross revenues (such as a consulting fee) received by the member in connection
with the provision of services during which the member used MTU facilities.
4.7.3 Disclosure and Review
4.7.3.1 Before engaging in the use of MTU
resources in connection with any work undertaken for outside sponsors, members
must fully disclose in writing to their immediate supervisors the extent to
which the proposed activity will utilize MTU resources. Supervisors may require that the member submit to special oversight or
management procedures or cease such activities, if they determine that such
activities constitute a Conflict of Interest or are otherwise detrimental to
the college's, school's, department's, or individual's primary duties. Members may appeal their supervisor's
decision to the Coordinator.
4.8
Supervision of Relatives
4.8.1 Guidelines
4.8.1.1 This
procedure is intended to prevent members from being accused of unfairly or
inappropriately advancing the interests of a family member or relative.
This policy also applies to principal and cooperating investigators conducting
sponsored research or other programs. Primary responsibility for avoiding
situations that create the appearance of conflict of interest falls on the
member or investigator.
4.8.1.2 Under no circumstances may members initiate or participate
in MTU decisions involving a direct monetary or non-monetary benefit to a
relative as defined in Board of Control Policy 3.8 (spouses, brothers, sisters,
sons, daughters, and parents) or person with whom member has close personal
relationship including, without limitation, decisions related to initial
appointment, retention, promotion, salary determination, travel, leave of
absence, stock shares or profits, stock options, and initial public offerings.
4.8.1.3 Members should exercise caution in their
involvement with MTU decisions that benefit relatives or a person with whom the
member has a close personal relationship.
4.8.1.4 Members who serve as principal and cooperating investigators
of proposals or participate in programs funded by outside agencies and
conducted through MTU must at all times abide by MTU policies and procedures
regarding hiring and supervision of relatives and related rules regarding
procurement during the life of the grant or contract.
4.8.2 Disclosure and Review
4.8.2.1 If any member serves in a supervisory role
to a relative, then such member must fully disclose that relationship to his or
her immediate supervisor. Supervisors may require the member to submit to
special oversight or management procedures or require alternative supervisory
responsibility for the relative. Members may appeal the supervisor's decision
to the Coordinator. Members have the primary responsibility for avoiding this
type of conflict of interest, and should excuse themselves from any situation
that might create even the appearance of nepotism. When in doubt, members
should step aside from potential conflicts of interest and seek advice from
higher administrators, who may appoint alternate supervisors for such cases.
4.8.2.2 Principal investigators and cooperating
investigators of proposals must fully disclose in writing to their immediate
supervisor and to the Coordinator their intent to hire relatives or include
relatives as investigators on the proposal at the time they submit grant and
contract proposals to MTU for approval and justify such a decision. The
Coordinator will work with the investigator(s) to propose remedies or
mechanisms for ameliorating, mitigating, or eliminating the Conflict of Interest,
including requiring the member to submit to special oversight or management
procedures or requiring alternative supervisory responsibility for the
relative, or the Coordinator will disapprove the proposed activity. These
remedies or mechanisms need not be finalized before submission of the proposal,
but must be finalized to the satisfaction of the Coordinator before funds may
be expended by any investigator to hire the relative. Members may appeal the Coordinator’s decision to the Committee.
5 Category IV:
Complex External Relationships, Including Outside Business Activities and
Entrepreneurial Projects
5.0 Background
Certain
external relationships entered into by members, by their very nature, pose
complicated Conflict of Interest problems. For example, MTU, like most state
universities, is expected to contribute to the state's economic development by
encouraging the movement of new ideas, processes, and technologies developed by
members into the marketplace. On occasion, members have sought to turn ideas into
marketable products, jobs, and profits. Adherence to the disclosure and review provisions of this
policy will help avoid improper preferential treatment to individual business
enterprises that involve members. It will also help to delineate more clearly
where activities that are part of a member’s MTU responsibilities end, and
where outside activities begin, when MTU employees have private business
interests related to their professional university responsibilities. The
possibility of financially benefiting outside entities, as well as one's
self, further clouds the issue. Finally, it is also possible for research
efforts by members who are connected to outside business interests to take
unfair advantage of the university's resources, since these resources are not
available to potential competitors.
5.1
Definitions
5.1.1 A member is normally deemed to be engaging in Category IV
activities when that member has a significant financial interest of $10,000 or
more per year in any outside activity related to their MTU responsibilities, i.e., (i) a significant financial
interest that would reasonably appear to be affected by the research,
educational and/or professional activities of the member, in particular
sponsored research activities, or (ii) a significant financial interest in
entities whose financial interests would reasonably appear to be affected by
such activities. The term “significant
financial interest” means anything of monetary value, including but not limited
to, salary or other payments for services (e.g. consulting fees or honoraria);
equity interest (e.g. stocks, stock options or other ownership interests); and
intellectual property rights (e.g. patents, copyrights and royalties from such
rights). The term does not include salary, royalties or
reimbursements from MTU; income from seminars, lectures or teaching engagements
sponsored by public or non-profit entities; income from service on advisory
committees or review panels for public or nonprofit entities; equity interests,
when aggregated for spouse and dependent children, which do not exceed $10,000
in value and do not represent more than a 5% ownership interest in a single
entity; salary, royalty or other payments, when aggregated for spouse and
dependent children, which do not exceed $10,000 in a year.[1]
However,
Category IV activities defined below in 5.1.1.4-5.1.1.7 require disclosure even
if the financial interest has not yet reached the $10,000 threshold. Category
IV activities include, but are not limited to:
5.1.1.1 participation in testing, trials, research, evaluation, or
development of a technology, machinery, process, product, hardware or software
owned or controlled by a business in which the member, a relative, or an
associated entity (trust or any other enterprise over which the individual
exercises a controlling interest) has a consulting relationship, sits on a
board of directors, holds stock or stock options or similar ownership interest,
or has any other financial interest;
5.1.1.2 assignment of students, postdoctoral fellows, or other
trainees to projects supported by a business (either as sponsored research or
as a gift) in which the member, a relative, or an associated entity (trust or
any other enterprise over which the individual exercises a controlling
interest) has a financial interest other than royalties under MTU policies;
5.1.1.3 participation in, or taking administrative action on,
MTU-supervised activities
via grants and contracts, purchase orders, lease arrangement, rentals, and/or
donations from a business in which the member, a relative, or an associated
entity (trust or any other enterprise over which the individual exercises a
controlling interest) has a consulting relationship, holds stock or similar
ownership interest, has any other financial interest (other than royalties
under MTU policies), or serves on the board of directors or advisory board;
5.1.1.4 assumption
of an executive position in a business engaged in commercial or research
activities related to his/her MTU responsibilities;
5.1.1.5 holding
of a financial interest in a business related to the member's MTU
responsibilities that competes or has the potential to compete with services,
products, or bids for sponsored research by MTU;
5.1.1.6 taking any
action on behalf of MTU that is
beneficial to a business in which the member, a relative, or an associated
entity has a financial interest.
5.2 Category
IV Guidelines
5.2.1 Early efforts to establish a business to commercialize the results of an
individual's MTU research may require some latitude in these areas. Members
interested in beginning entrepreneurial activities based on developments that
have occurred during their employment at MTU should consult the Office of
Intellectual Property and Technology Commercialization to determine if a
license is necessary (see 4.3.1.2) Once an enterprise has been established by a
member or involving a member, he or she must clarify the relationship between
MTU and the business with which he or she has financial interests. In
particular, the member’s role in the business and the relationship between the
member’s MTU and business activities must be disclosed to the Coordinator. In addition, if students are involved in
this activity, members must fully disclose to the students the relationship
between MTU and the business.
5.2.2 Members engaging in Category IV activities must abide by
the Category III guidelines for use of university resources (see 4.7 above) and
supervision of relatives (see 4.8 above).
5.3 Category
IV Disclosure and Review
5.3.1 Members who engage in any Category IV activity including
research and consulting, must submit timely, complete and accurate Disclosure
Forms to
their immediate supervisor and the Coordinator in advance of pursuing that
activity. Filing these forms with the Coordinator will begin the process of
seeking permission to engage in Category IV activities. All new Category IV
activities must be reviewed and approved by the Committee. The supervisor,
Coordinator and the Committee will keep this information as confidential as
possible.
5.3.2 After reviewing the Disclosure Forms the Coordinator may
require the member to submit to special oversight or management procedures or
to cease such Category IV activity altogether. Members may appeal the
Coordinator's decision to the Committee.
5.3.3 All members with a Category IV Conflict of Interest must
submit an annual report to the Coordinator with an update of all his or her
Category IV activities over the previous 12 months. This report will normally
be submitted in April, and the Coordinator will review this report within two
weeks.
6 Category V:
Other Activities and Conflicts
6.1 Purchasing
Purchasing is
an area where concerns about Conflict of Interest traditionally have focused,
given the opportunities that exist for an employee to benefit inappropriately
from official activities. MTU's purchasing procedures are designed to protect
MTU employees from the appearance of taking unfair advantages or making
inappropriate gains through their control of University purchases. The
procedures also protect MTU and insure that individuals responsible for
purchases are not in a Conflict of Interest and abusing their position.
6.1.1
Guidelines
6.1.1.1 MTU's purchasing policy seeks to use disclosure mechanisms
to insure that the marketplace, not personal financial gain, guides purchasing
decisions.
6.1.1.2 All members authorized to and engaged in purchasing on
behalf of MTU in any capacity must:
6.1.1.2.A Give first consideration to the objectives, policies and
procedures of MTU.
6.1.1.2.B Strive to obtain the maximum ultimate value of each dollar
of expenditure.
6.1.1.2.C Cooperate with trade and industrial associations in the
promotion and development of sound business methods.
6.1.1.2.D Demand honesty in sales representation whether offered
through the medium of an oral or written statement, an advertisement, or a
sample of a product.
6.1.1.2.E Decline personal gifts, gratuities, goods, services, and
trips, which might in any way influence the purchase of materials.
6.1.1.2.F Grant all competitive bidders equal consideration, to
regard each transaction on its own merits, to foster and promote fair ethical
and legal trade practices.
6.1.1.2.G Accord a prompt and courteous reception insofar as
conditions permit to all who call on legitimate business missions.
6.1.1.2.H Counsel and cooperate with National Association of
Educational Buyers members and to promote a spirit of unity among them.
6.1.1.3 Purchases may be made from firms in which a member or a
relative has a financial interest only upon prior, written disclosure to the
Coordinator and written approval by the member's immediate supervisor.
6.1.2
Disclosure and Review
6.1.2.1 Members authorized to and responsible for purchasing
equipment or services for MTU must fully disclose in writing any financial relationships
with potential vendors to the Coordinator upon each purchase requisition. A
member must disclose any level of ownership in, or control of, a company with
which such member intends to do business using MTU funds, equipment, expertise,
or influence, for any level of financial relationship.
6.1.2.2 Members authorized to and responsible for purchasing
supplies or services under research grants or sponsored projects also must
comply with the guidelines and standards specified in the individual contracts,
as well as with all MTU policies and procedures. If there is a conflict between
the different applicable policies and procedures, the member must resolve the
conflict with the advice of the Coordinator.
6.1.2.3 Members who exercise a significant measure of control over
purchases because of their positions (buyers, department chairs, MTU officers)
or because they must approve certain purchases (deans, upper-level
administrators, Board of Control members, etc.) must file financial disclosure
forms with the Coordinator if
there is a Conflict of Interest.
6.1.2.4 After reviewing submitted Disclosure Forms, the Coordinator
may require the member to submit to special oversight or management procedures
or to reverse the purchasing decision altogether. Members may appeal the
Coordinator's decision to the Committee.
6.2 Business
Referrals (see end note 1)
6.2.1
Guidelines
6.2.1.1 Except within the context of consulting activities that
conform to MTU's policies on consulting (see sections 3.1.1 and 4.1 and 4.2), a
member, while acting in the context of his or her MTU duties, may not make
professional referrals to a business or outside entity in which he/she, a
relative, or an associated entity has a financial interest.
6.2.1.2 To obtain advice untainted by potential or perceived
Conflicts of Interest, MTU employees must apply the principle of separation of
functions when retaining consultants or purchasing products. In this context,
the term "function" pertains to advising versus performance of tasks.
6.2.1.3 MTU must normally disqualify a consultant who serves as an
uncompensated adviser to MTU from receiving compensation for providing services
to MTU. MTU normally must not accept advice from a consultant that refers MTU
to an enterprise in which the consultant has a financial interest.
6.2.2
Disclosure and Review
6.2.2.1 A member may make exceptions to these procedures in cases
where MTU clearly benefits from not separating advice and service into separate
functions. Any exception to these section 6.2 guidelines must be approved in
advance by the Coordinator and the member's immediate supervisor.
6.3 Business
Relationships with Subordinates
When a
supervisor enters into a business relationship with a subordinate not involving
sponsored research, a conflict could arise concerning potential or perceived
coercion. Most business or consulting relationships are routine, acceptable and
should be encouraged. Some types of contractual, business relationships are
more serious and need more detailed disclosure, and may be prohibited. An
example of a relationship that may be prohibited, and that must be disclosed
and reviewed by the Coordinator, is a partnership that makes the student (or
subordinate) a co-owner or officer of a business, where the differential in
power puts the student (or subordinate) in an unfair bargaining position and
compromises the advisor's (or supervisor's) primary responsibility to MTU. Such
a business relationship is especially problematic if it involves undergraduate
students.
6.3.1
Guidelines
6.3.1.1 Members may occasionally hire students or subordinates to
do work for them unrelated to the member's MTU responsibilities (e.g., yard
work) or in a business setting (e.g., the hiring of students to do survey work
or testing as part of a consulting project). These activities are reasonable as
long as there is no coercion involved and fair and reasonable compensation is
provided.
6.3.1.2 In rare cases, members may enter into contractual or
business relationships involving substantial actual or potential financial
interests with students that they supervise provided that members sever their
MTU supervisory relationship with the student prior to negotiating the contract
or business relationship. This supervisory relationship may be maintained,
however, at the request of the member and the student, and with the prior
approval of the member's chair, dean, or director and the Coordinator.
6.3.2
Disclosure and Review
6.3.2.1 Under cases described in section 6.3.1.1, members must
notify their immediate supervisor prior to hiring subordinates or students whom
they advise or from their courses. The immediate supervisor may require the
member to submit to special oversight or management procedures or to reverse
the contemplated hiring altogether. Members may appeal the supervisor's
decision to the Coordinator.
6.3.2.2 Under cases described in section 6.3.1.2, members must
notify their immediate supervisor and the Coordinator. The immediate supervisor
and/or Coordinator may require the member to submit to special oversight or
management procedures or to eliminate the contemplated relationship altogether.
Members may appeal the supervisor's and/or Coordinator's decision to the
Committee. To avoid doubt, in such circumstances the immediate supervisor
and/or Coordinator will normally require that a faculty member be replaced as
the student's advisor. The involved student has a right to discuss issues
related to activities described in this section with the faculty member's
immediate supervisor and/or the Coordinator prior to the imposition of any
conditions upon the faculty member.
7 Review and
Enforcement
7.1 Supervisors
7.1.1 Supervisors have
substantial responsibility to work with faculty and staff in their departments
to resolve Conflicts of Interest. They should seek the advice of the
Coordinator as necessary.
7.1.2 Supervisors must submit
to the Coordinator an annual report of conflicts of interest that they have
resolved in their department. This will
assist the Coordinator in preparing the Coordinator’s annual report to the
Provost and Board of Control.
7.2 MTU
Conflict of Interest Coordinator
The Provost
and Senior Vice President for Academic and Student Affairs must designate a
Coordinator with an academic background and a familiarity with the academic and
research process. The Coordinator's primary responsibility will be to review
submitted Disclosure Forms and in cases of Category III, IV or V activities to
determine appropriate mitigation procedures whenever possible. The Coordinator
will have the authority to certify that MTU is in compliance with the Conflict
of Interest guidelines or regulations of external funding agencies as well as
those of MTU and the State of Michigan. The Coordinator will work with members
to identify means of minimizing or eliminating potential Conflicts of Interest.
The Coordinator also will have the authority to contact funding agencies in the
event that Conflicts of Interest cannot be resolved under these
procedures. The Coordinator will confer with Research
and Sponsored Programs before releasing any confidential information.
The
Coordinator will develop procedures to hear appeals of decisions made by
supervisors and will retain records connected to Coordinator-level Conflict of
Interest reviews for three years after each project is completed. The
Coordinator will request and must receive from supervisors an annual report that summarizes Conflicts
of Interest disclosed to supervisors, and
must prepare annual reports for the Provost and Board of Control that includes
a summary of Conflict of Interest activities during the previous year.
The
Coordinator will serve as a resource for members seeking to gain more
information about Conflicts of Interest, how to avoid them, and how to mitigate
and resolve conflicts that occur. The Coordinator will assist in the completion
of Disclosure Forms by members in a fashion analogous to MTU research staff who
help prepare budgets and financial statements for sponsored research proposals
to outside agencies. The Coordinator will play the role of facilitator and
educator on the subject of Conflict of Interest at MTU and will work with
members in seeking resolutions to Conflicts of Interest. Finally, members who
have concerns about Conflicts of Interest involving other members may contact
the Coordinator about their concerns.
All
communications with the Coordinator will normally be kept confidential. Members will have an opportunity to work
with the Coordinator to identify and eliminate their conflicts of interest. The Coordinator must contact immediate supervisors
about any unremedied Conflicts of Interest so that they may be examined
pursuant to these procedures.
7.3 MTU Conflict of Interest Committee
7.3.1 The Committee will review all activities
that fall under Category IV, as well as research proposals seeking external
funding that contain Conflicts of Interest that cannot be resolved by the
Coordinator, in a timely manner. The Committee is a permanent committee elected
by the MTU Senate, consisting of three members from the Senate constituency
(faculty and staff), with staggered
terms, in addition to the Coordinator as an ex officio member. It is
anticipated that relatively few cases will require such a review. But for these
reviews, the Committee may add, on a case-by-case basis, additional members as
necessary. These additional members will be appointed by the President of the
MTU Senate and the MTU administration based on their knowledge of the
applicable field of expertise as well as knowledge of Conflict of Interest and
intellectual property issues.
7.3.2 The charge to this Committee includes the following,
without limitation:
7.3.3 If the
Committee, in considering cases of the last two types, finds that a significant
Conflict of Interest exists, it will recommend to the Provost and Senior Vice
President for Academic and Student Affairs that a member take actions to
ameliorate or alleviate the Conflict of Interest. These actions may include,
without limitation:
This list is
not exclusive and there may be other possible actions adopted to ameliorate or
alleviate the Conflict of Interest.
7.3.4 In instances where a satisfactory resolution of Conflicts of
Interest still cannot be achieved through this procedure, the Coordinator will
contact relevant funding agencies to inform them of the circumstances
surrounding such cases. The Coordinator will notify Research and Sponsored
Programs before contacting these agencies. This step must be taken only at the conclusion of MTU's internal
review process. In the interest of maintaining confidentiality, principal
investigators and other members must not contact sponsors about such cases until
after the Coordinator has done so.
7.4
Violations of MTU Conflict of Interest Procedures
7.4.1 All members, at the time they begin their
connection with MTU, shall be given copies of these procedures. MTU may provide
continuing education about these procedures but it is the responsibility of
each member to know their obligations.
7.4.2 MTU's Conflict of Interest procedures place significant
trust and responsibility upon individual members, who are expected to make full
and open disclosure of Conflicts of Interest. Violation of this trust is an
especially serious failure of professional conduct. MTU has the authority to
take action against individuals who violate these procedures, up to and
including discharge. MTU approval to undertake particular projects, including sponsored
research, consulting, and outside professional activities that create Conflicts
of Interest may be withdrawn immediately in cases where individual members fail
to fully disclose or otherwise misrepresent significant financial interests.
Similarly, failure to cooperate with MTU officials responsible for reviews of
Conflict of Interest disclosure will prevent MTU approval and sending of
outside research and project proposals to potential sponsors.
7.4.3 When a violation of MTU policy is alleged (see section
7.2.3), a thorough and timely process shall take place within MTU to provide
adequate opportunity for the Committee to reach valid conclusions. It is
imperative that the procedures described in this document be followed and
protection be afforded to the rights and reputation of both accuser and
accused, those investigating the allegations, any sponsoring agency, and MTU.
All parties shall be responsible for maintaining the confidentiality of the
Committee proceedings and of all evidence developed in the proceedings to the
extent allowed by law. All proceedings shall be in accordance with applicable
rules and obligations of MTU. Only substantiated findings of violation of these
procedures, as determined by either the Provost and Senior Vice President for
Academic and Student Affairs or the MTU President, will be part of the
personnel record.
7.4.4 Allegations of violations of these
procedures shall be directed to the Coordinator. If the activities fall under Categories I or II, the Coordinator
shall refer the matter to the individual's immediate supervisor so that
Conflicts of Interest may be examined in the normal fashion. The same shall
apply to activities under Category III, with the exception of sponsored
research activities. If the allegations allege violations of policy involving
sponsored research activities, or about Category IV and V activities, the
Coordinator shall notify the individual so accused, and gather basic
information. The Coordinator will then present this material to the Committee within
fourteen (14) working days. The accused shall have opportunity to respond and
present information to the Committee. All evidence produced by the member shall
be reviewed and secured by the Committee. The Committee shall determine whether
grounds for an investigation of a violation exist, or whether the accusations
are without merit. The Committee shall notify the accused and the Provost and
Senior Vice President for Academic and Student Affairs of its finding.
7.4.5 If the Committee determines that grounds for an
investigation exist, the Provost and Senior Vice President for Academic and
Student Affairs may accept or reject that finding. If accepted, an additional
three-person investigating Committee shall be designated to investigate the
allegations. These individuals shall be impartial members with sufficient
expertise and dedication to conduct a thorough and equitable investigation.
These members will generally not be from the same academic unit as the accused.
Appointments will be made to this committee by agreement of the University
Senate President and the MTU President. Strict attention shall be paid to any
factors that might compromise their ability to impartially examine the
allegations by those members asked to serve.
7.4.6 Private and separate sessions shall be
conducted by the investigating Committee to hear the accuser(s), the accused,
and others as determined necessary by the Committee. Sessions to obtain
testimony may be conducted either in person or by electronic means such as
telephone conference calls. The accused shall be informed of the accusations in
writing from the investigating Committee and be given the opportunity to
respond and present evidence on his/her behalf during the inquiry. All evidence
that is produced shall be reviewed and secured. Necessary administrative
support (e.g., clerical, gathering information, witnesses, and record keeping)
will be provided by the Provost and Senior Vice President for Academic and
Student Affairs.
7.4.7 The investigating Committee shall submit a written report of its findings,
conclusions, and recommendations, together with pertinent documentation and
evidence, to the Provost and Senior Vice President for Academic and Student
Affairs, the accused, the Coordinator, and the Committee within thirty (30)
working days after its formation, unless the time limit is extended by the
Provost and Senior Vice President for Academic and Student Affairs following a
written request and explanation from the Committee. If the investigating
committee finds that the procedures have been violated, it shall recommend
sanctions (see also section 7.2.3) to reflect the seriousness of the violation.
Distinctions shall be made between neglect, honest oversights, or ignorance of
procedures on the one hand, and willful violations on the other hand,
especially deliberate failures to fully disclose relationships that create
Conflicts of Interest. Sanctions may include but are not limited to sending a
letter of reprimand, setting special conditions on outside professional activities,
research or consulting efforts, or external entrepreneurial activities,
requiring special certification or assurances of compliance, disbarment from
the opportunity to conduct externally funded research with selected funding
agencies for fixed periods of time, or termination of employment. Any
termination shall occur in a manner consistent with existing applicable MTU
policies on employment practices and academic tenure. MTU may impose
limitations or special reviews on the outside professional and entrepreneurial
activities of affected individuals.
7.4.8 The Provost and Senior Vice President for Academic and
Student Affairs shall receive the investigating Committee's report and shall
respond within fourteen (14) working days, accepting, modifying, or rejecting
its findings. The Provost and Senior Vice President for Academic and Student
Affairs shall submit his/her decision in writing to the accused, the
investigating committee and the Committee, the Coordinator, the appropriate
dean or unit director, and the MTU President. Individuals have a right to
appeal decisions to the MTU President, making such an appeal within fourteen
(14) working days. The President shall appoint an appeals committee of at least
three impartial members, at least two of whom were not members of previous
committees hearing this appeal, and who are not party to the conflict. The
committee shall report its findings and
recommendations to the President within twenty-one (21) working days of being
convened. The President's decision shall be submitted to the accused, all three
committees, the Coordinator, the appropriate dean or unit director, and the
Provost and Senior Vice President for Academic and Student Affairs.
7.4.9 The
Coordinator shall maintain evidence, reports, and recordings involving the
allegations, inquiry, and investigation for five years after the submission of
the final report. Where required by the rules and procedures of sponsoring and
granting agencies, the Coordinator shall inform them of the final decisions and
provide reports of investigations.
ENDNOTES
1. This document includes enforceable provisions for members.
In addition, MTU will protect its interest from self-dealing advice by
including appropriate language in contracts for consultants and letters of
appointment for unpaid advisers. The Coordinator and Committee will have the
opportunity to review and advise MTU on the language used in the general form
of these letters and contracts.
Adopted
by Senate: 9 April 2003
Approved by President: 19 May 2003
Became Senate Procedures 201.1.1
[1] Note: This definition is from the Conflict of
Interest Policies section of the National Science Foundation Grant Policy
Manual NSF 02-051, effective August 2002, available at http://www.nsf.gov/pubs/2002/nsf02151/gpm02_151.doc