Code of Conduct

The Institute is committed to maintaining the highest ethical standards of conduct and preserving the public trust in our organization. This Code of Conduct establishes a framework for the conduct of all persons holding positions of responsibility and trust on behalf of the Institute, including but not limited to members of the Institute’s Board of Trustees, officers, staff members and members of advisory groups to the Institute (collectively, “members”). Any circumstances which may arise that are not covered herein should be discussed with and resolved by the Executive Vice President of the Institute in accordance with the principles expressed in this Code of Conduct.

Principles

The Institute believes that all of its actions and those of its members must be regarded as based upon the highest motives of fairness, integrity and objectivity and that this can be accomplished if all members observe the following principles:

  • Each member should exercise the highest fiduciary standards of care, including diligence, fairness, personal integrity and prudence, when conducting any activity on behalf of the Institute.
  • In regard to all matters involving the Institute, each member should act fairly, responsibly, without any personal benefit, and without undue bias in any direction.
  • Members should assume that every situation and action may be subject to public scrutiny.
  • When negotiating on behalf of the Institute, a member must maintain an arm’s-length relationship with the other party in order to remain objective, both presently and in the future.
  • Each member has an affirmative and ongoing obligation to disclose to the Institute any relationships, existing or prospective, which create, potentially create, or may appear to create conflicts of interest, or are otherwise contrary to the policies of the Institute.
  • No employment or other decision shall be based on an individual’s race, religion, color, national origin, creed, ethnic group, sex, height, weight, sexual orientation, sex identification, age, disability, marital status, veteran status or any other characteristic protected by applicable law.
  • In the event of doubt, each situation should be resolved in accordance with the principle of avoiding even the appearance of impropriety.

Conflicts of Interest

Although it is difficult to describe every conflict of interest situation, a conflict of interest generally arises when a member has an affiliation or financial interest that would tend to affect such member’s independence of judgment in regard to a particular transaction or decision.

For purposes of this Code of Conduct:

  • Affiliation: An individual is affiliated with an organization if the individual holds a position or interest that would tend to affect the individual’s independence of judgment in regard to a particular transaction or decision, even if the transaction or decision would not result in financial gain to the individual. For example, such an affiliation may exist if the individual is a director, trustee, officer, employee, significant donor, volunteer or advisor of an organization that may receive funding from, or engage in a transaction with, the Institute.
  • Financial Interest: An individual has a financial interest in a particular transaction or decision if the individual may receive a direct or indirect financial benefit as a result of the Institute entering into a transaction or making a certain decision. For example, a member may receive a direct financial benefit if the member has an ownership or investment interest in, or receives compensation from, an organization doing business with, or receiving funding from, the Institute. A member may receive an indirect financial benefit if the member’s close relative or an individual residing in the member’s household has a financial interest.

This Code of Conduct aims to maximize confluence of interest between members and the Institute, while minimizing conflict of interest. To do so, members must:

  • Fully disclose any affiliation or financial interest that may affect the member’s independence of judgment in regard to a particular transaction or decision. This disclosure is required even if the member believes their judgment will not be affected by the affiliation or financial interest. If a member is unsure whether disclosure is required, the member should disclose the relationship.
  • Refrain from exercising undue influence over decisions regarding a transaction in which the member has an affiliation or financial interest.
  • Refrain from transacting any business with the Institute outside the scope of the member’s duties to the Institute, whether or not the transaction will occur at arm’s length. Prohibited transactions between the Institute and members include, but are not limited to, sales or leasing of property, lending of money, furnishing of goods, services, or facilities by the Institute (other than as part of a reasonable compensation package), payment of excessive compensation to a member and use of the Institute’s income or assets for the benefit of a member.

The Institute will not take any action that is inconsistent with its status as a private operating foundation. In addition, the Institute will not enter into a contract or transaction with an individual or an organization with which a member has an affiliation or financial interest unless (a) the individual or organization is performing personal services that are reasonable and necessary for carrying out the exempt purposes and programs of the Institute, (b) full disclosure of the affiliation or financial interest has been made to the Institute, (c) the person or organization being contracted with is, under the facts and circumstances of each case, the most reasonable source of the services, and (d) payment is not excessive. When the Institute makes a decision to enter into such a contract or transaction, the basis for that decision must be made a matter of record in the minutes of the meeting at which the decision was made.

Procedures

  • When an individual begins serving as a member and annually thereafter, the member shall disclose any current financial interest and affiliation that the member has with the Institute and any individual or organization that receives funding from, or does business with, the Institute. Such disclosure shall be made to the Institute’s Board of Trustees on the Annual Statement Form.
  • Each member has an affirmative and ongoing obligation to disclose to the Institute’s Board of Trustees or the member’s immediate supervisor, as appropriate under the circumstances, any financial interests, affiliations or relationships, existing or prospective, which may affect the member’s independence of judgment in regard to a particular transaction, decision, project or program of the Institute, regardless of whether the member believes that their independence of judgment will actually be affected.
  • As situations arise that may result in the Institute engaging in a transaction in which a member is affiliated or financially interested, such member shall not attempt to unduly influence the other members, and no special consideration shall be given.
  • If a member is present at a meeting of the Board of Trustees or another meeting where a particular transaction or decision with which the member is affiliated or has a financial interest is being addressed, the member shall leave the meeting while the issue is discussed and abstain from voting or taking other action with respect to the issue. The member should not communicate further with the other members on the same subject unless the non-interested members request additional information from the member. The minutes for such meeting should reflect that the member made a disclosure of their interest and abstained from voting. If full disclosure cannot be made because of an attorney-client or physician-patient privilege, then the member should completely abstain from taking any action with respect to the decision and indicate that a privilege is involved. An abstention shall not be deemed to affect the presence or absence of a quorum at any meeting.
  • After the interested member has left the meeting, the remaining members present at the meeting will decide if a conflict of interest exists that would prevent the Institute from moving forward with a particular transaction, program or project. The Institute generally must avoid any transaction that results in a direct or indirect financial benefit to a member, and is prohibited from engaging in any acts of self-dealing under section 4941 of the Internal Revenue Code. Avoiding the appearance of a conflict is also an important objective of the Institute and, to that end, the Institute will not customarily make grants to, or contract with, organizations affiliated with members or close relatives of members.

Other Duties of Members

As members carry out their duties by participating in Institute programs and decision making, and representing the Institute in different work and sectors, the members must act with the highest standards of fiduciary care. They must maintain the highest degree of ethical behavior, personal integrity and honesty. They must respect and maintain the reputation and work of the Institute. They must be prudent with the Institutes’ resources. And, so as to avoid jeopardizing the Institute’s reputation and tax-exempt status, all members must:

  • Refrain from implicating the Institute in any lobbying or political activity. The Institute itself is prohibited from attempting to influence legislation or participating or intervening in any political campaign on behalf of or in opposition to any candidate for public office. To avoid having an individual member’s political activity attributed to the Institute, members must (i) not conduct any political activity while acting on behalf of the Institute; (ii) not use any of the Institute’s equipment or facilities for any political activity; and (iii) in no way suggest that the Institute in any manner supports or opposes a particular political activity or position. The Institute encourages members to discuss any contemplated political activity with their immediate supervisor or the President.
  • Not accept any gifts that may create an appearance that the gift was intended to influence the member in making certain decisions. Members may only accept gifts, gratuities, favors or entertainment that are nominal in value and are not related in any way to a contract or other transaction that is pending before the Institute. Generally, nominal value means $75 or less. Members may accept meals from a person as long as the practice is customary under the circumstances. Members may not accept honoraria, payments or royalties for speaking engagements, articles or other activities from any individual or organization that has or contemplates entering into a transaction with the Institute without the President’s advance permission.

Maintain the Institute’s confidential information. From time to time, a member may obtain certain non-public information through their position with the Institute. When a member possesses such confidential information, the member may not use the information for their own opportunity and, for as long as such information remains undisclosed to the general public, may not divulge the information to anyone outside the Institute without the prior authorization of the President.

Investments by the Institute

The Institute’s investments present a particular application of the guidelines set forth in this Code of Conduct in order to protect the Institute when it considers an investment that might benefit the private interest of a member. In addition to the conflicts described above, a conflict of interest exists when a member is financially interested in an investment of the Institute. A member has a financial interest if he or she has directly or indirectly through business, investment or family:

  • an actual or contemplated ownership or investment interest in any entity in which the Institute has an investment,
  • an actual or contemplated compensation arrangement with any entity in which the Institute has an investment, or
  • a business or personal relationship with any individual or entity that provides or is negotiating to provide investment advice to the Institute, or through which the Institute makes or contemplates making an investment.

In addition to the disclosures made on a member’s Annual Statement, each member who is a Trustee, each member who serves on the Investment Committee, and each member on the Institute’s staff who deals with the selection, purchase, or sale of the Institute’s investments must adhere to the following guidelines:

  • Disclose a financial interest. When a member’s responsibilities to the Institute require the member to make or participate in a decision concerning an actual or potential investment by the Institute, and the member has a financial interest in the investment, the member must disclose the financial interest to the body making the decision (for example, the Board of Trustees or the Investment Committee).
  • Determine whether a conflict of interest exists. After disclosure of the financial interest, the member, if present in person at the meeting of the Board or Investment Committee, shall leave the meeting while the financial interest is discussed. The remaining Board or Committee members will vote upon whether a conflict of interest exists.
  • Address the conflict of interest.
    • If the Board or Committee determines a conflict of interest exists, the chairperson of the Board or Committee will appoint a disinterested person or subcommittee to investigate alternatives to the proposed investment. After reviewing that person’s or subcommittee’s report (which may be oral or written), the Board or Committee will determine whether the Institute can obtain a similar or more advantageous investment with reasonable efforts from a person or entity that would not give rise to a conflict of interest.
    • If a similar or more advantageous investment is not reasonably obtainable under circumstances that would not give rise to a conflict of interest, the Board or Committee will determine by a majority vote of the disinterested members whether the proposed investment is in the Institute’s best interest and whether the transaction is fair and reasonable to the Institute. The Board or Committee will make its decision as to whether to enter into the investment in conformity with such determination, and the minutes of the meeting will record the decision and reflect the basis for the decision. Under no circumstances shall the Institute make an investment that would be considered an act of self-dealing under section 4941 of the Internal Revenue Code or would otherwise be inconsistent with its status as a private operating foundation.