Conflicts of Interests

What is a Conflict of Interest?

In the broadest terms, when an employee has some type of personal or professional interest that competes or is in tension with his or her duties to the university, there is a conflict of interests. Conflicts of interests are regulated by law as well as by university policies and contractual obligations. 

Many conflicts of interest involves money.  In these situations a university decision-maker has a financial interest that conflicts with his or her duty to the university.  A conflict can also arise when a university official who makes a decision or takes an action has a non-monetary stake in the outcome of a decision—for example, a personal relationship, prestige, or career advancement. 

Not all conflicts of interest are wrong or unacceptable. Some conflicts are prohibited by law.  Others are subject to requirements to be disclosed and/or managed in a particular way, such as by recusing the official with the conflicting interest from the decision.  But in many cases conflicts management is not primarily a question of law but of ethics.  

A common mistaken is to decide that because you have not allowed your personal or professional interest to affect your conduct of your university duties, there is no conflict.  In fact, a conflict may exist even if your personal or professional interest does not actually affect decisions you make or the way you do your job. 

Some examples of situations creating conflicting interests are:

• accepting anything of value for doing your job -- other than compensation paid by W&M
• accepting any money, gift, loan, service, or professional opportunity that tends to influence you in the performance of your job or that gives rise to questions of impartiality OR accepting any single gift worth more than $100, if you are an employee required to complete a Statement of Economic Interest 
• accepting an honorarium for a speech, appearance or article where you provided expertise or opinions related to the performance of your work.

The Governor's Executive Order No. 2 [pdf] establishes rules for public university employees regarding conflicts of interest including gift acceptance.  

University Policies and Procedures

The university’s overarching prohibition on conflicts of interest is imposed by the Code of Ethics, which directs all members of the William & Mary community to “avoid both conflicts of interest and the appearance of such conflicts.”  

The university has a Conflict of Interests Policy, which helps ensure employees are aware of situations in which conflicts may arise, and their obligation to prevent, avoid and disclose conflicts.

There are four narrower, more specific policies and procedures.   

1.  The university’s Policy on Financial Conflicts of Interest [pdf] applies to faculty, executive employees, and professionals and professional faculty.  This  policy is particularly relevant for those who engage in research grant or contract work. 

2.  For individuals participating in research funded by the NIH, FDA, CDC, or certain other agencies operating under the Public Health Service, an additional Financial Conflict of Interest Procedure [pdf] applies. (See Conflicts in Sponsored Research.)

3.  The university’s Policy on External Paid Employment [pdf] applies to any outside professional activity that is undertaken for compensation by faculty, executive employees, or professionals and professional faculty.  This Policy requires covered employees to complete a Approval Form [pdf] prior to engaging in external paid employment.

4.  The university’s policy and rules regarding procurement of goods and services include prohibitions on conflicts arising in contracting, such as by

• Prohibiting employees responsible for procurement transactions from accepting or agreeing to accept anything of value from a bidder, offeror, contractor or subcontractor, unless consideration of substantially equal or greater value is exchanged; and
• Prohibiting employees responsible for procurement transactions from accept an employment with any bidder, offeror or contractor with whom he or she dealt on behalf of the university within one year from the cessation of the employment with the university, unless a written notification is provided to the university before the commencement of the employment by that bidder, offeror or contractor.
  

Guidance on the conflict of interest rules in procurement is provided in the Commonwealth of Virginia Purchasing Manual for Institutions of Higher Education and Their Vendors

Laws

The Conflict of Interest Act. 

The Virginia State and Local Government Conflict of Interests Act addresses financial conflicts of interest of university employees. The Act also requires certain university employees to annually disclose certain economic interests by filing Statements of Economic Interest.  These employees also must undergo training about the Conflict of Interest Act.   Guidance on the State and Local Government Conflict of Interests Act, including formal advisory opinions, is provided by the Virginia Conflict of Interest and Ethics Advisory Council at http://ethics.dls.virginia.gov/ .  Statements of Economic Interest are also available for public review on the Advisory Council's website.  Information about the Statements of Economic Interest is provided to W&M employees through the Office of Finance and Administration.  The 2017 filing guide (pdf) is available for review.

Governor McAuliffe's Executive Order No. 33 (2014, updated April 24, 2015) implements elements of the Conflicts of Interest Act by identifying classes of university employees required to complete statements of economic interest (pdf), the disclosure forms specified by the Conflicts of Interest Act.   The Governor updated this Executive Order on April 24, 2015.  The update significantly changed the list of individuals required to complete a statement of economic interest, removing from the list several types of employees that had been included in the original Executive Order.  The current list is:

1. Presidents/Vice Presidents/Provosts/Deans
2. Any other persons designated by the institution including those persons with approval authority over contracts or audits.

Those employees designated by William & Mary to complete statements of economic interest are notified by the Office of Finance & Administration of their status and the obligation to complete the statement.  

Federal Conflict of Interest Regulations  

PHS (Public Health Service) and NSF (National Science Foundation) regulations promote objectivity and research by establishing standards to ensure freedom from bias, by regulating financial conflicts of interest.  These regulations are described in the following section.

Gifts

A gift is defined in the Governor's Executive Order No. 2 as anything of value to the extent that a consideration of equal or greater value is not received by the donor.  The Executive Order includes fourteen exceptions, including gifts on the basis of personal friendship (provided that the gift was not provided because of the employee’s official position).  Other exceptions include items that are donated to charity (without taking a charitable contribution), offers of certain tickets, admission or passes, financial aid normally awarded, and certain prizes or awards.

Gifts and benefits made to or conferred upon the university for the benefit of the professional activities of a particular employee are considered to be a financial interest of the employee (for example, a laptop computer provided to W&M for the use of a specific employee).

Under state law, university employees may not accept:

• or solicit anything of value for performing their jobs, except the compensation paid by the university in accordance with the Policy on Compensation;
• directly, or indirectly, any Gift valued at over $100, from any one source, singularly or in the aggregate over the course of any given calendar year. Gifts of less than $25 each do not count towards the $100 total; however, gifts of less than $25 are prohibited if they would reasonably tend to or are designed to influence the employee in his or her job
• any money, Gift, service, loan, or professional opportunity, etc. that reasonably tends to or is designed to influence employees in the performance of their university jobs;
• any business or professional opportunity when they know there is a reasonable likelihood that the opportunity is being afforded him to influence him in the performance of their W&M work;
• or offer anything of value for helping a third person obtain a job or a contract with a Virginia governmental or advisory agency, including any Virginia institution of higher education;
• a Gift or benefit from someone who has interests in the employee’s university work, where the timing, frequency, or nature of the Gift or benefit would give rise to questions of impartiality or the appearance of using the employee’s office or position for private gain;
• directly or indirectly, any Gift from any lobbyist or any principal, employee, or agent of any principal.

In addition, under Executive Order Number 2, no Immediate Family Member of any employee shall:

• Solicit anything of value from any lobbyist or any principal, employee, or agent of a principal
• Accept, directly or indirectly, any Gift from any lobbyist or any principal, employee, or agent of any principal.
• Accept, directly, or indirectly, any Gift valued at over $100, from any one source, singularly or in the aggregate over the course of any given calendar year. Gifts of less than $25 each do not count towards the $100 total.

In addition to the prohibitions in listed above, any employee who is required to file a Statement of Economic Interest is prohibited from accepting, soliciting, or receiving any single gift with a value of more than $100 or any combination of gifts with an aggregate value of more than $100 within any single calendar year from a lobbyist, lobbyist’s principal, or a person or entity who is, or who is seeking to become, a party to a contract with William & Mary, except to the extent permitted by Section 2.2-3103.1 of the Code of Virginia.  

Employees with questions or inquiries regarding these Gift limitations are encouraged to contact University Counsel.  

Conflict of Interest Obligations Arising in the Context of Sponsored Research Activities

Faculty and others involved in sponsored research at W&M are subject to the university policies and procedures regarding conflicts of interest, particularly the Policy on Financial Conflicts of Interest.  They are also subject to specific requirements and restrictions imposed by the grant.  And individuals participating in research funded by the NIH, FDA, CDC, or certain other agencies operating under the Public Health Service are subject to W&M's Financial Conflict of Interest Procedure. This procedure involves self-disclosure by investigators of financial interests.   It also requires investigators to periodically complete online training regarding conflicts of interest.  This training is distinct from the state-provided training regarding the Conflicts of Interest Act.  The Office of Sponsored Programs provides guidance and assistance with conflicts issues arising in the research context, and can answer questions regarding them. 

NIH provides guidance and online regulations regarding financial conflict of interest rules. 

Training and Other Resources

• Training on the State and Local Government Conflicts of Interests Act is provided by the State; information and access instructions are available online.  Faculty and staff required to complete Statements of Economic Interest are required to complete the training every two years.
• CITI provides an online training course covering PHS regulations regarding financial conflicts of interest.  
• For more information about conflicts of interest in the higher education context, see the Association of Governing Boards of Universities and Colleges Statement on Conflict of Interest.