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Conflict of Interest Policy - Academic Affairs, Research and Grants & Contracts Matters
Section I. Item 10.
Historically, university missions have focused on the areas of teaching, research, and public service. In contemporary times Northern Illinois University (hereafter, "University") and its employees are asked increasingly to assist in a broad range of economic development activities, to work on projects that involve support from the governmental and the commercial sectors, and to engage in consulting relationships and other outside activities that interrelate the University missions to public benefit interests outside the University. Generally, such outside activities enhance professional development, scholarship, and teaching and are strongly encouraged. Along with these benefits, the arrangements between external enterprises and the University, its employees, and students, can potentially create possibilities for conflicts of interest that must be avoided or otherwise managed to protect the integrities of the concerned parties.
The purpose of this policy statement is not to discourage or prohibit these activities, but to serve as a standard and resource for guidance through disclosure, review and resolution, in order for the University to manage, reduce or eliminate any real or perceived conflicts associated with the University's research and scholarly activities.
Because universities are stewards of public funds and public trust, NIU fosters assistance to its employees in identifying activities that present potential for conflicts and in reducing or managing those potential conflicts to ensure that they do not threaten the integrity of the University's employees or its core activities.
A conflict of interest occurs when there is a divergence between an individual's private interests and his or her professional obligations to the University such that an independent observer might reasonably question whether the individual's professional actions or decisions are determined by considerations of personal private gain, either financial or otherwise. A conflict of interest depends on actual situational conditions, the respective roles of the personnel who may be involved, but not on perceptions of the individual's moral character.
This policy should be viewed as complementary to existing University policies and practices. It incorporates Illinois law (110 ILCS 100/1 et seq.) that requires fulltime University faculty members obtain prior written approval before engaging in remunerated private consulting, commercial business, or research for non-governmental external persons or organizations. It also incorporates related policies set forth in various University governance documents.
A. Statement of Policy
University employees and others acting on its behalf have the obligation to avoid ethical, legal, financial, or other conflicts of interest and to ensure that their activities and interests do not conflict with their commitments to the University or its prosperity and welfare. Essential to effective administration and adherence to this policy are clear and complete disclosure of outside activities and interests to designated University entities, and their review and management as described below.
B. Persons Covered
These policies and procedures apply to all employees of the University (including, but not limited to, officers, administrators, faculty, supportive professional staff, operating staff, and students) who are directly or indirectly involved in scholarly and/or research activities. All covered persons are referred to herein as "University employees" or "employees."
It is the responsibility of the employee to know the University's published policies on conflict of interest and if uncertainties arise, to seek advice and counsel from the Office of the Provost (OP), the University General Counsel, or the University Ethics Officer to clarify questions. Any perceived or potential case of conflict of interest should be reported in writing to the OP. In cases where the employee reports to a different division of the university organization, the written report should also be referred to the appropriate Vice President by the Executive Vice President and Provost (Provost). In cases where the employee reports to the President, the written report should also be referred to the President. Responsibility for avoidance of conflict of interest lies primarily with the employee, as does accountability for non-compliance.
The University, through this policy, informs each employee of his/her disclosure reporting obligations. Responsible behavior requires that the University reviews disclosures of potential conflicts and takes action to manage, reduce or eliminate any actual conflicts.
D. Principles and Definitions
1. Research financial conflict of interest (Financial Conflict of Interest Disclosure) exists when significant financial interest considerations may compromise an investigator's method in designing, conducting or reporting research. The bias engendered by such conflicts may conceivably affect not only the collection, analysis, and interpretation of data, but also, the hiring of staff, procurement of materials, sharing of results, choice of protocol, involvement of human participants, and selection of statistical method approach and application.
The term "investigator" means the principal investigator, co-investigators, and any other person responsible for the design, conduct, or reporting of research funded by or proposed for funding by the sponsor. For purposes of financial disclosures, "investigator" includes the investigator's family.
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 interests (e.g., stocks, stock options or other ownership interests); and intellectual property rights (e.g., patents, copyrights and royalties from such rights). This includes:
- salary, royalties or other payments that, when aggregated for the investigator and his/her family are expected to exceed $10,000 over a twelve-month period.
- equity interest that, when aggregated for the investigator and his/her family exceeds $10,000 in value as determined through reference to public prices or other reasonable measures of fair market value, and represents more than a five percent ownership interest in any single entity.
Payments received through the University, including from grants and contracts are excluded. Appropriate reporting procedures described below must be followed if the designated limit is exceeded.
"Family" includes a person's spouse and children and any person who either receives or from whom an employee receives, directly or indirectly, more than one-half of his or her support.
NOTE: Where the employee is participating in research involving human subjects, and where the employee or family member has any financial interest in the sponsor that interest must be disclosed, regardless of its value.
2. Conflict of commitment arises when activities and undertakings that are not direct responsibilities of a University faculty or staff employee are so substantial or demanding of time as to interfere and/or diminish adequacy of performance of the employee's responsibilities to his or her unit, to students, and/or to the University.
a. Consulting Activities
Interaction (e.g., research or consulting) between employees and outside enterprises for reasonable periods of time (and which may or may not provide personal remuneration) is advantageous when the relationship enhances one's professional skills or entails a public service activity. Such relationships are encouraged as long as they are consistent with the missions of the University.
Based on the positive recommendation of the administrator of the employee's unit, the University has generally allowed full-time instructional staff members up to one day per week (i.e., 40 days per appointment year for those on academic-year appointments) for appropriate outside activities, subject to the specific needs of that person's administrative unit. Such time for non-University activities is not an automatic entitlement of either an instructional or staff employee but requires prior approval from the employee's applicable supervisor and the OP. Released time is not normally available for an activity or business which is personal in nature or which is not related or does not contribute to the advancement of the employee's professional skills, or does not provide an opportunity for professional growth that will benefit the University and the public's interests. Released time from University assignment for outside activities of instructional staff members with part-time appointments is not normally available unless an exception is made by the OP. For purposes of work time reporting and accountability under the State Officials and Employees Ethics Act, authorized released time shall be considered work-related unless the authorization specifies the utilization of unpaid leave or the applicability of available vacation benefits (if any) (see Outside Consulting or Research by Full-Time Faculty form (OCRF)).
b. Involvement with Start-Up Companies
To the extent consistent with state law, University intellectual property policies and applicable Legislative Audit Commission Guidelines for Universities, the University supports faculty entrepreneurship and the creation of start-up companies founded on a faculty inventor's new technology. Such companies represent an important and viable path to technology commercialization and to local economic development and job creation. The University does not subsidize start-up companies, but the University Treasurer may, with appropriate repayment security, provide initial working funds from eligible sources on a contractual reimbursement basis provided such reimbursement obligation is written and to be repaid within a year of the advance.
In the early stages of a faculty start-up company, University employee(s) may participate, for limited periods of time, in accordance with and as specified by the aforementioned consulting activities, in business management discussions and decisions affecting the development of their company. Because of the personal involvement of the faculty member in his or her own start-up company, it is expected that such involvement will be:
(a) fully described and considered in the Conflict Management Plan (see E.4 below), and
(b) updated whenever there are significant changes in the situation.
While University faculty and staff may provide professional consulting to a start-up company (frequently with titles such as chief scientific advisor or chief technical advisor), they are not normally permitted, while employed full time by the University, to hold active line titles/responsibility in the company (CEO, CFO, President, etc.) or be actively involved in its day-to-day management and operation.
3. Conflict of opportunity arises when an employee diverts, for personal gain and without prior University approval, activities or opportunities for project support (especially research projects) to outside enterprises or other institutions, which could have reasonably advanced the University's mission if they had come to the University.
4. Conflict of rights arises when an employee participates in ceding or transferring publication or intellectual property rights elsewhere that would normally reside with the University when doing so would be detrimental to the University. No employee may cede or transfer rights to patents, licenses, copyrights, or other proprietary rights in research results to any external person or entity except through the sharing provisions set forth in a research or consulting contract and pursuant to the University Intellectual Property Policy.
5. Use of University facilities and resources not typically available to the general public may not be used for private or commercial gain except on University projects officially sponsored by internal or external sources. All externally sponsored projects carried out using University facilities or resources must be conducted under a grant or contract agreed to and administered by the University. Use of University facilities and resources or personnel may be allowable in some cases through a full cost reimbursement contract including overhead costs between a University unit and outside user.
6. Students and trainees should not be involved in faculty member's outside activities unless it can be demonstrated that such participation affords a substantial educational benefit for them. No employee will hire or directly supervise a student in non-University activities while simultaneously serving as the student's academic instructor, advisor, supervisor, or as a member of that student's thesis or dissertation committee without the prior written approval of the Chair or the student's academic unit. Cases involving use of students and trainees must be closely monitored by the academic unit, not by the individual employee.
University identification and management of conflicts of interest and commitment begin with disclosure: the release of relevant information about significant financial interests and time and other commitments to non-University interests and activities. All disclosures of potential conflict of interest should be reported to the OP.
The University has established a reporting system under which faculty members annually request permission from the OP, as the President's duly appointed designee, to engage in personal outside research or consulting. This annual request must be completed both for ongoing activities as well as for new outside research or consulting activities. This request is initiated through completion of the Outside Consulting or Research by Full-Time Faculty form (OCRF). Annual written approval to engage in such activities must be received prior to such engagement. Faculty who receive permission to engage in these activities then must submit an annual written report to the faculty member's department chair, dean and OP of the amount of actual time spent on the approved research or consulting project(s). Compensation for these activities does not qualify as additional pay or as any other type of University remuneration and therefore may not be paid through University cost centers.
Employees submitting a grant proposal or contract (also see Section F below) must complete the Conflict of Interest Statement on the internal clearance documents. If employees on the project do have a potential conflict of interest, they must submit to the OP a copy of his or her updated OCRF and a Statement of Financial Interest form at the time of proposal submission. The conflict must be satisfactorily resolved before the University will authorize the expenditure of any award or contract funds. A copy of his or her OCRF and Statement of Financial Interest must be submitted thereafter on an annual basis or as new reportable interests are obtained.
For reporting and review purposes, conflicts of commitment only occur during the contract period; conflicts of financial interest can occur beyond the contract period.
The OP will receive the disclosure and in a timely manner, will make one of the following determinations:
- no conflict exists,
- a conflict situation could exist and monitoring of the situation is required, or
- a conflict situation does exist and must either have a management plan or be eliminated.
If a conflict or potential conflict is deemed to exist, the employee and his or her unit Chair/Director will develop a Conflict Management Plan to address the conflict and with his or her Dean's approval will submit it to the OP for approval or revision. The Provost may consult with the Ethics Officer and/or convene, at his/her discretion or at the request of interested parties, an ad hoc Committee on Ethics and Professionalism (CEP) to review the conflict management plan. If the University Ethics Officer is consulted or a CEP is convened, after review, the Ethics Officer or CEP will forward appropriate recommendations to the Provost for final action. That action plan might include one of more of the following (this list is not exhaustive):
- Requirement for public disclosure of significant interests.
- Monitoring of the activity by an independent oversight committee of reviewers.
- Modification of a research or business plan to avoid or minimize conflict.
- Disqualification from participation in all or part of a funded research activity.
- Divestiture of significant financial interest.
- Severance of relationships that create actual or potential conflicts.
- Required utilization of available vacation or unpaid leave options to facilitate continued participation in relationships posing an actual conflict of commitment.
3. Committee on Ethics and Professionalism
At the Provost's discretion, a CEP can be convened to help the OP analyze the extent to which a conflict of interest may exist and how it might be managed and resolved. The CEP can also be convened at the request of interested parties or to resolve any disputes that an employee may have with the OP's determination. The CEP will consist of four tenured faculty members, one of whom will chair the committee, one member of the group to which the individual with the potential conflict of interest belongs, and a representative from the OP as ex-officio and non-voting member. The University General Counsel or designee will act as counsel for the CEP and will assist in fact development and interpretation of each case brought for consideration. The CEP and its chair will be appointed jointly by (1) the President of the Faculty Senate or, in the alternative, the Assistant Chair of the Graduate Council and (2) by the Provost. Members from the supportive professional staff, operating staff, or the student body will be appointed in consultation with the appropriate Councils or Officers.
A person who has a close professional or personal affiliation or any real or apparent conflict of interest with the individual with the potential conflict of interest should not be a member of the CEP, and is required to bring such affiliation or real or apparent conflict to the attention of the Provost and the President of the Faculty Senate or the Assistant Chair of the Graduate Council immediately, or within a reasonable amount of time after discovery. This person may still be called as a witness to the CEP. The CEP may provide advisory interpretations of the University's policies and procedures to the Provost on conflict of interest. After consultation with the University General Counsel or designee and, if necessary, with the employee, the elected members of the committee will render an advisory determination such as one of those listed above under E.2. Review.
The advisory findings of the CEP will be forwarded to the Provost who will make a final determination. The OP will provide the employee with written notification of his or her determination. Original documentation will be retained in the OP with a copy given to the employee.
4. Conflict Management Plan
The Conflict Management Plan is a collaborative effort between the University and employees to manage potential conflicts of interest. Among others, the issues to be managed include conflict of commitment, use of University intellectual property, use of University resources, involvement of University students and other staff in faculty-owned commercial enterprises and limitation on an individual serving as a principal investigator especially if the funding comes from a faculty member's personal company. Plans must be crafted to manage a particular activity. For example, a Conflict Management Plan for an outside activity involving a large time commitment by the employee would describe how the employee would manage and track his or her activities to meet the obligations of University employment.
If an employee owned start-up company meets any of the criteria below, the employee and his or her chair or director must develop a Conflict Management Plan to be submitted to the OP for review.
- Licenses University intellectual property.
- Employs University students or other University employees.
- Uses University resources, such as laboratory space or equipment, office space, or computing resources. Requires a significant commitment of time from the employee, greater than 40 working days per year or is not reasonably related to the employee's professional responsibilities.
- Involves the chair or director or other senior management within a unit. Appears to need a Management Plan for any other reason, for example, if the distinction between the employee's work for the University and his/her work for the company is not clear; even if the company is not licensing University intellectual property.
- Funds sponsored research or gifts at the University.
- Executes a facilities use or technical testing agreement with the University.
- Subcontracts to the University from awards such as SBIR, STTR, DARPA, on which the company is the prime contractor, or accepts subcontracts from awards on which the contractor University is prime.
F. Additional Reporting Procedures for Federal Research
- Public Health Service (PHS) regulations, "Objectivity in Research," 42 CFR Part 50 and 45 CFR Part 94, and the "Investigator Financial Disclosure Policy" of the National Science Foundation (NSF) apply to investigators participating in Federally funded research, as defined by the regulations, including sub grantee/contractor/collaborating investigators, but excluding applications for Phase I support under the Small Business Innovative Research (SBIR) and Small Business Technology Transfer (STTR) program.
- Disclosure of an investigator's or his or her family's significant financial conflict of interest (see C.1 above) must be done at submission of a funding application.
- The University is required to report to PHS, prior to the expenditure of any funds under a PHS award, the existence (but not the nature) of any conflict and to assure PHS that the conflict has been managed, reduced or eliminated.
- For conflicting interests identified subsequent to the University's initial report under a PHS award, the University is obligated to report the conflict and manage, reduce or eliminate it, at least on an interim basis, within 60 days of its identification.
- NSF also requires the University to report any conflict the University is unable to manage satisfactorily. As part of the NSF grant proposal process, the University additionally must certify that actual or potential conflicts were, or prior to funding will be, managed, reduced, or eliminated, or disclosed to NSF.
- The records of all financial disclosures and all actions taken by the institution will be maintained for at least three years from the date of submission of the final expenditures report.
Approved by the Responsible Conduct of Scholarship Committee November 30, 2007
Approved by the Graduate Council February 1, 2010
Approved by University Council March 17, 2010