Resolution on Conflict of Interest

BE IT RESOLVED that the Board of Governors of Rutgers, The State University of New Jersey adopts the following University regulations

3.83. Conflict of Interest

3.83a. In carrying out their University responsibilities and professional activities, faculty members may be presented with the opportunity of representing the interests of both the University and other individuals, organizations, or institutions. It Is the policy of the University that all faculty members avoid any conflict of interest or appearance of conflict of interest, as defined by the provisions of the New Jersey Conflicts of Interest Law as well as the relevant Regulations and written policies of the University. Whenever a potential for conflict of interest exists, faculty members have an obligation to inform the University of the potential conflict through their department chairs or unit heads and to consult with them to determine whether a conflict of interest actually exists and, if so, what appropriate steps may be required to eliminate the conflict.

3.83b. Faculty members must not represent, appear for, or negotiate on behalf of any individuals, organizations, or Institutions outside the University in connection with any contract, grant application, cause, proceeding, or other matter pending before the University. Faculty members must not act an behalf of the University in any matter involving outside organizations in which they have decision-making authority or a direct or indirect financial interest that might reasonably be expected to impair objectivity or independence of judgement (ownership or control of more than ten percent of the profits, assets, or stock in an outside organization shall automatically be regarded as constituting impairment of objectivity or independence of judgement. Faculty members must also inform the University through their department chairs or unit heads of their association, direct or indirect, with any outside organization with which the University has, or is actively negotiating for, contractual relationships, if that association includes decision-making authority or a direct or indirect financial interest that might reasonably be expected to impair objectivity or independence of judgement.

3.183c. Faculty members must not use or attempt to use their University positions to secure inappropriate privileges or advantages for themselves or others.

3.83d. Some examples of conflict of interest are as follows:

(1) Orienting University research, teaching, or other University activity for inappropriate private advantage or, without disclosure to the University, to serve the needs of outside individuals, organizations, or institutions with which the faculty member is associated for financial gain.

(2) Transmitting, without disclosure to and approval by the University, to outside Individuals, organizations, or institutions with which the faculty members is associated for financial gain, or other inappropriate nonacademic use for financial gain or other private advantage, of University-sponsored work products, results, materials, records, or Information that are not made generally available.

(3) Undertaking for financial gain or other private advantage, and without permission from the university, either In the employment of oneself or in that of outside individuals, organizations, or institutions, contracted research or other similar contracted professional activity that the faculty member would normally engage in under University auspices.

(4) Participating in or influencing the purchase or lease of equipment. instruments, materials, or other items for University use from individuals, organizations, or institutions with which the faculty member is associated for financial gain without disclosure of the association to the University.

 (5) Using University equipment, Materials, services, students, or facilities without proper autha6zation, and compensation where appropriate, for the faculty members own benefit or for the benefit of other individuals, organizations, or institutions with which the faculty member is associated for financial gain.

(6) Accepting gifts, favors, or services having value from individuals, organizations, or Institutions seeking access to University facilities or programs, or with which the University does business, under circumstances that might reasonably be interpreted as an attempt to influence the recipient in the conduct of his or her duties.

3.83e. The University retains the right to require a faculty member to withdraw from any outside association that it judges to constitute a conflict of interest with the faculty members obligations to the University. This right shall be exercised by the dean of the academic unit to which the faculty member is assigned. Before exercising this right, the dean shall provide the faculty member with an opportunity to demonstrate that no conflict of interest exists and shall seek advice from the unit committee of review. A faculty member who as been directed to withdraw from Outside associations may appeal the decision of the dean to the campus provost, who will render a final decision.

3.83f.

A. Introduction

There are times when a faculty or staff members involvement with commercial enterprise may exceed the usual relationships developed as part of normal duties, in professional affiliations, or In a consulting role, and thus may not be covered by other provisions of University ethics regulations or policies, or by the University's patent and copyright policies. The propensity for such involvement has increased as the potential to develop commercial enterprises to market university research-based technology has increased. The University recognizes that such involvement can be and has been of significant benefit to the University, the faculty or staff member, the commercial entity, the general public, and the economy of the State of New Jersey and encourages worthwhile technology transfer. Involvement with commercial enterprise also offers the potential for conflicts of interest and time, for inhibition of free exchange of information, and for interference with the faculty or staff member's primary allegiance to the University and its mission. This potential Is most likely to exist when a proposed agreement closely relates to the faculty or staff members area of academic work. An essential part of the University's commitment to encouraging worthwhile technology transfer is protection of the University's integrity and its primary goals of education and open inquiry. Toward this end, this Section of the University's Code of Ethics prescribes a disclosure and approval process for faculty or staff involvement with commercial enterprise wherein the faculty or staff member or a member of the faculty or staff members family holds a financial Interest of greater than 1% In any organization, firm, corporation or partnership which wishes to enter into a contract or agreement with the university, The policy recognizes the needs for flexibility and the difficulty of anticipating all situations which may arisi3 by leaving discretion to the University to interpret the policy and weigh the potential risks of conflict of interest against the potential benefits to the University.

B. Review Procedure

1. Applicability. In order for the University to have an opportunity to evaluate carefully the benefits and burdens of a faculty or staff member's equity interest in a commercial enterprise which seeks to enter into an agreement with the University, all faculty members must request prior approval, In writing, from their Department Chair (or Director or unit head) when such an agreement is contemplated. Staff must request prior approval from their unit head. (The applicable procedure is more fully set forth in paragraph 8.4.) Contracts or agreements for which approval must be sought include:

a. Ownership of substantial equity (greater than 1%) in a commercial enterprise that carries on business activities with the University; and

b. Ownership of substantial equity (greater than I %) In a commercial enterprise by a member of a faculty or staff members immediate family, that wishes to carry on business activities with the University.

2. Disclosure and Information-Requirement Faculty or staff requests for approval of such contracts or agreements shall disclose fully to the Department Chair (or Director or unit head) the following aspects of the affiliation:

a. Nature of the relationship;

b. Short and long-term commitment of time and effort;

c. Financial aspects, including the extent of compensation, equity, and indirect and/or potential economic value;

d. Expected benefit to the commercial enterprise;

e. Expected benefits to the faculty or staff member, the University, the public and the State of New Jersey;

f. The names of all other individuals who have an interest in the commercial enterprise.

3. Factors and Considerations. Consideration should be given to the following major Issues when evaluating such requests from faculty or staff members:

a. There should be prospective benefits to the faculty or staff member and the University

b. The relationship should not interfere with the faculty or staff members primary obligation to his or her University appointment, nor should it undermine the academic integrity of the University;

c. There must be no foreseeable inappropriate reorientation of academic programs or student direction. Special attention must be given to protecting the intellectual property of students and In protecting students from performing work under any such contract or agreement which is out of proportion to the benefits received by the student for their performance of the work;

d. There should be free access to the results of all research conducted at the University, subject only to reasonable restrictions related to protection of intellectual property; 

e. Except under extraordinary circumstances, holding of a line management position or participation in day-to-day operations within a commercial enterprise with which the University does or will do business should not be approved.

f. Alternative arrangements, in which a conflict of interest does not exist, should be explored.

g. Such contracts or agreements shall not be negotiated by the subject faculty member on behalf of the commercial enterprise.

4. Approval Procedure. Faculty shall submit a request for approval, accompanied by the required disclosures and information, to their Department Chair (or director or unit head). In the event that the Chair finds the disclosure inadequate to evaluate the request, the Chair shall request further information. The Information disclosed by the faculty member and a record of recommendation of the Department Chair an the faculty member's request shall be submitted to the Dean, ordinarily within thirty working days of receipt of the request tar approval. In considering requests for approval of these contracts or agreements, the Chair or Dean may consult with representative faculty within the department to ensure that the request is consistent with departmental goals. The Dean shall forward his/her recommendation to the Vice President for Research for final decision. The Dean shall also forward his/her recommendation to the Campus Provost who shall advise the Vice President for Research. The Vice President for Research may seek the advice of legal counsel, the Research Advisory Board, or an advisory committee which may be formed for such purpOS83, and/or the Executive Commission on Ethical Standards as warranted. The Vice President for Research shall ordinarily render a decision within six months of receipt of the request for approval of the proposed contract or agreement In the event a proposed contract or agreement is disapproved, an appeal may be made to the University Vice President for Academic Affairs. Staff shall submit a request for approval to their unit head, who shall forward their recommendation through their superiors, ultimately to the Vice President for Research.

C. Usual Exemptions.

1.The following activities are generally exempt from the provisions of this Section unless they represent a potential conflict of interest, time, or allegiance with the faculty or staff member's University position. Such activities, however, remain subject to other applicable provisions of the New Jersey Conflict of Interest Law, N.J.S.A. 52:13D-l2 et seq., and the University's ethics regulations and policies:

a. Minor stock holdings (no more than 1%).

b. Uncompensated service on boards of directors. The Department-Chair (or Director or unit head) may also exempt compensated service on company boards if he or she finds that it does not conflict with the faculty or staff members University position. In the event that the Department Chair finds there to be a substantial conflict issue, the Chair shall submit the matter to the full review procedure set forth in Section B.4.

c. Ownership of or equity in a corporation used solely for the faculty members consulting activities.

2. Faculty members an leave without pay or during unpaid summer months continue to represent Rutgers University In the eyes of the public The provisions of the University's ethics regulations and policies are applicable during these periods. During these times, therefore, faculty members are still required to request approval for any contracts or agreements covered by this Policy.

D. Reports to University Board of Governors.

All contracts and agreements approved under this procedure shall be periodically reported to the University's Board of Governors following such approval. 

E. Annual Review.

1. Each faculty or staff member who has received approval for any arrangement under this section of the Code of Ethics during the preceding calendar year shall submit a summary of activities undertaken to his/her department chairperson by January 15th of the year next following such approval, and annually thereafter, with a copy to the Doan and the University Vice President for Academic Affairs. Department Chairs should closely monitor on-going relationships to ensure the minimizing of detrimental conflicts.

2. Following receipt of Department Chair’s reports, the Deans shall review the arrangements of faculty members In their schools approved under this Section and prepare a report for the University Vice President for Academic Affairs. The report shall be submitted to the University's Board of Governors.

3. The annual summary of faculty and staff involvement with commercial enterprise under this section shall be made available by the University's Board of Governors to the Executive Commission on Ethical Standards, and to the Legislature as required by law. Board of Governors Rutgers, The State University of New Jersey February 12, 1993