Date Issued: _____________________, 2002
Authority: Lloyd Armstrong, Jr.,
Provost and Senior Vice President for Academic Affairs
Dennis F. Dougherty
Senior Vice President for Administration
1.0
Introduction
The most
important heritage of the University of Southern California is our good name
and reputation, which has been created by our faculty, staff and students.
Maintaining our good name and reputation depend upon our willingness to
adhere to the highest ethical standards in our professional and business
practices.
Each andToward that end, everyevery
faculty member, staff member and student faculty member and staff employed
employee
by the University of Southern Californiamust
conduct himself or herself in a manner which willavoid
both actual conflicts of interest and the appearance of conflicts of interest
with the UniversityUniversity. The avoidance of such conflicts is important
to academic integrity in research and in the classroom. Its importance extends
to the trust that all faculty members and staff employees carry on behalf of
the public and our students, alumni, research sponsors and donors.
The objective of this document is to provide an institutional policy that protects academic freedom and encourages the full professional development of USC's faculty members and staff employees, while minimizing the risk of unacceptable behavior in potential conflict situations. This policy is intended to assist University faculty members and staff employees in managing real or perceived conflicts of interest.
2.0 Scope
This policy applies to all
faculty
members (including part-time and visiting faculty), staff and
other employees
(such as postdoctoral scholars), and students (including
postdoctoral fellows and graduate students)
employed or
otherwise engaged by the University.
3.0 Definitions
3.1 Conflict
of Interest
The term "conflict of interest"
in this policy refers to situations in which financial or other personal
considerations compromise, or have the appearance of compromising, an
individual's professional judgment and ability to perform his or her
responsibilities to USC. Faculty members
and staff employees should consider not only situations that are unacceptable,
but should also consider gray areas that might involve the appearance of
conflict. The mere appearance of a conflict may be just as serious and
potentially damaging as an actual bias in professional judgment. For every situation contemplated, there will
be some variant that adds a new set of considerations.
3.2 Close
Relation
A “Close Relation” is defined as a spouse, mutual financial
dependent, significant other, or person in an intimate relationship; a child, parent, sibling
(including in-laws and step-relations), grandparent or grandchild, niece or nephew, aunt, uncle or cousin.
3.3 Substantial
Financial Interest
The ownership of an interest of more than
5% in a
company is considered a substantial
financial interest. Any
management role in a company, e.g., officer, creates an appearance of conflict
equivalent to owning a substantial financial interest.
3.4
Employee
The term
“employee” is used in this policy to include all those covered by its
scope as defined in Section 2.0. The
term “staff employee” is used to include all employees who are not faculty
members.
4.0 Principles
4.1 Conflict
of Interest in Employment and Business Practices
A conflict of
interest exists each time a member of theUniversity faculty
members and staff community employees must not
allows a personal or outside interest to
interfere with his or hertheir duties
and responsibilities to the University.
Even the appearance of a conflict of interest should be avoided,
even though no actual interference with job performance may exist. . Any
arrangements or relationships that may pose an actual or apparent conflict of
interest should be disclosed and managed pursuant to Section 5.0 of this
policy.
Although not an all-inclusive list, examples of actual or apparent conflicts of interest in business practices that should be disclosed under this policy include:
(i)
A
uConducting business with an individual or entity in which you or
your Close Relation has a personal, managerial or substantial
financial interest;
(ii)
Maintaining
an external consulting or other business or employment relationship or
any other (including all arrangements in which
you are compensated in any way),
with a supplier, vendor or competitor of the University, or other entity which
he or shea reasonable
person might reasonably expect
would would expect to impair, or which appear to impair, his
or her iyour independence of judgment in the performance
of your University duties;
(iii)
Competing
with the University, or competing with other external vendors for University
business, whether as an individual, as an employee of another organization, or
through a separate entity owned or operated by you or your Close Relation that
exists outside of your professional obligations to the University;
(iv)
Accepting
personal or provide gratuities, gifts or
special favors from individuals or entities that provide, or seek to
provide, or may in the future provide, services
or supplies to the University. , unless such This does not include occasional gifts is
of nominal or minormodest value
((e.g., gifts less than $50.00 in value,
or isolated invitations to lunch or
dinner associated with legitimate business activities and
of modest value);
(v)
Endorsing
or authorizing the endorsement of any product or service on behalf of the
University. As described in Section
5.2, such arrangements require the explicit prior written approval from the
President, Provost and Senior Vice President for Academic Affairs or Senior
Vice President for Administration;
(vi)
Making use of any
University assets (including the University's name, trademark or service mark),
property (including letterhead), resources,
or supplies or assets in the
course of his or her own participation in activities (except for incidental use) outside the
scope of his or herhis or her employment.
Actual or apparent conflicts that cannot be adequately managed are not acceptable and are prohibited under this policy. Examples of unacceptable situations (unless recommendations to manage the situation are implemented) include the following:
(i)
CA uonditioning any actual or potential
business relationship with the University on a charitable gift or contribution made
by or givento the University;
(ii) Participating in any way in any negotiation or transaction between the University and a business entity in which you or your Close Relation has a personal, managerial or substantial financial interest;
(iii) Directly supervising or evaluating the work of a Close Relation (See also Section 4.3 of this policy);
(iv) Participating in any decision (such as decisions concerning initial appointment, retention, termination, promotion, salary, or leave of absence) that involves either a direct benefit or a detriment to a Close Relation (See also Section 4.3 of this policy);
(v) Soliciting personal gifts or special favors from individuals or entities that provide, or seek to provide, services or supplies to the University;
(vi) Unauthorized use of confidential, privileged or proprietary information obtained in connection with your University position, or use of such information for your personal benefit or the personal benefit of another.
(vii) For faculty members who conduct clinical practice, failing to abide by their respective faculty practice plan agreements.
This policy cannot regulate or eliminate all situations of conflict of interest, but is intended to enable faculty members and staff employees to recognize situations that raise an appearance of impropriety and to ensure that such situations are properly reviewed and resolved. To this end, all USC faculty members and staff employees must disclose actual or perceived conflicts so that they can be managed appropriately. Disclosure will not necessarily restrict or preclude an individual’s activities. In most cases, problems arise when the conflict is not disclosed, or when it is not assessed or managed.
4.2 Conflict
of Commitment
Each full-time faculty member and staff
employee owes professional loyalty to the University and shall be alert to the
possibility that outside obligations, financial interests, or employment can
affect that commitment. Section 3-18
of the Faculty Handbook states that, "Faculty members have a binding
obligation to discharge instructional and other regular duties, and performance
of those duties may be impaired by any private activity requiring a large
portion of time." Any involvement
by a a University faculty member or staff
employee in a personal business ventures shall be
conducted outside the University work environment and not during times when he
or she is required or expected to perform the duties and responsibilities of
his or her University employment.
Faculty members and staff employees must
be careful that their work for others than the University, including work
during sabbaticals, other leaves or vacations, while visiting other
institutions and while consulting with industry, does not conflict with their
obligations and commitments to the University, especially including potential
conflicts concerning the ownership of intellectual property and the general
responsibilities of full-time University employment. For application of these policies to faculty, refer to the
Faculty Handbook, Section 3-15 Outside Activities of Faculty Members. Faculty Handbook Section 3-15(C) states,
"It should always be borne in mind that consulting is a conditional
privilege granted by the University. As
such, the University is the final judge of the appropriateness of the outside
activity and whether it unduly compromises the faculty member's primary
responsibilities implicit in his or her contract of full-time employment with
the University."
Faculty members who seek to be educators
at other institutions concurrent with their holding a full-time USC appointment
(including teaching in corporate programs, or preparing course content for
another entity) must seek advance permission as provided in Faculty Handbook
Section 3-15(D). Such permission is
granted either as part of approving a leave of absence to teach elsewhere, or
by a separate letter from the dean.
Full-time faculty members and staff
employees may not hold substantially full-time concurrent positions elsewhere,
except as part of an approved leave.
All work by full-time faculty outside the University is governed by the
provisions of the Faculty Handbook on outside consulting, Section 3-15 (C), and
outside teaching 3-15 (D).
Simultaneous appointments at another
educational institution, or participation as a co-principal investigator or
paid staff member on sponsored projects at another institution requires prior
written permission from the dean. A
faculty member may not hold tenure at two institutions without written
permission from the Provost and Senior Vice President for Academic Affairs.
Faculty members and staff employees
involved in research activities also should refer to the Intellectual Property
Policy and Conflict of Interest in Research Policy. These policies can be found at: www.usc.edu/policies.
Staff employees are expected to share
their skills and experience with the University community and, in the spirit of
collegiality, to serve as a resource for departments outside their own. They
also should recognize the potential conflict of commitment created when
opportunities for compensation occur within the University, but outside their
home department. Additional compensation beyond base salary to staff exempt
employees by a second department is discouraged. Such payments require review by the University Compensation
Office and approval in advance by the Dean or appropriate Vice President of
both the employee’s home department and the second department. Compensation for
such employment must comply with University policies and procedures concerning
compensation, overload payments, and overtime compensation for non-exempt
employees. An individual who performs
both staff functions and teaching activities is considered a full-time staff
employee with a concurrent part-time faculty appointment and title, and is governed
by all Staff Employment Policies and Procedures. Payments to staff employees for teaching activities cannot be
made without the prior written approval of the Senior Vice President for
Administration. Full-time faculty
members with administrative duties may receive an additional stipend with
approval of the Provost.
4.3 Personal
Conflicts Of Interest
Any faculty member or staff employee
should take all reasonable steps to avoid a conflict of interest or the
appearance of a conflict of interest in his or her University work that could
arise from a family or intimate relationship with a Close Relation employed by
the University or with whom the University has contracted to provide goods or
services. In particular, a faculty member or staff university
employee shall not participate in any decision (such as decisions concerning
initial appointment, retention, termination, promotion, salary, or leave of
absence) that involves either a direct benefit or a detriment to a Close
Relation, as defined under this policy.
Faculty members and staff employees shall
not supervise directly or evaluate the work of a Close Relation. For example, a
principal investigator shall not hire on a grant or contract a person who is a
Close Relations. In an unusual
situation that would otherwise call for a subordinate to report to a supervisor
who is a Close Relation, the written permission of the Provost and Senior Vice
President for Academic Affairs is required to authorize special arrangements
for faculty members, such as having the subordinate report to an unrelated
third party. For non-faculty employees,
such arrangements require the written permission of the Senior Vice President
for Administration. To protect privacy,
faculty members and staff employees who choose to recuse themselves from such
decisions or supervisory responsibilities are not required to state reasons.
If a faculty member or staff employee is
in doubt concerning the possibility of a personal conflict of interest, it is
recommended that the employee consult the appropriate supervisor, chair or
Dean. A supervisor, chair or Dean with
similar doubts should initiate discussion with the faculty member or staff
employee; and any other employees with such concerns should raise them with the
supervisor, chair or Dean who should take appropriate steps. For faculty, advice in these situations
should be sought from the Vice Provost for Faculty Affairs or the President of
the Faculty. Non-faculty employees also
may consult their supervisor or, for employees on the University Park campus,
the Manager of Personnel Services, Policies and Procedures; or, for those on
the Health Sciences campus, the Director of Personnel Services. Such consultation may address concerns about
the potential personal conflict of interest in their own situation or those of
their colleagues. Confidentiality shall be protected to the full extent
practicable.
4.4 Conflicts
of Interest in Research
(i)Consensual
relationships are defined as those romantic or sexual relationships which are
mutually voluntary between two people. Certain such relationships, particularly
those where there is a power differential between the two individuals, carry
risks of conflict of interest, breach of trust and possibly breach of ethics.
For those reasons, an individual who is in a consensual relationship, with a
person over whom he or she has direct evaluative or supervisory responsibility
(for example, faculty-student relationships where the faculty member is
evaluating, supervising or advising the student as part of a school program,
personnel decisions, authority over certain business transactions, salary
determinations, promotions and retention) should disclose the relationship to
the appropriate Dean or Vice President. In such instances, the university may
need to take appropriate action to prevent the conflict of interest including
removal of the person with authority from his/her evaluative or supervisory
role over that individual or reassignment to another supervisory role, transfer
of one of the individuals, or implementation of an audit process, as examples.
Failure to disclose a consensual relationship may be cause for disciplinary
action, which may result in termination or dismissal for cause. Disclosure of
consensual relationships shall be handled confidentially, to the extent
practicable.
In
accordance with this policy, every employee has the continuing responsibility
to make immediate and full disclosure of any existing or potential conflicts of
interest to his or her Dean, Vice President, Chair or Director. The employee must obtain written approval
from his or her Dean, Vice President, Chair or Director (as appropriate) with
an explanation of how such conflicts shall be managed prior to engaging in
behavior that may create an actual or potential conflict of interest. The mere existence of a conflict or
potential conflict of interest may not necessarily affect an employee’s
job-related responsibilities: however, failure to disclose and manage any such
conflict or potential conflict may be cause for disciplinary action which may
result in termination.
The University also has adopted
policies and procedures for managing potential conflicts of
interest in the conduct of research. These policies apply to .
Ffaculty,
staff and students who conduct research with that policy
as well. The policy regarding Conflicts of Interest in Research can be found a. Refer to the USC Web site (www.usc.edu/policies).
5.0
Procedure for
Managing Potential Conflicts of Interest
5.1 General
Procedure
Full disclosure and consultation regarding potential conflicts of interest is in the best interest of both the University and its faculty members and staff employees. However, the University respects the privacy of its employees and does not wish them to disclose financial or personal information that does not relate to a potential conflict of interest. Any faculty member or staff employee who receives such financial or personal information in the process of disclosure is responsible to take reasonable steps to maintain the confidentiality of such information.
Disclosure
If a faculty member or staff employee believes or suspects that a conflict of interest may exist, it should be disclosed to the faculty member’s chair or Dean, or the staff employee's supervisor, director, chair, Dean or Vice President for further action. A Dean or Vice President may also require annual or other periodic reports of actual or apparent conflicts of interest.
Review and
Management
A chair or supervisor should take the necessary action to manage the actual or apparent conflict after obtaining approval from the Dean in case of a faculty member, or the appropriate Vice President in case of a staff employee. Permission required under Section 3-15 of the Faculty Handbook is granted only by the Dean, in advance and in writing. Further, if appropriate, the Dean or Vice President should consult with the Office of the Provost or the Senior Vice President for Administration before approving any plan to manage an actual or apparent conflict.
Many conflicts can be managed, after an appropriate evaluation, in the following manners. Situations will be found to be:
· Permitted as is, because the disclosed personal information does not represent an apparent or actual conflict of interest or other possible source of unreasonable bias or inappropriate activity, or
· Permitted contingent upon the implementation of one or more recommendations to manage an apparent or actual conflict or otherwise preclude unreasonable levels of bias or inappropriate activities, or
· Unacceptable, and thus prohibited.
Management of an actual or apparent conflict could include, among other things:
· Appropriate disclosure of the conflict to parties involved in the transaction;
· Recusal from participating in certain negotiations, decisions, or transactions;
· Recusal from managing or supervising particular faculty members or staff employees;
· Recusal from managing or overseeing certain business transactions;
· Severance of outside relationships that pose conflicts;
· Appropriate monitoring and oversight by University management;
· Obtaining approval required by the Faculty Handbook, Staff Employment Policies and Procedures or other relevant University policies;
Conflicts that cannot be managed appropriately are unacceptable, and thus prohibited under this policy.
The supervisor or chair should document the manner in which the conflict has been managed and should monitor, as necessary, to ensure that the conflict continues to be managed appropriately. Such documentation should be included in the affected employee's personnel file.
The faculty member should notify his or her chair or Dean, and the staff employee should notify his or her supervisor if there is any significant change in personal, financial or fiduciary status that reasonably would impact the actual or apparent conflict of interest.
5.2 Procedures for Conflicts of Interest
Involving Business Practices
In addition to the procedure set forth in Section 5.1, Purchasing Services also may identify actual or apparent conflicts of interest or commitment in the course of performing their duties. In the event that Purchasing Services identifies a situation that is or appears to be a conflict of interest or commitment, they will request that a disclosure be made under this policy and will coordinate with the relevant department, unit or school to address and manage the conflict. Depending upon the potential magnitude of the issue, Purchasing Services also may refer the issue to the Senior Vice President for Administration or his or her designee, for resolution.
Purchasing Services may suspend any further action on the request that initiated the disclosure until such time as the conflict is managed.
In addition to the procedures set forth above, a University faculty member or staff employee also must obtain the prior written approval from the Provost and Senior Vice President for Academic Affairs or Senior Vice President for Administration before he or she may endorse or authorize endorsement of any product or service on behalf of the University.
Assistance in managing potential
conflicts of interest for staff employees is available from the Manager of
Personnel Services, Policies and Procedures on the University Park campus; or,
for staff employees on the Health Sciences campus, the Director of Personnel
Services. For faculty, assistance is
available from the Vice Provost for Faculty Affairs at (213) 740-6715. Tthe
Office of the General Counsel at (213) 740-7922 or the Office of Compliance at
(213) 740-8258 also may be consulted for assistance.
6.0 Remedial Action for Non-Compliance
Failure to disclose and manage actual or apparent conflicts of interest under this policy, including the expectations detailed above about what an individual should or should not do, may be cause for disciplinary action, which may result in termination. For faculty, such action shall observe all provisions of the policies published in the Faculty Handbook. Any disciplinary action against a faculty member or staff employee under this policy must take into account the scale of the offense, the individual’s intent, and the degree of wrongdoing.