Conflict of Interest Policy

The purpose of this Conflict of Interest Policy is to protect this tax-exempt organization’s (Business Relationship Management Institute, Inc. or “BRM Institute”) interests, when it is contemplating to enter into a transaction or arrangement that might benefit the private interest of an Interested Person of BRM Institute or might result in a possible excess benefit transaction. This Policy is intended to supplement but not replace any applicable state and federal laws governing conflict of interest applicable to nonprofit and tax exempt organizations.

BRM Institute encourages the active involvement of its directors, officers, employees, contractors, and volunteers in the community. In order to deal openly and fairly with actual and potential conflicts of interest that may arise as a consequence of this involvement, BRM Institute adopts the following Conflict of Interest Policy.

Policy

Directors, officers, employees, contractors, and volunteers are expected to use good judgment, to adhere to high ethical standards, and to conduct their affairs in such a manner as to avoid any actual or potential conflict between the personal interests of a director, officer, employee, contractor, or volunteer and those of BRM Institute. A conflict of interest exists when the loyalties or actions of a director, officer, employee, contractors, or volunteer are divided between the interests of BRM Institute and the interests of the director, officer, employee, contractor, or volunteer. Both the fact and the appearance of a conflict of interest should be avoided.

Definitions

1. Interested Person

Any director, principal officer, or member of a committee with governing board delegated powers, who has a direct or indirect financial interest, as defined below, is an interested person.

2. Financial Interest

A person has a financial interest if the person has, directly or indirectly, through business, investment, or family:

  1. An ownership or investment interest in any entity with which BRM Institute has a transaction or arrangement,
  2. A compensation arrangement with BRM Institute or with any entity or individual with which BRM Institute has a transaction or arrangement, or
  3. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which BRM Institute is negotiating a transaction or arrangement.

Compensation includes direct and indirect remuneration as well as gifts or favors that are not insubstantial. A financial interest is not necessarily a conflict of interest. Under Article III, a person who has a financial interest may have a conflict of interest only if the appropriate governing board or committee decides that a conflict of interest exists.

3. Affiliated, affiliation

Affiliated, affiliation includes all direct and indirect financial interests between a director, officer, or employee and a person with whom BRM Institute is considering entering into any transaction. It also includes any other interest that may influence the judgment of a director, officer, employee, contractor, or volunteer. An objective test is applied to determine whether an affiliation exists between the director, employee, contractor, or volunteer and the other person: whether the involvement or relationship of the director, employee, contractor, or volunteer with the other person is such that it reduces the likelihood that the director, employee, contractor, or volunteer can act in the best interests of BRM Institute.

 4. Person

Person means any individual, trust, estate, partnership, association, company or corporation.

5. Substantial influence over BRM Institute.

The following persons are deemed to have substantial influence over BRM Institute:

(a) each member of the Board of Directors;

(b) the officers of BRM Institute, and such persons’ spouses, ancestors, children, grandchildren, great grandchildren, brothers, sisters and the spouses of the children, grandchildren, great grandchildren, brothers and sisters; and

(c) an entity in which such persons hold more than 35 percent (35%) of the control of BRM Institute.

Furthermore, any person who met one of these definitions in the five (5) years before the proposed transaction is deemed, for purposes of this Policy, to have substantial influence over BRM Institute.

Procedures

1. Duty to Disclose

Financial Interest(s).  In connection with any actual or possible conflict of interest, an Interested Person must disclose the existence of the financial interest and be given the opportunity to disclose all material facts to the directors and members of committees with governing board delegated powers considering the proposed transaction or arrangement.

Other Interest(s).

  1. Disclosure by Interested Person.  Each Interested Person shall disclose to the directors and members of committees with governing board delegated powers all material facts regarding the affiliation of such employee, contractor, or volunteer with any person with whom BRM Institute is considering entering a transaction. The Interested Person shall make that disclosure promptly upon learning of the link between that person and transaction.
  2. Disclosure by CEO and/or other person with substantial influence.  The Chief Executive Officer and any other person with substantial influence over BRM Institute shall disclose to the Board all material facts regarding his or her affiliation with any person with whom BRM Institute is considering entering a transaction. The Chief Executive Officer or person with substantial influence shall make that disclosure promptly upon learning of the link between that person and the transaction.
  3. Deciding if the person has a substantial influence.  If there is a question as to whether the employee, contractor, or volunteer has substantial influence over BRM Institute, the Chief Executive Officer shall present this issue to the Board of Directors, and the Board shall resolve the matter.

At any meeting of the Board at which a transaction involving an affiliated person will be considered, a director shall disclose to the members of the Board all material facts regarding the director’s affiliation with any person with whom the Board is considering entering into any transaction.

2. Procedures for Addressing the Conflict of Interest

  1. An Interested Person may make a presentation at the governing board or committee meeting, but after the presentation, he/she shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest.
  2. The chairperson of the governing board or committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.

 

3. Determining Whether a Conflict of Interest Exists, Consequences of the Existence of a Conflict of Interest

  1. With regard to an employee, contractor, or volunteer without substantial influence over BRM Institute, the Board of Directors shall decide if a conflict exists and the appropriate response by BRM Institute once a conflict of interest has been determined to exist. An employee, contractor, or volunteer may appeal any adverse determination to the Board.
  2. With regard to the Chief Executive Officer or a person with substantial influence over BRM Institute, the Board shall follow the procedures set forth in Article III, Section 4, Findings of the Board, in order to decide whether to enter into the transaction and, if so, to ensure that the terms of the transaction are reasonable.
  3. In the case of a director, if it is determined that a conflict of interest exists, the director shall leave the meeting while the transaction is discussed and shall not vote on it. The remaining directors shall follow the procedures set forth in Article V in order to decide whether to enter into the transaction and, if so, to ensure that the terms of the transaction are reasonable.

4. Findings of the Board

If the Board of Directors determines that a person with substantial influence over BRM Institute (such person) has a conflict of interest with regard to a transaction of BRM Institute, BRM Institute may engage in the transaction only if the following conditions are met prior to the transaction:

  1. Such person shall disclose to the Board all material facts concerning the person’s affiliation with the transaction.
  2. After exercising due diligence, the governing board or committee shall determine whether BRM Institute can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest.
  3. If a more advantageous transaction or arrangement is not reasonably possible under circumstances not producing a conflict of interest, the governing board or committee shall be informed.
  4. The Board shall review the material facts. The transaction may be approved only if a majority of the directors, not counting the vote of such person, concludes that:
    1. The proposed transaction is fair and reasonable to BRM Institute, and
    2. BRM Institute proposes to engage in this transaction for its own purposes and benefits and not for the benefit of such person, and
    3. The proposed transaction is the most beneficial arrangement which BRM Institute could obtain in the circumstances with reasonable efforts.

The minutes of any meeting at which such a decision is taken shall record the nature of the affiliation and the material facts disclosed by such person and reviewed by the Chair of the Board.

5. Violations of the Conflicts of Interest Policy

  1. If the governing board or committee has reasonable cause to believe an Interested Person has failed to disclose actual or possible conflicts of interest, it shall inform the member of the basis for such belief and afford the member an opportunity to explain the alleged failure to disclose.
  2. If, after hearing the member’s response and after making further investigation as warranted by the circumstances, the governing board or committee determines the member has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.

Records of Proceedings

The minutes of the governing board and all committees with board delegated powers shall contain:

  1. The names of the persons who disclosed or otherwise were found to have a financial or other interest in connection with an actual or possible conflict of interest, the nature of the financial or other interest, any action taken to determine whether a conflict of interest was present, and the governing board’s or committee’s decision as to whether a conflict of interest in fact existed.
  2.  The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings.

Compensation

  1.  A voting member of the governing board who receives compensation, directly or indirectly, from BRM Institute for services is precluded from voting on matters pertaining to that member’s compensation.
  2. A voting member of any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from BRM Institute for services is precluded from voting on matters pertaining to that member’s compensation.
  3.  No voting member of the governing board or any committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from BRM Institute, either individually or collectively, is prohibited from providing information to any committee regarding compensation.

Annual Statements

Each director, principal, officer and member of a committee with governing board delegated powers shall annually sign a statement which affirms such person:

  1. Has received a copy of the conflicts of interest policy,
  2. Has read and understands the policy,
  3. Has agreed to comply with the policy, and
  4. Understands that BRM Institute is charitable and in order to maintain its federal tax exemption it must engage primarily in activities which accomplish one or more of its tax-exempt purposes.

Remedies

Any director or officer who fails to comply with this Conflict of Interest Policy may, in the discretion of the Board of Directors, be censured or be removed from the Board.

If an employee, contractor, or volunteer who is deemed to have substantial influence over BRM Institute fails to comply with this Conflict of Interest Policy, he or she may be put on notice or terminated, in the discretion of the Board of Directors.

Any other employee, contractor, or volunteer who fails to comply with this Conflict of Interest Policy may be put on notice or terminated, in the discretion of the Chief Executive Officer.

Periodic Reviews

To ensure BRM Institute operates in a manner consistent with charitable purposes and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be conducted. The periodic reviews shall, at a minimum, include the following subjects:

  1. Whether compensation arrangements and benefits are reasonable, based on competent survey information and the result of arm’s length bargaining.
  2. Whether partnerships, joint ventures, and arrangements with management organizations conform to BRM Institute’s written policies, are properly recorded, reflect reasonable investment or payments for goods and services, further charitable purposes and do not result in inurement, impermissible private benefit or in an excess benefit transaction.

Use of Outside Experts

When conducting the periodic reviews, BRM Institute may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the governing board of its responsibility for ensuring periodic reviews are conducted.

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