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DARTMOUTH COLLEGE CONFLICT OF INTEREST POLICY
FOR PURCHASING AND PROCUREMENT OF GOODS AND SERVICES
I. Policy
Dartmouth College recognizes the importance of avoiding actual and perceived
conflicts of interest in purchasing and procurement. A conflict of
interest occurs when an individual’s personal or private interests might lead
an independent observer to reasonably question whether the individual’s
professional actions or decisions are influenced by considerations of personal
interest, financial or otherwise. To avoid such conflicts, Dartmouth
College adheres to the following principles regarding purchasing and
procurement:
1. All purchasing and
procurement decisions made on behalf of Dartmouth College must be based solely
on a desire to promote the best interests of the institution. In
order to avoid conflicts of interest in purchasing and procurement, whenever
practical, purchasing decisions shall be made based on competitive bidding,
using fairly developed specifications which increase the opportunity for
multiple sources to submit a bid.
2. Purchasing and
procurement decisions should not provide personal gain to an employee.
Employees of the College who have direct or
indirect influence on those decisions have an obligation to identify situations
which would lead to personal gain, and each department should provide an
opportunity for an employee to identify potential personal gain and to recuse
himself or herself from the decision.
3. Employees may not
participate in the selection, award, or administration of a contract if the
employee, or any member of his or her immediate family, his or her domestic
partner, his or her close friend, or business associate, has a financial or
other interest in a firm that is eligible to be considered for an
award.
4. Gifts and Gratuities: No
gifts, beyond those of an advertising nature and insignificant value, generally
distributed to all potential customers, may be accepted by any Dartmouth
employee or related party from an actual or potential supplier of goods and
services. Gifts offered or received which are unacceptable according to
this policy shall be rejected or returned to the donors and the offer of the
gift shall be reported to the appropriate supervisor, Dean or Department
Chairperson, and to the Director of Procurement & Auxiliary Services.
Participation as a guest of a vender in an event sponsored by the
College is not considered a gift or a gratuity. However,
departments are encouraged to recognize that allowing one individual within a
department to participate in events at the exclusion of others can lead to
morale problems and perceptions of unfairness. Furthermore, repeated
participation as the guest of one vender can lead to concerns about favoritism
towards that vender.
5. Meals: For a variety of
reasons, it may be convenient for an employee and a representative of a
supplier to meet over a meal. There is nothing unethical about meeting
with a supplier or potential supplier over a modest meal paid for by a
supplier, either to give the salesperson a better opportunity to present his or
her case, or to cultivate a business relationship, provided the employee
accepts invitations for such a meal from other suppliers or potential
suppliers. However, an employee should reject an offer of a meal if he or
she believes that accepting the offer might be viewed as creating an obligation
on the part of the College. Furthermore, extravagant and/or frequent
meals with an individual supplier are more likely to benefit the individual
employee than the College and must be avoided.
6. Attendance at
Events. From time to time, employees are invited to attend events
sponsored in whole or in part by vendors or potential vendors of the
College. As with gifts and gratuities, employees should not accept
purely social entertainment offered or sponsored by suppliers. Entertainment is
not construed to mean an occasional business meal as described above or a
function where Dartmouth stands to benefit from the supplier association.
In some cases, employees may attend events that are sponsored by a vendor if
the employee reasonably believes that attendance may be beneficial to the
College. For example, an employee may attend an educational or networking
event sponsored by a vendor as a way to obtain information that may be
beneficial to the College.
II. Noncompliance
The College reserves the right to void contracts which in the College’s
judgment promote the interests of an employee over the interests of the
institution. In addition, an employee’s failure to follow the guidelines
set forth above may result in discipline, up to and including discharge.
In the event an employee fails to comply with this policy, the Director of
Procurement and Auxiliary Services should be notified in order to evaluate
whether or not any action should be taken related to the transactions that the
College entered into. Concerns about conflicts of interest should
be brought to the attention of the Director of Procurement and Auxiliary
Services. As an alternative, the concern can be raised by contacting the
College’s Business Ethics Helpline (http://www.dartmouth.edu/~businessethics/helplines/index.html).
III. Examples
The following examples illustrate the situations described above and the
expected employee response. These examples are illustrative only and are
not meant to be exhaustive.
1. Disclosure and
Recusal:
a. Department A needs to
purchase a piece of equipment for a laboratory. The Department’s business
manager, Mary, would normally research the venders for a purchase like that
and, working with the principal investigator(s), make the purchase.
Mary’s husband Bob is a commission salesman for an equipment company that sells
the equipment the Department needs. If Department A purchases the
equipment from Bob’s company, he will receive a commission. In order to
avoid a conflict of interest, Mary should advise her supervisor, the Department
Chair or the relevant Dean in writing of the conflict and remove herself from
the decision making process. In addition, Mary should not participate in
the purchasing decision. Instead, the decision should be made by her
supervisor or another more senior person within the Department.
Procurement can provide support for purchasing decisions in these
cases.
b. Department B purchases a
commodity that is available from several different vendors. Company X is
one of the vendors that supplies the commodity in the Upper Valley. Bob,
the manager of Department B, is responsible for the purchasing decisions.
Company X is owned by an individual who has been Bob’s friend for many years
and their friendship predates Bob’s position at Dartmouth. If Bob decided
to buy the material from Company X, it might appear to others that his
friendship was a factor in that decision. In addition, eliminating
Company X from the opportunity to supply the College would disadvantage Company
X and might result in higher cost for the College. Alternatives include
allowing Procurement and Auxiliary Services to solicit bids for the products
and recommend an
award
2. Gifts and
Gratuities:
a. Outdoor Programs Golf
Tournament. Each year, the Outdoor Programs Office hosts a
fundraising golf tournament. Several venders of the College, including
venders who have no connection to the Outdoor Programs Office, pay for
foursomes to play in the outing. Some of those venders invite College
employees to participate in the tournament. Those invitations may arise
out of friendship with a particular employee or a business relationship with
that employee. In either case, participating in the tournament as a guest
of a vender would not be a violation of this policy because the event is
sponsored by the College. Departments should be aware that a concern may
develop within a department if some people are denied the opportunity to
participate in such an event while others are allowed to participate.
Managers should be prepared to deal with the morale issues that can be caused
by including some employees while excluding others.
b. Entertainment.
Company A sells a commodity that is used by a particular department at the
College. The commodity is available from several different
suppliers. Bill is the manager in that department and he can decide what
supplier to purchase from. The owner of Company A, who has no
relationship with Bill outside of work, invites Bill to join him for a trip to
Fenway Park to see the Red Sox. Bill should not accept the ticket to the
game because it violates this policy. Accepting the gift is a problem
because it could put Bill in the position of feeling ‘in debt’ to Company A and
needing to spend College money to “clear” that debt, it could lead the owner of
Company A to believe that Bill will steer more business his way, and it could
lead other people in Bill’s department to think that Bill was not making
purchasing decisions in the best interest of the College.
c. Red Sox Game. Assume
the same fact pattern as Example B above, with the following addition:
The Owner of the Company A and Bill are friends and their friendship precedes
the relationship at Dartmouth. Bill has disclosed his relationship to the
owner of Company A under this policy. The Owner invites Bill to attend
the game as a friend, not as a business contact. Bill will not feel “in
debt” to the Company by accepting these tickets. Accepting the tickets
under these circumstances would not be a violation of the policy.
d. Networking event. A
vendor is a sponsor of a networking event at an educational program of interest
to a manager. Managers from peer institutions are likely to attend the
educational program and the networking event. Contact with peers is
likely to be helpful to the manager in the performance of his or her duties,
and thus helpful to the College. The manager may attend the
event.
Throughout this
policy, the term “employee(s)” shall mean individuals who are employed by Dartmouth College, including the professional
schools, the officers of Dartmouth College and independent agents or
consultants who are retained by Dartmouth College.
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