Conflict of Interest Policy

							                         Conflict of Interest Policy




Reference number              2P/2.4.2.3

Accountable executive         Executive Director: Research and Innovation
manager

Policy owner                  Director: Technology Transfer and Innovation Support

Responsible division          Technology Transfer and Innovation Support

Status                        Approved

Approved by                   Council

Date of approval              24 November 2006

Amendments                    This policy was reviewed in May 2010 with only editorial
                              changes being made.

Date of amendments

Review date                   2011

Procedures in terms of this   None
policy

Web address of this policy    http://www.nwu.ac.za/gov_man/policy/index.html
                              Amanda van der Merwe(10935746) R:\2. Management\2.1.3
Address on the policy data    Policy development and review\2.1.3.2 Review\Database\Policy
base                          documents\2P-2.4.2.3-conflict of interest_e.docx
Conflict of Interest Policy
1     Preamble
As a pre-eminent university in Africa, driven by the pursuit of knowledge and innovation, with a unique institutional
culture based upon the values the University espouses, the North-West University has adopted this Conflict of
Interest Policy on 24 November 2006.

2     Background and problem statement
Conflicts of interest can arise naturally from an employee's engagement with the world outside and the mere
existence of a conflict of interest does not necessarily imply wrongdoing on anyone's part. When a conflict of
interest does arise, however, they must be recognized, disclosed, and either eliminated or properly managed.

The purpose of this policy is to:
    • protect the credibility and integrity of the University and its staff so that public trust and confidence is
        ensured, and to
    • maintain a reasonable balance between the competing interests of staff in their commitment and
        dedication towards NWU and their entrepreneurial drive to enhance their experience and income through
        external activities.

3     Purpose and applicability
Conflicts of interest can arise naturally from an employee's engagement with the world outside and the mere
existence of a conflict of interest does not necessarily imply wrongdoing on anyone's part. When a conflict of
interest does arise, however, it must be recognised, disclosed, and either eliminated or properly managed.

The purpose of this policy is to:
    • protect the credibility and integrity of the University and its staff so that public trust and confidence are
        ensured, and to
    • maintain a reasonable balance between the competing interests of staff in their commitment and
        dedication towards NWU, and their entrepreneurial drive to enhance their experience and income through
        external activities.

This Policy applies to all NWU employees and post-doctoral researchers who apply for, receive, or who are
currently working on a grant contract, cooperative agreement, subcontract, or an invention for which the University
receives, or has the potential to receive royalties, dividends or research income from external parties (hereafter
called employee).

Exclusion: An employee who owns or manages directly or indirectly any business activity to gain an Economic
Interest, but which business activity has no resemblance, relationship, or is of no interest to the University. These
situations are not regarded as a conflict of interest and are not covered under this policy. However, they could lead
to a Conflict of Commitment and acceptable arrangements to manage these conflicts should be addressed during
the employees’ Task Performance Agreement review.

4     Definitions

4.1     Economic Interest T
This includes an employee's interest in obtaining a shareholding, management position or board membership and
any other fiduciary relationship (liability to protect and perform) with an organization other than the NWU. It
includes anything of monetary value or in kind, but not limited to, salary, commission, fees, subsidies, grants,
honoraria, equity interests, intellectual property rights, royalties or gifts.

Economic Interest excludes any and all monetary income which an employee received from the University,
including project allowances, profit sharing, royalties, internal teaching and research awards, publications, prize
money, etc.



Conflict of Interest Policy                                                                                       1
4.2       Conflict of Interest
A divergence between employees' private interests and their professional obligation to the University in such a way
that an independent observer might reasonably question whether the employees' professional actions or decisions
are determined or influenced by considerations of personal gain, financial or otherwise. It includes an action,
omission or situation which may or may not appear to compromise the objectivity of an employee’s design,
conduct or reporting of a project.

A Conflict of Interest will exist when an employee, a direct family member or associated legal entity of such an
employee (e.g. company, closed corporation or trust) has an external economic interest that effects or provides an
incentive to affect the employee's conduct and responsibilities at NWU. In other words, an employee holding
equity, being a director, being in a managerial position, being in any controlling position for or not for Economic
Interest in a company or other legal entity which has commercial ties with the University either as vendor, supplier,
subcontractor, licensee, licensor, grantor, research assignor or assignee, would be regarded as being in a Conflict
of Interest situation.

The principle of Conflict of Interest is therefore not a question of employees not doing their job satisfactorily
(Conflict of Commitment), but whether they are in a position to make or influence a decision which could affect
their personal interests in contrast with those of the NWU.

4.3       Conflict of Commitment
Employees are expected to satisfy all the requirements of their employment, and should not permit outside
activities to interfere with the performance of their NWU obligations. Conflict of Commitment is usually easily
defined and recognized, since it involves a perceptible reduction of the employee's time and energy devoted to
NWU activities. Time allocated to external activities should be recognized and defined in the employee's Task
Performance Agreement with the University.

4.4       Task Performance Agreement
Employees and Management agree annually on the tasks and output required from employees to achieve the
overall objectives of the University. Any potential Conflict of Commitment and Conflict of Interest should be
resolved through acceptable arrangements in the Task Performance Agreement.

4.5       Technology Transfer
The University has an obligation to commercialise its research results. Technology Transfer includes the process
of finding partners, licensees or buyers and negotiating with them to pay a fee in whatever form and term for any
right to exploit such results. This process requires careful management and various skills to optimize the income to
the University and its staff.

5     Policy
The following principles underlie the policy:

      •    Employees should not be in a position to influence the commercial decisions of the NWU or its associated
           or subsidiary companies in such a way that it may lead to reduced income for the Institution or its
           affiliates.
      •    Employees, who may be, or may potentially be, in a position of Conflict of Interest, should promptly
           disclose any such situation to their line managers.
      •    Should a potential Conflict of Interest arise, the NWU should be represented by staff members who are
           not directly or indirectly involved in the Conflict of Interest situation to ensure objectivity and to protect the
           affected employee(s) from unduly acquisitions.
      •    The relevant Dean has the ultimate responsibility, with input from the Executive Director: Research and
           Innovation to regulate the Conflict of Interest situation.

Based on these principles:

           I.      Employees are allowed to have Economic Interest in non-University interests for personal gain,
                   as explained in the exclusions under paragraph 3, provided such activities do not lead to a
                   Conflict of Commitment.
           II.     Employees are allowed to engage in outside activities which could be regarded as potential
                   Conflicts of Interest, provided they disclose the potential Conflict of Interest situations. In such
                   cases the University, at its sole discretion, may decide to alter or limit the participation of
                   employees in such outside activities to eliminate the Conflict of Interest, as contemplated in
                   Section 5 below.




Conflict of Interest Policy                                                                                               2
             III.            Employees who have Economic Interests in Technology Transfer projects of the University are
                             not entitled to share in royalties, dividends or income that the University may receive from such
                             projects.
             IV.             Employees who have Economic Interests in Technology Transfer projects of the University are
                             not allowed to participate in technology-transfer negotiations with those organizations in which
                             they have such interests.
             V.              No employee may be appointed as a director on any board in their personal capacity, or exofficio
                             on behalf of the University, without proving to the University that they understand the legal liability
                             (fiduciary duty) of such an appointment.

6       Rules
             I.              Employees must disclose any potential or actual Conflict of Commitment or Conflict of Interest to
                             their relevant line manager, as well as to the Executive Director: Research and Innovation, who
                             will assist the relevant line management with any action required to avoid Conflict of Interest.
             II.             Any situation addressed as in I must be reviewed on at least an annual basis.
             III.            Line managers have to ensure the proper structuring and management of annual Task
                             Performance Agreements to avoid any Conflict of Commitment.
             IV.             Line managers have to report on any potential Conflict of Interest situation to the relevant the
                             next level of line management.
             V.              The next level of line management (see IV) must evaluate the potential Conflict of Interest
                             situation and the line manager’s report in terms of this Policy.
             VI.             The Technology Transfer and Innovation Support Office will, on request, assist line management
                             by investigating the situation and forwarding recommendations to the relevant line manager and
                             Executive Director: Research and Innovation.
             VII.            The next level of line management (see IV) will advise the employee's line manager of any
                             special requirements or constraints to be included in the employee's Task Performance
                             Agreement.

7       Possible ways to deal with Conflict of Interest situations
The area of commercialization and Conflict of Interest is very complex and no policy could cover all permutations
and combinations of situations. The solutions below are given as guidelines only.

Some ways to resolve a Conflict of Interest situation (more than one could be applied):
   • public disclosure of such interest, including to sponsors and other stakeholders;
   • monitoring the project/programme, using independent University reviewers;
   • modification of the legal structure of the relationship;
   • modification of the conditions of employment and/or responsibilities of affected employees (e.g.
      5/8 or contract appointment with a modified Task Performance Agreement, rather than a full time
      appointment);
   • disqualification of affected employees from the project or involvement in the business;
   • withdrawal of the project or business plan by the NWU;
   • divestiture from the interest by affected employees; and
   • severance from the relationship which causes the actual or potential Conflict of Interest.

Potential Conflict of Interest situations could be beneficial for both the University and its employees.
Spin-off companies, which commercialise the University's research results, for example, could be more successful
with University personnel playing executive roles in such companies.

8       Acknowledgements
The following institutions' Policies of Conflict were consulted in the compilation of this document:

Medical Research Council
Wright State University
James Madison University
University of Tennessee
University of Stellenbosch
University of Monash, Australia
Original details: Amanda van der Merwe(10935746) R:\2. Management\2.1.3 Policy development and review\2.1.3.2 Review\Database\Policy documents\2P-2.4.2.3-conflict of
interest_e.docx
21 June 2010

File reference: 2P/2.4.2.3




Conflict of Interest Policy                                                                                                                                             3