Conflict of Interest
Under South Dakota State University's conflict of interest policy, faculty must disclose and obtain approval for outside activities. Federal and South Dakota Board of Regents regulations also guide compliance for research-related conflicts.
Definitions
South Dakota State University’s overarching 4:9 Conflict of Interest Reporting and Approval policy applies to all members of the university. The policy requires certain conflicts of interest and commitment disclosures and prior approval of specified private practice, private consulting, employment with entities outside of the university and other related activities.
Federal regulations also govern the disclosure and management of conflicts of interest. Federal provisions applicable to objectivity in research and financial conflicts of interest require certain disclosures. University employees are required to review and comply with all South Dakota Board of Regents provisions this control this policy and its procedures, this implementing policy and its procedures, and controlling laws, as applicable.
When an SDSU employee's outside interests could potentially affect decisions they make in their capacity as a university employee, conflicts of interest may occur in the two basic categories below:
Conflict of Commitment
A "conflict of commitment" typically refers to circumstances where an employee's extracurricular activities have the potential to take away from the time and focus they can dedicate to their university work, which could have a detrimental effect on their performance or other assigned tasks.
- A scenario where an SDSU employee's professional obligations to other institutions and organizations they serve as professionals take precedence over other professional duties to SDSU, particularly when it comes to time and effort allocation.
Financial Conflict of Interest
A financial interest consists of one or more of the following interests of the SDSU researcher and those of the researcher’s immediate family members that reasonably appear to be related to the researcher’s responsibilities:
- When an SDSU faculty member is serving outside interest: Conducting research when any of the participants or their immediate family members have share ownership, managerial or consulting role, or financial interest in the sponsor whose product, process or device is under study.
- When an SDSU faculty member is accepting gifts and gratuities: Accepting gifts of more than nominal value, gratuities or special flavors from outside entities supporting sponsored research.
- When an SDSU faculty member is consulting: Entering into paid consulting agreements that may affect research in a material way (direction, focus, timing, reporting, etc.).
- When using SDSU employees, students or staff to perform services for an outside entity in which the researcher or the researcher’s immediate family has a share ownership, managerial or consulting role or financial interest.
- When using SDSU nonreimbursed or otherwise unauthorized institutional resources such as equipment, supplies, facilities or space to support the interests or activities of an outside entity in which a researcher or the researcher’s immediate family has an share ownership, managerial or consulting role or financial conflict of interest.
- When a SDSU faculty is accessing to research information, providing unauthorized privileged access to research information or other intellectual property developed with university resources or support to an outside entity in which the researcher or the researcher’s immediate family has an share ownership, managerial or consulting role or financial conflict of interest.
Disclosure Requirements
Prior to submitting a research application to an external sponsor, investigators must submit a financial conflict of interest disclosure form to their department chair. For internally funded research that has a potential significant financial interest, investigators must submit a disclosure form to their department chair before funds are expended. During the period of award, the investigator must submit an updated disclosure form within 30 days of discovering or acquiring a new SFI.
Annual Disclosure
Annually, faculty disclose all conflicts of interest through the Dynamic Forms system. In addition to this disclosure, faculty will use the disclosure form to update previously disclosed SFIs and to disclose any new SFIs.
Outside Employment Disclosure
The Provide Practice, Private Consulting and Outside Employment Disclosure and Request for Prior Approval form is available on InsideState and must be completed and submitted if the employee conducts outside work or consultation during or outside of business hours.
Conflict of Interest Management Plan
The Conflict or Potential Conflict of Interest/Commitment Management Plan form is available on InsideState and must be completed and submitted if the employee is requested.
Private Practice, Consulting and Outside Activity
Faculty members who propose to enter into private practice, private consulting, additional teaching or research, or other activity for which additional compensation is received must complete a private practice, consulting and outside activity form.
Below are some general management strategies for handling conflicts of interests, including but not limited to:
- Recusal from decisions involving the hiring of family members or close friends.
- Recusal from decisions involving an outside company with whom the employee or an employee’s family member has a relationship.
- Limitations on using subordinates or students in outside activities without agreements and/or supervision changes in place.
- Agreements to use university resources for outside activities (equipment, materials, time, labs/space, etc.).
- Certification of conflicts to research collaborators, team members and the public in writing, scholarly publications, presentations and articles/press releases.
Faculty may devote up to but not exceeding four working days per month on such activity during the contract period. The activity must be related to assigned responsibilities and must promote state and local economic development or benefit the professional discipline or development of the individual or otherwise, as determined by the institution.
Nonfaculty exempt and career service employees may not be dually employed or enter into outside activities that may be reasonably viewed to influence the performance of their professional duties, and they must receive prior approval from their supervisor for activities for which leave is required. Outside activities may not interfere with assigned full-time employment responsibilities. Employees with Extension appointments have special restrictions on outside activities that differ from other university employees. Approval of proposed paid activities that present actual or potential conflicts of interest or commitment may be withheld or a conflict management plan may be required.
The form must be completed by the individual requesting approval, and all approvals must occur before the service to the outside entity can be provided.
Complete the Private Practice, Consulting and Outside Activity Form
Conflict or Potential Conflict of Interest/Commitment Management Plan
Based on the review of the private practice, if a conflict of interest or a potential conflict of interest is identified a Conflict or Potential Conflict of Interest/Commitment Management Plan form must be completed. Management of any conflict is determined on a case-by-case review, specific to the situation. A Conflict of Interest/Commitment Management Plan must be in place for all faculty members for outside activities that may create a conflict of interest or a conflict of commitment before the activity begins.
The following individuals have been appointed as the approval authorities for Conflict or Potential Conflict of Interest/Commitment Management Plan:
- Department head
- Dean
- Research integrity and compliance officer
- Vice president for research and economic development
Guidance for Conflict of Interest Management Plans Regarding Faculty- and Staff-Owned Businesses
SDSU Policy 4:9 Conflict of Interest Reporting and Approval is the authoritative document regarding conflicts and potential conflicts of interest. Nothing in this document should be interpreted as preempting university policy or South Dakota state law.
University faculty and staff often conduct activities beyond their university duties. The activities outside of employment duties are usually to the benefit of the employee and often the university, thus the university has an interest in encouraging and supporting these activities, where appropriate. Often, faculty and staff own or co-own businesses that may conduct business with the university and overlap with their assigned duties as university employees. To ensure transparency and proper supervision, a conflict of interest management plan (CMP) is required by the university. As each faculty or staff member has a unique situation, each CMP is unique and best developed by employees and their supervisors working closely together.
Faculty- or staff-owned businesses, or faculty or staff compensation by a business, may generate conflicts due to the relationships among the business personnel required to run the business. South Dakota Board of Regents Policy 4.9.3 Conflict of Interest, C.1.4, states that “professional employees will not use their institutional positions to induce junior colleagues, subordinates or students to accept employment or engagements unrelated to the activities of the institution and will not permit disputes arising from an outside employment or engagement to influence decisions that the professional employee makes on behalf of the board about the performance of junior colleagues, subordinates or students.”
The following suggestions are offered for development into CMPs to ensure compliant and transparent processes for faculty and staff who own businesses or are employed by businesses.
Students employed by the business. When undergraduate or graduate students are employed by the business, the university employee will inform their supervisor, dean of their academic unit (or equivalent) and the vice president of academic affairs (corresponding vice president of the university division of their employment), including the names of the students, within one week of the initiation of the employment and at least once per semester thereafter. Similarly, the university employee will inform their supervisor, dean of their academic unit and the vice president of academic affairs if a student leaves employment of the business.
If the employee serves as the student’s instructor of record, supervises the student as part of their university duty or has any formal academic relationship with the student, they will disclose this fact to their supervisor, dean of their academic unit and the vice president of academic affairs.
If the student employed by the business is a graduate student whose degree requires a thesis or dissertation, the university employee will draft a managed supervisory plan in coordination with the student’s graduate advisory committee and/or committee chair. The plan should be submitted to and approved by the vice president of academic affairs and copies of the plan distributed to the faculty or staff member’s supervisor, the graduate student, the academic dean and the department head of the department that houses the degree program of the student.
- Other university employees employed by the business. When university employees are also employed by the business or supervised by the university employee in the business, the university employee should inform their own university supervisor and the university supervisor of the employee within one week of initiation of employment. These parties should also be informed within one week if the university employee leaves the employment of the faculty- or staff-owned business.
Contracts between the business and the university. Occasionally, clients or customers of the business may also be clients or customers of the university and the employee manages that relationship through their university assigned duties. In such cases, processes must be implemented to ensure self-dealing does not occur.
One solution is that the university employee’s supervisor regularly review lists of the employee’s business’ clients and compares that to relevant lists of university clients. Alternatively, the university employee could regularly provide their supervisor with a list of all business clients who are also university clients. In either case, it is incumbent upon the supervisor to review the lists and ask questions of the university employee to ensure that the integrity of the university relationship with the clients is not compromised and that self-dealing does not occur.
Regardless of the selected process, the supervisor and employee must take action to prevent self-dealing.
- Faculty or staff business owners are cautioned that buying services from their own business through decisions they make in their university assigned duties violates SDSU policy, South Dakota Board of Regents policy and, possibly, South Dakota law. If appropriate, the supervisor may make these decisions to purchase their supervisee’s services but robust reasons as to why purchases were not made from a vendor not associated with the university should be documented.
- Summary of relevant South Dakota state law (SDCL 5-18A-17, 5-18A-17.1 to 5-18A-17.6).
- Employees, may not approve, award or administer contracts that directly benefit themselves, a spouse or someone they live with and comingles assets with.
- Contracts in which the employee directly benefits may be authorized by the employee's supervisor under the following conditions:
- Employee fully discloses interest in the contracting party through the process established and maintained by human resources,
- If applicable, the employee's authorization for private practice, private consulting or outside employment with the contracting party is on file with human resources,
- A conflict management plan, if deemed required, is on file with human resources,
- Supervisor of the employee must document in writing,
- That the terms and conditions of the contract and the employee's role in the contract have been reviewed, and,
- Transaction and contract terms are fair, reasonable and not contrary to the public interest.
SDSU Policies
SDSU’s policy and procedure for reporting and approving conflicts of interest is detailed in policy 4:9. Any person may obtain information about financial conflicts of interest by submitting an email request to the vice president for research.
