Conflicts of Interest

1. Conflicts of Interest

2. Conflicts of Interest

3. Overview • Conflict of interest: any situation in which you, as an employee, have a personal or private interest that interferes with – or appears to interfere with – your ability to do your job fairly and ethically • You are in a position of trust • It is your duty to act in our organization’s best interests • Don’t compete with our organization • Never let outside interests influence business dealings on our behalf  A conflict of interest may not always be obvious You must also avoid apparent and potential conflicts of interest

4. Customers and Suppliers • We award business solely on merit and obtain the best product/service at the best price • We will not engage in relationships that create (or appear to create) a conflict of interest You must be objective and impartial, and you may not – • Accept or solicit gifts, loans, favors or other valuables • Accept gifts or favors that could influence your decisions • Maintain private business relationships that could affect your independence and objectivity • Offer or accept bribes, payments, loans, kickbacks, special privileges or services

5. Accepting Gifts • You may not accept a gift, favor or entertainment that would compromise your business judgment • You may accept gifts of nominal value given as a business courtesy • You may accept meals/entertainment of reasonable value in connection with business discussions • You may not accept meals, gifts or entertainment that would be considered “lavish,” “extravagant” or “too frequent” • You may not solicit gifts or favors If you are offered or receive money or an inappropriate gift, notify your supervisor immediately

6. Special Note…

7. Duty of Loyalty • You must avoid situations in which your loyalty is divided • Prohibited activities: • Entering into unauthorized business relationships with competitors • Working, without our consent, for anyone who competes with our organization • Owning a competing business or assisting anyone in competing activities • Participating in any activity that competes with our organization • Consult your supervisor or our legal counsel before pursuing a questionable activity

8. Pop Quiz! • Alizah, an XYZ Inc. employee, does some computer programming on the side (“moonlighting”). Recently, she was approached separately by an XYZ competitor and an XYZ supplier to do some programming work for each of them. May she accept? • No. • She can moonlight for the competitor but not the supplier. • She can moonlight for the supplier but not the competitor.

9. Outside Activities • Conflicts may arise if you engage in outside activities at the expense of our business • Consult with your supervisor before taking on outside employment or directorships Public service and political participation can present conflicts • Consult with our legal counsel if in doubt Avoid situations that could discredit, embarrass or conflict with our organization’s best interests

10. Outside Activities (cont’d) • If you speak out on public issues – • Do so as an individual only • Make clear that you are not speaking on behalf of the organization You may not use our organization’s name, influence, funds, materials, facilities or employees – or work time – for your outside activities without authorization Conflict may arise if you give a presentation, write an article, etc., on work-related activities – especially if you accept compensation • Obtain written authorization from our legal counsel before doing so

11. Financial Interests • Your personal financial interests may not – • Adversely affect or conflict with our organization’s best interests • Influence the proper performance of your duties as an employee You must disclose personal financial interests that you (or your family members) have in – • Any entity that has established (or is attempting to establish) a businessrelationship with our organization • Any entity that competes with our organization

12. Family and Personal Relationships • Business decisions must be fair and impartial, based on sound business practices, and not influenced by family/personal concerns • You may not hire/supervise family members • Family members or those with a close personal relationship must be separated from your scope of influence You must disclose family or personal relationships that may cause a conflict You may not have direct involvement in business decisions affecting members of your immediate family If you are unsure, consult with your supervisor or legal counsel

13. Pop Quiz! • Ritu, an XYZ Inc. manager, finds out that one of her employees, Jason, is engaged to a manager at DEF Corp., an XYZ competitor. What should Ritu do? • Advise Jason to break off the engagement is he wants to keep his job. • Discuss the situation with XYZ’s legal counsel. • Fire Jason.

14. Government Employees • Activities that are acceptable in the private sector may be improper/illegal when dealing with government employees • You must follow any special procurement rules that apply to each governmental agency you deal with You may not give or offer gifts, meals, entertainment or gratuities to government employees Dealings with foreign governments present special issues • FCPA prohibits offering anything of value to a foreign official for the purpose of obtaining or retaining business • Violations can result in civil and criminal penalties for this involved

15. Violations • Violators are subject to discipline, up to and including termination of employment • Notify your supervisor immediately of any potential conflicts of interest Consult with your supervisor or legal counsel if you have any questions or doubts about a particular situation

16. Final Quiz

17. Questions?

18. Thank you for participating! This course and the related materials were developed by WeComply, Inc. and the Association of Corporate Counsel.