Ethical Practices in the Workplace: A Comprehensive Guide

1. Annual Study in Ethics for the Directors, Officers, and Employees Claudia Herrington, Don Grubbs, Kelly Butts, Nick D’Angelo, Evan Kellett, & Tyler Yaple November 5, 2018

2. Overview for Today’s Ethics Course of Study

3. A. Conflicts of Interest Applies to all JobsOhio Employees, Directors and Officers

4. JobsOhio Code of Regulations Per Article VI: Conflicts of Interest require … • Policy on conflicts • Annual Statement and Pledge by Directors and Officers Per Article VII: Standards of Conduct require … • Highest ethical conduct and fundamental honesty • Maintain confidentiality • Annual certifications and acknowledgement of Standards of Conduct

5. What is a Financial Interest? A financial ownership interest or investment interest between you or your family and any person or entity, such as: • An equity interest in a non-publicly traded entity; • An equity interest of 1% or more of any publicly-traded company; • Remuneration of over $10,000 in the preceding year from an entity other than JobsOhio; • Income from intellectual property rights. It is usually not your JO salary, pension, mutual funds, or bank account.

6. What is a Fiduciary Interest? An obligation to act in the best interests (financial success) of another, such as membership on a Board or management role in a company. Family = spouse or domestic partner, dependent children or other individuals claimed as dependents for tax purposes.

7. Potential Conflicts of Interest -- Disclosure Financial Disclosure Statement (FDS) Per R.C. 187.03(B)(2): Directors and employees with significant administrative, supervisory, contracting, or investment authority must file. FDS due to the Ohio Ethics Commission on/before April 15th. For all former public officials or employees who had to file, additional filing for 1 year after leaving covered employment.

8. JobsOhio’s Process for Handling Potential Conflicts If someone suspects a Conflict of Interest (COI), consult with the Director of Compliance (DOC) or General Counsel (GC) immediately. Salesforce performs COI checks when Projects are created, an Application is filed, and in preparation of an IRP meeting. TWICE WEEKLY, DOC will check all proposed or actual JobsOhio transactions on the JO/DSA agenda against the FDS disclosures. GC will determine: no conflicts exists; de minimis COI; or a potential COI exists. Potential COI will be presented for review by the Board of Directors, Investment Committee or President and Chief Investment Officer. If a potential COI exists, the reviewing body will decide if more advantageous transaction is available or another disinterested entity could proceed w/transaction, or if none, the transaction is fair and reasonable to JobsOhio.

9. Gifts – JobsOhio has 2 Policies that Everyone Must Follow JobsOhio is not exempt from all ethics laws when dealing with a public official. Employees must abide by the law just like any other private entity that is doing or seeking to do business with a public official.

10. Gift Policy Gift = ANYTHING of value that holds no expectation of receiving anything in return. Applies to gifts received by/for JobsOhio Employees. ”Business Associate” = person/entity, other than JO colleagues, with whom the employee interacts on a professional basis. Employee may not solicit anything of value that could reasonably be expected to influence the employee in the performance of their duties.

11. Gift Policy (cont’d.) They are given without an express or implied understanding of obligation; They do not violate law; They do not place the employee in a compromising position; and They are not of such a character to create the impression of favoritism Acceptance of gifts is generally prohibited unless the following steps are taken: No cash or cash equivalent (exception = one gift card $35 or less) Attempts to circumvent the gift policy may result in disciplinary action Cannot accept a gift under the guise of a “purchase” Understand the cumulative cost of the gift.

12. Corporate Gift Giving Applies to gifts given by JobsOhio employees Gift = ANYTHING of value that holds no expectation of receiving anything in return. (e.g. travel expenses, tickets to sporting events, offers of future employment, better loan rate) “Business Associate” = Same as in Gift Policy Promotion Items = OK Prohibitions: No gifts to vendors/consultants

13. Permissible Gift Giving and Examples Small gift or token of esteem or gratitude Relevant connection to or made in Ohio Give openly and transparently Properly recorded in giver’s books Provide only to reflect esteem or gratitude Permitted under local law

14. Permissible Gift Giving Amounts $25 = Consultants <$35 = No prior approval $35 – $100 = Supervisor approval $100 – $200 = Leadership Team approval >$200 = President and CIO approval In Yellow – DOC approval if to a Foreign National All gifts >$35 – Corporate Gift Giving Form If Business Associate cannot accept a gift, do not offer it to his/her staff or family Cannot circumvent or exceed the policy by paying for it yourself !!!

15. FCPA No employee or associate should pay, offer to pay, promise to pay, or authorize payment of money or anything of value to a foreign official in order to influence any act/decision of that foreign official in his/her official capacity or to secure any other improper advantage in order to obtain or retain business. Anything of value – not defined in statute Business purpose test – ordinary and legitimate promotion of business without corrupt intent Corrupt intent Made willingly Compliance with JobsOhio’s Policy = Compliance for the FCPA

16. Whistleblower Expectations Reporting Retaliation

17. Lobbying Definitions Office of the Legislative Inspector General (OLIG): Non-partisan legislative office with two primary functions: • Administers Ohio’s lobbying laws and provides, collects, and reviews documents to ensure all lobbying activity is properly reported, and • Administrative office of the Joint Legislative Ethics Committee (JLEC) – Legislative committee of 12 General Assembly members. Expenditure: Any payment, reimbursement, or gift of anything of value provided by a Lobbyist or an Employer for the use or benefit of a Reportable Person. (Includes services, gifts, meals, beverages, entertainment, ticketed events, lodging, and transportation.) Reportable Person: Any member of the General Assembly or Controlling Board; legislative staff in Appendix D; the Governor; the head of any department or agency in Appendix C; and any staff of the governor or department in Appendix C who is required to file a financial disclosure statement. (Can provide Appendices if anyone is interested.)

18. Lobbying (cont’d) Overview JobsOhio is considered an Executive Agency. JobsOhio is a reportable entity. If an Executive Agency Lobbyist (“EAL”) purchases any gift or food/beverage (coffee/beer/anything) for a JobsOhio reportable agent, the EAL will need to report it. JobsOhio employs a Legislative lobbyist (Director of Government Affairs). If JobsOhio staff pays expenses for a legislator or reportable staff person, we will need to be aware and track it. Recordkeeping As the employer of legislative lobbyist, JobsOhio must report and keep a record of all expenditures on legislators and/or reportable staff persons. JobsOhio’s registered legislative lobbyist must separately report and keep a record of all his or her expenditures on legislators and/or reportable staff persons. Both JobsOhio and JobsOhio’s registered legislative lobbyist must file quarterly activity and expenditure reports with the office of the Legislative Inspector General. A record of all expenditures must be retained for 2 calendar years after the expenditure was made. BOTTOM LINE: pay for Yourself !!!!!

19. Lobbying (cont’d) In the News Ohio lobbyists fail to report $55,000 in legislative gifts for first 4 months of 2017 June 7, 2017

20. Lobbying (cont’d) Is it a Reportable Expenditure? The tickets AREan expenditure even though it was not related to any lobbying activity Scenario #1 Jane lobbyist and Legislator Doe were college roommates and friends long before Legislator Doe was elected. Jane gave Legislator Doe a pair of concert tickets for her birthday Scenario #2 Both the ticket provided to Legislator Roe and the ticket provided to Alyssa AREExpenditures made for the benefit of Legislator Roe. John Lobbyist gives Legislator Roe and his wife, Alyssa, tickets to a The Memorial Tournament. Tickets are valued at $26 dollars each. Scenario #3 Employer ABC provides electronics to a store owned by Legislator Roe’s wife, Alyssa. As a holiday gift, ABC gave all of its customers, including Alyssa, a complimentary iPhone. The iPhone is NOTan Expenditure. ABC has an independent business relationship with Alyssa that is unrelated to her being Legislator Roe’s Wife

21. Lobbying (cont’d) Real World Scenarios

22. Lobbying (cont’d) Activity Group 1: You are attending a dinner at Mitchell’s with a JobsOhio client. The dinner was arranged by one of the client’s consultants. The consultant is also a registered Ohio legislative and executive agency lobbyist. The company’s CEO pays for the meal for all attendees Group 2: You are in the Short North celebrating a friend’s birthday, you know some but not all attendees of the party. You offer to buy a round of drinks for the group. Later that night you find out one of the attendees works as a legislative aide at the Ohio Senate. Group 3: You are invited to attend a legislative reception at the Renaissance Hotel as part of OEDA’s annual summit. Dinner is served, there is an open bar and all attendees receive a gift bag with a coffee mug and cookies. All members of the Ohio General Assembly were invited to attend the event and you see many of them there

23. JobsOhio Corporate Governance The JobsOhio Board of Directors promotes a culture of integrity and ethics • Accountability • Transparency • Responsible business practices JobsOhio goes beyond its statutory reporting requirements because of its unique mission and structure

24. JobsOhio in the Press – the early days Columbus Dispatch 2011 – “JobsOhio Board Members Share Links to Governor” Cleveland Plain Dealer 2011 – “Close Scrutiny for JobsOhio” Media.Cleveland.com2012 – “JobsOhio: Unethical, Unaccountable, Ineffective” Dayton Daily News 2013 – “Board has ties to firms that got help” (“6 of 9 members have direct financials ties to companies that received tax credits and other assistance”) Associated Press 2013 – “Ohio Auditor Scolds JobsOhio for Conflict Handling” Youngstown Vindicator 2013 – “Directors of JobsOhio deserve scrutiny for conflict of interest”

25. Reporting and Disclosure Requirements JobsOhio Transparency We make a great deal of information available to the public, including: Annual metrics results Details about executed grant and loan agreements each month Our Annual Report and 2017 Strategic Plan Quarterly reports on spending on public officials Our Form 990 Federal Income Tax Returns Total Compensation paid to all employees The financial audits of JobsOhio and JOBS A summary of all incentive proposals made to companies for the prior year Records related to company performance and their Metric Commitments Employee acknowledgements to DSA agreements Changes to our Conflict of Interest, Standards of Conduct, Records Retention, or Whistleblower Policies A copy of all public meeting minutes This ethics training dec

26. Reporting and Disclosure Requirements (cont’d) IRS Form 990 Required Disclosure Family/business relationships between Board Members Conflicts of Interest by Directors, Officers, and key employees Acknowledgement of ethics, conflict of interest and whistleblower policies and corporate governance practices

27. Corporate Governance – Duties of the Directors Set the mission and direction for JobsOhio Decision making Oversight Mentorship Duty of care – Exercise the care an ordinarily prudent person in a like position would use under similar circumstances. Duty of loyalty – Act in good faith, in a manner he/she reasonably believes to be in or not opposed to the best interests of the corporation. When operating as a board, JobsOhio is 1st loyalty. Board must act as a whole. An individual director has no authority to take any action unless authorized by the Board. Need a quorum at meetings.

28. Reliance State corporation law provides protection for a Directors’ reliance on – Officers and employees of JobsOhio Legal Counsel Public Accountants Consultants or other professionals Committees of directors

29. Duty of Management and Employees Provide input to help the board give direction. Execute direction given by the Board through the appropriate use of authority and observing set limits. Duty of care – Exercise the care an ordinarily prudent person in a like position would use under similar circumstances. Duty of loyalty – Act in good faith, in a manner he/she reasonably believes to be in the best interest of the corporation. [higher duty than that of directors]

30. In my work at JobsOhio, I act in the best interests of: Stakeholders (REDOs, LEDOs, EPA, PDPT, etc.) Me (job retention, financial security, career advancement) Companies in my sector / our sectors JobsOhio Consultants for companies in my/our sector The people of Ohio

31. In my work at JobsOhio, I act first and foremost in the best interests of: Stakeholders (REDOs, LEDOs, EPA, PDPT, etc.) Me Companies in my sector / our sectors JobsOhio Consultants for companies in my/our sector The people of Ohio

32. JobsOhio Standards of Conduct Policy Annual Sign-off I understand it is my responsibility to perform my duties for JobsOhio at all times, . . . in good faith, in accordance with the highest ethical conduct and fundamental honesty, in a manner I reasonably believe to be in or not opposed to the best interests of JobsOhio, and with that care that an ordinarily prudent person in a like position would use under similar circumstances.

33. In my work at JobsOhio, I act first and foremost in the best interests of: - - - JobsOhio - -

34. Standards of Conduct In performing our duties for the Corporation, each member of the Board of Directors and all employees shall strive for the highest ethical conduct and fundamental honesty. We must: • perform our duties at all times in good faith, • in a manner we reasonably believe to be in the best interest of JobsOhio, or not opposed to, • with the care that an ordinarily prudent person in a like position would use under similar circumstances, and • Maintain the confidentiality of all information regarding the activities of JobsOhio and its customers, unless the disclosure of the information has been authorized.

35. Standards of Conduct (cont’d) We must not: Deceive, defraud, or mislead JobsOhio board members, our associates, or those with whom JobsOhio has business or other relationships. Misrepresent JobsOhio in any negotiations, dealings, contracts, or agreements. Divulge or release any information of a confidential or proprietary nature relating to JobsOhio’s plans, mission, or operational activities without appropriate approval. Obtain, or seek to obtain, a personal advantage or benefit due to relationships established by my position with JobsOhio or by any use of the JobsOhio name. Withhold my best efforts to perform my duties to acceptable standards. Engage in unethical business practices of any type. Use JobsOhio property, financial resources, or services of JobsOhio personnel for my personal benefit. Violate any applicable laws or ordinances.

36. Common Sense

37. General Motors – Dress Code Policy • “Dress appropriately” • If you’re not sure what that means, ask. • If you’re still not sure – and not showing – that you know what “dress appropriately” means, then GM is not the place for you. • Common Sense comes from leadership . . .

38. Common Sense - - - Leadership • Less strictures (i.e., detailed written policies) from the “top” means less uniformity in execution, which can be ok in some areas. • But different interpretations can also lead to disaster (reputational harm, legal liability, toxic employee morale, etc.). And this is where leadership comes in: • Barra: “If managers can't handle 'dress appropriately,' what other judgment decisions are they not making?” • Common Sense . . . the best interests of JobsOhio.

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