AGB Board of Directors’ Statement on Conflict of Interest with Guidelines on Compelling Benefit
In response to requests for policy guidance from presidents, board chairs, trustees, and other higher education leaders, in 2009 the AGB Board issued AGB’s "Statement on Conflict of Interest." As the introduction to the Statement noted, "Because boards are responsible for institutional autonomy in our unique governance system, and in light of a number of high profile conflict of interest violations across the not-for-profit sector, there is a pressing need for boards to conduct thorough and periodic reviews of their conflict of interest policies and to ensure adherence." The Statement, drafted after a careful deliberative process guided by a distinguished panel—and with input from presidents, trustees, and other higher education leaders—recommended 12 principles to inform board decisions and discussion on conflict of interest. However, because the document was a Statement of high-level principle, it intentionally did not extensively "drill down" into details of implementing those principles.
The companion "Guidelines on Compelling Benefit," issued by the AGB Board in 2013, provides more specific, sometimes technical, guidance to boards seeking to implement the 2009 Statement. The Guidelines focus on one important aspect of the Statement—the recommendation that transactions involving conflict of interest should be approved only if the board finds that the transaction would bring compelling benefit to the institution. The purpose of the Guidelines is to help boards, advised in appropriate situations by institutional counsel, apply the compelling benefit standard to a wide range of circumstances in which conflicts may figure.