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Code Of Ethics For The CFOS Foundation


The Foundation, wishing to function as an effective and responsible grantmaker, and recognizing that its activities can be brought under close surveillance by various public agencies and the general public believes that it is important to establish a Code of Ethics to guide Foundation in its daily activities and the Board in the discharge of their duties.

1. General

The reason the foundation established a Code of Ethics is to assure prospective grantees and the general public that no Foundation Board or staff member will benefit unfairly from the Foundation's grant funds and no organization has an unfair advantage in obtaining grant funds because of Board or staff affiliations. The reputation and credibility of the Foundation rests on its ability to make fair, objective and impartial decisions in accordance with explicit criteria. At the same time, the Foundation recognizes that its Board members have broad interests and participate in many community, charitable and business activities. The broader the Board's experience, the more value it is to the Foundation. The principles of awareness, disclosure and disinterested decision making will guide this Foundation.

2. Definitions

Self-dealing
A self-dealing situation is where the individual has a financial self-interest in a transaction with the Foundation. It includes a situation where the individual may profit or receive a monetary benefit from a transaction with the Foundation that may lead to or suggest influence in the Foundation's decision.

A self-dealing situation also includes indirect self-dealing where the individual owns 35% or more of 1) the voting stock or 2) a partnership interest (profits and losses) or 3) a financial or beneficial interest in a corporation, partnership or other organization that is involved in a financial transaction with the Foundation.

Conflict of Interest
The Boards, officers and employees owe the Foundation the duty of undivided loyalty. A conflict of interest situation is where the individual is in a position of divided or conflicting loyalties in a transaction with the Foundation. An individual will be in a position of divided or conflicting loyalties where his or her relationship or affiliation with the entity or organization, or its officers or directors, involved in a financial transaction with the Foundation may significantly impact, or bias, the individual's decision regarding the transaction. Relevant factors in determining whether there is a potential for divided or conflicting loyalties include the duration, strength and intimacy of the personal or business relationship or affiliation, and the functions performed by the individual. The question depends on the circumstances and is often one of proximity and degree.

A conflict of interest situation includes where the individual is an officer, director, Board, partner or employee of, a consultant, counselor or regular advisor to, or has a beneficial or financial interest in, the entity or organization, or its affiliate, which is involved in a financial transaction with the Foundation. It does not include the situation where the individual is a non-controlling member of the entity or organization.

Individual
With respect to self-dealing and conflict of interest and Individual includes officers, Boards and employees of the Foundation and their family members. Family members include spouse, parents, children, grandchildren and spouses of children and grandchildren.

Transaction
Transaction means any transaction where the Foundation receives or provides goods, services, or facilities for consideration or enters into a contract for consideration, and any situation where the Foundation grants or contributes funds to a charitable organization.

3. Disclosure

Each Board, and foundation officer with grantmaking program duties, shall provide to the president each year a list of all entities or organizations with which the individual may have a potential self-dealing or conflict of interest situation. Further, each Board and Foundation officer with grantmaking duties shall update the list at each grantmaking meeting of the Boards. Potential self-dealing and conflict of interest situations are those situations where the Foundation has a reasonable possibility of entering into a financial transaction with the entity or organization, including situations where the entity or organization will be will be considered for a foundation grant or contribution or will be involved in the action or policy to be considered.

In addition, the list should include any public charitable organization that solicits grants from foundations with which the Board or officer, or his or her spouse, is affiliated as officer, director, Board or employee.

The lists shall name the entity or organization, the individual and the relationship or affiliation. The list and a brief report will be furnished to the Boards prior to each grantmaking meeting. Further, the Board's or Foundation officer's relationship with an entity or organization will be noted on the grantmaking meeting Board worksheet.

4. Board Meeting Policy

At the time when any grant application or other action or policy is under consideration by the Board, the Board shall make a disclosure of any self-dealing or conflict of interest situation the Board or Foundation officer has with the matter under consideration.

Any Board member who has such a self-dealing situation shall leave the meeting room during the discussion of and voting on any proposal with respect to which a self-dealing situation exists.

Any Board member who has such a conflict of interest situation shall abstain from voting on any proposal with respect to which a conflict of interest situation exists. The Board may remain in the meeting room. The Board may participate in discussion of the proposal but only at the request of the Chairman of the Board.

5. Grant Evaluation

To assist the Board, officers and/or employees in resolving self-dealing and conflict of interest questions, proposed grants should be evaluated by the disinterested Board members, officers and employees in accordance with the following tests:

  • All grants and disbursements must comply with the federal, state and local laws and regulations governing the foundation and the rules of the Seattle Foundation. Where there is a doubt whether a grant or disbursement meets this compliance test, a legal opinion and/or ruling from the Internal Revenue Service and the Seattle Foundation will be sought.
  • All grants must meet both the CFOS Foundation's grantmaking policies and procedures and those of the Seattle Foundation and clearly fall within established program area objectives and criteria.
  • The Board, officers or employees with a potential self-dealing or conflict of interest situation should not be involved in submitting, reviewing, recommending or approving the grant, or in the subsequent monitoring or evaluation.
  • As the grant is being processed, approved or ratified by the staff and Board, any potential self-dealing or conflict of interest situations must be fully disclosed in accordance with this Code of Ethics.

6. Recognition for Actions Taken by the Foundation

Board members, officers or employees shall not seek or accept personal recognition for actions taken by the Foundation. Any acknowledgment or recognition of a grant must be accepted by the Chairperson or other officer on behalf of the Foundation.

7. Acceptance of Benefits from Grantees or Contractors and Separateness.

Board, officers and employees of the Foundation may not knowingly accept any gift, or thing of value from any person if the offer or acceptance of the gift or thing of value could reasonably be construed to be in connection with an actual or prospective grant from, or contract with, the Foundation. "Thing of value" for example includes tickets to fundraisers, performances and events and meals and beverages. As a representative of the foundation, it is inappropriate to accept honorariums, gifts or similar means of payment for speaking or other engagements. The Foundation will pay travel and related expenses in accordance with approved policies.

8. Discussions with Prospective Grantees.

As far as is reasonably possible, meetings or discussions of specific grants with prospective grantees should be in the presence of the officers and Board members of the Foundation. Potential grantees are informed of the policy against contacting Boards regarding specific applications in the Foundation's published "Grantmaking Policies and Procedures." When approached by prospective grantees, Board members should inform them of this policy. At the time of voting on any grant or contract, Board members  should disclose any discussions he may have had regarding prospective grants or contracts.

9. Involvement by Officers and Employees in Other Organizations.

Board members, officers and employees are, on their own time, free to involve themselves in the activities of other organizations, including grantees and prospective grantees. However, in so doing there is an obligation to take care to avoid a conflict of interest or the appearance of a conflict of interest.