BD208 - Board Fiduciary Duties

Purpose

Board members have fiduciary duties to always act in the best interest of the College, exercising independent judgment on behalf of and for the benefit of the College. The College must be protected when considering transactions or arrangements that might benefit the private interest of a College director, the interest of a person or group not associated with the College, etc. This policy should supplement but not replace any applicable state or federal laws governing conflicts of interest applicable to Iowa school corporations. If there are any inconsistencies between this policy’s requirements and procedures and the law’s applicable requirements and procedures, the law’s requirements and procedures will apply unless the provisions hereof are more stringent, in which case this policy’s requirements and procedures shall control.

Definitions

1. Interested person.
   1. Any Board member (“member”), who has a direct or indirect personal or financial interest as defined below, and each of the members of the immediate family, general counsel and business affiliates of each of the members is an “interested person.”
   2. For this policy’s purposes, immediate family shall include one’s spouse and dependent children. 
   3. For this policy’s purposes, a business affiliate of a member shall include any person who directly or indirectly through one or more intermediaries controls, is controlled by, or is under common control with the member in a business entity or enterprise.
2. Financial interest.
   
   A member has a financial interest if the member has or expects to have, directly or indirectly through business, investment, or immediate family:
   1. An ownership or investment interest in any entity with which the College has or expects to have a transaction or arrangement (“transaction”),
   2. A compensation arrangement with the College or with any entity or individual with which the College has or expects to have a transaction, or
   3. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the College is negotiating a transaction.
      
      
      
      Compensation includes direct and indirect remuneration as well as gifts or favors that are not nominal.
      
      
      
      A financial interest is considered a “conflict of interest” unless a majority of the disinterested members of the Board decides that a conflict of interest does not exist.
      
       
3. Personal interest:
   
   A member has a personal interest if the member has, has had, or expects to have, directly or indirectly, through immediate family, business associates, or other acquaintances, relationships, memberships, or associations with any organization or person involved in a transaction with the College and whose interests may be contrary to the best interests of the College. The best interests of the College are primary.

Conflict of Interest Statement

Board members will be required to complete a “Conflict of Interest Statement” on an annual basis.

For this policy’s purpose, a “conflict of interest” exists when a member has a real, potential, or apparent conflict between personal interests and the interests of the college. More specifically, a member has a conflict of interest when he or she 1) has an existing or potential financial or other personal interest which impairs or might appear to impair the member’s independent judgment in the discharge of responsibilities to the College, or 2) may receive a material financial or other benefit from using knowledge or information confidential to the College.

Legal Reference:
Iowa Code 68B

Iowa Code 71.1

Iowa Code 277.27

Iowa Code 279.7A

Iowa Code 301.28

Cross Reference:
Procedure BD2081 - Fiduciary Duties  

Adopted: July 13, 2015
Reviewed: 2019

Revised:
June 12, 2023