Conflict of Interest Policy

POLICY TYPE: GOVERNANCE PROCESS

POLICY TITLE: CONFLICT OF INTEREST

LEVEL: GOVERN #2E-1

The board commits itself and its members to ethical, businesslike, and lawful conduct, including proper use

of authority and appropriate decorum when acting as board members.

Accordingly,

A. Purpose:

1. The purpose of the conflict of interest policy is to protect this tax-exempt organization’s (The

Alliance for Astronomy, Inc.) interest when it is contemplating entering into a transaction or

arrangement that might benefit the private interest of an officer, director or member of a

committee of the Organization or might result in a possible excess benefit transaction. This policy

is intended to supplement but not replace any applicable state and federal laws governing conflict

of interest applicable to nonprofit and charitable organizations.

B. Definitions:

1. Interested Person: Any director, principal officer, or member of a committee with governing

board delegated powers, who has a direct or indirect financial interest, as defined below, is an

interested person.

2. Financial Interest: A person has a financial interest if the person has, directly or indirectly,

through business, investment, or family:

a. An ownership or investment interest in any entity with which the Organization has a

transaction or arrangement.

b. A compensation arrangement with the Organization or with any entity or individual with

which the Organization has a transaction or arrangement, or

c. A potential ownership or investment interest in, or compensation arrangement with, any

entity or individual with which the Organization is negotiating a transaction or

arrangement.

Compensation includes direct and indirect remuneration as well as gifts or favors that are not

insubstantial.

A financial interest is not necessarily a conflict of interest. Under Article 3, Section 2, a person

who has a financial interest may have a conflict of interest only if the appropriate governing board

or committee decides that a conflict of interest exists.

C. Procedures:

1. Duty to Disclose: In connection with any actual or possible conflict of interest, an interested

person must disclose the existence of the financial interest and be given the opportunity to disclose

all material facts to the directors and members of committees with governing board delegated

powers considering the proposed transaction or arrangement.

2. Determining Whether a Conflict of Interest Exists: After disclosure of the financial interest and

all material facts, and after any discussion with the interested person, he/she shall leave the

governing board or committee meeting while the determination of a conflict of interest is

discussed and voted upon. The remaining board or committee members shall decide if a conflict

of interest exists.

3. Procedures for Addressing the Conflict of Interest:

a. An interested person may make a presentation at the governing board or committee

meeting, but after the presentation, he/she shall leave the meeting during the discussion of,

and the vote on, the transaction or arrangement involving the possible conflict of interest.

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b. The chairperson of the governing board or committee shall, if appropriate, appoint a

disinterested person or committee to investigate alternatives to the proposed transaction or

arrangement.

c. After exercising due diligence, the governing board or committee shall determine whether

the Organization can obtain with reasonable efforts a more advantageous transaction or

arrangement from a person or entity that would not give rise to a conflict of interest.

d. If a more advantageous transaction or arrangement is not reasonable possible under

circumstances not producing a conflict of interest, the governing board or committee shall

determine by a majority vote of the disinterested directors whether the transaction or

arrangement is the Organization’s best interest, for its own benefit, and whether it is fair

and reasonable. In conformity with the above determination it shall make its decision as

to whether to enter into the transaction or arrangement.

4. Violations of the Conflicts of Interest Policy:

a. If the governing board or committee has reasonable cause to believe a member has failed

to disclose actual or possible conflicts of interest, it shall inform the member of the basis

for such belief and afford the member an opportunity to explain the alleged failure to

disclose.

b. If, after hearing the member’s response and after making further investigation as

warranted by the circumstances, the governing board or committee determines the

member has failed to disclose an actual or possible conflict of interest, it shall take

appropriate disciplinary and corrective action.

D. Records of Proceedings: The minutes of the governing board and all committees with board delegated

powers shall contain:

a. the names of the persons who disclosed or otherwise were found to have a financial interest in

connection with an actual or possible conflict of interest, the nature of the financial interest, any

action taken to determine whether a conflict of interest was present, and the governing board’s or

committee’s decision as to whether a conflict of interest in fact existed.

b. The names of the persons who were present for discussions and votes relation to the transaction or

arrangement, and a record of any votes taken in connection with the proceedings.

E. Compensation

a. A voting member of the governing board who receives compensation, directly or indirectly, from

the Organization for services is precluded from voting on matters pertaining to the member’s

compensation.

b. A voting member of any committee whose jurisdiction includes compensation matters and who

receives compensation, directly or indirectly, form the Organization for services is precluded form

voting on matters pertaining to that member’s compensation.

c. No voting member of the governing board or any committee whose jurisdiction includes

compensation matters and who receives compensation, directly or indirectly, form the

Organization, either individually or collectively, is prohibited from providing information to any

committee regarding compensation.

F. Annual Statements: Each director, principal officer and member of a committee with governing board

delegated powers shall annually sign a statement which affirms such person:

a. Has received a copy of the conflicts of interest policy,

b. Has read and understands the policy,

c. Has agreed to comply with the policy, and

d. Understands the Organization is charitable and in order to maintain its federal tax exemption it

must engage primarily in activities which accomplish one or more of its tax-exempt purposes.

G. Periodic Reviews: To ensure the Organization operates in a manner consistent with charitable purposes

and does not engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be

conducted. The periodic reviews shall, at a minimum, include the following subjects:

a. Whether compensating arrangements and benefits are reasonable, based on competent survey

information and the result of arm’s length bargaining.

b. Whether partnerships, joint ventures, and arrangements with management organizations conform to

the Organization’s written policies, are properly recorded, reflect reasonable investment or payments

for goods and services, further charitable purposes and do not result in inurement, impermissible

private benefit or in an excess benefit transactions.

H. Use of Outside Experts: When conducting the periodic reviews as provided in Article G, the

Organization may, but not need not, use outside advisors. If outside experts are used, their use shall not

relieve the governing board of its responsibility for ensuring periodic reviews are conducted.

Approved by Board Attest: , Secretary

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