- The State of California Political Reform Act of 1974 prohibits University employees from participating in University decisions when personal financial interests may be affected by those decisions.
- A University employee must not make a decision or attempt to influence a decision if the employee has an economic interest in the entity doing business with the University. As such, the Political Reform Act requires that all University employees, including inventors, disqualify themselves from participating in or attempting to influence business decisions if they have a personal economic interest in the business entity.
Financial Conflict of Interest
Financial conflicts of interest involve relationships in which an individual benefits by receiving a salary, gift, royalty, intellectual property rights, consulting fee, honoraria for promotional speakers’ bureau, or other financial benefit.
An employee with a financial conflict of interest must disqualify himself/herself from making a decision (e.g., hiring someone or approving a purchase), participating in making a decision (e.g., advising or recommending to a decision maker who hires or approves a purchase), or influencing a decision (e.g., communicating with a decision maker) by the University that will impact the employee’s economic interests or the economic interests of the conflict’s source.
If there is any doubt by the supervisor, employee or other party as to the proper course of action with regard to any conflict of issue action, they should contact the Campus Conflict of Interest Coordinator at conflicts@berkeley.edu(link sends e-mail) for clarification on the issue.
Employees who are not designated officials are not prohibited from receiving gifts of more than $500 but must disqualify themselves from making, participating in the making of, or influencing University decisions that would have a material financial effect on the source. They are not subject to any disclosure requirements to place this disqualification on file.
Economic Interests Causing Potential Conflicts of Interest
The following are deemed to be economic interests from which conflicts of interest can arise:
- Direct or indirect investments (worth $2,000 or more) in an organization seeking to do business with the university
- Employment as a director, officer, partner, trustee, employee or other management responsibilities with a business seeking to do business with the university
- Real property (worth $2,000 or more) which may increase (or decrease) in value due to a university decision
- Sources of income (aggregating over $500, received or promised within 12 months prior to the decision)
- Gifts (aggregating over $460 in value, received or promised within 12 months prior to the decision)
The following are deemed to be economic interests from which conflicts of interest can arise:
Business Investment
You have an economic interest in a business entity in which, you, your spouse, your dependent children or anyone acting on your behalf has invested $2,000 or more.
Business Employment or Management
You have an economic interest in a business entity for which you are a director, officer, partner, trustee, employee or hold any position of management.
Real Property
You have an economic interest in real property in which you, your spouse, your dependent children or anybody acting on your behalf has invested $2,000 or more, and also in certain leasehold interests.
Sources of Income
You have an economic interest in anyone, whether an individual or organization, from whom you received (or by whom you have been promised) $500 or more in income within 12 months prior to the decision about which you are concerned. Keep in mind that you have community property interest in your spouse's income, a person from whom your spouse receives income may also be a source of conflict to you. Also if you, your spouse or your dependent children own 10% or more of a business, you are considered to be receiving "pass through" income from the business clients. In other words, the business's clients may be considered sources of income to you.
Gifts
You have an economic interest in any entity, individual or organization if you have been given gifts, which total $500 or more within a 12-month period to the decision about which you are concerned.
Personal Financial Effect
You have personal financial effect on your personal expenses, income, assets or liabilities, as well as those of your immediate family (spouse, dependent children). If these expenses, income, assets, liabilities go up or down by more than $500 or more in a 12-month period, as result of the decision about which you are concerned.