An explanatory statement of the ALA Code of Ethics
Identifying and resolving conflict-of-interest situations is crucial to good governance and maintaining trust in public institutions.
“Civil servants and public officials are expected to maintain and strengthen the public’s trust and confidence in public institutions, by demonstrating the highest standards of professional competence, efficiency and effectiveness, upholding the constitution and the laws, and seeking to advance the public good at all times.” OECD’s Managing Conflict of Interest in the Public Sector Toolkit
This document is intended to provide general guidance for libraries of all types regarding common questions about conflicts of interest, and is not intended as a comprehensive list of requirements or legal advice. Library governing authorities, librarians, and other library staff should consult legal counsel for definitive guidance and for the approval of policy statements.
For the purposes of this document, the terms “library employees” and “employees” encompass all representatives of the library, including staff, volunteers, administration, and advisory and governing bodies.
Questions: 1. What is a conflict of interest? | 2. Should a library have a conflict of interest policy? | 3. What is an employee-vendor relationship? | 4. Can a library employee accept free samples or gifts from vendors? | 5. Can a library purchase goods or services from an employee or an employee-owned business? | 6. Why are we required to disclose our external activities? Why doesn’t the library or its governing body simply trust its employees? | 7. Will the requirements within a library’s conflict of interest disclosure policy discourage employees from getting involved in positive, creative, and entrepreneurial activities? | 8. To whom does the conflict of interest disclosure process apply? | 9. How should an employee disclose potential conflicts of interest and commitment? | 10. What is an example of a financial interest? | 11. If an employee received an honorarium for a speaking engagement outside of the library, what should be reported? | 12. What information should new library employees receive regarding conflicts of interest? | 13. Are employees bound by any state/federal guidelines regarding conflicts of interest? | 14. What should a library do when a conflict of interest is discovered?
1. What is a conflict of interest?
A conflict of interest involves circumstances where an individual's professional actions or decisions at the library could be influenced by considerations of personal gain, usually of a financial nature, as a result of interests outside their library responsibilities (cf. Conflict of Values and Conflict of Commitment).
2. Should a library have a conflict of interest policy?
All libraries should have a board- or administration-approved conflict of interest policy that is shared and signed by all members of the library's administration, staff, and volunteers. It is the responsibility of all members to be aware of and adhere to the policy. The policy must follow local, state, and national laws and regulations. A conflict of interest policy should include:
- A definition of the circumstances that constitute a conflict of interest;
- A procedure for disclosing a conflict to the audit committee or, if no audit committee, to the board or library administration;
- A requirement that the person with the conflict not be present at or participate in board/committee deliberation or vote on the matter giving rise to the conflict;
- A prohibition against any attempt by the person with the conflict to influence improperly the deliberation or voting on the matter giving rise to the conflict;
- A requirement that the existence and resolution of the conflict be documented in the corporation’s records, including in the minutes of any meeting at which the conflict was discussed or voted upon; and
- Procedures for disclosing, addressing, and documenting related party transactions in accordance with local, state, and federal laws and regulations.
ALA provides a sample ethics policy and conflict of interest policy for public libraries.
3. What is an employee-vendor relationship?
An employee-vendor relationship is any relationship between a library employee, a vendor, and/or a proposed vendor; a vendor is an employee, owner, or representative of a company/firm that proposes to or does buy, sell, or lease goods or services. The relationship between a library employee and vendor may be professional in that business transactions are exchanged; personal if both individuals are already acquainted beyond the scope of contract negotiations or purchase decisions; and/or familial if the individuals are near-relatives of one another.
Examples of employee-vendor relationships that might create a conflict of interest may include:
- A library employee acting as a vendor to sell goods or services to the library
- A library employee buying goods or services for the library from a vendor who is a member of the family
- A library employee serving as a decision maker for the library that is also on the payroll of the proposed vendor/publisher
- A member of the library board of trustees accepting free samples from a vendor that has a consortium agreement with the board
- A member of the library board of trustees recommending his/her company for a library contract.
4. Can a library employee accept free samples or gifts from vendors?
Employees should check with their own institution or governmental unit to determine if there are specific rules about accepting gifts and what qualifies as “substantial”. Specific definitions of “substantial” may vary by state and institution.
“Substantial” can be generally defined as almost anything other than gifts and meals of nominal value. Some examples of items of nominal value are t-shirts, calendars, pencils, branded inexpensive pens, and other inexpensive promotional items. However, accepting a large quantity of nominal gifts could still mean that the gifts, when added up, are “substantial.”
Generally speaking, no public employee should solicit or accept anything of value, or use their authority or authorize the use of public employment to secure anything of value or the promise or offer of anything of value that could manifest a substantial and improper influence upon the public employee with respect to that person’s duties.
Library employees may often face such scenarios at professional conferences.
In addition, in determining whether an item is of such a character as to manifest a “substantial and improper influence” upon a public employee, the source of the gift and the nature of the gift must be scrutinized.
If the gift is intended to compensate a public employee for the performance of their job duties, then it is prohibited.
To avoid a conflict of interest, the appearance of a conflict of interest, or the need for employees to examine the ethics of acceptance, a library may prohibit its employees from accepting any gifts from vendors, suppliers, customers, potential employees, potential vendors or suppliers, or any other individual or organization, under any circumstances.
5. Can a library purchase goods or services from an employee or an employee-owned business?
Generally speaking, a library may purchase goods or services from an employee or an employee-owned business in certain instances. The most important requirement is that the employee must not have any involvement in the decision to use the company. The employee should refrain from all discussions, deliberations, decision-making, implementation, and/or oversight of those rendering the services.
Additionally, the goods or services must be legitimately needed for the operation of the library.
There is no law that requires any type of specific disclosure in such a situation; however, it is important to ensure that there is no appearance of impropriety. It is recommended that the library’s governing authority be informed in open session of the desire to use an employee’s company, including explaining why the company was chosen. Also, to avoid the perception of preferential treatment, the library should consider soliciting more than one bid for products or services over a certain amount.
6. Why are we required to disclose our external activities? Why doesn’t the library or its governing body simply trust its employees?
A conflict of interest disclosure statement is often required by an employer to help identify and avoid any potential conflicts that may exist between the employer and an employee’s own interests. The disclosure of external activities is not a matter of trust; rather, it serves as a safeguard from inadvertent engagement in any circumstances that may be considered a conflict of interest, thereby protecting the reputation of the institution, its employees, and the integrity of their actions.
7. Will the requirements within a library’s conflict of interest disclosure policy discourage employees from getting involved in positive, creative, and entrepreneurial activities?
The American Library Association has long encouraged the professional and personal development of library employees through knowledge and skill enhancement, creative collaboration, and the fostering of individual aspirations and goals. The intent of a conflict of interest disclosure is not to discourage employees from engaging in outside entrepreneurial activities, and the existence of an actual or potential conflict of interest should not necessarily preclude an employee’s involvement in a particular activity or venture.
However, according to Article VI of the ALA Code of Ethics, library employees cannot “advance private interests at the expense of library users, colleagues, or our employing institutions.” Therefore, disclosing and resolving conflicts of interest as they arise not only upholds an important ethical standard, but safeguards the integrity of the employee, the institution, and the best interests of its user community.
The disclosure policy should be viewed as a means of protection, not a deterrent to the pursuit of personal entrepreneurial endeavors.
8. To whom does the conflict of interest disclosure process apply?
The conflict of interest disclosure process applies to any employee who is in a position to influence a decision from an individual, agency, or vendor. For the purposes of this document, the terms “library employees” and “employees” encompass all representatives of the library, including staff, volunteers, administration, and advisory and governing bodies.
9. How should an employee disclose potential conflicts of interest and commitment?
A disclosure of potential conflicts of interest and/or duality of interest form should be signed annually by all employees who have business dealings with outside individuals, agencies, or vendors. When contracts involving financial commitments are being discussed, the board chair should ask if anyone has a conflict of interest. If an employee believes a potential conflict of interest is occurring, a supervisor should be alerted so that appropriate actions to avoid the conflict can be taken.
10. What is an example of a financial interest?
As defined by Indiana University, a financial interest is “anything of monetary value, whether or not the value is readily ascertainable, including, but not limited to, salary, commissions, consulting fees, honoraria, equity interests, interests in real or personal property, dividends, royalties, rent, capital gains, intellectual property rights, and forgiveness of debt…”
The policy also specifies exceptions — things that are not a financial interest — including compensation from the university; certain educational, advisory, and research activities; and certain investments. Examples include:
- Tickets to a sporting event
- Gift certificates to local restaurants
- Paid trip from a potential vendor to view new instructional classroom modeling and configuration
- Owning stock options in a potential vendor or construction firm
- Family member is a potential consultant, vendor, or performer
11. If an employee received an honorarium for a speaking engagement outside of the library, what should be reported?
There are a number of factors to consider:
- Does the library or institution have a policy regarding honoraria?
- Was the employee asked to speak because of personal expertise (i.e., knowledge of ethics that is not directly related to the employee’s responsibilities) or because of the employee’s position (i.e., knowledge of system migration based on a job as a systems administrator)?
- Did the employee speak or prepare for speaking on company time or use vacation or other leave time to prepare and/or make a presentation?
It is likely that speaking engagements on your own time based on your personal expertise would be considered outside employment, while speaking engagements on company time based on your position would be considered part of your job. Ultimately, however, you should consult with your institution about when it is allowed to accept an honorarium or other related payments (travel, lodging, etc.).
12. What information should new library employees receive regarding conflicts of interest?
New library employees should be provided with information about applicable state and federal laws and institutional policies, and should also be explicitly made aware of Article VI of the ALA Code of Ethics: “We do not advance private interests at the expense of library users, colleagues, or our employing institutions.” These steps by an employer ensure that employees are made expressly aware of their ethical and legal responsibilities regarding conflict of interest.
Training and procedure examples:
- Boston University requires all new employees to sign its Conflict of Interest Policy Employment Disclosure Form, mandating disclosure of whether any immediate family members have worked for BU.
- California State University’s Office of General Counsel requires annual disclosures for certain employees outlined in the Conflict of Interest Handbook.
- Massachusetts law makes employee training and education programs on conflict of interest mandatory as outlined in Public Library Employees FAQs on the Conflict of Interest Law.
13. Are employees bound by any state/federal guidelines regarding conflicts of interest?
National Conference of State Legislatures (NCSL) notes that all states address potential conflicts of interests for legislators by constitution, statute, or rule; and in many states this includes any public official or servant, which encompass any publicly funded library, school, or university employee. NCSL also maintains a table of definitions and laws for all 50 states.
A few government agencies, including the US Office of Government Ethics and Occupational Safety and Health Administration (OSHA), outline guidelines for ethical behavior and avoiding conflict of interest that is required for U.S. government employees. Title 18, United States Code, Sections 201 through 209 provide criminal penalties for prohibited acts by federal employees that involve conflict of interest, depending on in which governmental agency the person is employed.
Examples of state government resources that provide guidance for public employees including librarians are Massachusetts, New York, and Ohio. Many state education or public instruction departments, such as in Michigan, New Hampshire, South Dakota, and Wisconsin, will provide resources for teachers, school districts, and public employees.
14. What should a library do when a conflict of interest is discovered?"
Each library should develop their own process or procedure for addressing conflicts of interest. Below are a few examples of what others have done:
The New Hartford Public Library lists five “Procedures for addressing the Conflict of Interest” within its Conflict-of-Interest Policy:
- An interested person may make a presentation at the board or committee meeting, but after such presentation, he/she shall leave the meeting during the discussion of, and to be vote on, the transaction or arrangement that results in the conflict of interest.
- The president of the board or committee chair shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
- After exercising due diligence, the board or committee shall determine whether the library can obtain a more advantageous transaction or arrangement with reasonable efforts from a person or entity that would not give rise to a conflict of interest.
- If a more advantageous transaction or arrangement is not reasonably attainable under circumstances that would not give rise to a conflict of interest, the board or committee shall determine by majority vote of the disinterested trustees whether the transaction or arrangement is in the best interest of the library and for its own benefit and whether the transaction is fair and reasonable to the library and shall make its decision as to whether to enter into the transaction or arrangement in conformity with such determination.
- If the actual or possible conflict of interest arises from a relationship between an interested person and the library, the disclosure by such interested person shall be referred to the board for review and or forwarding (if required for action) to the appropriate committee.
In its Managing Conflict of Interest in the Public Sector Toolkit, the Organisation for Economic Co-Operation and Development (OECD) provides a list of Resolution and Management Options (p. 103):
Options for positive resolution or management of a continuing or pervasive conflict can include one or more of several strategies as appropriate, for example:
- Divestment or liquidation of the interest by the public official.
- Recusal of the public official from involvement in an affected decision making process.
- Restriction of access by the affected public official to particular information.
- Transfer of the public official to duty in a non-conflicting function.
- Re-arrangement of the public official’s duties and responsibilities.
- Assignment of the conflicting interest in a genuinely “blind trust” arrangement.
- Resignation of the public official from the conflicting private-capacity function, and/or
- Resignation of the public official from their public office.
Stanford Medicine’s “Eliminating, Mitigating, or Managing Conflicts of Interest” suggests seven possible strategies for addressing conflicts of interest in the context of research:
Conflicts that are deemed to have the potential or are likely to be perceived as having the potential to have a direct and significant effect on the research must be eliminated, mitigated, or managed. Such strategies for eliminating, mitigating, or managing conflicts can include:
- public disclosure of significant financial interests;
- training on conflicts of interest and commitment for all personnel involved in the research;
- monitoring of research by independent reviewers;
- modification of the research plan;
- disqualification from participation in all or a portion of the research;
- divestiture of significant financial interests; and/or
- severance of relationships that create actual or potential conflicts.
Conflict of Values
A conflict of values is an ethical dilemma in which acting on one principle or standard of behavior would limit or prohibit a person from acting on another such principle or standard (cf. Conflict of Interest and Conflict of Commitment).
Conflict of Commitment
According to USLegal.com, conflict of commitment means:
a situation in which an individual has substantial outside activities and business interests, such as consulting, lecturing, acting as an expert witness, public service, or service on a professional board or committee, which lead to conflict of commitment as they interfere with the importance of the individual's commitments to the institution as [their] primary employer. If there is any question about an external activity representing a conflict of commitment or interfering with the fulfillment of an institution’s responsibilities, then the employee should consult with [a] supervisor for directions. If the employee’s supervisor is not available within a reasonable period of time, then the employee should contact the associated unit head for directions. (Cf. Conflict of Interest and Conflict of Values).
Consulting refers to paid or volunteer activities that happen outside of the workplace and draw upon a person’s professional expertise. This does not include activities related to membership in professional organizations.
External activities are activities not included within one’s duties and responsibilities to the specified employer. These activities may include outside employment, consulting, and/or professional services that relate to an individual’s area of expertise regardless if compensation, reimbursement, or honorarium is received.
USLegal.com defines a gift as “the voluntary transfer of property or funds to another without receiving anything of value in return and without conditions attached…” Examples of gifts of more than nominal value given to a library employee may include, but are not limited to, money, service, loan, travel, lodging, meals, refreshments, entertainment, discount, or promise to do or not do something having a monetary value.
Immediate Family Members
According to Black's Law Dictionary, immediate family is defined as "a person's parents, spouse, children, and siblings, as well as those of the person's spouse; stepchildren and adopted children are usually immediate family members."
For the purposes of this document, the terms “library employees” and “employees” encompass all representatives of the library, including staff, volunteers, administration, and advisory and governing bodies.
According to Merriam-Webster, to lobby is “to conduct activities aimed at influencing public officials and especially members of a legislative body on legislation”; or, more generally, “to attempt to influence or sway (someone, such as a public official) toward a desired action.”
Nonlibrary (or Non-Library) Entity
A nonlibrary entity is an organization (as a business, nonprofit, or governmental unit) that has an identity separate from those of its members and is not connected in any formal way to the library.
Where can I find more information?
The Commonwealth of Massachusetts maintains a FAQ for Public Library Employees
The Stanford Medicine Conflict of Interest provides examples of financial interests as well as relationships that could be conflicts.
The Texas Association of School Boards eSource has compiled resources related to conflicts of interest and school boards.
The Illinois Council of School Attorneys publishes a guide for school leaders that answers frequently asked questions about potential conflicts in schools.
Managing Conflict of Interest in the Public Sector is a toolkit produced by the Organisation for Economic Co-Operation and Development (OECD), which is a unique forum where the governments of 30 democracies work together to address the economic, social, and environmental challenges of globalization.
Example Conflict of Interest Policies:
American Association of Law Libraries
Adopted by the Committee on Professional Ethics, June 30, 2014; and amended April 30, 2019.