Conflicts of Interest: Class Response

The Foundation Group defines a conflict of interest as “a transaction or arrangement that might benefit the private interest of an officer, board member, or employee.” While IRS guidelines generally pertain to conflicts of interest which will financially benefit a member of the board or a friend or family member, it is important for nonprofits to also pay close attention to conflicts of interest that prevent the board from providing each grant applicant a fair chance in the selection process. With the amendments selected we hope to minimize any outside conflict of interest and implement a balanced selection process.

The issue that the Inspire Up Foundation encountered was that many of the students in our class had previously worked with a number of nonprofits through our service learning requirement and a number of students were enrolled in Nonprofit Management which entails the student writing a grant for a nonprofit in the DC community. As a class we debated several solutions to these issues and eventually came up with rules to inhibit conflict of interest with each area of concern. After much discussion we created three amendments that work to eliminate these areas of concern.

The main concern surrounding student’s previous work history was that this student would unfairly prioritize this organization over others during the voting process. We were also concerned that this person would be an advocating voice for the organization during the deliberation process when other organizations would not be afforded this advantage. Our solutions for this issue are for the student to recuse themselves on votes including an organization for which they have worked, and for the Foundation to only evaluate the organization based on the information included in the grant application and to ignore external information provided by a previous employee.

The cause of apprehension with the Nonprofit Management class was that some students were considering submitting an application for their community partner to receive the grant provided by the Inspire Up Foundation. Members of the Foundation were worried that this would give the grant writers inside information that would provide an unfair advantage to these community partners compared to unaffiliated organizations. The Foundation agreed on an amendment that banned members of the Foundation from writing a grant for an outside organization to receive Inspire Up Foundation funding.

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